Managerial Accounting Exam Practice Tests
Course Introduction
Managerial Accounting focuses on the identification, measurement, analysis, interpretation, and communication of financial information for internal decision-making purposes. The course covers essential topics such as cost behavior, cost-volume-profit analysis, budgeting, performance evaluation, and decision-making techniques that support effective planning and control within organizations. Students will learn how managers use accounting information to guide strategic business choices, allocate resources efficiently, and enhance organizational performance. Through case studies and practical applications, participants develop skills to analyze financial data, prepare internal reports, and contribute to the overall success of an organization.
Recommended Textbook
Horngrens Cost Accounting A Managerial Emphasis 3rd Australian Edition by Charles Horngren
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21 Chapters
3782 Verified Questions
3782 Flashcards
Source URL: https://quizplus.com/study-set/3568 Page 2
Chapter 1: Management Accounting in Context
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200 Verified Questions
200 Flashcards
Source URL: https://quizplus.com/quiz/70842
Sample Questions
Q1) The Sarbanes-Oxley legislation in the USA was passed in response to a series of corporate scandals.
A)True
B)False
Answer: True
Q2) Accountants have special ethical obligations,given that they are responsible for the integrity of the financial information provided to internal and external parties.
A)True
B)False
Answer: True
Q3) A well-conceived plan allows managers the ability to:
A)keep lower-level managers from implementing change.
B)take advantage of unforeseen opportunities.
C)not make decisions again until the next planning session.
D)underestimate costs so that actual operating results will be favourable when comparisons are made.
Answer: B
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Chapter 2: Different Costs for Different Purposes
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324 Verified Questions
324 Flashcards
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Sample Questions
Q1) What term is used to refer to a band of normal activity or volume in which specific cost-volume relationships are maintained?
A)Relevant range
B)Cost-allocation range
C)Cost driver range
D)Average range
Answer: A
Q2) When comparing the operating profits between absorption costing and variable costing,and beginning finished inventory exceeds ending finished inventory,it may be assumed that:
A)variable costing operating profit exceeds absorption costing operating profit
B)variable cost per unit is less than fixed cost per unit
C)there is an unfavourable production-volume variance
D)sales increased during the period
Answer: A
Q3) Budgeting is the most commonly used tool for planning and control.
A)True
B)False
Answer: True
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Chapter 3: Determining How Costs Behave
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182 Verified Questions
182 Flashcards
Source URL: https://quizplus.com/quiz/70844
Sample Questions
Q1) Data collection problems arise when:
A)accrual-basis costs are used rather than cash-basis costs.
B)fixed and variable costs are not separately identified and both are allocated to products on a per unit basis.
C)data are recorded electronically rather than manually.
D)purely inflationary price effects are removed.
Answer: B
Q2) The coefficient of determination (r<sup>2</sup>)measures the percentage of variation in Y explained by X (the independent variable).
A)True
B)False
Answer: True
Q3) When new products are introduced,learning curve effects can have a major influence on production scheduling.
A)True
B)False
Answer: True
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Chapter 4: Costvolumeprofit Analysis
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211 Verified Questions
211 Flashcards
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Sample Questions
Q1) What is the current break-even point in terms of number of units?
A)934 units
B)2400 units
C)1000 units
D)None of these answers are correct.
Q2) The number of units that Mt.Panorama Company must sell to reach targeted operating profit of $180 000 is:
A)3334 units.
B)5667 units.
C)5000 units.
D)4334 units.
Q3) What minimum volume of sales dollars is required to earn an after tax net profit of $30 000?
A)$330 000
B)$165 000
C)$456 000
D)$465 000
Q4) Total revenues less total fixed costs equal the contribution margin.
A)True
B)False
Page 6
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Chapter 5: Estimating the Cost of Producing Services
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100 Verified Questions
100 Flashcards
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Sample Questions
Q1) A cost object is anything for which an estimation of costs is sought.
A)True
B)False
Q2) When designing costing systems,managers and management accountants must compare the benefits derived from allocating costs with the costs incurred in making these allocations.
A)True
B)False
Q3) After identifying the purposes for which costs are to be allocated,managers and management accountants must decide on how to:
A)allocate them.
B)trace them.
C)accumulate them.
D)estimate them.
Q4) Are job costing and process costing mutually exclusive?
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Chapter 6: Estimating the Costs of Products and Inventory
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356 Verified Questions
356 Flashcards
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Sample Questions
Q1) Indirect manufacturing costs should be allocated equally to each job.
A)True
B)False
Q2) Switching production to products that absorb the highest amount of fixed manufacturing costs is also called:
A)cost reduction.
B)throughput costing.
C)producing for sales.
D)cherry picking.
Q3) A company would use multiple cost-allocation bases:
A)because there is more than one way to allocate overhead.
B)because this is a simpler approach than using one cost-allocation base.
C)if managers believe that using multiple cost-allocation bases is the only acceptable method.
D)if managers believed the benefits exceeded the additional costs of that costing system.
Q4) Direct costs are traced the same way for actual costing and normal costing.
A)True
B)False
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Chapter 7: Target Costing, Managing Activities and Managing Capacity
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154 Verified Questions
154 Flashcards
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Sample Questions
Q1) What is the term used for the continuing reduction in the demand for a company's products that occurs when it fails to meet or better competitors' prices?
A)downward demand spiral
B)target cost
C)target price
D)capacity cost
Q2) In ________ budgeting,managers estimate the revenues and business function costs of the value chain attributable to each product from its initial R&D to its final customer service and support.
A)product life-cycle
B)target
C)value
D)capacity
Q3) Locked-in costs have already been incurred.
A)True
B)False
Q4) Target pricing is a form of cost-based pricing.
A)True
B)False
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Chapter 8: Activity-Based Management and Activity-Based Costing
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230 Verified Questions
230 Flashcards
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Sample Questions
Q1) A PRIMARY reason for assigning selling and distribution costs to products for analytical purposes is:
A)that all indirect costs must be assigned.
B)that different processes,products and customers require different quantities of selling and distribution activities.
C)that controllers are required to assign all costs when valuing inventories.
D)to justify a varied product mix.
Q2) How much of the correspondence costs will be assigned to Department B?
A)$100 000
B)$1600
C)$12 500
D)$20 000
Q3) Traditional systems are capable of producing reasonably accurate costs where a single activity accounts for a sizeable proportion of a department's indirect costs.
A)True
B)False
Q4) Production department employee wages are a corporate cost.
A)True
B)False
10
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Chapter 9: Pricing and Customer Profitability
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171 Verified Questions
171 Flashcards
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Sample Questions
Q1) In a competitive market with differentiated products like cameras,what is/are the key factor(s)affecting pricing decisions?
A)customer's willingness to pay
B)cost of producing and delivering the product
C)the price charged for alternative products
D)All of these answers are correct.
Q2) Determining the ________ cost of each activity and product is not straightforward.
A)cost-plus
B)discriminatory
C)variable
D)predatory
Q3) Managers who utilise customer profitability charts should drop customers that generate a negative customer operating profit,since dropping an unprofitable customer will automatically cause overall income to increase.
A)True
B)False
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11
Chapter 10: Decision Making and Relevant Information
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211 Verified Questions
211 Flashcards
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Sample Questions
Q1) Relevant-cost analysis generally emphasises qualitative factors that can be expressed in financial terms.
A)True
B)False
Q2) Northwoods is invited to bid on a one-time-only special order to supply 100 rustic tables.What is the lowest price Northwoods should bid on this special order?
A)$9000
B)$8000
C)$13 500
D)$6300
Q3) What could feedback regarding previous actions affect?
A)The decision model
B)Implementation of the decision
C)Future predictions
D)All of these answers are correct
Q4) Product-mix decisions are typically long-run decisions.
A)True
B)False
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Page 12
Chapter 11: Budgeting, Management Control and Responsibility Accounting
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215 Verified Questions
215 Flashcards
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Sample Questions
Q1) A company's actual performance should be compared against budgeted rather than actual amounts for the same accounting period so that:
A)no feedback is possible.
B)a rolling budget can be implemented.
C)adjustments for expected changes in future conditions can be included in the comparison.
D)inefficiencies of the past year can be included in the comparison.
Q2) A financial budget focuses on how operations and planned capital outlays affect ________.
A)cash.
B)inventory.
C)receivables.
D)payables.
Q3) Activity-based budgeting and kaizen budgeting are really equivalent in meaning. A)True
B)False
Q4) A revenues budget is the usual last step in preparing the operating budget. A)True
B)False
Q5) Describe the concept of kaizen budgeting.
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Chapter 12: Flexible Budgets, Direct Cost Variances and Management Control
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246 Verified Questions
246 Flashcards
Source URL: https://quizplus.com/quiz/70853
Sample Questions
Q1) When benchmarking,management accountants are MOST valuable when they:
A)provide insight into why costs or revenues differ across companies.
B)highlight differences in the benchmarking data to management.
C)provide complex mathematical analysis.
D)present differences in the benchmarking data to management.
Q2) __________ analysis provides suggestions for further investigation,not conclusive evidence of good or bad performance.
A)Sensitivity
B)Performance
C)Variance
D)Budget
Q3) Management by exception is the practice of concentrating on areas not operating as anticipated (such as a cost overrun)and placing less attention on areas operating as anticipated.
A)True
B)False
Q4) The master budget is one type of flexible budget.
A)True
B)False
14
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Chapter 13: Flexible Budgets, Overhead Cost Variances and Management Control
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170 Verified Questions
170 Flashcards
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Sample Questions
Q1) Causes of a favourable variable overhead efficiency variance might include using lower-skilled workers than expected.
A)True
B)False
Q2) What is the fixed overhead spending variance?
A)$4100 unfavourable
B)$5750 favourable
C)$5700 favourable
D)$5750 unfavourable
Q3) The variable overhead flexible-budget variance measures the difference between standard variable overhead costs and flexible-budget variable overhead costs.
A)True
B)False
Q4) Calculate the flexible-budget variance for variable set-up overhead costs.
A)$1200 unfavourable
B)$2600 favourable
C)$2600 unfavourable
D)$1200 favourable
Page 15
Q5) Explain why sales-volume variance could be helpful to managers.
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Chapter 14: Allocation of Support-Department Costs,
Common Costs and Revenues
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137 Verified Questions
137 Flashcards
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Sample Questions
Q1) The direct allocation method highlights recognition of services rendered by support departments to other support departments.
A)True
B)False
Q2) One benefit of the dual-rate method is the low cost to implement it.
A)True
B)False
Q3) Common costs exist because each user obtains a lower cost by sharing than the separate cost that would result if such user were an independent entity.
A)True
B)False
Q4) Explain the two methods of allocating revenues of a bundled package to the individual products in that package.Describe any special problems associated with each method.
Page 16
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Chapter 15: Strategy Formation, Strategic Control and the Balanced Scorecard
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157 Verified Questions
157 Flashcards
Source URL: https://quizplus.com/quiz/70856
Sample Questions
Q1) Downsizing can often mean eliminating jobs,which can have an adverse effect on employee morale.
A)True
B)False
Q2) A product differentiation strategy is probably best for a company if the engineering team is more skilled at making process improvements than at creatively designing new products.
A)True
B)False
Q3) What is an organisation's ability to offer products or services that are perceived by its customers as being superior and unique relative to those of its competitors called?
A)Cost leadership
B)The balanced scorecard
C)Product differentiation
D)Strategy
Q4) Engineered costs have no measurable cause-and-effect relationship between output and resources used.
A)True
B)False
Page 17
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Chapter 16: Quality, Time and the Balanced Scorecard
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120 Verified Questions
120 Flashcards
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Sample Questions
Q1) Observations outside control limits serve as inputs for Pareto diagrams.
A)True
B)False
Q2) The balanced scorecard includes both financial and non-financial measures of customer satisfaction.
A)True
B)False
Q3) Conducting business correctly and quickly helps increase revenues and decrease costs.
A)True
B)False
Q4) Costs of Quality (COQ)are classified into four categories: prevention costs,appraisal costs,inspection costs and warranty costs.
A)True
B)False
Q5) Without financial quality measures,companies could be spending more money on improving non-financial quality measures than it is worth.
A)True
B)False
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Chapter 17: Inventory Management, Just-In-Time and Simplified Costing Methods
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126 Verified Questions
126 Flashcards
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Sample Questions
Q1) The simplest version of the economic order quantity (EOQ)model incorporates only ordering costs,carrying costs and purchasing costs into the calculation.
A)True
B)False
Q2) The CEO of Robotics Limited is concerned because the cost of materials has not been in line with the budget for several periods,even after implementing an EOQ model.The company has the normal direct material variance computations of price and efficiency at the end of each month.The price variance of the direct materials used is usually near expectations.The CEO does not understand how the budget differences are always larger than the material price variances.
Required: What explanation can you give for the evaluation problems presented?
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19
Chapter 18: Capital Budgeting and Cost Analysis
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140 Verified Questions
140 Flashcards
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Sample Questions
Q1) How does accelerated depreciation result in greater savings in cash outflows.
Q2) The 'evaluate each possible course of action and select the best one' stage of the capital budgeting process consists of determining which investment yields the greatest benefit and the least cost to the organisation.
A)True
B)False
Q3) Which of the following results of the net present value method in capital budgeting is the LEAST acceptable?
A)$0
B)$(18 000)
C)$(7000)
D)$(10 000)
Q4) The payback method allows for managers to highlight liquidity.
A)True
B)False
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Chapter 19: Management Control Systems, Transfer Pricing and
Multinational Considerations
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140 Verified Questions
140 Flashcards
Source URL: https://quizplus.com/quiz/70860
Sample Questions
Q1) Market-based transfer prices are ideal in perfectly competitive markets when there is idle capacity in the selling division.
A)True
B)False
Q2) Area(s)which is/are usually appropriate for decentralised decision making is/are:
A)sources of supplies and materials.
B)long-term financing.
C)product advertising.
D)Both A and C are correct.
Q3) Which formula correctly reflects the company's operating profit per kilo?
A)$5.00 - ($1.25 + $2.50)= $1.25
B)$5.00 - ($0.25 + $1.25 + $3.50)= 0
C)$5.00 - ($0.75 + $3.75)= $0.50
D)$5.00 - ($0.75 + $2.50)= $1.75
Q4) If a firm uses a cost-based transfer price,its selling division will never be able to achieve goal congruence.
A)True
B)False
Page 21
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Chapter 20: Performance Measurement, Compensation
and Multinational Considerations
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140 Verified Questions
140 Flashcards
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Sample Questions
Q1) Economic Value Added (EVA)calculations are similar to residual income calculations because in each calculation there is a charge for the division's invested capital which is deducted from a measure of that division's profit.
A)True B)False
Q2) One way to achieve greater comparability of historical cost-based ROIs for a company's foreign division is to restate performance in home country currency.
A)True B)False
Q3) What is the EVA for Broome?
A)$1 530 000
B)$450 000
C)$414 360
D)$1 115 640
Q4) What is the EVA for Townsville?
A)$135 580
B)$234 000
C)$220 000
D)$305 000
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Chapter 21: Measuring and Reporting Sustainability
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50 Verified Questions
50 Flashcards
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Sample Questions
Q1) Sustainability requires 'systems thinking'.Which of these is a part of systems thinking?
A)Accepting uncertainty and ambiguity
B)Challenging our world view
C)Recognising the larger context
D)All of the above.
Q2) All of these statements are correct except:
A)many businesses profess a commitment to sustainable business practices.
B)eco-justice is an important concept of sustainability.
C)there is pressure from society for businesses to address social and environmental concerns.
D)all businesses currently accept that sustainability is their primary goal.
Q3) Performing life-cycle analysis for a product may also mean looking at the costs of suppliers and customers.
A)True
B)False
Q4) The objectives for sustainability are unlikely to be completely met within an organisation.
A)True
B)False
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