TEST BANK FOR Managerial Accounting 4th Edition by Charles E. Davis, Elizabeth Davis ISBN: 978-1119577669 COMPLETE GUIDE ALL CHAPTERS COVERED 100% VERIFIED A+ GRADE ASSURED!!!!NEW LATEST UPDATE!!!GUARANTEED PASS!!!!

1-1 Test Bank for Davis & Davis, Managerial Accounting, 4
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Table Of Contentsma ma




1. Accounting as a Tool for Management
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2.Cost Behavior and Cost Estimation
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3. Cost-Volume-Profit Analysis and Pricing Decisions
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4. Product Costs and Job Order Costing
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5. Planning and Forecasting
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5A: Planning and Forecasting in a Retail Setting* (online only)
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6. Performance Evaluation: Variance Analysis
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7. Activity-Based Costing and Activity-Based Management
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8. Using Accounting Information to Make Managerial Decisions
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9. Capital Budgeting
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10. Decentralization and Performance Evaluation
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11. Performance Evaluation Revisited: A Balanced Approach
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12. Financial Statement Analysis
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13. Statement of Cash Flows
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Chapter 1 ma




Accounting as a Tool for Management ma ma ma ma ma




CHAPTER LEARNING OBJECTIVES ma ma




1. Define managerial accounting (Unit 1.1) ma ma ma ma




There are several formal definitions of managerial accounting. A simple one is “
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thegeneration of relevant information to support management’s decision-
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making activities.” ma




2. Describe the differences between managerial and financial accountin
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g(Unit 1.1)
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Managerial accounting’s primary users are managers and decision makers within an o
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rganization, whereas financial accounting is aimed primarily at external users. Unlike
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GAAP that guides financial accounting, there are no mandated rules in managerial ac
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counting. Managerial accounting reports focus on operating segments, while financial
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accounting statements report results for the organization as a whole. Managerial acc
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ounting is concerned more with projecting future results than reporting past results.
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Managerial information is prepared to take advantage of a window of opportunity, e
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venif some accuracy must be sacrificed. Financial accounting information is balanced
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to the penny and is delivered after the end of the accounting period.
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3. List and describe the four functions of managers (Unit 1.1)
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Planning means setting a direction for the organization. Long-
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term, or strategic planningprovides direction for a five- to ten-year period. Short-
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term or operational planning provides more detailed guidance for the coming year; it
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translates the company’s strategy into action steps. Controlling is the monitoring of d
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ay-to-
day operations to identify any problems that require corrective action. Evaluating is t
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he process of comparing a particular period’s actual results to planned results, for th
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e purpose of assessing managerial performance. Decision making means choosing bet
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ween alternative courses of action.
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4. Explain how the selection of a particular business strategy determines t
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heinformation that managers need to run an organization effectively (U
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nit 1.2) ma




To run a business effectively, managers need information that shows how well op
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erations are meeting the organization’s strategic goals. For instance, if the organiz
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ation’s strategy is to be a low- ma ma ma ma ma ma



cost producer, information about product costsand cost variances will be more us
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eful to managers than information about researchand development.
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5. Discuss the importance of ethical behavior in managerial accounting (Uni
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Ethical behavior means knowing right from wrong and then doing the right thing. M
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anycompanies and most professional organizations have codes of conduct to guide e
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mployees’ actions. Acting unethically can lead to illegal activity and ultimately to the
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destruction of the firm. Furthermore, research has shown that a public commitmen
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t toethical behavior can lead to superior financial performance.
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