Test Bank For Cornerstones Of Cost Management, 3rd Edition

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CHAPTER 1:INTRODUCTION TO COST MANAGEMENT© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.1.Anaccountinginformationsystemcollects,records,summarizes,analyzes,andmanagesdatatotransforminputsintoinformationthatisprovidedtousers.a.Trueb.FalseANSWER:True2.Thetwomajorsubsystemsoftheaccountinginformationsystemarethefinancialaccountinginformationsystemandthecostmanagementaccountinginformationsystem.a.Trueb.FalseANSWER:True3.Thecostmanagementinformationsystemisprimarilyconcernedwithproducingoutputsforexternalusers.a.Trueb.FalseANSWER:False4.Thethreebroadobjectivesoffinancialaccountinginformationsystemsaretoprovideinformationforcostingoutservicesandproducts,planningandcontrol,anddecisionmaking.a.Trueb.FalseANSWER:False5.Preparingreportsfordivisionmanagersisanactivityassociatedwiththecostmanagementinformationsystem.a.Trueb.FalseANSWER:True6.Thecostmanagementinformationsystemhastwomajorsubsystems:thecostaccountinginformationsystemandtheoperationalcontrolinformationsystem.a.Trueb.FalseANSWER:True

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.7.Changesinthewaybusinessisconductedworldwidehavebroadenedthefocusofcostmanagementaccountingsystems.a.Trueb.FalseANSWER:True8.Oneofthemajoradvancesininformationtechnologythataffectsfirmsistheemergenceofelectroniccommerce.a.Trueb.FalseANSWER:True9.TheservicesectoroftheU.S.economyhasdecreasedinimportanceastraditionalindustrieshavedeclinedinimportance.a.Trueb.FalseANSWER:False10.Enterpriseresourceplanning(ERP)softwarehastheobjectiveofprovidinganintegratedsystemcapabilityandisabletorunalltheoperationsofacompany.a.Trueb.FalseANSWER:True11.Injust-in-time(JIT)manufacturing,eachoperationproducesonlywhatisnecessaryforthesucceedingoperations.a.Trueb.FalseANSWER:True12.JITisacriticalpartofamorecomprehensiveapproachreferredtoasLeanManufacturing.a.Trueb.FalseANSWER:True13.ThefocusofLeanManufacturingistoeliminatewaste,whichisanythingthatdoesnotaddvaluetotheenduser(customer).a.Trueb.FalseANSWER:True

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.14.Theroleofcostandmanagementaccountantsisoneofsupportandteamworkandassistanceofthosewhoareresponsibleforachievingacompany’sbasicobjectives.a.Trueb.FalseANSWER:True15.Positionsthathavedirectresponsibilityforbasicobjectivesarereferredtoasstaffpositions,andthoseindirectlyresponsiblearecalledlinepositions.a.Trueb.FalseANSWER:False16.TheControllerofacompanysupervisesalltheaccountingdepartmentsandisoftenviewedasamemberofthetopmanagementteam.a.Trueb.FalseANSWER:True17.TheTreasurerofacompanyisresponsibleforalltaxationactivities,includingdealingwiththeIRS.a.Trueb.FalseANSWER:False18.Evaluatingtheperformanceofasegmentofthecompanyisanexampleofplanning.a.Trueb.FalseANSWER:False19.Theprocessofchoosingamongcompetingalternativesiscalleddecisionmaking.a.Trueb.FalseANSWER:True20.Businessethicsislearningwhatisrightorwrongintheworkenvironmentandchoosingwhatisright.a.Trueb.FalseANSWER:True

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.21.EmployeeandcustomerloyaltyareNOTaresultofstrongcodesofethics.a.Trueb.FalseANSWER:False22.FirmssubjecttotheSarbanes-OxleyActof2002donothavetodisclosewhethertheyhaveacodeofethicsforseniorfinancialofficers,norwhy.a.Trueb.FalseANSWER:False23.TheInstituteofManagementaccountantshasestablishedethicalstandardsformanagementaccountants.a.Trueb.FalseANSWER:True24.Inresolvinganethicalconflict,itwouldbeappropriatetotakethemattertothepresswherethere’snolegalrequirement.a.Trueb.FalseANSWER:False25.DivulgingcompanyinformationwhennotlegallyobligatedtodosoviolatestheconfidentialitypartoftheIMACodeofConduct.a.Trueb.FalseANSWER:True26.ThreeofthemajorcertificationsavailabletomanagementaccountantsareCertificatesinManagementAccounting,PublicAccounting,andInternalAuditing.a.Trueb.FalseANSWER:True27.Foreachcertification,allanapplicanthastodoismeetspecificeducationalandexperiencerequirements.a.Trueb.FalseANSWER:False

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.28.TheexaminationforobtainingtheCertificateinManagementAccountingconsistsoftwoparts:(1)FinancialPlanning,PerformanceandControl,and(2)FinancialDecisionMaking.a.Trueb.FalseANSWER:True29.TheCertificateofPublicAccountingdoesnotincludetherighttoserveasexternalauditors.a.Trueb.FalseANSWER:False30.TheCertifiedInternalAuditormustpassacomprehensiveexaminationdesignedtoensuretechnicalcompetenceandhavetwoyears’workexperience.a.Trueb.FalseANSWER:True31.Theinformationsystemisprimarilyconcernedwithproducingoutputsforinternalusersusinginputsandprocessesneededtosatisfymanagementobjectives.ANSWER:costmanagement32.Thecostmanagementsubsystemdesignedtoassigncoststoindividualproductsandservicesiscalledtheinformationsystem.ANSWER:costaccounting33.isthepersistentpursuitandeliminationofwastewhichresultsinthedecreaseofleadtime.ANSWER:LeanManufacturing34.Theisamethodusedtocontinuouslyimprovemanufacturingandnonmanufacturingactivities.ANSWER:theoryofconstraints35.Theroleofaccountantsistoassistandsupportthoseresponsibleforcarryingoutanorganization’sbasicobjectives.ANSWER:costandmanagement

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.36.Positionsin acompanythathavedirectresponsibilityforitsbasicobjectivesarecalled_______________positions,andthepositionsindirectlyresponsibleforthecompany’sobjectivesarecalled___________________________positions.ANSWER:line;staff37.Thestandardsofethicalconductformanagementaccountantsincludecompetence,confidentiality,integrity,resolutionofethicalconflict,and.ANSWER:credibility38.Companieswith astrongcanbenefitfromstrongcustomerandemployeeloyalty.ANSWER:CodeofEthics39.TheIMA’sprogramtorecognizeprofessionalcompetenceinthefieldofmanagementaccountingyieldsadesignationasaAccountant.ANSWER:CertifiedManagement40.OnlyCertifiedPublicAccountantsarepermittedbylawtoserveas.ANSWER:externalauditors41.Inanaccountinginformationsystem,theinputsareusuallya.financialstatements.b.analyzingdata.c.performancereports.d.economicevents.ANSWER:d42.Inanaccountinginformationsystem,whichofthefollowingisNOTatransformationalprocess?a.collectingdatab.analyzingdatac.performancereportingd.summarizingdataANSWER:c43.WhichofthefollowingisNOTaprocessassociatedwithanaccountinginformationsystem?a.auditingexistingdatab.collectingandrecordingdatac.providinginformationtousersd.analyzingandmanagingdataANSWER:a

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.44.isdevotedtoprovidinginformationforexternalusers.a.Managementaccountingb.Financialaccountingc.Internalaccountingd.CostaccountingANSWER:b45.Financialaccountinginformationisusedfora.investmentdecisions.b.regulatorymeasures.c.stewardshipevaluation.d.alloftheabove.ANSWER:d46.WhichofthefollowingdoesNOTdescribecostmanagementsystem?a.evaluationofsegmentsorproductswithinthefirmb.emphasisonthefuturec.externallyfocusedd.focusoneffectiveuseofresourcesANSWER:c47.WhichofthefollowingisNOTpartofthefinancialaccountinginformationsystem?a.filingreportswiththeSECb.reportingalargecontingentliabilitytocurrentandpotentialshareholdersc.determiningthefuturecashflowsofaproposedflexiblemanufacturingsystemd.preparingGAAPfinancialstatementsANSWER:c48.Costmanagementreportsareprepareda.tomeettheneedsofdecisionmakerswithinthefirm.b.wheneverstockholdersrequestthem.c.accordingtoguidelinespreparedbytheSecuritiesandExchangeCommission.d.accordingtofinancialaccountingstandards.ANSWER:a

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.49.WhichofthefollowingisNOTprovidedbycostaccountants?a.costinformationinaccordancewithGAAPb.costinformationaboutprocessesandactivitiesc.financialinformationforexternalusersd.costinformationaboutproducts,customers,andservicesANSWER:c50.Theprimaryobjectiveofthecostmanagementinformationsystemistoprovidea.stockholdersandpotentialinvestorswithusefulinformationfordecisionmaking.b.banksandothercreditorswithinformationusefulinmakingcreditdecisions.c.managementwithinformationusefulforplanningandcontrolofoperations.d.theInternalRevenueServicewithinformationabouttaxableincome.ANSWER:c51.Thecostmanagementinformationsystemisconcernedwitha.reportingfinancialinformationaccordingtoGAAP.b.providingcostinformationthatisusedinplanning,control,anddecision-making.c.reportingtoexternalusers.d.providingfinancialinformationtoinvestors.ANSWER:b52.Costaccountinga.isconcernedwithassigningcoststovariouscostobjects.b.attemptstosatisfythecostingobjectivesofbothfinancialaccountingandmanagementaccounting.c.providescostinformationthatsupportsplanning,controlling,anddecisionmaking.d.allofthese.ANSWER:d53.Costmanagementisthebranchofaccountingconcernedwithreportingtoa.internalmanagers.b.stockholders.c.thegovernment.d.bankers.ANSWER:a

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.54.Thetypeofmanagementwhichbroadensthefocusofaccountingbecauseitisconcernedwithfactorsthatdrivecosts,suchascycletimeandprocessproductivityiscalled:.a.Costaccountingb.Costmanagementc.Financialmanagementd.FinancialaccountingANSWER:b55.WhichofthefollowingactivitiesisNOTassociatedwiththecostmanagementinformationsystem?a.preparingacostofqualityreportb.preparingaperformancereportthatcomparesactualcoststobudgetedcostsc.determiningthecostofacustomerd.usingfutureexpectedearningstoestimatethepriceofashareofcommonstockANSWER:d56.Whichofthefollowingcostingactivitiesisassociatedwiththefinancialaccountingsystem?a.determiningthecostofadepartmentb.determiningthecostofgoodssoldforfinancialstatementsc.preparingbudgetsd.determiningthecostofacustomerANSWER:b57.Whichofthefollowingactivitiesisassociatedwiththecostmanagementinformationsystem?a.preparingreportsfordivisionmanagersb.preparingreportsfortheIRSc.preparingreportsfortheSECd.preparingfinancialstatementsthatconformtoGAAPANSWER:a58.Theoperationalcontrolsystemisconcernedwitha.investmentdecisions.b.whatactivitiesshouldbeperformedandassessinghowwelltheyareperformed.c.consumptionofproductiveresourcesbyindividualproducts.d.noneofthese.ANSWER:b

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.59.WhichofthefollowingactivitiesisNOTassociatedwiththefinancialaccountinginformationsystem?a.reportingonthecostofqualityb.reportingtotheSECc.preparingreportsfortheIRSd.preparingastatementofcashflowsANSWER:a60.Whichofthefollowingisacostmanagementsubsystemdesignedtoassigncoststoindividualproductsandservicesandotherobjects,asspecifiedbymanagementa.financialaccountinginformationsystemb.operationalcontrolsystemc.costaccountinginformationsystemd.alloftheaboveANSWER:c61.WhichofthefollowingstatementsisTRUE?a.TheservicesectorcomprisesapproximatelythreequartersoftheUnitedStates'economyandemployment.b.Theservicesectorcomprisesapproximately20percentoftheUnitedStates'economyandemployment.c.Traditionalsmokestackindustrieshaveincreasedinimportanceinrecentyears.d.Theservicesectorhasdecreasedinimportanceinrecentyears.ANSWER:a62.Anyformofcommercethatisexecutedusinginformationandcommunicationstechnologyiscalled:a.ERPb.OLAPc.electroniccommerced.DSSANSWER:c63.Factorsthathaveledtoaglobalmarketformanufacturingandservicefirmsarea.improvedtransportationandcommunicationssystems.b.improvedtelemarketingandcommunications.c.improvedtelemarketingandtransportationsystems.d.Noneofthesefactorshavecontributed.ANSWER:a

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.64.Whichofthefollowingcostmanagementtoolssupportsthefirm'sconcentrationonthedeliveryofvaluetothecustomer?a.serviceindustrygrowthb.globalcompetitionc.preparinganearningsreportfortheSECd.value-chainanalysisANSWER:d65.Acomputerizedinformationsystemthatstrivestoinputdataonceandmakeitavailabletopeopleacrossthecompanyfordifferentpurposesiscalleda(n):a.costmanagementinformationsystemb.enterpriseresourceplanningsystemc.internalaccountingsystemd.financialaccountingsystemANSWER:b66.WhichofthefollowingisNOTanadvanceininformationtechnologythataffectsfirms?a.computerintegratedapplicationsb.GAAPreportingc.emergenceofelectroniccommerced.availabilityoftoolssuchasOLAPandDSSANSWER:b67.Softwarethathasintegratedsystemcapabilityusingrealtimedataisa.enterpriseresourceplanningsoftware.b.on-lineanalyticprograms.c.computer-assistedengineeringsoftware.d.noneofthese.ANSWER:a68.Theincreasedimportanceofcostingactivitiesinthevaluechainanddeterminingthecostofdifferentsuppliersandcustomershasledtotheemergenceofa.OLAP.b.EDIandsupplychainmanagement.c.CAM.d.theoryofconstraints.ANSWER:b

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.69.WhichofthefollowingactivitiesisNOTsignificanttotheadvancementofinformationtechnology?a.enterpriseresourceplanningsoftwareb.emergenceofelectroniccommercec.theoryofconstraintsd.decisionsupportsystemsANSWER:c70.Manufacturingenvironmentautomationisassociatedwithincreasesina.inventory.b.productivecapacity.c.processingtime.d.noneofthese.ANSWER:b71.Whichofthefollowingapproacheshaveledtoadvancementsinthemanufacturingenvironment?a.theoryofconstraintsb.computer-integratedmanufacturingc.JITmanufacturingd.alloftheseANSWER:d72.InJITmanufacturing,eachoperationproducesa.onlywhatisnecessaryforthesucceedingoperations.b.allthatitcantooffsetfixedcosts.c.afixedpercentageinexcessoforderstoensureadequatequalitystock.d.allthatitcaninordertobuildinventories.ANSWER:a73.JITisacriticalpartofamorecomprehensiveapproachreferredtoas:a.supplychainmanagementb.leanmanufacturingc.just-in-timemanufacturingd.computer-integratedmanufacturingANSWER:b

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.74.WhichofthefollowingareresultsofLeanManufacturing?a.eliminationofwasteb.decreasedleadtimec.costsdecreased.alloftheaboveANSWER:d75.Whichofthefollowingemergingtrendsincostaccountingdealswithmanagersstrivingtocreateanenvironmentthatwillenableworkerstomanufactureperfect(zero-defect)products?a.advancesininformationtechnologyb.timeasacompetitiveelementc.globalcompetitiond.totalqualitymanagementANSWER:d76.Competitiveadvantageisestablishedbyprovidinga.morecustomerproductsthancompetitors.b.betterqualitythancompetitors.c.greatercustomervalueforlesscostthancompetitors.d.greaterefficienciesthancompetitors.ANSWER:c77.WhichofthefollowingactivitiesisNOTassociatedwithnewproductdevelopment?a.life-cyclecostingb.targetcostingc.activity-basedmanagementd.performancereportsANSWER:d78.Totalqualitymanagementemphasizesa.zerodefects.b.continualimprovement.c.eliminationofwaste.d.allofthese.ANSWER:d

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.79.Costmanagementinformationsystemsfurthercompetitiveadvantagebysupportingthreefundamentalorganizationalgoals.WhichofthefollowingisNOToneofthesefundamentalorganizationalgoalsthatfurthercompetitiveadvantage?a.improvedtime-basedperformanceb.improvedqualityofproductsandservicesc.maximizingshareholdervalued.improvedefficiencyANSWER:c80.WhichofthefollowingstatementsisNOTtrueaboutworld-classfirms?a.World-classfirmsarefirmsthatarepoorincustomersupport.b.World-classfirmsknowtheirmarketandtheirproducts.c.World-classfirmsstrivecontinuallytoimproveproductdesign,manufacture,anddelivery.d.World-classfirmscancompetewiththebestofthebestinaglobalenvironment.ANSWER:a81.ImprovementintimeperformanceismostlikelyNOTenhancedbya.redesignofproducts.b.addingprocessesinproduction.c.eliminatingwaste.d.eliminatingnon-value-addedactivities.ANSWER:b82.Acriticalmeasureofefficiencyisa.thecostofactivity.b.aT-test.c.customersatisfaction.d.employeejobsatisfaction.ANSWER:a83.Today'scostmanagersmustassemblecostinformationanddeterminehowtovaluethings.WhichmethodswouldNOTbecriticaltoachievingthis?a.foreigncurrencytranslationb.costingandqualityanalysisc.differentiatingbetweenvalue-addedandnon-value-addedactivitiesd.measuringproductivityANSWER:a

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Chapter 1:Introduction to Cost Management© 2015 Cengage Learning. All Rights Reserved. May not be scanned, copied orduplicated, or posted to a publicly accessible website, in whole or in part.84.Apersoninastaffpositiona.isdirectlyinvolvedinproduction.b.providessupportforthelinefunction.c.isnotactuallyanemployeeofthecompany.d.allofthese.ANSWER:b85.Theinternalauditorperformsaa.linefunction.b.stafffunction.c.productionfunction.d.marketingfunction.ANSWER:b86.Whichofthefollowingisastaffposition?a.vicepresidentofproductionb.vicepresidentoffinancec.vicepresidentofmarketingd.plantforemanANSWER:b87.Whichofthefollowingpositionswouldmostlikelybealinemanager?a.personneldepartmentmanagerb.productionsupervisorc.treasurerd.purchasingdepartmentmanagerANSWER:b88.Whichofthefollowingjobpositionsisalinefunction?a.financialvicepresidentb.controllerc.productionsupervisord.treasurerANSWER:c

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