Cost Accounting 375.

• Management uses this information to decide how to allocate resources to the most efficient and profitable areas of the business.

• T

• F

1. Manufacturers purchase finished goods for resale.

• T

• F

1. Merchandisers convert purchased raw materials into finished goods by using labor, technology, and facilities.

• T

• F

1. Non-for -profit service businesses, such as health clubs, accounting firms, and NHL hockey teams, sell services rather than products.

• T

• F

1. For-profit service agencies, such as charities, governmental agencies, and some health care facilities, provide at little or no cost the user.

• T

• F

1. The nature of the manufacturing process requires that the accounting information systems of manufacturers be designed to accumulate detailed cost data relating to the production process.

• T

• F

1. Product quality is as important a competitive weapon as control in the global arena.

• T

• F

1. Management accounting meets the needs of investors, creditors, and other external users of financial information.

• T

• F

1. Financial accounting focuses on historical and estimated data that management needs to conduct ongoing operations and do long-range planning.

• T

• F

• Purchases of materials on account are recorded as a debit to Materials in the general ledger.

• T

• F