Horngren's Accounting,11e (Miller-Nobles)
Chapter 18 Introduction to Manageria Accounting F
Learning Objective 18-1
1) Manageria accounting focuses on providing information for internal planning and control.
F F F F F F F F F F F
Answer: TRUE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
2) Financial accounting prepares reports for internal purposes, whereas managerial accounting provides
F F F F F F F F F F F
information to external stakeholders.
F F F
Answer: FALSE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
3) Financial statements prepared for investors and creditors often include forward-looking information
F F F F F F F F F F F
because they make decisions based on a company's future prospects.
F F F F F F F F F
Answer: FALSE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
4) Managerial accounting reporting by a public firm is required to follow the rules of GAAP and
F F F F F F F F F F F F F F F F
guidelines of the Securities and Exchange Commission.
F F F F F F
Answer: FALSE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
5) A budget is a managerial accounting tool used in the planning process.
F F F F F F F F F F F F
Answer: TRUE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
,6) Financial reporting is typically much more detailed than managerial accounting.
F F F F F F F F F F
Answer: FALSE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
7) Which of the following is an objective of managerial accounting?
F F F F F F F F F
A) to generate a company's financial statements for tax reporting
F F F F F F F F
B) to provide information to business managers to assist them in controlling their business
F F F F F F F F F F F F
C) to provide information to shareholders to assist them with their investment decisions
F F F F F F F F F F F
D) to ensure that the reports produced for internal and external business purposes are GAAP compliant
F F F F F F F F F F F F F F F
Answer: B F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
8) Which of the following statements is true of managerial accounting?
F F F F F F F F F
A) The external stakeholders of a company are the primary users of managerial accounting.
F F F F F F F F F F F F
B) Managerial accounting information is used to help managers plan and control their operations.
F F F F F F F F F F F F
C) An external audit by an independent CPA is required for managerial accounting information.
F F F F F F F F F F F F
D) Managerial accounting information must comply with Generally Accepted Accounting Principles.
F F F F F F F F F F
Answer: B F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
9) Managerial accounting information for a company is primarily used by
F F F F F F F F F F .
A) its customers to understand the pricing of the product
F F F F F F F F
B) its creditors to understand the credibility of the business
F F F F F F F F
C) its employees to plan and control operations
F F F F F F
D) its investors to make their investment decisions
F F F F F F F
Answer: C F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
,10) Which of the following statements is true of financial accounting?
F F F F F F F F F
A) It provides information to investors needed for their investment decisions.
F F F F F F F F F
B) It provides forward-looking information needed for managing and delegating operations.
F F F F F F F F F
C) It focuses on detailed reports for parts of the company rather than the whole company.
F F F F F F F F F F F F F F
D) It focuses on planning and controlling day-to-day operations.
F F F F F F F F
Answer: A F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
11) Managerial accounting includes the planning function. Which of the following items would be part of
F F F F F F F F F F F F F F F
the planning function of a business's managerial accounting?
F F F F F F F
A) comparing actual performance to previously budgeted amounts
F F F F F F
B) creating detailed budgets F F
C) implementing operational plans F F
D) evaluating results of operations F F F F
Answer: B F
Diff: 1 F
LO: 18-1
F
AACSB: Analytical thinking
F F F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
12) Comparing actual performance to previously budgeted amounts is part of the
F F F F F F F F F F F .
A) controlling function of managerial accounting F F F F
B) planning function of managerial accounting
F F F F
C) reporting function of managerial accounting
F F F F
D) organizing function of managerial accounting F F F F F
Answer: A F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
13) Which of the following is the primary objective of managerial accounting?
F F F F F F F F F F
A) providing information that managers need to make operational decisions
F F F F F F F F
B) providing historical data to investors and creditors
F F F F F F
C) providing summarized results of operations F F F F
D) providing information to comply with laws and regulations of government bodies
F F F F F F F F F F F
Answer: A F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
14) Which of the following is the primary focus of financial accounting?
F F F F F F F F F F
A) providing information that managers need to make operational decisions
F F F F F F F F
, B) providing summarized information on operational results to investors and creditors
F F F F F F F F F
C) providing budgets for future periods F F F F
D) providing highly detailed information on product lines, regions, and divisions
F F F F F F F F F F
Answer: B F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
15) For each of the following, indicate whether the statement relates to managerial accounting (MA) or
F F F F F F F F F F F F F F F
financial accounting (FA): F F
Applies to F
Statement MA or FA
F F
How reports will affect employee behavior is a
F F F F F F F
concern.
Summary reports are prepared primarily on the F F F F F F F
company as a whole, usually on a quarterly or annual
F F F F F F F F F
basis.
Relevant information and focus on the future.
F F F F F F
Primary users include investors, creditors, and
F F F F F
government authorities. F
There is no requirement to follow GAAP.
F F F F F F
Answer:
Applies to F
Statement MA or FA
F F
How reports will affect employee behavior is a
F F F F F F F
concern. MA
Summary reports are prepared primarily on the F F F F F F F
company as a whole, usually on a quarterly or annual
F F F F F F F F F
basis. FA
Relevant information and focus on the future.
F F F F F F MA
Primary users include investors, creditors, and
F F F F F
government authorities. F FA
There is no requirement to follow GAAP.
F F F F F F MA
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
Chapter 18 Introduction to Manageria Accounting F
Learning Objective 18-1
1) Manageria accounting focuses on providing information for internal planning and control.
F F F F F F F F F F F
Answer: TRUE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
2) Financial accounting prepares reports for internal purposes, whereas managerial accounting provides
F F F F F F F F F F F
information to external stakeholders.
F F F
Answer: FALSE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
3) Financial statements prepared for investors and creditors often include forward-looking information
F F F F F F F F F F F
because they make decisions based on a company's future prospects.
F F F F F F F F F
Answer: FALSE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
4) Managerial accounting reporting by a public firm is required to follow the rules of GAAP and
F F F F F F F F F F F F F F F F
guidelines of the Securities and Exchange Commission.
F F F F F F
Answer: FALSE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
5) A budget is a managerial accounting tool used in the planning process.
F F F F F F F F F F F F
Answer: TRUE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
,6) Financial reporting is typically much more detailed than managerial accounting.
F F F F F F F F F F
Answer: FALSE F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
7) Which of the following is an objective of managerial accounting?
F F F F F F F F F
A) to generate a company's financial statements for tax reporting
F F F F F F F F
B) to provide information to business managers to assist them in controlling their business
F F F F F F F F F F F F
C) to provide information to shareholders to assist them with their investment decisions
F F F F F F F F F F F
D) to ensure that the reports produced for internal and external business purposes are GAAP compliant
F F F F F F F F F F F F F F F
Answer: B F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
8) Which of the following statements is true of managerial accounting?
F F F F F F F F F
A) The external stakeholders of a company are the primary users of managerial accounting.
F F F F F F F F F F F F
B) Managerial accounting information is used to help managers plan and control their operations.
F F F F F F F F F F F F
C) An external audit by an independent CPA is required for managerial accounting information.
F F F F F F F F F F F F
D) Managerial accounting information must comply with Generally Accepted Accounting Principles.
F F F F F F F F F F
Answer: B F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
9) Managerial accounting information for a company is primarily used by
F F F F F F F F F F .
A) its customers to understand the pricing of the product
F F F F F F F F
B) its creditors to understand the credibility of the business
F F F F F F F F
C) its employees to plan and control operations
F F F F F F
D) its investors to make their investment decisions
F F F F F F F
Answer: C F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
,10) Which of the following statements is true of financial accounting?
F F F F F F F F F
A) It provides information to investors needed for their investment decisions.
F F F F F F F F F
B) It provides forward-looking information needed for managing and delegating operations.
F F F F F F F F F
C) It focuses on detailed reports for parts of the company rather than the whole company.
F F F F F F F F F F F F F F
D) It focuses on planning and controlling day-to-day operations.
F F F F F F F F
Answer: A F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
11) Managerial accounting includes the planning function. Which of the following items would be part of
F F F F F F F F F F F F F F F
the planning function of a business's managerial accounting?
F F F F F F F
A) comparing actual performance to previously budgeted amounts
F F F F F F
B) creating detailed budgets F F
C) implementing operational plans F F
D) evaluating results of operations F F F F
Answer: B F
Diff: 1 F
LO: 18-1
F
AACSB: Analytical thinking
F F F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
12) Comparing actual performance to previously budgeted amounts is part of the
F F F F F F F F F F F .
A) controlling function of managerial accounting F F F F
B) planning function of managerial accounting
F F F F
C) reporting function of managerial accounting
F F F F
D) organizing function of managerial accounting F F F F F
Answer: A F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
13) Which of the following is the primary objective of managerial accounting?
F F F F F F F F F F
A) providing information that managers need to make operational decisions
F F F F F F F F
B) providing historical data to investors and creditors
F F F F F F
C) providing summarized results of operations F F F F
D) providing information to comply with laws and regulations of government bodies
F F F F F F F F F F F
Answer: A F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
14) Which of the following is the primary focus of financial accounting?
F F F F F F F F F F
A) providing information that managers need to make operational decisions
F F F F F F F F
, B) providing summarized information on operational results to investors and creditors
F F F F F F F F F
C) providing budgets for future periods F F F F
D) providing highly detailed information on product lines, regions, and divisions
F F F F F F F F F F
Answer: B F
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
15) For each of the following, indicate whether the statement relates to managerial accounting (MA) or
F F F F F F F F F F F F F F F
financial accounting (FA): F F
Applies to F
Statement MA or FA
F F
How reports will affect employee behavior is a
F F F F F F F
concern.
Summary reports are prepared primarily on the F F F F F F F
company as a whole, usually on a quarterly or annual
F F F F F F F F F
basis.
Relevant information and focus on the future.
F F F F F F
Primary users include investors, creditors, and
F F F F F
government authorities. F
There is no requirement to follow GAAP.
F F F F F F
Answer:
Applies to F
Statement MA or FA
F F
How reports will affect employee behavior is a
F F F F F F F
concern. MA
Summary reports are prepared primarily on the F F F F F F F
company as a whole, usually on a quarterly or annual
F F F F F F F F F
basis. FA
Relevant information and focus on the future.
F F F F F F MA
Primary users include investors, creditors, and
F F F F F
government authorities. F FA
There is no requirement to follow GAAP.
F F F F F F MA
Diff: 1 F
LO: 18-1
F
AICPA Functional: Reporting
F F F
PE Question Type: Concept
F F F
H2 : Financial Versus Managerial Accounting
F F F F F
