Multiple choice Questions
1. The ___________ function is primarily responsible for managing the financial resources of the organization.
d. Human resource
2. Advances in accounting information systems and other changes in the past decade have caused managerial accountants to view their roles as including:
a. The interpretation of information
b. Creation of useful information for other managers
c. Facilitators of management decision-making processes
d. Each of the above roles
3. Relevant costs:
a. Will not differ among decision alternatives
b. Include those costs that are avoidable when one alternative is chosen rather than another
c. Have already been incurred and cannot be avoided regardless of a future decision
d. Should either be considered or ignored based on the circumstances
4. Opportunity costs:
a. Are never relevant in a decision-making context
b. May include costs that have already been incurred and will not change as a consequence of future decisions
c. Are often difficult to quantify, but should be considered in a decision-making context
d. Include all past costs regardless of their nature
5. Most decisions involve risk. Which of the following is true with respect to considering risk in a decision-making context?
a. Risks cannot be controlled and should be given only minimal attention when making decisions.
b. Risks are present in most business contexts, but managers generally do not revise plans to counteract those risks.
c. Risks should be evaluated and their impact on decision alternatives carefully weighed before final decisions are made.
d. Each of the above statements is true.
6. Which of the following statements about ethics is true?
a. Business decisions are solely economic and do not require consideration of ethical issues.
b. Ethical issues frequently arise in decision-making contexts.
c. Companies can and should operate without consideration of the ethical implications of their decisions.
d. None of the above statements is true.
7. Which of the following are reasons for the increased need for enterprise risk management?
a. Sensitivity analysis
b. Stakeholder demands
c. Compliance with applicable laws and regulations
d. Both b and c
8. Effective enterprise risk management requires companies to do all of the following except:
a. Consider their risk appetite
b. Focus on individual silos of risk
c. Consider the portfolio of overall business risks
d. Identify and measure risks
9. Which of the following sequences of steps in the decision-making process is correct?
a. Define the problem, identify objectives, identify and analyze available options, consider ethical implications, select the best option
b. Identify objectives, define the problem, identify and analyze available options, consider ethical implications, select the best option
c. Select the best option, consider ethical implications, identify objectives, define the problem, identify and analyze available options
d. Define the problem, identify and analyze available options, consider ethical implications, select the best option