Managerial accounting is very similar to financial accounting in this aspect.

Emphasis between past and future

Reliance on the accounting database

Line management includes

Information-technology managers

As teamwork has become more prominent in the last few years, differences between staff and line management:

Have become more important relative to promotions

Have only been evident in employee reward system

Management accounting plays three key roles in a business organization: (1) Scorekeeping, (2) Attention-Directing (3) Problem-Solving. Problem-solving is best illustrated in which of the following situations?

Making a recommendation regarding the lease or purchase of a fleet of vehicles

Tracking the type of product returned

None of the choices illustrates problem-solving or any important role in management accounting

For control decisions, emphasis is placed on the ___ role(s) of management accounting.

Both Scorekeeping and Attention-Directing

For strategic decisions, emphasis is placed on the ___ role(s) of management accounting.

Both Scorekeeping and Attention-Directing

The latest version of IMA Standards of Ethical Professional Practice for management accountants comprises of (A) competence, (B) confidentiality, (C) integrity and (D) credibility. "Integrity" requires management accountant to:

Maintain an appropriate level of professional expertise by continually developing knowledge and skills and perform duties in accordance with relevant laws, regulations, and technical standards

Keep information confidential unless disclosure is authorized or legally required

Mitigate actual conflicts of interest and refrain from engaging in any conduct that would prejudice carrying out duties ethically

Communicate information fairly and objectively and disclose all relevant information expected to influence an intended user's understanding of the reports, analysis and recommendations

Which of the following actions should a management accountant take first in confronting a potential ethical conflict concerning your direct supervisor?

Review your organization's procedures concerning resolution of such a conflict.

Confront the supervisor directly.

Discuss the situation with your supervisor's direct supervisor.

Inform the Board of Directors of the existence of a potential conflict.

In contrast to managerial accounting, financial accounting

emphasizes relevance and flexibility rather than precision.

places more emphasis on the future.

looks at the organization as a whole rather than emphasizing the segments of an organization.

focuses on providing data for internal users.

Which of the following is not one of the major trends that would characterize the development of management accounting in the next decade?

Design and implementation of separate costing systems

The shift to predictive accounting

Managing information technology and shared services as a business

Management accounting will be further oriented towards the management of intellectual capital

The professional certification program most suited for one interested in a career in management accounting leads to which of the following designations?

Certified Management Accountant (CMA)

Certified Computing Professional (CCP)

Certified Internal Auditor (CIA)

Certified Information Systems Auditor (CISA)

Management accounting and cost accounting

provide cost information about products and services, as well as information for internal decision making.

are required for recordkeeping as are financial accounting and tax accounting.

require an entirely separate group of accounts than financial accounting.

focus solely on the determination of costs to produce a product or provide a service.

Which of the following is not part of the current focus of management accounting?

It emphasizes the use of aggregated average cost information for individual products.

It emphasizes the use of cost information for strategic decision making.

It measures and reports quality costs as well as nonfinancial measures of quality such as defect rates.

It tries to determine why activities are performed and how well they are performed.

The Institute of Management Accountants issues

Statements on Management Accounting

Statements on Accounting Research for Managers

Statements on Managerial and Cost Accounting

The actions that follow are associated with a firm's accounting information system. Which of the following actions belong to management accounting?

Preparing a report that details profit by customer

Preparing an income statement that complies with generally accepted accounting principles

Voluntarily reporting safety costs to potential and existing investors

Research to determine how to report an uninsured facility destroyed by flood

The current focus of management accounting can best be described as

having emphasis on activity-based costing and process value analysis

a system that achieves relevance by making financial accounting information more useful to internal users

having emphasis on assigning manufacturing costs to products so that inventory cost can be reported to external users

The actions that follow are associated with a firm's accounting information system. Which of the following actions belong to financial accounting?

Determining the cost of bad debts for the balance sheet

Reporting on the trends in defect rates to the plant manager

Determining the cost of dropping a product

Determining the cost of producing a new product

Which of the following pertains to CMA?

The oldest and best-known certification

Is concerned with internal auditing only

Qualifying exam covers economics, finance, and management

Must be licensed by the government to practice

is more concerned with verifiable, historical information than is managerial accounting.

is primarily concerned with internal reporting.

focuses on the parts of the organization rather than the whole.

is specifically directed at management decision-making needs.

Which of the following statements is true?

Management accounting is a subset of both cost and financial accounting.

Management accounting is a subset of cost accounting.

Cost accounting is a subset of both management and financial accounting.

Financial accounting is a subset of cost accounting.

Which of the following statements is false?

Two primary hallmarks of cost and management accounting are standardization of procedures and use of generally accepted accounting principles.

A primary purpose of cost accounting is to determine valuations needed for external financial statements.

A primary purpose of management accounting is to provide information to managers for use in planning, controlling, and decision making.

The act of converting production inputs into finished products or services necessitates cost accounting.

Historical experience should be used with caution in setting standards because

they may not be achievable by operating personnel.

most companies have very poor records.

ideal standards are always better than historical standards.

they may perpetuate operating inefficiencies.

Which of the following best describes the difference between financial and managerial accounting?

Managerial accounting is not restricted to generally accepted accounting principles, while financial accounting is restricted to GAAP.

Managerial accounting provides information to support decisions, while financial accounting does not.

Managerial accounting does not result in financial reports, while financial accounting does result in financial reports.

Managerial accounting is concerned solely with the future and does not record events from the past, while financial accounting records only events from past transactions.

Which of the following topics is of more concern to management accounting than to cost accounting?

impact of economic conditions on company operations

generally accepted accounting principles

The primary purpose of management advisory services is

To conduct special studies, preparation of recommendations, development of plans and programs, and provision of advice and assistance in their implementation.

To provide services or to fulfill some social need.

To improve the client's use of its capabilities and resources to achieve the objectives of the organization.

To earn the best rate of return on resources entrusted to its care with safety of investment being taken into account and consistent with the firm's social and legal responsibilities.

The unit of measurement used in management accounting is

any measurement unit that is useful in a particular situation.

usually current replacement cost.

the measurement unit used by competing companies.

Which of the following typically does not relate to the role of a controller?

A controller supervises the accounting department.

A controller safeguards an organization's assets.

A controller oversees the preparation of reports required by governmental authorities.

Which of the following statements is false?

Cost accounting is a tool of both financial and managerial accounting.

Managerial accounting draws heavily on economics, statistics, operations research, and other disciplines as necessary in providing accounting and financial information.

In management accounting, emphasis is given to identifying or matching costs with functions, projects, or responsibilities rather than with time periods.

An innovative manufacturing company does not

emphasize on existing products.

respond to the changing business environment.

emphasize on continuous improvement.

strive to improve customer satisfaction through product quality.

Managerial accounting is very similar to financial accounting in this particular aspect

Quality of data provided to users

Reliance on the accounting information system database

Emphasis between past and future

A CPA should not undertake a management advisory service engagement that includes continued participation through implementation, unless:

The CPA accepts overall responsibility for implementation of the chosen course of action.

The CPA acquires overall knowledge of the client's business that is equivalent to that of possessed by management.

Upon implementation the client's personnel will have the knowledge and ability to adequately maintain and operate such systems as maybe involved.

Upon implementation a new study and evaluation of the system of internal control is performed.

Tennis Company ledger shows a credit balance in the 'Materials Quantity Variance' account. This simply means that:

Actual quantity used is less than standard quantity allowed

Actual quantity used is more than standard quantity allowed

Actual quantity purchased is less than standard quantity allowed

Actual quantity purchased is more than standard quantity allowed

Management Accounting Quiz

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MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Profit maximization as the goal of the firm is NOT ideal because

profits are only accounting measures.

profit maximization does not consider risk.

cash flows are more representative of financial strength.

profits today are less desirable than profits earned in future years.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The controller is commonly responsible for

Tax administration

Investor relations

Banking and custody

Managing credit activities

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which set of terms more accurately describes management accounting information rather than financial accounting information?

Historical, precise, useful

Required, estimated, internal

Budgeted, informative, adaptable

Comparable, verifiable, monetary

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

For a hospital, what type of position (line vs. staff) is each of the following?

Emergency room manager (staff); Human resources manager (staff)

Emergency room manager (staff); Human resources manager (line)

Emergency room manager (line); Human resources manager (staff)

Emergency room manager (line); Human resources manager (line)

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following is LEAST likely to fall within financial management?

Surplus assets are sold off.

Funds are raised to finance an investment project.

The dividend payment to shareholders is increased.

A report is produced comparing actual results to budget.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following statements is NOT correct?

Cost accounting can be used for inventory valuation to meet the requirements of internal reporting only.

Management accounting provides appropriate information for decision making, planning, control, and performance evaluation.

Routine information can be used for both short-term and long-ren decisions.

Financial accounting information can be used for internal reporting purposes.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Management accounting

Provides information about the company as a whole

Reports information that has occurred in the past that is verifiable and reliable

Provides information that is generally available only on a quarterly or annual basis

Focuses on estimating future revenues, costs, and other measures to forecast activities and their results

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Management Accounting Quiz

Profit maximization as the goal of the firm is NOT ideal because

The controller is commonly responsible for

Which set of terms more accurately describes management accounting information rather than financial accounting information?

For a hospital, what type of position (line vs. staff) is each of the following?

Which of the following is LEAST likely to fall within financial management?

Which of the following statements is NOT correct?

Management accounting

Which of the following groups would be least likely to receive detailed management accounting reports?

Managerial accounting is very similar to financial accounting in this aspect.

Which financial executive is primarily responsible for both management and financial accounting?

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