MS Preweek - Theories Quiz

Management accounting:

• Provides information about the company as a whole

• Reports information that has occurred in the past that is verifiable and reliable

• Provides information that is generally available only on a quarterly or annual basis

• Focuses on estimating future revenues, costs, and other measures to forecast activities and their results

Financial accounting provides a historical perspective, whereas management accounting emphasizes

• The future

• Past transactions

• A current perspective

• Reports to shareholders

Which financial executive is primarily responsible for both management and financial accounting?

• Treasurer

• Controller

• Chief financial officer

• Auditor

The person (s) directly responsible for attaining of organizational objectives is/are the:

• Controller

• Chief financial officer

• Line management

• Staff management

Staff management includes

• Purchasing managers

• Distribution managers

• Manufacturing managers

• Human-resource managers

As teamwork has become more prominent in recent years, differences between staff and line management:

• Have increased

• Have diminished

• Have become more important relative to promotions

• Have only been evident in employee reward system

Management accounting plays three key roles in a business organization: (1) Scorekeeping, (2) Attention-Directing (3) Problem-Solving. Problem-solving is best illustrated in which of the following situations?

• A daily sales report {scorekeeping}

• Tracking the type of product returned {attention-directing}

• Making a recommendation regarding the lease or purchase of a fleet of vehicles

• None of the choices illustrates problem-solving or any important role in management accounting

For control decisions, emphasis is placed on the ___ role(s) of management accounting.

• Scorekeeping

• Problem-Solving

• Attention-Directing

• Both Scorekeeping and Attention-Directing

For strategic decisions, emphasis is placed on the ___ role(s) of management accounting.

• Scorekeeping

• Problem-Solving

• Attention-Directing

• Both Scorekeeping and Attention-Directing

The latest version of IMA Standards of Ethical Professional Practice for management accountants comprises of (A) competence, (B) confidentiality, (C) integrity and (D) credibility. “Integrity” requires management accountant to:

• Maintain an appropriate level of professional expertise by continually developing knowledge and skills and perform duties in accordance with relevant laws, regulations, and technical standards

• Keep information confidential unless disclosure is authorized or legally required

• Mitigate actual conflicts of interest and refrain from engaging in any conduct that would prejudice carrying out duties ethically

• Communicate information fairly and objectively and disclose all relevant information expected to influence an intended user’s understanding of the reports, analysis and recommendations