Management Accounting Quiz

Profit maximization as the goal of the firm is NOT ideal because

• profits are only accounting measures.

• profit maximization does not consider risk.

• cash flows are more representative of financial strength.

• profits today are less desirable than profits earned in future years.

The controller is commonly responsible for

• Tax administration

• Investor relations

• Banking and custody

• Managing credit activities

Which set of terms more accurately describes management accounting information rather than financial accounting information?

• Historical, precise, useful

• Required, estimated, internal

• Budgeted, informative, adaptable

• Comparable, verifiable, monetary

For a hospital, what type of position (line vs. staff) is each of the following?

• Emergency room manager (staff); Human resources manager (staff)

• Emergency room manager (staff); Human resources manager (line)

• Emergency room manager (line); Human resources manager (staff)

• Emergency room manager (line); Human resources manager (line)

Which of the following is LEAST likely to fall within financial management?

• Surplus assets are sold off.

• Funds are raised to finance an investment project.

• The dividend payment to shareholders is increased.

• A report is produced comparing actual results to budget.

Which of the following statements is NOT correct?

• Cost accounting can be used for inventory valuation to meet the requirements of internal reporting only.

• Management accounting provides appropriate information for decision making, planning, control, and performance evaluation.

• Routine information can be used for both short-term and long-ren decisions.

• Financial accounting information can be used for internal reporting purposes.

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

Which of the following groups would be least likely to receive detailed management accounting reports?

• Managers

• Shareholder

• Sales representatives

• Production supervisors

Managerial accounting is very similar to financial accounting in this aspect.

• Users of reports

• Type of data provided to users

• Emphasis between past and future

• Reliance on the accounting database

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

• Treasurer

• Controller

• Chief Financial Officer (CFO)

• Chief Operating Officer (COO)