Chapert 13 Quiz

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CHAPTER 13 - MULTIPLE CHOICE QUESTIONS

1.Managerial accounting information is generally prepared for
a.shareholders
b.creditors
c.managers
d.regulatory agencies

C is correct.
Section “Management accounting basics” – Management accounting focuses mainly on the preparation of reports for the internal users of financial information, i.e. managers are all levels of the entity.

2.Managerial accounting information
a.relates to the entity as a whole and is highly aggregated
b.relates to sub-units of the entity and may be very detailed
c.is prepared only once a year
d.is constrained by the requirements of generally accepted accounting principles

B is correct.
Section “Management accounting basics” – Management accounting pertains to subunits of the entity and may be very detailed.

5.Which of the following is not an internal user of management information?
a.Creditor
b.Department manager
c.Controller
d.Treasurer

A is correct.
Section “Management accounting basics” – Creditors are external to the entity.

6.Managerial accounting does not encompass
a.calculating product cost
b.calculating earnings per share
c.determining cost behavior
d.profit planning

B is correct.
Section “Management accounting basics” – Calculating earnings per share is a function for external users of financial information.

7.Management accounting is applicable to
a.service entities
b.manufacturing entities
c.not-for-profit entities
d.all of these

D is correct.
Section “Management accounting basics” – Management accounting applies to any business entity.

10.Financial statements for external users can be described as
a.user-specific
b.general-purpose
c.special-purpose
d.management reports

B is correct.
Section “Management accounting basics” – Financial statements prepared for external users are general purpose financial reports.

11.Management accounting reports can be described as
a.general-purpose
b.macro-reports
c.special-purpose
d.classified financial statements

C is correct.
Section “Management accounting basics” – Management accounting reports provide special purpose information for a particular user for a specific reason.

12.The reporting standard for external financial reports is a.industry-specific
b.company-specific
c.generally accepted accounting principles
d.department-specific

C is correct.
Section “Management accounting basics” – The reporting standard for external financial reports is generally accepted accounting principles.

15.Internal reports are generally
a.aggregated
b.detailed
c.regulated
d.unreliable

B is correct.
Section “Management accounting basics” – Internal reports are generally very detailed.

16.Planning is a function that involves
a.hiring the right people for a particular job
b.coordinating the accounting information system
c.setting goals and objectives for an entity
d.analysing financial statements

C is correct.
Section “Management accounting basics” – Planning requires management to look ahead and to establish objectives.

18.Which of the following is not a management function?
a.Demotivating
b.Planning
c.Controlling
d.Directing

A is correct.
Section “Management accounting basics” – Management are concerned with directing and motivating, not demotivating.

19.A manager who is establishing objectives is performing which management function?
a.Motivating
b.Directing
c.Planning
d.Constraining

C is correct.
Section “Management accounting basics” – Planning involves looking ahead and establishing objectives.

20.The document of an organisation that depicts authority relationships within the company is the
a.chart of accounts
b.ledger
c.organisation chart
d.constitution

C is correct.
Section...
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