management accounting is concerned with providing information to managers, the people _____an organization who direct and control its operations?
financial accounting primarily summarizes ____ financial transactions, while management accounting has a strong ____orientation.
with the fast changing globalized economy, management accounting plays an important role in supporting managers to make quick and relevant decisions.
only large organization has managers. managers must be responsible for planning, directing and motivating personnel, controlling operations and making informed decision making.
the ________________is an ethical code issued by institute of management accountants (ima) of the united states and a revised version was published in july 2017.
which of the following costs belongs to direct labor costs?
which of the following costs would be considered a period rather than a product cost in a manufacturing company?
which of the following costs belongs to selling and administrative costs?
racing bicycle company produces and sells a single type of mountain bike. the beginning finished inventories are $130,000. cost of bikes manufactured this year is $760,000. ending finished goods inventories are $150,000. what is the cost of goods sold for this year?
which of the following is not true about cost classification？
suppose that you bought an automobile that cost $10,000 two years ago. suppose that your car could be sold now for $5,000. you are trying to decide whether to drive or take the train to kuala lumpur to attend a concert. you have ample cash to do either, but you don’t want to waste money needlessly. which of the following costs is relevant to this decision？
which of the following costs would be variable with respect to the number of cones sold at a baskins & robbins shop? (there may be more than one correct answer.)
manufacturing companies purchase finished goods from suppliers for resale to customers
consistent with the matching principle, product costs are initially assigned to an inventory account on the balance sheet.
when expressed on a per unit basis, a fixed cost is inversely related to activity.
manufacturing overhead consist of indirect labor costs and indirect material costs.
costs incurred for depreciation, property taxes, utilities, and insurance associated with its selling and administrative functions are included as part of manufacturing overhead.
finished goods consist of units of product that are partially complete, but will require further work to be saleable to customers.
manufacturing companies calculate cost of goods sold as beginning finished goods inventory plus cost of goods manufactured minus ending finished goods inventory.
a fixed cost is constant within the relevant range. in other words, fixed costs do not change for changes in activity that fall within the “relevant range.”
bmw, the renowned automobile manufacturing corporation, spends a big deal of money every year on production. which of the following statement is true about cost classification?
which of the following statement is incorrect with regard to least-squares regression method?
which of the following methods provides the most accurate results in cost estimation?
in july, bigburgers inc. served 5,000 burgers and was billed $500 for electricity by the utility company. in august, the company served 5,500 burgers and the electricity bill was $520. using the high/low method, what is the fixed cost of electricity per month?
which of the following belong to discretionary fixed costs? there may be more than one correct answer.
a cost driver is a measure of what causes the incurrence of variable costs.
production volume is the only activity base within companies.
total fixed cost is proportional to the activity level within the relevant range, however, at per unit level, fixed cost remains unchanged.
a manufacturing company will often have many variable costs associated with the manufacture and distribution of its products to customers.
in engineering approach, each account under consideration is classified as variable and fixed based on the yst’s prior knowledge about how costs behave. this approach is limited in value in the sense that it glosses over the fact that some accounts may have both fixed and variable components.
account ysis approach is particularly useful to estimate mixed costs when no past experience is available concerning activity and costs.
offshoring may help reduce operating costs for core business functions without relying on 3rd party suppliers.
a least squares regression method is a quick and easy way to isolate the fixed and variable components of a mixed cost.
the first step of high-low method is to choose the data points pertaining to the highest and lowest activity levels.
high-low method uses all of the data points in estimating cost behavior. the basic goal of this method is to fit a straight line to the data that minimizes the sum of the squared errors.
which of the following assumptions is incorrect in cost-volume-profit ysis?
which of the following statements is not true about cvp ysis?
coffee klatch is an espresso stand in a downtown office building. the average selling price of a cup of coffee is $1.49 and the average variable expense per cup is $0.36. the average fixed expense per month is $1,300. 2,100 cups are sold each month on average. what is the cm ratio for coffee klatch?
coffee klatch is an espresso stand in a downtown office building. the average selling price of a cup of coffee is $1.49 and the average variable expense per cup is $0.36. the average fixed expense per month is $1,300. how many cups of coffee would have to be sold to attain target profits of $2,500 per month？
coffee klatch is an espresso stand in a downtown office building. the average selling price of a cup of coffee is $1.49 and the average variable expense per cup is $0.36. the average fixed expense per month is $1,300. 2,100 cups are sold each month on average. what is the break-even sales dollars?
coffee klatch is an espresso stand in a downtown office building. the average selling price of a cup of coffee is $1.49 and the average variable expense per cup is $0.36. the average fixed expense per month is $1,300. 2,100 cups are sold each month on average. what is the margin of safety expressed in cups?
rbc corporation currently has a negative contribution margin. which of the following statements is true?
darth company sells three products. sales and contribution margin ratios for the three products follow: product x y z sales in euros €20,000 €40,000 €80,000 contribution margin ratio 35% 40% 15% given these data, what is the contribution margin ratio for the company as a whole?
the traditional format of income statement is helpful to managers in judging the impact on profits of changes in selling price, cost, or volume.
the margin of safety is the volume or dollars of sales at which profit is zero.
the margin of safety helps management assess how far above or below the target profit the company is currently operating.
in cvp graph, the break-even point is where the total revenue and total expenses lines intersect.
cm ratio, the contribution margin ratio is calculated by iding the total contribution margin by total sales.
which method will produce the highest values for work in process and finished goods inventories?
which of the following statement is not true about variable costing?
which of the following costs does not belong to manufacturing overhead?
which of the following is not true about variable costing?
please read the information above and calculate the unit product cost under absorption costing
please read the information above and calculate the unit product cost under variable costing
please read the information above and calculate the net operating income under absorption costing for the month of june
please read the information above and calculate the net operating income under variable costing for the month of june
which of the following department does not belong to operating department？
which of the following methods of allocating service department costs results in the most accurate product cost?
assume that the company uses the step method of allocation with cafeteria services allocated first. what would be the amount of cafeteria service costs allocated to the cutting department?
the central purposes of the organization are carried out in the operating departments.
the direct method partially recognizes the services provided by a service department to other service departments.
the step-down method provides the most accurate modeling of the service patterns.
the step-down method provides for the allocation of a service department’s costs to other service departments, as well as to operating departments.
in direct method, each service department assigns its own costs to operating departments plus the costs that have been allocated to it from other service departments.
while the reciprocal method only allocates forward and never backwards, the step-down method allocates service department costs in both directions.
which of the following statements best describes a cost driver?
which of the following is not a batch-level activity?
a company that provides packing services has an activity-based costing system with three activity cost pools: scheng, packing boxes, and setting up machinery. the activity rates are $6 per appointment scheduled, $1.50 per box packed, and $5 per machine set-up. if a customer requires one scheduled service call and has 50 boxes to pack using two different machines, how much cost would be assigned to the job for the customer by the activity-based costing system?
what are the factors that need to be considered in customer profitability ysis with the use of abc? there may be more than one answer.
what are the limitations of abc？ there may be more than one answer.
abc is a good replacement to our traditional cost system
abc is designed to provide managers with cost information for strategic and other decisions that potentially affect capacity and therefore affect “fixed” as well as variable costs
abc assigns both manufacturing costs and non-manufacturing costs to products
abc assigns all manufacturing costs to products and uses more cost pools
abc usually relies on volume measures such as direct labor hours or machine hours to allocate all overhead costs to products
in activity based costing, a cost pool is a cost bucket in which costs related to a single activity measure are accumulated
duration driver is the simple count of the number of times an activity occurs.
a company can use abc for external reporting because it conforms to gaap.
which of the following is not the reason why we must allocate overhead costs to jobs?
on january 1, 20x7, laut company’s work-in-progress account had a balance of $36,000. during the year, direct materials costing $70,000 were placed into production. direct labour cost for the year was $120,000. the predetermined overhead rate for the year was set at 150% of direct labour cost. actual overhead costs for the year totalled $180,000. jobs costing $380,000 to manufacture (according to their job sheets) were completed during the year. what would the balance in the work-in-progress inventory account be on december 31, 20x7?
which of the following statements is not correct?
which of the following companies may benefit from using job order costing systems？
which of the following statements is true? there may be more than one correct option
which of the following statements is true? there may be more than one correct option
a company would use a job order costing system when identical products are produced each period.
we need to compute predetermined overhead rates and estimated overhead costs, rather than actual overhead costs are used in the job-order costing process.
manufacturing overhead includes direct materials, direct labor and other manufacturing costs.
over-applied overhead exists when the amount of overhead applied to jobs during the period using the predetermined overhead rate is less than the total amount of overhead actually incurred during the period.
once a sales order has been received and a production order issued, the production department prepares a materials requisition form to specify the type, quantity, and total cost of materials.
to facilitate the allocation of manufacturing overhead to each job, we calculate a predetermined overhead rate after the period begins. the rate is calculated by iding the total actual manufacturing overhead for the coming period by the actual total units of the allocation base.
what is the amount of actual overhead cost incurred？
which of the following statements about a process costing system is incorrect?
which of the following statements about a process costing system is incorrect?
which of the following is incorrect about cost flows and journal entries of labor costs in process costing?
which of the following companies would be likely to use process costing rather than job-order costing? there may be more than one correct answer.
which of the following belongs to manufacturing overhead for a manufacturer enterprise?
job-order and process costing are similar in that they both deal with assigning materials, labor and overhead to products as a way to calculate the unit product cost.
equivalent units are the product of the number of partially completed units and the percentage completion of those units.
the flow of costs through the manufacturing accounts is basically the same for process and job-order costing
a process costing system is best used by companies that produce many units of different product
when we use the fifo method we make no distinction between work done in the prior period and work done in the current period
when finished products are sold to the customer, the costs of these products are transferred from finished goods inventory to cost of goods sold
process costing systems trace and apply manufacturing costs to jobs
which of the following statement is not true?
which of the following is not true about operational budget?
which of the following types of manufacturing costs are not included in the overhead budget?
what are the cash collections for march, 20x7?
which of the following statement is true? there may be more than one correct answer.
which of the following statement is true about budgeted income statement? there may be more than one correct answer.
planning involves developing objectives and preparing various budgets to achieve those objectives
to be effective, a good budgeting system must provide for both planning and control
operating budget for a manufacturer consists of sales budget, ending inventory budget, production budget, direct materials budget, direct labor budget, manufacturing overhead budget as well as selling and administrative expense budget
ending balance of retained earnings is based on beginning balance plus net income and deduct idends paid
what should the revenue be in a flexible budget for 600 lawns?
what should the total expenses be in a flexible budget for 600?
what should the net operating income be in a flexible budget for 600 lawns?
a flexible is suitable for planning and is valid for only the planned level of activity.
flexible budgets help managers control costs and improve performance evaluation
part of the discrepancy between the budgeted net operating income and the actual net operating income, which is because the actual level of activity is higher than the planned activity, is called activity variance.
an activity variance arises solely due to the difference in the level of activity included in the planning budget and the actual level of activity.
an activity variance is the difference between what the total revenue should have been, given the actual level of activity for the period, and the actual total revenue.
flexible budget allows us to isolate activity variances and revenue and spending variances.
which of the following statement is not true?
which one of the following variances is most controllable by the production control supervisor?
what is the direct material quantity variance for the period?
what is the direct labor rate variance?
what is the direct labor efficiency variance?
which of the following is not true? there are more than one answer.
revenue and spending variances can be decomposed into two parts, a part measuring how well resources were used and another part measuring how well the acquisition prices of those resources were controlled.
in managerial accounting, two types of standards are commonly used by manufacturing, service, and not-for-profit organizations: quantity standards and price standards.
price standards specify how much of an input should be used to make a product or provide a service.
standards are not determined by using available references that estimate the time needed to perform a given task, or by relying on time and motion studies.
setting price and quantity standards require the combined expertise of everyone who has responsibility for purchasing and using inputs.
in order to be more productive and efficient at work, any cost variances should be brought to the attention of management.
which of the following statement is incorrect?
consider the following data: return on investment (roi) 17% sales €140,000 average operating assets €80,000 minimum required rate of return 15% profit margin 10% what is the residual income?
what is the roi for fruta in 20x7?
what are the advantages of decentralization?
a decentralized organization does not confine decision-making authority to a few top executives
the manager of a cost center has control over costs, revenue as well as investment funds
profit center managers are often evaluated by comparing actual profit to targeted or budgeted profit
investment center managers are often evaluated using return on investment (roi) or residual income.
a segmented income statement using the traditional net income format can be used to reflect decentralized performance in inidual segment
traceable fixed costs of one segment may be a common fixed cost of another segment.
which of the following statement is incorrect?
which of the following is not true about joint costs?
warson ltd. is considering closing its alberta ision. which of the following would not be relevant to the closure decision?
what are the advantages of vertical integration? there may be more than one correct answer.
what qualitative factors should be considered in keep-or-drop decision? there may be more than one correct answer.
an avoidable cost is a cost that can be eliminated, in whole or in part, by choosing one alternative over another
a sunk cost is a cost that has already been incurred and cannot be avoided regardless of what a manager decides to do
costs that are relevant in one decision situation may not be relevant in another context.
when two or more products are produced from a common input these products are known as by products
the decision to drop an old segment or add a new one is going to hinge primarily on the impact the decision will have on net operating income.
all future costs are relevant in decision making
which of the following statement is not true?
lester company has been offered a five year contract to provide component parts for a large manufacturer. at the end of five years the working capital will be released and may be used elsewhere by lester. lester company uses a discount rate of 10%. what’s the net present value of the project? should the contract be accepted?
the expected annual net cash inflow from a project is $22,000 over the next 5 years. the required investment now in the project is $79,310. what is the internal rate of return on the project?
consider the following two investments: project x project y initial investment $100,000 $100,000 year 1 cash inflow $60,000 $60,000 year 2 cash inflow $40,000 $35,000 year 14-10 cash inflows $0 $25,000 which project has the shortest payback period?
the term capital budgeting is used to describe how managers plan significant cash outlays on projects that have long-term implications, such as the purchase of new equipment and the introduction of new products.
the capital budgeting techniques best recognize the time value of money and those involve discounted cash flows.
the time value of money concept recognizes that a dollar today is worth more than a dollar a year from now
the internal rate of return is a valuation method used to estimate the value of an investment based on its future cash flows
the discounted cash flow is the rate promised by an investment project over its useful life
the internal rate of return is the discount rate that will result in a net present value of zero
the payback method focuses on the payback period, which is the length of time that it takes for a project to recoup its initial cost out of the cash receipts that it generates.
the acceptance criteria of the payback method is that if the payback period is more than management’s target or required period, the project would be chosen.
a shorter payback period means that one investment is more desirable than another.
what is the current ratio for year 2018?
what is the times interest earned ratio for year 2018?
what are the strengths of financial statement analysis? there may be more than one correct answer.
financial statement ysis assists in assessing the financial health and future prospects of a company by top managers, stockholders, creditors and other stakeholders.
the ratio of earnings per share expresses the relationship between a stock’s market price per share and its earnings per share.
p/e ratio quantifies the percentage of current earnings being paid out in idends
the ratio of return on total assets measures the rate of return earned by capital employed
market prices reflect expectations about future earnings and idends, whereas book value reflects past results
short-term creditors want to be repaid on time, while long-term creditors concern with a company’s ability to repay its loans over the long run
ample working capital provides some assurance to long-term creditors
a large and growing working capital balance may not be a good sign.
which of the following statements about a process costing system is incorrect?
what are the cash collections for march, 20x7?
which one of the following variances is most controllable by the production control supervisor?
consider the following data: return on investment (roi) 17% sales €140,000 average operating assets €80,000 minimum required rate of return 15% profit margin 10% what is the residual income ?
which of the following companies would be likely to use process costing rather than job-order costing? there may be more than one correct answer.
what are the advantages of decentralization?
job-order and process costing are similar in that they both deal with assigning materials, labor and overhead to products as a way to calculate the unit product cost.
equivalent units are the product of the number of partially completed units and the percentage completion of those units.
a flexible is suitable for planning and is valid for only the planned level of activity.
which of the following statement is true about relevant information?
racing bicycle company produces and sells a single type of mountain bike. the beginning finished inventories are $130,000. cost of bikes manufactured this year is $760,000. ending finished goods inventories are $150,000. what is the cost of goods sold for this year?
which of the following methods provides the most accurate results in cost estimation?
coffee klatch is an espresso stand in a downtown office building. the average selling price of a cup of coffee is $1.49 and the average variable expense per cup is $0.36. the average fixed expense per month is $1,300. 2,100 cups are sold each month on average. what is the cm ratio for coffee klatch?
coffee klatch is an espresso stand in a downtown office building. the average selling price of a cup of coffee is $1.49 and the average variable expense per cup is $0.36. the average fixed expense per month is $1,300. how many cups of coffee would have to be sold to attain target profits of $2,500 per month?
which of the following is not a batch-level activity?
which of the following statements is true? there may be more than one correct option
which of the following belong to discretionary fixed costs? there may be more than one correct answer.
with the fast changing globalized economy, management accounting plays an important role in supporting managers to make quick and relevant decisions.
manufacturing companies purchase finished goods from suppliers for resale to customers.
account ysis approach is particularly useful to estimate mixed costs when no past experience is available concerning activity and costs.
the traditional format of income statement is helpful to managers in judging the impact on profits of changes in selling price, cost, or volume.