Questions and Answers of Managerial Accounting 12th

Which primary management responsibility includes the process of creating budgets?a. Controllingb. Directingc. Planningd. Calculating
Which primary management responsibility includes the process of comparing the budget to actual results?a. Directingb. Planningc. Calculatingd. Controlling
The focus of management accounting is usuallya. Tax returns.b. Internal reporting.c. External reporting.d. Auditing.
Part One: In 2021, Fran Lexa opened Fran’s Flowers, a small shop selling floral arrangements. On December 31, 2022, her accounting records show the following:RequirementPrepare an income
What type of information would be used for managerial accounting?a. Sales forecastsb. Financial accounting informationc. Nonfinancial informationd. All of the listed choices
The duties of a chief financial officer (CFO) would includea. Managing the preparation of financial statements.b. Supervising the preparation of all corporate tax returns.c. Providing reports to
Which of the following positions is primarily responsible for raising capital and investing funds?a. The controllerb. The CEOc. The treasurerd. The CFO
“Maintain an appropriate level of professional leadership and expertise by enhancing knowledge and skills” is an example of which IMA ethical standard?a. Competenceb. Confidentialityc.
Olson Frame manufactures picture frames. Suppose the company’s July records include the items described below. What is Olson Frame’s total manufacturing overhead cost in July? Oil for
What is the Institute of Management Accountants (IMA)? What is the Association of International Certified Professional Accountants (AICPA)? How could being a member of a professional organization
To help meet profit goals in the current year, the Fretter Corporation manager ships out pre-ordered merchandise the last week of December, even though the customer explicitly stated that the order
According to the Sarbanes- Oxley Act, who is responsible for the corporation’s financial statements?a. The auditorsb. The company’s CEO and CFOc. Internal Revenue Service (IRS)d. Securities and
Unity Gas wants to move its sales order system online. Under the proposed system, gas stations and other merchants will use a secure site to check the availability and current price of various
The triple bottom line focuses on what three factors?a. People, planet, profitb. People, place, profitc. Place, planet, profitd. Profit, people, plants
Which of the following is a benefit of using data analytics in an organization?a. Businesses can make quicker decisions.b. The efficiency of internal operations is increased.c. Data analytics add
Describe the benefits an organization could realize from using data analytics to guide its decision-making process.
Which of the following types of companies would rarely, if ever, have inventory?a. Serviceb. Merchandisingc. Manufacturingd. All of the above
The cost that Lowe’s incurs to deliver building supplies to a customer would be an example of what type of activity in the value chain?a. Marketingb. Customer Servicec. Distributiond. Administration
A cost that is related to a cost object, but cannot be traced specifically to it, is known as a(n)a. Controllable cost.b. Product cost.c. Direct cost.d. Indirect cost.
Which one of the following costs would be considered a direct cost of serving a particular customer at a McDonald’s restaurant?a. The salary of the restaurant managerb. The depreciation on the
Which of the following costs would be classified as manufacturing overhead?a. Electricity used in the sales and marketing building.b. Depreciation on the fleet of distribution trucks.c. Lease
Which of the following types of companies will not have “cost of goods sold” on its income statement?a. Service.b. Merchandising.c. Manufacturing.d. Both merchandising and manufacturing.
Which type of companies will always have operating expenses on its income statement?a. Service.b. Service and merchandising.c. Merchandising and manufacturing.d. Service, merchandising, and
Which of the following statements is true?a. Sunk costs are irrelevant to decisions.b. Managers have the ability to influence uncontrollable costs in the short run.c. Differential costs are not
The number of customers who purchased Product XA-343 during June would be ___ data.a. Discreteb. Continuousc. Categoricald. Ordinal
Part One: In 2021, Patsy Jackson opened Patsy’s Posies, a small retail shop selling floral arrangements. On December 31, 2022, her accounting records show the following:RequirementPrepare an income
Suppose the smartphone manufacturer Skylar Technologies provides the following information for its costs last month (in millions):Requirements1. Classify each of these costs according to its place in
This case is a continuation of the Burburr Resorts & Hotels Corporation serial case that began in Chapter 1. The components of the Burburr serial case can be completed in any order.What follows
Which of the following statements is false about Excel?a. In Excel, a table is the same concept as a data array.b. Sorting means putting the data in a specific order.c. Filtering means only the data
Jazmyn Grandstone is a new staff accountant at James & Associates. She is paid a salary of $67,600 per year and is expected to work 2,600 hours per year on client jobs. The firm’s indirect cost
Which of the following companies would be most likely to use a job costing system rather than a process costing system?a. Beverage bottlerb. Cereal manufacturerc. Legal firmd. Steel manufacturer
Would the following companies use job costing or process costing?a. A legal firmb. An oil refineryc. A commercial plumbing contractord. A cereal manufacturere. A custom-home builder
What form is used to accumulate the costs of a job in a job costing system?a. Bill of materialb. Labor time recordc. Job cost recordd. Requisition form
How can a company’s management use product cost information?a. To identify ways to cut production costs.b. To set prices of its products.c. To decide which products to emphasize.d. All of the
Which of the following tasks would be least likely to be performed by a bot?a. Notifying the purchasing department when raw materials need to be purchasedb. Billing the customer once the completed
A pivot table would be an appropriate tool for each of the following actions excepta. Summarizing transaction data by store location.b. Locating one specific sales transaction.c. Calculating the
Cost distortion is likely to cause:a. Over-costing of all products.b. Undercosting of all products.c. Over-costing some products and under-costing other products.d. Accurate costing of all products.
Insurance on a company’s buildings would most likely be classified as a _______ cost.a. Unit-levelb. Batch-levelc. Product-leveld. Facility-level
The legal costs associated with filing a patent for a new model of scooter at a toy manufacturer is an example of which type of activity?a. Unit-levelb. Batch-levelc. Product-leveld. Facility-level
The information provided by an activity-based costing system can help with what type of decisions by an automobile manufacturer?a. Pricingb. Evaluating manager performancec. Cost cuttingd. All of the
Handy Products Company manufactures a product that goes through three processing departments. Information relating to activity in the first department during October is given below:The department
Cretin Enterprises uses a predetermined overhead rate of $8 per direct labour-hour. This predetermined rate was based on 40,000 estimated direct labour-hours and $320,000 of estimated total
Carera Corporation uses a predetermined overhead rate of $18 per direct labour-hour. This predetermined rate was based on 15,000 estimated direct labour-hours and $270,000 of estimated total
Oil Field Equipment Company is a small company that manufactures specialty heavy equipment for use in Alberta oil-fields. The company uses a job-order costing system and applies manufacturing
Ainsley Industries uses the weighted-average method in its process costing system. Data for the Assembly Department for May appear below:Required:Compute the cost per equivalent unit for materials,
Tasty Bakery uses a process costing system for its single product- a popular rye bread. Tasty has two processing departments-Mixing and Baking. The T-accounts below show the flow of costs through the
United Claim Processors provides claims processing services for major insurance companies. The Winnipeg location processes all health benefit claims for various insurance benefit providers. Claims
Ida Sidha Karya Company is a family-owned company located in the village of Gianyar on the island of Bali in Indonesia. The company produces a handcrafted Balinese musical instrument called a gamelan
What is the second-stage allocation in ABC?
Klein Company produces three types of bird feeders: Basic, Squirrel-Proof, and Deluxe. Currently, the company allocates overhead to products using machine-hours. This year, the company produced 1,000
Jamesway Corporation makes two types of replacement fittings for heavy construction equipment screws and bolts. Data regarding the two products follow:Additional information about the company
What is benchmarking?
Various activities at Reservations Online, a hotel reservation call centre, are listed below:Required:1. Classify each activity as unit-level, batch-level, product-level, customer- level, or
Colby Company makes cases for cell phones of all sizes and types for sale through specialty retailers. The company makes a standard model for the most recent iPhone as well as a deluxe model.
What are unit-level, batch-level, product-level, customer-level, and organization-sustaining activities?
What is an activity cost pool?
The following activities occur at Greenwich Corporation, a company that manufactures a variety of products:a. Manage the parts inventories.b. Issue purchase orders for a job.c. Human Resources
Alderberry Recording Inc. is a small audio recording studio. The company handles work for advertising agencies-primarily for radio ads-and has a few singers and bands as clients. Alderberry Recording
Foster Appliance Repair has developed a reputation over many years of providing high-quality, reliable repair services at a fair price. The company has grown from a two-person operation (run by
Logan Products computes its predetermined overhead rate annually on the basis of machine-hours. At the beginning of the year, it estimated that its total manufacturing overhead would be $250,000 and
Refer to the data in Exercise 3-2 for the Cool-It Company.Required:1. Using the high- low method, estimate the fixed shipping expenses per month and the variable cost of shipping each unit.2. Express
Serenity Living manufactures gas fireplaces for home use. Each unit produced goes through a complex quality control process. The company has observed quality control costs as follows over the past 16
Cycle Accessories manufacturers cellphone holders that can be mounted on the handle bars of most motorcycles. The manufacturing process is highly automated and management feels that machine-hours are
Cool-It Company is a wholesaler of custom-built air conditioning units for commercial buildings. The data below show the number of units shipped and the total shipping expenses for the past eight
Further to the information provided in Review Problem 2, assume that all of the fixed costs pertain to the two full-time staff members who process each patient being admitted to the hospital. Each
Dozier Company produced and sold 1,000 units during its first month of operations. It reported the following costs and expenses for the month:Required1. With respect to cost classifications for
Identify some examples of variable costs for a restaurant.
You have just started a new part-time job at Learning Solutions, a company that develops online training platforms for corporate cl ients and provides content support on a subscription basis.
Robyn Blake has invented a new type of fly swatter. After thinking it through carefully, she has decided to quit her $5,000 per month job with a start-up tech company to produce and sell the fly
You are looking at options for a new mobile plan. Instead of selling the iPhone 8 that your parents gave you for your birthday last year, you decide to keep it to reduce the cost of a new plan by
Assume your mobile plan provides you with 5 GB of data for $50 per month and charges you $5 for every 200 MB of data you use in excess of that. What type of cost is this?
Below are listed various costs that may be found in a variety of organizations.1. Small glass plates used for lab tests in a hospital.2. Straight-line depreciation of a building.3. Senior management
The following details are from the accounting records of Gulf Shore Limited for the year ended April 30:Required1. Prepare a schedule of cost of goods manufactured for the year ended April 30.2.
Providing extrinsic rewards such as bonuses for achieving or exceeding expected levels of performance can be a powerful motivator. Not surprisingly, the use of extrinsic rewards is pervasive in
Identify a control a company could use to reduce the risk that environmental protection laws related to pollution are violated.
Why is timeliness of information so important for managerial accounting?
It is now common for companies to regularly report their corporate social respons ibility performance. Such CSR reports include information on environmental performance (e.g., emissions, water
What is the role of managerial accounting in strategic management?
What is a performance report and how might it be useful to managers?
For what purposes might predictive analytics be used by managers?
What is the difference between directing activities and controlling activities?
What is the difference between intrinsic motivation and extrinsic incentives?
John Ran ton, president and founder of Running Mate, could hardly contain his excitement over the operating results for his company's second year of operations. Running Mate is an online retailer of
What are the three basic categories of manufacturing costs?
Precision Electronics manufactures wearable devices that incorporate Global Positioning System technology. Their devices are used by runners, cyclists, golfers, hikers, etc. The following are some
What are administrative costs? How are they treated on the income statement?
If a company automates its production processes, would you expect that to increase or decrease prime costs? Why?
Which two classes of inventory does a manufacturing company have that a merchandising or service company does not?
RTW Company manufactures acoustic and electric guitars. Selected costs from the most recent year of operations follow below.1. The guitars use metal for the frets and tuning knobs that costs $10 per
The Ramon Company is a manufacturer that is interested in developing a cost formula to estimate the fixed and variable components of its monthly manufacturing overhead costs. The company wishes to
What is the activity base? What would be a likely activity base for the cost of sales commissions paid to sales staff?
What is a non-linear variable cost?
Tom Davis runs a guiding company, Chief Adventures, based in Squamish, British Columbia, that takes customers on guided tours 12 months a year. During peak season, Davis employs up to 30 guides, all
Anand Limited manufactures drones for industrial use. Most of their costs are either true variable costs or fixed costs. However, an account analysis shows the following items are mixed costs.In 2019
What is the difference between a true variable and a step-variable cost?
Describe a non-linear variable cost and give an example.
Given the facts in part 3-8, estimate the total contribution margin for August if seven air conditioners are produced and sold.Phillips Company manufactures air-conditioning units for commercial
Given the facts in part 3-8, if total fixed costs (excluding shipping) are $3,000 per month, estimate operating income for August if seven air conditioners are produced and sold.Phillips Company
Sarnia Ltd. is a manufacturing company that produces a single product. The company keeps meticulous records of manufacturing activities from which the following information has been extracted:The
Estimate variable shipping expenses to ship 12 air conditioners if the shipping company reduces the variable cost per unit by 10% for each unit shipped in excess of 10 units.Phillips Company

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