Test Bank Horngren's Financial & Managerial Accounting, The Financial Chapters, 7th Edition by Tracie Miller-Nobles, Brenda Mattison Chapter 1-15. with Appendix

TEST BANK ||




Financial and Managerial Accounting:
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Managerial Chapters, 7th Edition
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(Miller-Nobles) Chapter 1-11
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,Chapter ||M:1 Introduction ||to ||Managerial ||Accounting

Learning ||Objective ||M:1-1

1) Managerial ||accounting ||focuses ||on ||providing ||information ||for ||internal ||planning
||and ||control. || ||Answer: | | TRUE
Diff: ||1
LO: || | | M:1-1
AACSB: | | Application ||of
||knowledge | | AICPA ||Functional:

| | Reporting

PE ||Question ||Type: || || Concept
H2: || ||Why ||Is ||Managerial ||Accounting ||Important? ||(H1)

2) Financial ||accounting ||prepares ||reports ||for ||internal ||purposes, ||whereas ||managerial
||accounting ||provides | | information ||to ||external ||stakeholders.
Answer: || ||FALSE
Explanation: ||The ||reverse ||is ||true. ||Financial ||accounting ||serves ||external ||stakeholder
||information ||needswhile | | managerial ||accounting ||serves ||the ||needs ||of ||managers ||and

||internal ||staff.

Diff: ||1
LO: || | | M:1-1
AACSB: | | Application ||of
||knowledge | | AICPA ||Functional:

| | Reporting

PE ||Question ||Type: || || Concept
H2: || ||Why ||Is ||Managerial ||Accounting ||Important? ||(H1)

3) Financial ||statements ||prepared ||for ||investors ||and ||creditors ||often ||include ||forward-looking
||information | | because ||they ||make ||decisions ||based ||on ||a ||company's ||future ||prospects.
Answer: || ||FALSE
Explanation: ||Financial ||statements ||provide ||mostly ||historical ||information; ||relevant
||and ||faithfully | | representative ||information ||and ||focused ||on ||the ||past.

Diff: ||1
LO: || | | M:1-1
AACSB: | | Application ||of
||knowledge | | AICPA ||Functional:

| | Reporting

PE ||Question ||Type: || || Concept
H2: || ||Why ||Is ||Managerial ||Accounting ||Important? ||(H1)

4) Managerial ||accounting ||reporting ||by ||a ||public ||firm ||is ||required ||to ||follow ||the
||rules ||of ||GAAP. || ||Answer: | | FALSE
Explanation: ||Managerial ||accounting ||information ||is ||not ||guided ||by ||GAAP ||but ||rather ||by
||the ||concept ||of | | usefulness ||to ||management ||for ||decision ||making ||purposes.

Diff: ||1
LO: || | | M:1-1
AACSB: | | Application ||of
||knowledge | | AICPA ||Functional:

| | Reporting

PE ||Question ||Type: || || Concept

,H2: || ||Why ||Is ||Managerial ||Accounting ||Important? ||(H1)



5) Financial ||reporting ||is ||typically ||much ||more ||detailed ||than ||managerial
||accounting. || ||Answer: | | FALSE
Explanation: | | Financial | | reporting | | is | | typically | | less | | detailed | | than | | managerial
| | accounting | | information. | | Financial || accounting || reporting || is || usually || summary

|| reports, || prepared || primarily || on || the || company || as || a | | whole, ||usually ||on ||a ||quarterly

||or ||annual ||basis.

Diff: ||1
LO: || | | M:1-1
AACSB: | | Application ||of
||knowledge | | AICPA ||Functional:

| | Reporting

PE ||Question ||Type: || || Concept
H2: || ||Why ||Is ||Managerial ||Accounting ||Important? ||(H1)

6) Managerial ||accounting ||provides ||financial ||statements ||that ||report ||results ||of
||operations, ||financial | | position, ||and ||cash ||flows ||both ||to ||managers ||and ||to ||external
||stockholders.
Answer: || ||FALSE
Explanation: ||Managerial ||accounting ||provides ||the ||information ||needed ||to ||plan ||and ||control
||operations ||and | | therefore ||serves ||the ||information ||needs ||of ||internal ||parties ||such ||as

||managers ||and ||staff.

Diff: ||1
LO: || | | M:1-1
AACSB: | | Application ||of
||knowledge | | AICPA ||Functional:

| | Reporting

PE ||Question ||Type: || || Concept
H2: || ||Why ||Is ||Managerial ||Accounting ||Important? ||(H1)

7) Which ||of ||the ||following ||is ||a ||focus ||of ||managerial ||accounting?
A) to ||generate ||a ||company's ||financial ||statements ||for ||tax ||reporting
B) to ||provide ||information ||to ||business ||managers ||to ||assist ||them ||in ||controlling ||their ||businesses
C) to ||provide ||information ||to ||shareholders ||to ||assist ||them ||with ||their ||investment ||decisions
D) to ||ensure ||that ||the ||reports ||produced ||for ||internal ||and ||external ||business ||purposes ||are
||GAAP ||compliant || ||Answer: | | B
Diff: ||1
LO: || | | M:1-1
AACSB: | | Application ||of
||knowledge | | AICPA ||Functional:

| | Reporting

PE ||Question ||Type: || || Concept
H2: || ||Why ||Is ||Managerial ||Accounting ||Important? ||(H1)

8) Which ||of ||the ||following ||statements ||is ||true ||of ||managerial ||accounting?
A) The ||external ||stakeholders ||of ||a ||company ||are ||the ||primary ||users ||of ||managerial ||accounting.
B) Managerial ||accounting ||information ||is ||used ||to ||help ||managers ||plan, ||direct ||and ||control ||their
operations.
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C) An ||external ||audit ||by ||an ||independent ||CPA ||is ||required ||for ||managerial ||accounting
||information.

, D) Managerial ||accounting ||information ||must ||comply ||with ||Generally ||Accepted ||Accounting
||Principles. || ||Answer: | | B
Diff: ||1
LO: || | | M:1-1
AACSB: | | Application ||of
||knowledge | | AICPA ||Functional:

| | Reporting