MA 1 difficile chiuso
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Questions and Answers

What distinguishes managerial accounting from financial accounting?

  • The type of data collected
  • The audience it addresses (correct)
  • The use of accounting principles
  • The level of detail in the information provided

    • Which type of costs are easily traced to a unit of product or cost object?

  • Direct costs (correct)
  • Common costs
  • Manufacturing costs
  • Indirect costs

    • What is the primary audience for managerial accounting information?

  • Government regulatory bodies
  • The management of the organization (correct)
  • External investors
  • Financial analysts

    • What do non-manufacturing costs include?

    <p>Selling costs and administrative costs</p> Signup and view all the answers

    How does the level of detail in managerial accounting information compare to that in financial accounting?

    <p>It is less detailed and more aggregated</p> Signup and view all the answers

    What do product costs include?

    <p>Direct materials, direct labor, and manufacturing overhead</p> Signup and view all the answers

    What is a key difference in the organization of information between managerial accounting and financial accounting?

    <p>Managerial accounting has free formats with no specific accounting principles</p> Signup and view all the answers

    When do product costs attach to a unit of product?

    <p>As it's purchased or manufactured and remain attached to each unit in inventory until sold</p> Signup and view all the answers

    Which type of accounting addresses the needs of external stakeholders such as investors and creditors?

    <p>Financial accounting</p> Signup and view all the answers

    What are manufacturing costs comprised of?

    <p>Direct materials, direct labor, and manufacturing overhead</p> Signup and view all the answers

    What is the primary focus of the information provided by managerial accounting?

    <p>Internal decision-making</p> Signup and view all the answers

    What happens to direct materials costs in manufacturing companies when used in production?

    <p>Transferred from raw materials to work in process</p> Signup and view all the answers

    What are period costs?

    <p>All selling and administrative costs assigned to the period when the cost is incurred</p> Signup and view all the answers

    Which costs have two options to show up in the income statement and balance sheet?

    <p>Product costs</p> Signup and view all the answers

    What are committed fixed costs?

    <p>Long-term costs that cannot be significantly reduced in the short term</p> Signup and view all the answers

    What are relevant costs and irrelevant costs based on?

    <p>The decision-making setting</p> Signup and view all the answers

    What are sunk costs and how should they be treated in decision-making?

    <p>Costs that have already been incurred and should be ignored</p> Signup and view all the answers

    For what purposes is the traditional format for income statements used?

    <p>External reporting purposes</p> Signup and view all the answers

    What does the contribution margin represent?

    <p>The amount remaining from sales revenue after variable expenses have been deducted</p> Signup and view all the answers

    What does the degree of operating leverage (DOL) measure?

    <p>The percentage change in profit associated with a change in volume or sales</p> Signup and view all the answers

    What does the cost-volume-profit analysis help determine?

    <p>The quantity of break-even or the sales of break-even</p> Signup and view all the answers

    What does the contribution income statement help managers assess?

    <p>The impact on profits of changes in selling price, cost, or volume</p> Signup and view all the answers

    What does the degree of operating leverage (DOL) measure?

    <p>The percentage change in profit associated with a change in volume or sales</p> Signup and view all the answers

    What is the formula for determining break-even quantity based on?

    <p>A simple equation</p> Signup and view all the answers

    What is a requirement to become a Certified Management Accountant (CMA)?

    <p>A bachelor's degree, two years of relevant professional experience, and passage of the CMA exam</p> Signup and view all the answers

    What distinguishes managerial accounting from financial accounting in terms of reporting?

    <p>Managerial accounting focuses on segment reports, while financial accounting has a primary focus on companywide reports</p> Signup and view all the answers

    What is a requirement for obtaining the Chartered Global Management Accountant (CGMA) designation?

    <p>A bachelor's degree in accounting, membership in the AICPA, and three years of relevant management accounting work experience</p> Signup and view all the answers

    What does the CMA exam content specifications cover?

    <p>Performance and control, as well as financial decision-making</p> Signup and view all the answers

    What do employers expect accounting majors to have?

    <p>Strong financial accounting skills and the planning, controlling, and decision-making skills foundational to managerial accounting</p> Signup and view all the answers

    What is the primary focus of managerial accounting courses?

    <p>Teaching measurement skills that managers use to support planning, controlling, and decision-making activities</p> Signup and view all the answers

    What is the primary focus of financial accounting?

    <p>Providing companywide reports and following GAAP/IFRS</p> Signup and view all the answers

    What is a requirement to become a Certified Management Accountant (CMA)?

    <p>Membership in the Institute of Management Accountants, a bachelor's degree, two years of relevant professional experience, and passage of the CMA exam</p> Signup and view all the answers

    What does the Chartered Global Management Accountant (CGMA) designation require?

    <p>A bachelor's degree in accounting, passage of the CPA exam, membership in the AICPA, three years of relevant management accounting work experience, and passage of the CGMA exam</p> Signup and view all the answers

    What does managerial accounting primarily focus on?

    <p>Segment reports and planning, controlling, and decision-making activities</p> Signup and view all the answers

    What is a key difference between financial accounting and managerial accounting?

    <p>Financial accounting is mandatory for external reports, while managerial accounting is not mandatory</p> Signup and view all the answers

    What does the Institute of Management Accountants (IMA) estimate about professional accountants in the U.S.?

    <p>Over 80% work in non-public accounting environments</p> Signup and view all the answers

    Study Notes

    Financial and Managerial Accounting: Key Differences and Professional Opportunities

    • Financial accounting is focused on external persons making financial decisions, with a historical perspective and emphasis on objectivity and verifiability.
    • Managerial accounting is concerned with managers planning for and controlling an organization, with a future emphasis and focus on relevance, precision, and timeliness.
    • Financial accounting has a primary focus on companywide reports, must follow GAAP/IFRS and prescribed formats, and is mandatory for external reports.
    • Managerial accounting focuses on segment reports, is not bound by GAAP/IFRS or any prescribed format, and is not mandatory.
    • Managerial accounting involves planning, controlling, and decision-making activities, such as establishing goals, developing budgets, and making selections among competing alternatives.
    • Different majors, such as marketing, supply chain management, and human resource management, have specific planning, controlling, and decision-making considerations within managerial accounting.
    • The Institute of Management Accountants (IMA) estimates that over 80% of professional accountants in the U.S. work in non-public accounting environments.
    • Employers expect accounting majors to have strong financial accounting skills, as well as the planning, controlling, and decision-making skills foundational to managerial accounting.
    • To become a Certified Management Accountant (CMA), membership in the Institute of Management Accountants, a bachelor's degree, two years of relevant professional experience, and passage of the CMA exam are required.
    • The CMA exam content specifications cover topics such as financial reporting, planning, performance, and control, as well as financial decision-making, risk management, and professional ethics.
    • The Chartered Global Management Accountant (CGMA) designation, co-sponsored by the AICPA and CIMA, requires a bachelor's degree in accounting, passage of the CPA exam, membership in the AICPA, three years of relevant management accounting work experience, and passage of the CGMA exam.
    • Managerial accounting courses aim to teach measurement skills that managers use to support planning, controlling, and decision-making activities, and focus on cost concepts.

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    Related Documents

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    Description

    Test your knowledge of cost-volume-profit analysis and financial vs. managerial accounting with this quiz. Check your understanding of CVP applications, assumptions, and calculations, as well as the key differences between financial and managerial accounting, professional opportunities, and certifications in the field.

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