Question 1

Fundamentally, managerial accounting applies best to the manufacturing context.

Accepted Answer

While managerial accounting does have applications in manufacturing, it can also be applied to various types of organizations including service and non-profit.

Question 2

Determining the unit cost of manufacturing a product is an output of managerial accounting.

Accepted Answer

Managerial accounting provides information for internal decision-making, including determining the unit cost of manufacturing a product. This information is crucial for pricing decisions, cost control, and profitability analysis.

Question 3

Detailed reports scrutinized by managerial accountants include those focused on business sub-units.

Accepted Answer

Managerial accountants analyze and report on specific areas or sub-units within a business, such as departments or projects. This allows for a more detailed and targeted approach to decision-making and resource allocation.

Question 4

Decision-making is an integral part of the planning, directing and motivating functions, but not of the controlling function.

Accepted Answer

Decision-making is a part of all four functions of management, including controlling. The controlling function involves comparing actual performance to planned performance and taking corrective action if needed, which requires decision-making.

Question 5

Reports prepared in managerial accounting are general-purpose reports, whereas reports prepared in financial accounting are usually special-purpose reports.

Accepted Answer

The answer of Reports prepared in managerial accounting are general-purpose...

Question 6

An organization chart in a manufacturing company replaces the chart of accounts.

Accepted Answer

An organization chart determines the management structure of a company and the roles and responsibilities of its employees, while the chart of accounts is a list of all the financial accounts in a company's general ledger. They serve different purposes and cannot replace each other.

Question 7

The management function of planning is mainly concerned with setting goals and objectives for the entity.

Accepted Answer

The management function of planning is primarily concerned with setting goals and objectives for the entity. It involves analyzing the current situation, identifying opportunities and threats, and deciding on the best course of action to achieve the desired outcomes.

Question 8

A primary outcome of managerial accounting is the determination of costs for manufactured items and services.

Accepted Answer

Managerial accounting is concerned with providing information and analysis to managers within an organization to help them make informed business decisions. Its primary outcome is the determination of costs for manufactured items and services, among other things.

Question 9

The verification process for managerial accounting requires an independent audit by Chartered Accountants.

Accepted Answer

Though independent audits are common in managerial accounting, they are not always required and may be performed internally by the company or by non-chartered accountants.

Question 10

Management accounting is a sub-discipline within accounting focusing solely on the provision of economic and financial information for external users.

Accepted Answer

Management accounting is a sub-discipline within accounting focusing on the provision of economic and financial information for internal users (i.e. management) to support decision-making, planning, and control.

Question 11

Companies rely upon management accountants to collect non-financial information in order to assess how well the companies' resources are being used.

Accepted Answer

Management accountants not only collect financial information, but also non-financial information such as customer satisfaction, employee productivity, and quality control measures to provide a comprehensive evaluation of the company's overall performance.

Question 12

Organization charts are common in companies but not relevant to managerial accounting.

Accepted Answer

The answer of Organization charts are common in companies but...

Question 13

Directing is the process of determining whether planned goals are being met.

Accepted Answer

The answer of Directing is the process of determining whether...

Question 14

Managerial accounting applies only to manufacturing companies.

Accepted Answer

Managerial accounting can be applied to all types of companies, including service and retail companies, not just manufacturing companies.

Question 15

Managerial accounting internal reports are prepared less frequently than are classified financial statements.

Accepted Answer

The answer of Managerial accounting internal reports are prepared less...

Question 16

The content of managerial accountants' reports is very detailed and includes non-financial data relevant to business decision-making.

Accepted Answer

This statement is true. Managerial accountants' reports provide detailed information that goes beyond just financial data and includes non-financial data that is relevant to making informed business decisions. This can include information on production efficiencies, employee performance, and customer satisfaction, among other things.

Question 17

Management accounting and financial accounting, while in the same field, are mutually exclusive disciplines.

Accepted Answer

Management accounting and financial accounting are closely related and interdependent disciplines. Financial accounting provides information on a company's financial performance and position to external stakeholders, while management accounting provides information for internal decision-making and management control purposes. However, both disciplines share common concepts, principles, and techniques.

Question 18

Managerial accounting information generally pertains to an entity as a whole and is very detailed.

Accepted Answer

Managerial accounting information is focused on specific segments or departments within an entity and is less detailed than financial accounting information, which pertains to the entity as a whole.

Question 19

Given the decision to employ straight-line amortization or a usage-based amortization method, the management accountant's need to report the most relevant economic information to external users will determine which method is used.

Accepted Answer

The answer of Given the decision to employ straight-line amortization...

Question 20

Management accounting is a discipline with a rather narrow scope for career advancement.

Accepted Answer

Management accounting may have a narrower scope than general accounting, but there are still opportunities for career advancement within the field, such as becoming a controller, CFO, or consultant.

Quiz 1: Managerial Accounting