Performance Management Study Guide
Questions
Course Introduction
Performance Management explores the processes and tools organizations use to ensure employees' activities and outputs align with organizational goals. This course covers key concepts such as setting performance expectations, monitoring outcomes, providing feedback, and conducting appraisals. Students will learn strategies for developing effective performance management systems, diagnosing and addressing performance issues, and fostering a high-performance culture. Emphasis is placed on integrating best practices in goal setting, motivation, coaching, and performance reviews, as well as understanding the impact of organizational context and employee engagement on effective management.
Recommended Textbook
Cornerstones of Managerial Accounting 5th Edition by Maryanne M. Mowen
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16 Chapters
2824 Verified Questions
2824 Flashcards
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Page 2
Chapter 1: Introduction to Managerial Accounting
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64 Verified Questions
64 Flashcards
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Sample Questions
Q1) The managerial activity of monitoring a plan's implementation and taking corrective action as needed is referred to as decision making.
A)True
B)False
Answer: False
Q2) The ____________________ is responsible for the finance function.
Answer: treasurer
Q3) Management accounting information is only used by manufacturing organizations.
A)True
B)False
Answer: False
Q4) Managerial accounting information is not important for not-for-profit organizations.
A)True
B)False
Answer: False
Q5) Managerial accounting strongly emphasizes providing information about
Answer: future events
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Chapter 2: Basic Managerial Accounting Concepts
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247 Flashcards
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Sample Questions
Q1) Which of the following is an example of direct labor?
A) vice president of marketing
B) assembly line worker for televisions
C) staff accountant
D) supervisor at a manufacturing plant
Answer: B
Q2) Conversion cost is the sum of
A) product costs and period costs.
B) selling cost and administrative costs.
C) direct labor cost and direct materials costs.
D) direct labor cost and overhead costs.
Answer: D
Q3) Gross margin - selling and administrative expenses
A)Income Statement
B)Cost of goods manufactured
C)Work in process
D)Gross margin
E)Operating income
Answer: E
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Page 4
Chapter 3: Cost Behavior
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237 Flashcards
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Sample Questions
Q1) Fixed costs that cannot be easily changed and typically involve a long-term contract are known as ___________________.
Answer: committed fixed costs.
Q2) __________________ is the general term for describing whether a cost changes when the level of output changes.
Answer: Cost behavior
Q3) depreciation
A)discretionary
B)committed
Answer: B
Q4) Ruskin Company had utilities cost of $95,000 at an output level of 30,000 units. The utilities cost was a mixed cost and the fixed portion was $50,000. What would the estimate of total utilities cost be at an output level of 40,000 units?
A) $65,000
B) $95,000
C) $110,000
D) $125,000
Answer: C
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Chapter 4: Cost-Volume-Profit Analysis: a Managerial Planning Tool
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179 Verified Questions
179 Flashcards
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Sample Questions
Q1) Refer to Figure 4-3. What is the break-even point in units?
A) 2,167
B) 5,833
C) 8,000
D) 12,000
E) 2,800
Q2) The profit-volume graph
A) is difficult to interpret.
B) fails to reveal how costs change as sales volume changes.
C) can be only plotted using the break-even point.
D) can be only plotted using fixed costs.
E) shows the relationship between operating income and variable costs.
Q3) The contribution margin is
A) the difference between sales and variable costs.
B) the difference between target income and operating income.
C) the difference between operating income and margin of safety.
D) equal to sales.
E) when total sales equals total costs.
Q4) A ________________________ visually portrays the relationship between profits and units sold.
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Chapter 5: Job-Order Costing
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196 Flashcards
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Sample Questions
Q1) Which of the following is true about the job-order cost sheet?
A) It is prepared for every job.
B) It is subsidiary to the work-in-process account.
C) It is the primary document for accumulating all costs related to a particular job.
D) It contains all information pertinent to a job.
E) All of these are correct.
Q2) Using normal costing requires that
A) actual overhead costs are not assigned directly to jobs.
B) predetermined rates are not used to assign overhead.
C) applied overhead is not calculated on a job specific basis.
D) Neither plantwide or departmental rates can be used to assign overhead.
E) All of these are correct.
Q3) Refer to Figure 5-4. What is the selling price of Job 806?
A) $682
B) $1,320
C) $1,440
D) $920
E) $1,023
Q4) A _______ is one distinct unit or set of units.
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Chapter 6: Process Costing
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177 Flashcards
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Sample Questions
Q1) Refer to Figure 6-3. Kelley's equivalent units of production using the weighted average method would be
A) 34,250.
B) 32,000.
C) 35,000.
D) 24,740.
Q2) Refer to Figure 6-3. Kelley's total cost per equivalent unit of production would be
A) $12.23.
B) $10.76.
C) $11.26.
D) $8.52.
Q3) Which of the following best describes sequential processing?
A) Units must pass through one process before they can be worked on in the next processes.
B) Several sequences of production are applied to a product in the department.
C) Only one process can be applied to a product in each department.
D) Subcomponents can be worked on simultaneously in different processes and then brought together in a final process for completion.
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8
Chapter 7: Activity-Based Costing and Management
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178 Flashcards
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Sample Questions
Q1) Environmental costs are costs that are incurred because poor environmental quality may or does exist.
A)True
B)False
Q2) Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.
A)True
B)False
Q3) _________________________ is a system-wide, integrated approach that focuses management's attention on activities with the objective of improving customer value and profit achieved by providing this value.
Q4) A defective product is one that does conform to specifications.
A)True
B)False
Q5) Nonvalue-added activities
A) are unnecessary inputs.
B) are valued outputs to internal users.
C) are valued outputs to external users.
D) help meet the organization's needs, not the product needs.
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Chapter 8: Absorption and Variable Costing, and Inventory Management
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124 Flashcards
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Sample Questions
Q1) If the number of units produced in a period is smaller than the number of units sold in period, absorption costing income will be higher than variable costing income.
A)True
B)False
Q2) Rudd Company uses 40,000 micro-chips each year in its production of digital cameras. The cost of placing an order is $75. The cost of holding one unit of inventory for one year is $8. Currently Rudd places 20 orders of 2,000 units per order.
Required:
A. Compute the annual ordering cost.
B. Compute the annual carrying cost.
C. Compute the total cost of Rudd's current inventory policy.
D. Compute the economic order quantity.
E. Compute the order cost and the carrying cost for the EOQ.
F. How much money does using the EOQ policy save the company over the policy of purchasing 2,000 micro-chips per order?
Q3) For internal reporting ________________ is an important managerial tool because it provides vital cost information for decision making and control.
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Page 10
Chapter 9: Profit Planning
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Sample
Questions
Q1) Ressen Company finds that typically 30% of a month's sales are for cash. Payments on accounts receivable are 60% in the month of sale and 38% in the month following sale. Budgeted sales for June are $100,000, for July $140,000, and for August $120,000. What are the total cash receipts budgeted for July?
A) $127,400
B) $85,400
C) $122,000
D) $262,000
E) $140,000
Q2) The direct labor budget includes: units to be produced, direct labor time needed per unit, and total direct labor cost for the period.
A)True
B)False
Q3) sales in units
A)production budget
B)direct materials purchases budget
Q4) _________________ are used to ensure that budgeted costs can be realistically compared with costs for actual levels of activity.
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Chapter 10: Standard Costing: a Managerial Control Tool
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180 Flashcards
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Sample Questions
Q1) The _____________________ measures the difference between the direct materials actually used and the direct materials that should have been used for the actual output.
Q2) Which of the following is true regarding the disposition of materials and labor variances?
A) The variances for materials and labor are closed directly to Cost of Goods Sold regardless of materiality.
B) If the materials price variance is material, it is prorated among Materials Inventory, Materials Usage Variance, Work in Process, and Finished Goods.
C) The materials usage variance and the labor variances, if material, are prorated among Work in Process, Finished Goods, and Cost of Goods Sold.
D) The materials usage variance and the labor variances are always prorated among Work in Process, Finished Goods, and Cost of Goods Sold.
E) The materials usage variance and the labor variances are always closed to Cost of Goods Sold.
Q3) A ______________ is the difference between the sales price needed to capture a predetermined market share and the desired per-unit profit.
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Chapter 11: Flexible Budgets and Overhead Analysis
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172 Flashcards
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Sample Questions
Q1) Static budgets are the best benchmarks for preparing a performance report.
A)True
B)False
Q2) Refer to Figure 11-4. Calculate the fixed overhead spending variance.
A) $32,000 F
B) $0
C) $4,000 U
D) $12,000 U
E) $4,000 F
Q3) Refer to Figure 11-4. Calculate the applied fixed overhead.
A) $973,080
B) $855,030
C) $964,000
D) $910,000
E) None of these.
Q4) Activity-based budgeting supports continuous improvement and process management.
A)True B)False
Q5) A _______________ is a budget created in advance that is based on a particular level of activity.
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Chapter 12: Performance Evaluation and Decentralization
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166 Flashcards
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Sample Questions
Q1) Refer to Figure 12-5. What are the average operating assets for Division B?
A) $125,000
B) $120,000
C) $18,000
D) $420,000
Q2) Refer to Figure 12-4. Assume that Style and LeatherStuff have agreed on a transfer price of $3.25. What is the total benefit for Quinn, Inc.?
A) $22,500
B) $292,500
C) $163,000
D) $169,000
E) $190,800
Q3) _________________ emphasizes only effectiveness of implementation.
Q4) Refer to Figure 12-2. What is the residual income for Stock Division with the additional project?
A) $40,000
B) $6,000
C) $7,900
D) $4,200
E) $25,600
Page 14
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Chapter 13: Short-Run Decision Making: Relevant Costing
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170 Flashcards
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Sample Questions
Q1) Stadium Company charges cost plus 60%. If the price of an item is $260, what is the item's cost?
A) $180
B) $162.50
C) $100
D) $125.50
E) $150.75
Q2) Refer to Figure 13-5. What is the contribution margin per unit of scarce resource (machine time) for Model K-3?
A) $24
B) $12
C) $6
D) $14
E) $28
Q3) ________________ refers to the relative amount of each product manufactured by a company.
Q4) _____________________ are simply those factors that are hard to put a number on, including things like political pressure and product safety.
Q5) Why does a special order decision frequently ignore fixed overhead?
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Chapter 14: Capital Investment Decisions
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172 Flashcards
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Sample Questions
Q1) Which of the following provides an absolute dollar measure?
A) internal rate of return
B) net present value
C) payback period
D) accounting rate of return
E) None of these.
Q2) In order to use the payback period model, the proposed investment must have even cash inflows.
A)True
B)False
Q3) The time required for a firm to recover its original investment is the A) internal rate of return.
B) net present value.
C) life of the project.
D) accounting rate of return.
E) payback period.
Q4) The _________________________ measures the return on a project in terms of income.
Q5) When choosing among competing projects, the ___________________ model correctly identifies the best investment alternative.
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Chapter 15: Statement of Cash Flows
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185 Flashcards
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Sample Questions
Q1) Which of the following financing activities results in a cash outflow?
A) purchase of long-term investments.
B) collecting accounts receivable.
C) payment of dividends.
D) issuance of bonds.
Q2) Paid off long-term debt
A)Operating Activity, Source of Cash
B)Operating Activity, Use of Cash
C)Investing Activity, Source of Cash
D)Investing Activity, Use of Cash
E)Financing Activity, Source of Cash
F)Financing Activity, Use of Cash
G)Non-cash Investing & Financing Activity
Q3) The statement of cash flow classifies the cash flows into three categories. Describe each of these categories.
Q4) All firms that are registered with the ______________________ must issue a statement of cash flows.
Q5) Issuing shares of common stock, paying dividends and paying off debt are all examples of _______________.
Page 17
Q6) Income statements are prepared on a (n) ______________.
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Chapter 16: Financial Statement Analysis
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Sample Questions
Q1) The ___________________ is calculated by dividing the market price per share by earnings per share.
Q2) Refer to Figure 16-7.
Required: Calculate the following ratios:
A. return on sales
B. return on total assets
C. earnings per share
D. price-earnings ratio
Q3) Short-term creditors are usually most interested in assessing A) leverage.
B) liquidity.
C) marketability.
D) profitability.
Q4) Siri Company has $20,000 in cash, $8,000 in marketable securities, $36,000 in current receivables, $18,000 in inventories, and $68,000 in current liabilities. The company's quick ratio is closest to A) .94.
B) .41.
C) 1.88.
D) 1.21.
Page 18
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