Chapter 14

Question 1

Primary users of reports FA

Answer 1

External users: stockholders,

creditors, and regulators.

Question 2

Primary Uses of reports MA

Answer 2

Internal users: officers and

managers.

Question 3

Types and Frequency

of Reports FA

Answer 3

Financial statements.

Quarterly and annually.

Question 4

Types and Frequency

of Reports MA

Answer 4

internal reports.

As frequently as needed

Question 5

Purpose of Reports FA

Answer 5

General-purpose.

Question 6

Purpose of Reports MA

Answer 6

Special-purpose for

specific decisions.

Question 7

Content of Report FA

Answer 7

Pertains to business as a whole.
Highly aggregated (condensed).
Limited to double-entry accounting
and cost data. Generally accepted
accounting principles

Question 8

Content of Report MA

Answer 8

Pertains to subunits of the
business. Very detailed.
Extends beyond double-entry
accounting to any relevant
data. Evaluated based on
relevance to decisions

Question 9

Verification Process FA

Answer 9

Audited by CPA.

Question 10

Verification Process MA

Answer 10

No independent audits.

Question 11

t/f Managerial accountants have a single role within
an organization: collecting and reporting costs to
management

Answer 11

false

Question 12

t/f Financial accounting reports are general-purpose

and intended for external users.

Answer 12

True

Question 13

t/f Managerial accounting reports are special-

purpose and issued as frequently as needed

Answer 13

true

Question 14

t/f Managers’ activities and responsibilities can be
classified into three broad functions: cost
accounting, budgeting, and internal control.

Answer 14

false

Question 15

Managerial accounting reports must now
comply with generally accepted accounting
principles (GAAP)

Answer 15

False

Question 16

Material Cost

Answer 16

Direct Materials

Question 17

Labor costs

Answer 17

Direct Labor

Question 18

Depreciation on factory equipment

Answer 18

manufacturing overhead

Question 19

Property taxes on factory of building

Answer 19

Manufacturing overhead

Question 20

advertising cost

Answer 20

period costs

Question 21

Sales commission

Answer 21

PERIOD COSTS

Question 22

Maintenance salaries

Answer 22

Manufacturing overhead

Question 23

Salary of plat manager

Answer 23

manufacturing overhead

Question 24

Cost of shipping boards

Answer 24

period costs

Question 25

Product cost def

Answer 25

manufacturing costs

Question 26

Period Cost Def

Answer 26

Non manufacturing costs

Question 27

Merchandiser COGS equation

Answer 27

BI+COGP-EI

Question 28

Manufacturer COGS equation

Answer 28

Beginning (Finished goods Inventory) + COG manufactured -Ending finished goods inventory`

Question 29

Total Costs of Work in Process Equation

Answer 29

Beginning Work in Process Inventory + Total Manufacturing costs

Question 30

Cost of goods manufactured equations

Answer 30

Total Cost of Work in Process - Ending Work in Process Inventory

Question 31

Work in Process Inventory

Answer 31

Shows the cost applicable to units that have been started into production but are only partially completed

Question 32

Finished Goods inventory

Answer 32

shows the cost of completed goods on hand

Question 33

Total Quality Management

Answer 33

Reduce defects in finished products, with goal of zero defects

Question 34

Activity-Based Costing

Answer 34

Allocates overhead based on use of activities | Results in more accurate product costing and scrutiny of all activities in value chain

Question 35

Balanced Scorecard

Answer 35

Evaluates operations in an integrated fashion uses both financial and non-financial measures Links performance to overall company objectives

Question 36

Sarbanes-Oxley Act (SOX)

Answer 36

Clarifies managements responsiblities requires certifications by CEO and CFO Selection criteria for Board of Directors and Audit Committee. Substantially increased penalties for misconduct