1. What is the primary criterion for the preparation of managerial accounting reports?

Timing of the reports

Meet the manager needs
Relevance of the reports
Cost of the reports
Management Accounting and Control - Introduction to MAS (Easy)
Question #2
2. Which of the following is most associated with managerial accounting?
Is prepared for users outside the organization.
Must follow GAAP
Always reports on the entire entity
May rely on estimates and forecasts
Management Accounting and Control - Introduction to MAS (Easy)
Question #3
3. A company establishing a position of cost leadership would
stress the cost efficiencies in its production processes
all of the above are possible tactics
match all competitors price changes
emphasize the value of its products distinguishing features
Management Accounting and Control - Introduction to MAS (Easy)
Question #4
4. Another term often used to refer to factory overhead is:
other manufacturing cost
supervisory cost
factory burden
surplus
Management Accounting and Control - Introduction to MAS (Easy)
Question #5
5. If the cost of direct materials is a small portion of total production cost, it may be classified as
part of:
direct labor cost
factory overhead cost
selling and administrative costs
miscellaneous costs
Management Accounting and Control - Introduction to MAS (Easy)
Question #6
6. The cost of wages paid to employees directly involved in the manufacturing process in
converting materials into finished product is classified as:
wages expense
direct labor cost
factory overhead cost
direct materials cost
Management Accounting and Control - Introduction to MAS (Easy)
Question #7
7. The behavioral norms in a companys code of ethics should
be specific to the countries in which the company operates
require employees to act in accordance with local customs and traditions when in non-domestic
situations
engender consistent actions in all geographical segments
vary depending on an employees job level and global location
Management Accounting and Control - Introduction to MAS (Easy)
Question #8
8. All of the following employees hold line positions in Anthea Electric EXCEPT:
vice president of sales
vice president of finance
manager of the Valhalla Plant
vice president of production
Management Accounting and Control - Introduction to MAS (Easy)
Question #9
9. Costs other than direct materials cost and direct labor cost incurred in the manufacturing
process are classified as:
product costs
miscellaneous expense
other manufacturing costs
factory overhead cost
Management Accounting and Control - Introduction to MAS (Easy)
Question #10
10. Which of the following are the basic functions of management?
Supervising and directing
Organizing and directing
Planning and controlling
Decision making and supervising
Management Accounting and Control - Introduction to MAS (Easy)
Question #11
11. What term is used to refer to the cost of changing direct materials into a finished manufactured
product?
Period cost
Direct labor cost
Factory overhead cost
Conversion cost
Management Accounting and Control - Introduction to MAS (Easy)
Question #12
12. The agents of change in a business are the
managers
organizational stakeholders
employees
members of the organizational value chain
Management Accounting and Control - Introduction to MAS (Easy)
Question #13
13. Which of the following is generally viewed as improving organizational cost data?
value chain analysis
strategic resource management
cost-benefit analysis
activity-based costing
Management Accounting and Control - Introduction to MAS (Easy)
Question #14
14. What term is used to describe the process of directing operations to achieve the organizations
 goals and plans?
Planning
Directing
Supervising
Control
Management Accounting and Control - Introduction to MAS (Easy)
Question #15
15. The following are all product costs except:
Direct materials
Sales and administrative expenses
Direct labor
Factory overhead
Management Accounting and Control - Introduction to MAS (Easy)
Question #16
16. Which of the following statements is true?
All segments of an organization will have the same mission
Segment mission is affected by product life cycle
Product life cycle is affected by segment mission
An organizations products will not affect the determination of segment mission
Management Accounting and Control - Introduction to MAS (Easy)
Question #17
17. Which of the following would be considered a political risk in doing business globally?
Workplace diversity
Inflation
All of the above
Asset expropriation
Management Accounting and Control - Introduction to MAS (Easy)
Question #18
18. Managerial accounting
is related to the entire business entity only.
is prepared periodically only.
is prepared according to management needs.
is prepared according to GAAP.
Management Accounting and Control - Introduction to MAS (Easy)
Question #19
19. Which of the following is the principle reason for preparing managerial accounting reports?
Clarity
Usefulness to management
Cost of preparation
GAAP
Management Accounting and Control - Introduction to MAS (Easy)
Question #20
20. Which of the following costs are referred to as conversion costs?
Direct materials cost and direct labor cost
Factory overhead cost
Direct labor cost and factory overhead cost
Direct materials cost and factory overhead cost
 21. Which of the following are the basic functions of management?
Decision making and supervising
Planning and controlling
Organizing and directing
Supervising and directing

22. Which of the following budgeting systems focuses on improving operations?

operational budgeting
activity-based budgeting
responsibility budgeting
kaizen budgeting

23. Triglobal Industries, Inc., (TII) developed the following standard costs
for direct material and direct labor for one of their major products, the 10-
gallon plastic container.
Standard quantity Standard price
Direct materials 0.10 pounds P30 per pound
Direct materials 0.05 hours P15 per hour
During June, TII produced and sold 5,000 containers using 490 pounds of direct
materials at an average cost per pound of P32 and 250 direct labor hours at an
average wage of P15.25 per hour.
Junes direct material quantity variance was:

P680 favorable

P980 unfavorable

None of the above is correct.

P300 favorable

SOLUTION:

(AQ - SQ) x SP = [490# - (5,000 x 0.10#)] x P30 = P300 F

24. The financing section of the cash flow statement includes:

amounts paid for advertising costs

borrowing made and repaid

cash outflows for flexible resources

cash flows from retail sales

25. A company establishing a position of cost leadership would

emphasize the value of its products distinguishing features

all of the above are possible tactics
match all competitors price changes
stress the cost efficiencies in its production processes

26. Managers may be more willing to accept a budget if

it is imposed
it is very hard to attain
they can participate in its development
it is continuous

27. __________ specifies when items such as acquisitions for buildings and special-purpose
equipment must be made to meet activity objectives.
The production plan
The administrative and discretionary spending plan
The capital-spending plan
The materials purchasing plan

28. Triglobal Industries, Inc., (TII) developed the following standard costs
for direct material and direct labor for one of their major products, the 10-
gallon plastic container.
Standard quantity Standard price
Direct materials 0.10 pounds P30 per pound
Direct materials 0.05 hours P15 per hour
During June, TII produced and sold 5,000 containers using 490 pounds of direct
materials at an average cost per pound of P32 and 250 direct labor hours at an
average wage of P15.25 per hour.
Junes direct material cost variance was:

P300 favorableNone of the above is correct.P680 unfavorableP980 unfavorable

SOLUTION:

Total direct material cost variance = Actual direct material cost - Standard direct
material cost = (490# x P32) - (5,000 x 0.10# x P30) = P15,680 - P15,000 = P680
U
Management Accounting and Control - Budgeting (Easy)
Question #9
29. The following information pertains to Tiffany Company:

Month Sales Purchases

January P30,000 P16,000
February 40,000 20,000
March 50,000 28,000
Cash is collected from customers in the following manner:

Month of sale 30%

Month following the sale 70%
40% of purchases are paid for in cash in the month of purchase, and the balance
is paid the following month.
Labor costs are 20% of sales. Other operating costs are P15,000 per month
(including P4,000 of depreciation). Both of these are paid in the month incurred.
The cash balance on March 1 is P4,000. A minimum cash balance of P3,000 is
required at the end of the month. Money can be borrowed in multiples of P1,000.
How much cash will be paid to suppliers in March?

None of the choices is correct.

23,200

28,000

44,000

SOLUTION:

(February purchases P20,000 x 60% = P12,000) + (March purchases P28,000 x

40% = P11,200) = P23,200
30. Cathy Manufacturing produces a single product that sells for P80. Variable (flexible) costs per
unit equal P32. The company expects the total fixed (capacity-related) costs to be P72,000 for
the next month at the projected sales level of 2,000 units. In an attempt to improve performance,
management is considering a number of alternative actions. Each situation is to be evaluated
separately.
Suppose that Cathy Manufacturing's management believes that a 10% reduction in the selling price will
result in a 10% increase in sales. If this proposed reduction in selling price is implemented, then:
profit will decrease by P8,000
profit will increase by P16,000
profit will increase by P8,000
profit will decrease by P16,000
SOLUTION:

(P80 - P32) x (2,000 units) - P72,000 = P24,000 (P72 - P32) x (2,200 units) - P72,000 = P16,000 Will
decrease operating profit by P8,000