Question 1

Which of the following functions of management involves providing motivation to achieve results?

Accepted Answer

A)  Planning
B)  Organizing
C)  Directing/leading
D)  ControlE) All of the above
F) B) and C) C

Question 2

A cost that has already been incurred is called a(n) _______________ cost.

Accepted Answer

A)  indirect
B)  sunk
C)  relevant
D)  opportunityE) B) and C)
F) A) and D) B

Question 3

Which of the following functions of management involves setting short and long-term objectives and the tactics to achieve them?

Accepted Answer

A)  Planning
B)  Organizing
C)  Directing/leading
D)  ControlE) None of the above
F) C) and D)

Question 4

An irrelevant cost

Accepted Answer

A)  is also called a differential cost.
B)  must differ between decision alternatives.
C)  must be incurred in the future rather than in the past.
D)  will not influence a decision.E) B) and C)
F) A) and B)

Question 5

A cost that will occur in the future and differs between various alternatives under consideration is a relevant cost.For a cost to be relevant,it must occur in the future and differ between the various alternatives the manager is considering.

Accepted Answer

A) True 
 B)False

Question 6

A fixed cost

Accepted Answer

A)  goes up in total when activity increases.
B)  goes up per unit when activity increases.
C)  goes down in total when activity increases.
D)  goes down per unit when activity increases.E) B) and C)
F) A) and C)

Question 7

Which of the following types of organizations sells goods to the general public?

Accepted Answer

A)  Service companies
B)  Manufacturing firms
C)  Merchandising companies
D)  RetailersE) None of the above
F) All of the above

Question 8

Which of the following is not true about how the Sarbanes-Oxley Act emphasizes the importance of the character of managers and employees?

Accepted Answer

A)  It requires that ethics be embedded in the organizational culture.
B)  It requires that audit committees establish anonymous tip lines.
C)  It provides protection for whistle-blowers.
D)  It requires that public companies adopt a code of ethics for senior financial officers.E) C) and D)
F) None of the above

Question 9

Which of the following is an example of a variable cost for a manufacturing firm?

Accepted Answer

A)  The cost of rent on the factory.
B)  The cost of factory supervision.
C)  The cost of raw materials.
D)  The cost of depreciation on equipment.E) B) and C)
F) A) and B) C

Question 10

Robin Company has the following balances for the current month: What is Robin's total manufacturing cost?

Accepted Answer

A)  $115,200
B)  $81,600
C)  $33,600
D)  $60,800E) B) and D)
F) A) and B)

Question 11

Nonmanufacturing costs are generally classified into what two groups?

Accepted Answer

A)  Conversion costs and prime costs.
B)  Direct materials and direct labor.
C)  Marketing costs and administrative costs.
D)  Direct labor and manufacturing overheaD.Nonmanufacturing costs are generally classified into two groups: marketing or selling costs,and administrative costs.E) B) and C)
F) C) and D)

Question 12

To earn summer money,Joe could mow lawns in his neighborhood,or he could work at a local grocery store.Which of the following is an out-of-pocket cost of mowing lawns?

Accepted Answer

A)  The use of his father's truck to get to job sites.
B)  The wages he could have earned working at the grocery store.
C)  The time spent mowing the lawns.
D)  Cash paid for gas to run the lawnmower.E) A) and D)
F) All of the above

Question 13

The Sarbanes-Oxley Act of 2002 focuses on three factors that affect the accounting reporting environment: ethics,fraud,and managers.The Sarbanes-Oxley Act of 2002 focuses on three factors that affect the accounting reporting environment: opportunity,incentives,and character.

Accepted Answer

A) True 
 B)False

Question 14

Variable costs are always direct costs.Variable costs change,in total,in direct proportion to changes in activity levels.They are not always direct costs,which can be traced to a specific cost object.

Accepted Answer

A) True 
 B)False

Question 15

The planning function is the arranging of the necessary resources to carry out the plan.Planning involves setting long-term goals and objectives,along with the short-term tactics necessary to achieve them.

Accepted Answer

A) True 
 B)False

Question 16

Whether a cost is treated as direct or indirect depends on whether tracing the cost is either possible or feasible.Direct costs can be traced directly to a specific cost object,while indirect costs cannot be traced to a specific cost object or are not worth the effort of tracing.

Accepted Answer

A) True 
 B)False

Question 17

You are to receive five gold coins from your great uncle as an incentive to study hard.The coins were originally purchased in 1982.Your great uncle will deliver the coins the week after finals (assuming your grades are "acceptable") .The amount your great uncle paid for the coins is a(n)

Accepted Answer

A)  opportunity cost.
B)  indirect cost.
C)  sunk cost.
D)  overhead cost.E) All of the above
F) A) and B)

Question 18

Which of the following types of organizations purchases raw materials from suppliers and uses them to create a finished product?

Accepted Answer

A)  Manufacturing firms
B)  Merchandising companies
C)  Service companies
D)  RetailersE) All of the above
F) B) and D)

Question 19

Prime costs are defined as

Accepted Answer

A)  Manufacturing costs plus non-manufacturing costs.
B)  Direct labor plus direct materials.
C)  Variable costs equal fixed costs.
D)  Manufacturing overhead plus direct labor.E) A) and D)
F) C) and D)

Question 20

Robin Company has the following balances for the current month: What are Robin's prime costs?

Accepted Answer

A)  $60,800
B)  $56,000
C)  $75,200
D)  $65,600E) None of the above
F) All of the above

Exam 1: Introduction to Managerial Accounting

Which of the following functions of management involves providing motivation to achieve results?

Correct AnswerverifiedC

A cost that has already been incurred is called a(n) _______________ cost.

Correct AnswerverifiedB

Which of the following functions of management involves setting short and long-term objectives and the tactics to achieve them?

Correct AnswerverifiedShow Answer

An irrelevant cost

Correct AnswerverifiedShow Answer

A cost that will occur in the future and differs between various alternatives under consideration is a relevant cost.For a cost to be relevant,it must occur in the future and differ between the various alternatives the manager is considering.

Correct AnswerverifiedShow Answer

A fixed cost

Correct AnswerverifiedShow Answer

Which of the following types of organizations sells goods to the general public?

Correct AnswerverifiedShow Answer

Which of the following is not true about how the Sarbanes-Oxley Act emphasizes the importance of the character of managers and employees?

Correct AnswerverifiedShow Answer

Which of the following is an example of a variable cost for a manufacturing firm?

Correct AnswerverifiedC

Robin Company has the following balances for the current month: What is Robin's total manufacturing cost?

Correct AnswerverifiedShow Answer

Nonmanufacturing costs are generally classified into what two groups?

Correct AnswerverifiedShow Answer

To earn summer money,Joe could mow lawns in his neighborhood,or he could work at a local grocery store.Which of the following is an out-of-pocket cost of mowing lawns?

Correct AnswerverifiedShow Answer

The Sarbanes-Oxley Act of 2002 focuses on three factors that affect the accounting reporting environment: ethics,fraud,and managers.The Sarbanes-Oxley Act of 2002 focuses on three factors that affect the accounting reporting environment: opportunity,incentives,and character.

Correct AnswerverifiedShow Answer

Variable costs are always direct costs.Variable costs change,in total,in direct proportion to changes in activity levels.They are not always direct costs,which can be traced to a specific cost object.

Correct AnswerverifiedShow Answer

The planning function is the arranging of the necessary resources to carry out the plan.Planning involves setting long-term goals and objectives,along with the short-term tactics necessary to achieve them.

Correct AnswerverifiedShow Answer

Whether a cost is treated as direct or indirect depends on whether tracing the cost is either possible or feasible.Direct costs can be traced directly to a specific cost object,while indirect costs cannot be traced to a specific cost object or are not worth the effort of tracing.

Correct AnswerverifiedShow Answer

You are to receive five gold coins from your great uncle as an incentive to study hard.The coins were originally purchased in 1982.Your great uncle will deliver the coins the week after finals (assuming your grades are "acceptable") .The amount your great uncle paid for the coins is a(n)

Correct AnswerverifiedShow Answer

Which of the following types of organizations purchases raw materials from suppliers and uses them to create a finished product?

Correct AnswerverifiedShow Answer

Prime costs are defined as

Correct AnswerverifiedShow Answer

Robin Company has the following balances for the current month: What are Robin's prime costs?

Correct AnswerverifiedShow Answer

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