Question 1

Management accountants have a responsibility to be objective. What does this ethical standard require of management accountants?

Accepted Answer

The answer of Management accountants have a responsibility to be...

Question 2

Select the term from the list provided that best matches each of the following descriptions. The first is done for you. \(\begin{array}{|c|l|l|}
\hline \text { Answer } & \text { Description } & \text { List of terms } \
\hline 4 & \begin{array}{l}
\text { A. An inventory flow system that minimizes the amount of } \
\text { inventory on hand }
\end{array} & 1 \text {. Continuous improvement } \
\hline  & \begin{array}{l}
\text { B. The organization established by the accounting profession } \
\text { to develop accounting standards }
\end{array} & \text { 2. Cost of goods sold } \\hline & \begin{array}{l}
\text { C. The area of accounting designed to meet information } \
\text { needs of internal users }
\end{array} & \begin{array}{l}
\text { 3. Financial Accounting } \
\text { Standards Board }
\end{array} \
\hline  & \begin{array}{l}
\text { D. The government agency authorized to establish and } \
\text { regulate public company reporting practices }
\end{array} & \text { 4. Just in time } \\hline  & \begin{array}{l}
\text { E. Assessing the value chain to create new value-added } \
\text { activities }
\end{array} & \text { 5. Managenal accounting } \
\hline  & \begin{array}{l}
\text { F. Tasks that do not contribute to a product's abulity to satisfy } \
\text { customer needs }
\end{array} & 6 \text {. Nonvalue-added activities } \\hline  & \text { G. Costs incurred before the manufacturing process begins } & 7 \text {. Re-enganeening } \
\hline  & \begin{array}{l}
\text { H. The process of changing an or garization's production and } \
\text { delivery systems to make the organization more competitive }
\end{array} &  \text {. Upstream costs } \\hline  & \begin{array}{l}
\text { I. The ongoung process through whach employees become } \
\text { more effective and leam to work more efficiently }
\end{array} & \begin{array}{l}
\text { 9. Secunties and Exchange } \
\text { Commission }
\end{array} \
\hline  & \begin{array}{l}
\text { f. The term used for the amount of product costs expensed in } \
\text { the current period }
\end{array} & \begin{array}{l}
\text { 10. Activity-based } \
\text { management }
\end{array} \
\hline
\end{array}\)

Accepted Answer

The answer of Select the term from the list provided...

Question 3

Is McDonald's a manufacturing company or a service company? How do they record the cost of materials, labor, and overhead?

Accepted Answer

The answer of Is McDonald's a manufacturing company or a...

Question 4

Classify each of the following costs for Harrison Company as a selling or general and administrative period cost or as a direct or indirect product cost by entering the dollar amount(s) in the appropriate column(s):
A. Paid $75,000 in wages for employees who assemble the company's products.B. Paid sales commissions of $58,000.C. Paid $38,000 in salaries for factory supervisors.D. Paid $88,000 in salaries for executives (president and vice presidents).E. Recorded depreciation cost of $25,000. $13,000 was depreciation on factory equipment and $12,000 was depreciation on the company headquarters building.F. Paid $4,000 for various supplies that it used in the factory (oil and materials used in machine maintenance).G. Used $10,000 in prepaid corporate liability insurance

Accepted Answer

The answer of Classify each of the following costs for...

Question 5

How does the Sarbanes-Oxley Act of 2002 affect the responsibilities of the managers of publicly held US corporations?

Accepted Answer

The answer of How does the Sarbanes-Oxley Act of 2002...

Question 6

What are indirect costs, and how are the indirect costs incurred to make products accounted for?

Accepted Answer

The answer of What are indirect costs, and how are...

Question 7

Management accountants have a responsibility to demonstrate integrity. What does this ethical standard require of management accountants?

Accepted Answer

The answer of Management accountants have a responsibility to demonstrate...

Question 8

The Giga Company produces tablet computers. The following information is provided:
Required:
Classify each of the company's costs as a period cost (general, selling, and administrative cost) or as a direct or indirect product cost. Enter the dollar amount of the cost in the appropriate column. After entering all amounts, calculate the total general, selling, and administrative cost, the total direct product cost, and the total indirect product cost. $\begin{array}{lr}
\text { a) Materials used } & \$ 216,000 \
\text { b) Advertising } & \$ 40,000 \
\text { c) Insurance, factory } & \$ 20,000 \
\text { d) Administrative salaries } & \$ 50,000 \
\text { e) Property taxes, factory } & \$ 12,000 \
\text { f) Utilities, administrative building } & \$ 22,000 \
\text { g) Factory labor } & \$ 80,000 \
\text { h) Sales commissions } & \$ 56,000 \
\text { i) Factory supervisor's salary } & \$ 60,000 \
\text { j) Research and development } & \$ 18,000 \
\text { k) Depreciation, factory } & \$ 12,000 \
\text { 1) Depreciation, office } & \$ 8,000 \
\text { m) Indirect materials } & \$ 14,000
\end{array}$ $$\begin{array} { | l | l | l | l | } 
\hline  { \text { Item } } & \text { Period cost } & \text { Direct product cost } & \text { Indirect product cost } \
\hline \text { a) } & & & \
\hline \text { b) } & & & \
\hline \text { c) } & & & \
\hline \text { d) } & & & \
\hline \text { e) } & & & \
\hline \text { f) } & & & \
\hline \text { g) } & & & \
\hline \text { h) } & & & \
\hline \text { i) } & & & \
\hline \text { i) } & & & \
\hline \text { k) } & & & \
\hline \text { l) } & & & \
\hline \text { m) } & & & \
\hline \text { Total } & & & \
\hline
\end{array}$$

Accepted Answer

The answer of The Giga Company produces tablet computers. The...

Question 9

What is the fraud triangle? Which element of the fraud triangle is most closely connected with internal controls?

Accepted Answer

The answer of What is the fraud triangle? Which element...

Question 10

Jarvis Company provided the following information regarding its first year of operations:
Required:
Determine the following amounts:
(a) Total overhead costs.(b) Total product costs.(c) Product cost per unit.(d) Total cost of ending finished goods inventory.(e) Total cost of goods sold. $$\begin{array}{l}
\begin{array} { | l | r | } 
\hline \text { Administrative salaries } & \$ 60,000 \
\hline \text { Depreciation on factory equipment } & 16,000 \
\hline \text { Indirect materials } & 4,000 \
\hline \text { Marketing costs } & 40,000 \
\hline \text { Salaries for factory supervisors } & 28,000 \
\hline \text { Wages for production workers } & 80,000 \
\hline \text { Raw materials used } & 100,000 \
\hline \text { Research and development } & 32,000 \
\hline \text { Rent on factory building } & 18,000 \
\hline \text { Sales revenues } & 432,000 \
\hline \text { Sales salaries and other selling costs } & 56,000 \
\hline\

\hline \text { Beginning inventory } & 0 \text { units } \
\hline \text { Number of units produced } & 20,000 \
\hline \text { Number of units sold } & 18,000 \
\hline
\end{array}
\end{array}$$

Accepted Answer

The answer of Jarvis Company provided the following information regarding...

Question 11

Benchmarking involves the identification of the best practices used by world-class competitors. Discuss the following widely recognized best practices: activity-based management and just in time inventory.

Accepted Answer

The answer of Benchmarking involves the identification of the best...

Question 12

What part do management accountants play in corporate governance?

Accepted Answer

The answer of What part do management accountants play in...

Question 13

Select the term from the list provided that best matches each of the following descriptions. The first is done for you. \[\begin{array} { | c | l | l | } 
\hline \text { Answer } & \text { Description } & \text { List of terms } \
\hline 4 & \begin{array} { l } 
\text { A. Costs that are incurred after the manufacturing process is } \
\text { complete }
\end{array} & \text { 1. Benchmarking } \
\hline & \begin{array} { l } 
\text { B. The identification of the best practices used by world-class } \
\text { competitors }
\end{array} & \text { 2. Cost allocation } \
\hline & \begin{array} { l } 
\text { C. The linked sequence of activities that create value for the } \
\text { customer }
\end{array} & \text { 3. Direct costs } \
\hline & \text { D. Costs that cannot be easily traced to specific products } & \text { 4. Downstream costs } \
\hline & \begin{array} { l } 
\text { E. All costs related to obtaining or manufacturing a product } \
\text { intended for sale to customers }
\end{array} & \text { 5. Financial accounting } \
\hline & \begin{array} { l } 
\text { F. Work that contributes to a product's abdity to satisfy } \
\text { customer needs }
\end{array} & \text { 6. Indirect costs } \
\hline & \begin{array} { l } 
\text { G. The process of dividing a total cost into parts and } \
\text { assigning the parts to relevant cost objects }
\end{array} & \text { 7. Period costs } \
\hline & \begin{array} { l } 
\text { H. The field of accounting that is designed to meet the } \
\text { information needs of external users }
\end{array} & \text { 8. Product costs } \
\hline & \begin{array} { l } 
\text { I. General, selling, and administrative costs that are expensed } \
\text { in the period in which the economic sacrifice is made }
\end{array} & \text { 9. Value-added activity } \
\hline & \begin{array} { l } 
\text { J. Costs that can easdy and conveniently be traced to } \
\text { products }
\end{array} & \text { 10. Value chain } \
\hline
\end{array}\]

Accepted Answer

The answer of Select the term from the list provided...

Question 14

As a Certified Management Accountant, Steven is bound by the Institute of Management Accountant's Standards of Ethical Conduct. Describe the actions Steven should take when faced with an ethical dilemma at work.

Accepted Answer

The answer of As a Certified Management Accountant, Steven is...

Question 15

Discuss three practical implications of misclassifying product and/or period costs.

Accepted Answer

The answer of Discuss three practical implications of misclassifying product...

Question 16

Complete the following table to compare and contrast financial and managerial accounting. $$\begin{array} { | l | l | l | } 
\hline \text { Characteristic } & \text { Financial Accounting } & \text { Managerial Accornting } \
\hline \text { Users } & & \
\hline \text { Level of aggregation } & & \
\hline \text { Regulation } & & \
\hline \text { Characteristics of information } & & \
\hline \text { Time horizon } & & \
\hline \text { Reporting frequency } & & \
\hline
\end{array}$$

Accepted Answer

The answer of Complete the following table to compare and...

Question 17

What inventory holding costs would be incurred by a business that holds a large amount of inventory?

Accepted Answer

The answer of What inventory holding costs would be incurred...

Question 18

What is a value chain? And what relationship is there between the value chain and activity-based management?

Accepted Answer

The answer of What is a value chain? And what...

Question 19

What benefits may result from use of a just in time system?

Accepted Answer

The answer of What benefits may result from use of...

Question 20

What are upstream costs? What upstream costs would be incurred by a company that produces and sells computer software programs?

Accepted Answer

The answer of What are upstream costs? What upstream costs...

Quiz 1: Management Accounting and Corporate Governance