Question 1

All manufacturing costs are treated as product costs.

Accepted Answer

According to generally accepted accounting principles, all manufacturing costs, such as direct materials, direct labor, and manufacturing overhead, are treated as product costs and are included in the cost of goods sold.

Question 2

Predictive analytics is the process of recommending a course of action based upon meaningful patterns and insights from collected data.

Accepted Answer

Predictive analytics involves using statistical techniques and algorithms to forecast future outcomes based on historical data, not recommending actions. Recommending actions is typically associated with prescriptive analytics.

Question 3

Managers of small,private corporations use managerial accounting information whereas managers of large,public corporations use financial accounting information.

Accepted Answer

Managers of both small,private corporations and large,public corporations use both managerial and financial accounting information. However, the emphasis may differ depending on the size and ownership structure of the company.

Question 4

The Sarbanes-Oxley Act of 2002 focuses on three factors that affect the accounting reporting environment: ethics,fraud,and managers.

Accepted Answer

The Sarbanes-Oxley Act of 2002 primarily focuses on improving the accuracy and reliability of corporate disclosures, enhancing corporate governance, and increasing the accountability of company executives, rather than specifically targeting ethics, fraud, and managers.

Question 5

The Sarbanes-Oxley Act of 2002 places full responsibility on the board of directors for the accuracy of the reporting system.

Accepted Answer

The Sarbanes-Oxley Act of 2002 places responsibility not only on the board of directors but also significantly on top corporate executives (such as the CEO and CFO) for the accuracy and reliability of corporate disclosures and financial reporting.

Question 6

Managers must direct,lead and motivate during the implementation function.

Accepted Answer

Managers play a crucial role in directing, leading and motivating their team members during the implementation function in order to ensure success.

Question 7

An opportunity cost is the cost of not doing something.

Accepted Answer

An opportunity cost is the cost of not choosing the next best alternative, or the cost of not doing something in favor of doing something else.

Question 8

A cost that will occur in the future and differs between various alternatives under consideration is a relevant cost.

Accepted Answer

Relevant costs are future costs that differ among alternatives being considered.

Question 9

The term "Big data" refers to the volume,velocity and veracity of data.

Accepted Answer

The term "Big Data" refers to the volume, velocity, and variety of data, not veracity. Veracity refers to the quality or trustworthiness of the data.

Question 10

A sustainable business is one with the ability to meet the needs of today without sacrificing the ability of future generations to meet their own needs.

Accepted Answer

This is the definition of a sustainable business, as defined by the Brundtland Commission in 1987.

Question 11

Financial accounting information is generally used exclusively by internal parties such as managers.

Accepted Answer

Financial accounting information is used by both internal parties (such as managers and employees) and external parties (such as investors, creditors, and government agencies).

Question 12

Variable costs are always direct costs.

Accepted Answer

Variable costs can be either direct or indirect. Direct costs are directly attributable to the production of a specific good or service, while indirect costs are not. Variable costs change with production levels, but this does not necessarily mean they are always directly traceable to a single product.

Question 13

All manufacturing costs are inventoriable costs.

Accepted Answer

Inventoriable costs are the costs that are allocated to the cost of goods produced and not immediately expensed on the income statement. Manufacturing costs, such as direct materials, direct labor, and overhead, are all inventoriable costs as they are incurred in the production process and are eventually included in the cost of the finished goods.

Question 14

Of the following groups,which is the primary user of managerial accounting information?
A)Investors
B)Creditors
C)Regulators
D)Managers

Accepted Answer

The primary user of managerial accounting information is managers. Managerial accounting provides relevant financial information to internal users such as managers, employees, and executives to aid in decision-making, planning, and control of operations within the organization. Investors, creditors, and regulators are external users of financial accounting information.

Question 15

Whether a cost is treated as direct or indirect depends on whether tracing the cost is both possible and feasible.

Accepted Answer

Tracing a cost means being able to directly link it to a particular product, department, or activity. Feasibility refers to the cost and effort associated with tracing the cost. If tracing is possible and feasible, the cost is treated as direct. If tracing is not possible or not feasible, the cost is treated as indirect.

Question 16

What is the primary goal of accounting?
A)To set long-term goals and objectives.
B)To arrange for the necessary resources to achieve a plan.
C)To provide information for decision making.
D)To motivate others to work towards a plan's success.

Accepted Answer

The primary goal of accounting is to provide information for decision making. Accounting involves tracking, recording, and analyzing financial transactions to provide users with useful and relevant information to make informed decisions. This information is used by managers, investors, creditors, and other stakeholders to evaluate the financial health and performance of an organization, and to make decisions about resource allocation, investment, and other strategic choices. While setting long-term goals, arranging resources, and motivating others are important functions of management, they are not the primary goal of accounting.

Question 17

Fixed costs stay the same,on a per-unit basis,as activity level changes.

Accepted Answer

Fixed costs stay the same in total, but on a per-unit basis, they decrease as the activity level (or volume of production) increases, because the same total fixed cost is spread over more units.

Question 18

Prime costs include direct materials,direct labor,and manufacturing overhead.

Accepted Answer

Prime costs include only direct materials and direct labor, but not manufacturing overhead.

Question 19

Descriptive analytics uses patterns and insights from collected data to show what has happened.

Accepted Answer

Descriptive analytics is focused on analyzing historical data to gain insights and understand what has happened in the past. This can include identifying patterns and trends, summarizing statistics, and visualizing data.

Question 20

Financial accounting information is reported for the company as a whole.

Accepted Answer

Financial accounting information provides an overview of a company's financial performance as a whole rather than individual departments or operations.

Quiz 1: Introduction to Managerial Accounting