Question 1

One purpose of planning activities is to monitor day-to-day operations to ensure that processes are operating as expected.

Accepted Answer

One purpose of controlling activities is to monitor day-to-day operations to ensure that processes are operating as expected,

Question 2

Managerial accounting information is always prepared by the controller or cost accountant.

Accepted Answer

Managerial accounting information can be prepared by various individuals within an organization, including the controller, cost accountant, financial analysts, and other managers.

Question 3

Managerial accounting is designed to assist managers with four general activities: planning,controlling,evaluating,and decision making.

Accepted Answer

Managerial accounting is indeed designed to assist managers with planning, controlling, evaluating, and decision making in order to help them make informed and effective business decisions.

Question 4

Managerial accounting information provides feedback about how well the organization is implementing its strategy and achieving its goals.

Accepted Answer

Managerial accounting information is used by managers to assess the performance of various departments, projects, and products. By analyzing this information, managers can determine whether the organization is meeting its goals and implementing its strategy effectively. Therefore, the statement is true.

Question 5

Decision makers might have a long list of information they would find helpful,and they are generally not willing to sacrifice accuracy for having the information quickly.

Accepted Answer

Decision makers might have a long list of information they would find helpful.But sometimes they might need to sacrifice precision for timeliness,

Question 6

If a company follows a strategy of product differentiation,it will seek ways to set its products apart from competitors' in terms of quality,design or service.

Accepted Answer

Product differentiation is a strategy in which a company seeks to distinguish its products or services from competitors by offering something unique or better, such as quality, design, or service.

Question 7

For the product differentiation strategy,companies will want information on quality,such as defect rates,percentage of on-time deliveries,and customer satisfaction.

Accepted Answer

Product differentiation strategy focuses on providing high quality products and services to differentiate from competitors. Therefore, companies would be interested in information regarding quality measures such as defect rates, on-time deliveries, and customer satisfaction.

Question 8

A company that focuses on product differentiation does not need to monitor product costs because if the quality is sufficient customers will pay the price.

Accepted Answer

Even if a company focuses on product differentiation, it is still important to monitor product costs to ensure profitability and competitiveness in the market. Customers may be willing to pay a higher price for a unique product, but if the costs to produce it are too high, it can negatively impact profits.

Question 9

The primary users of managerial accounting information are managers and decision makers.

Accepted Answer

Managerial accounting information is specifically designed for internal use by the managers and decision makers of an organization to make informed decisions regarding the operations of the business. It is not intended for external users such as shareholders or customers.

Question 10

The task of assessing how well employees have performed relative to expectations is a controlling activity.

Accepted Answer

The task of accessing how well employees have performed relative to expectations is considered an evaluation activity,

Question 11

All other things held equal,the more frequent the controlling activity,the faster an out-of-control process can be corrected.

Accepted Answer

The statement is true. The more frequent the controlling activity, the faster corrective action can be taken, which reduces the impact of an out-of-control process.

Question 12

The American Institute of Certified Public Accountants is the leading organization for management accountants in the

Accepted Answer

The American Institute of Certified Public Accountants is the leading organization for public accountants, not specifically management accountants.

Question 13

Long-term planning is often referred to as strategic planning.

Accepted Answer

Long-term planning is indeed referred to as strategic planning. Strategic planning involves setting long-term goals and developing a plan to achieve those goals over a period of several years.

Question 14

Under a build strategy,a company aims to increase its market share and competitive position relative to others in the industry,maximizing its short-term earnings and positive cash flow.

Accepted Answer

Under a build strategy, a company aims to invest in long-term growth and sustainability, even if it means sacrificing short-term earnings or cash flow. The focus is on innovation, expanding into new markets, and investing in research and development to create a competitive advantage. Therefore, the statement is false.

Question 15

Managerial accounting reports historical information,often with the purpose of comparing actual results to budgeted results.

Accepted Answer

Managerial accounting does indeed report historical information, and one common reason for doing so is to compare actual results to budgeted results. This can help managers identify areas where they may need to adjust their operations to improve performance in the future. However, it's worth noting that managerial accounting can also provide other types of information, such as forecasts, performance metrics, and analysis of various business activities.

Question 16

Managerial accounting differs from financial accounting in that managerial accounting has no comparable set of rules governing what information must be provided to decision makers or how that information is presented.

Accepted Answer

Managerial accounting is focused on providing information to internal decision-makers, such as managers, to support planning, controlling, and decision-making. As a result, there are no specific rules or regulations governing what information must be provided or how it should be presented, unlike financial accounting which has a set of standardized rules and regulations.

Question 17

Management accounting is the generation of relevant information and analysis provided to external users.

Accepted Answer

Management accounting is the generation of relevant information and analysis provided to internal users, such as managers and decision makers within an organization, to assist with organizational planning, controlling and decision-making processes. It is not meant for external users.

Question 18

Managerial accounting provides reports and information for a range of decision makers outside an organization.

Accepted Answer

Managerial accounting provides reports and information for decision makers within an organization, such as managers and executives, rather than outside of it.

Question 19

The four strategies based on a firm's approach to market share growth are build,hold,harvest and divest.

Accepted Answer

This statement is true. The four strategies based on a firm's approach to market share growth are indeed build, hold, harvest, and divest.

Question 20

Preparers of managerial accounting information are generally not active participants in the decision making process.

Accepted Answer

Preparers of managerial accounting information often play an active role in the decision making process by providing insights and recommendations based on their analysis of the data.

Quiz 1: Accounting As a Tool for Management