1. Management accounting:
A) is both retrospective, providing feedback about past operations, and also prospective, incorporating forecasts and estimates about future events.
B) is primarily oriented to external stakeholders.
C) must be consistent with rules formulated by the Financial Accounting Standards Board (FASB).
D) provides information that is generally available only on a quarterly or annual basis.
2. Management accounting information is BEST described as:
A) providing a signal that something is wrong.
B) identifying and helping to explain what is wrong.
C) simply summarizing information, but giving no indication that anything is wrong.
D) measuring overall organizational performance.
3. Which of the following would be MOST helpful for a top manager of a company?
A) profitability report of the company
B) information to monitor hourly and daily operations
C) number of customer complaints
D) operating expense summary reported by department
4. The Balanced Scorecard is said to be "balanced" because it measures:
A) short-term and long-term objectives.
B) financial and nonfinancial objectives.
C) internal and external objectives.
D) All of the above are correct.
5. The ________ perspective of the Balanced Scorecard asks, "How is success measured by our shareholders?"
A) learning and growth
B) customer
C) financial
D) shareholder
6. Defect rates for products and yield percentages in manufacturing are measures of quality included in the ________ perspective of the Balanced Scorecard.
A) financial
B) production
C) process
D) internal
7. The purpose of the Balanced Scorecard is BEST described as helping an organization:
A) develop customer relations.
B) mobilize employee skills for continuous improvements in processing capabilities, quality, and response times.
C) introduce innovative products and services desired by target customers.
D) translate an organization's mission, vision, and strategy into a set of performance measures that help to implement the strategy.
8. The FIRST step in developing strategic objectives for the Balanced Scorecard is:
A) defining the long-run financial objectives.
B) identifying the target customer.
C) articulating the organization's vision.
D) select objectives for the customer value proposition.
9. Identify the BEST description of the Balanced Scorecard's customer perspective. To achieve our firm's vision and strategy:
A) How do we lower costs?
B) How do we motivate employees?
C) How can we obtain greater profits?
D) How does the company intend to attract, retain, and deepen relationships with targeted customers by differentiating itself from competitors?
10. Fixed costs:
A) may be either direct or indirect costs.
B) vary with production or sales volume.
C) include parts and materials used to manufacture a product.
D) can be adjusted in the short run to meet actual demands.
11. Which of the following describes a variable cost?
A) Variable cost are always indirect costs.
B) Variable costs increase in total when the actual level of activity increases.
C) Variable costs include most personnel costs and depreciation on machinery.
D) Variable costs can always be traced directly to the cost object.
12. Cost-volume-profit analysis is used PRIMARILY by management:
A) as a planning tool.
B) for control purposes.
C) to establish a target net income for next year.
D) to attain extremely accurate financial results.
13. The break-even point is the level at which revenues:
A) equal fixed costs.
B) equal variable costs.
C) equal fixed costs minus flexible costs.
D) equal variable costs plus fixed costs.
14. Cost-volume-profit analysis assumes all of the following EXCEPT:
A) all costs are purely variable or fixed.
B) units manufactured equal units sold.
C) total variable costs remain the same over the relevant range.
D) total fixed costs remain the same over the relevant range.