Managerial vs. Financial Accounting Quiz
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Managerial vs. Financial Accounting Quiz

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Questions and Answers

Which of the following is NOT a characteristic of a Lean Production System?

  • Broad employee roles
  • Emphasis on quality
  • Shortened set-up times
  • Production occurs in large batches (correct)

    • Which of the following is true about financial accounting information?

  • It is primarily used by internal managers for decision making.
  • It must be formatted according to ASPE or IFRS. (correct)
  • It often includes reports on subunits like departments.
  • It focuses extensively on future forecasts.

    • What is the main goal of Total Quality Management (TQM)?

  • To reduce production costs
  • To provide customers with inferior products
  • To enhance employee productivity
  • To provide customers with superior products and services (correct)

    • What distinguishes managerial accounting from financial accounting?

    <p>Managerial accounting provides reports on a company’s subunits.</p> Signup and view all the answers

    Which of the following is categorized as an internal failure cost?

    <p>Costs of reworking defective components</p> Signup and view all the answers

    Which role has evolved from being just a 'bean counter' to a key advisor in organizations?

    <p>Management Accountant</p> Signup and view all the answers

    What type of cost is represented by lost profits from lost sales due to a poor reputation?

    <p>External failure cost</p> Signup and view all the answers

    Which job duty is typically NOT associated with the internal auditor?

    <p>Prepare journal entries for month-end closing.</p> Signup and view all the answers

    For which type of accounting is the reporting of historical transactions with external parties primarily relevant?

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

    Which of the following actions is classified as a prevention cost?

    <p>Salaries of engineers designing for overload protection</p> Signup and view all the answers

    Which statement about the responsibilities of management accountants is accurate?

    <p>They provide decision support and interpret accounting data.</p> Signup and view all the answers

    Which statement about Just-In-Time (JIT) systems is most accurate?

    <p>They require shortened manufacturing cycle times.</p> Signup and view all the answers

    Which of the following is NOT a recommended step if an ethical dilemma is not resolved?

    <p>Ignore the situation</p> Signup and view all the answers

    What is NOT a characteristic of managerial accounting?

    <p>Reports must comply with legal requirements.</p> Signup and view all the answers

    What is a common goal for companies pursuing a lean production strategy?

    <p>To improve production efficiency and quality</p> Signup and view all the answers

    Which of the following roles would be primarily responsible for issuing company bonds?

    <p>Treasurer</p> Signup and view all the answers

    What is the purpose of adhering to professional conduct rules?

    <p>To define acceptable behaviors in the profession</p> Signup and view all the answers

    Which guideline involves identifying potential ethical conflicts in a situation?

    <p>Assessing the Situation</p> Signup and view all the answers

    What action should be taken first when reporting unethical behavior?

    <p>Follow company’s policies</p> Signup and view all the answers

    Which statement accurately describes the relationship between unethical and illegal behavior?

    <p>Unethical behavior can occur without legal implications</p> Signup and view all the answers

    What is a key aspect of the guideline 'Integrative Analysis'?

    <p>Anticipation of issues and alternatives</p> Signup and view all the answers

    What would be classified as an appraisal cost in a manufacturing setting?

    <p>Cost of inspecting components during production</p> Signup and view all the answers

    What is the purpose of 'Conclude/Advise and Communicate' in ethical guidelines?

    <p>To make a transparent decision</p> Signup and view all the answers

    In ethical behavior guidelines, what should be regularly monitored to ensure compliance?

    <p>Subordinate activities and adherence to rules</p> Signup and view all the answers

    What ethical guideline emphasizes the importance of developing knowledge and skills?

    <p>Competence</p> Signup and view all the answers

    Which of the following describes the ethical guideline regarding the use of confidential information?

    <p>Refrain from using information for unethical advantage</p> Signup and view all the answers

    Which regulation was enacted to address financial practices in the USA?

    <p>Sarbanes-Oxley Act of 2002</p> Signup and view all the answers

    What is the main purpose of Integrated Reporting?

    <p>To provide a concise overview of value creation</p> Signup and view all the answers

    What is a key benefit of Advanced Information Systems for companies?

    <p>They help save money and respond quickly to changes</p> Signup and view all the answers

    Which of the following best describes the role of web-enabled business in supply chain management?

    <p>To effectively coordinate supply chain activities</p> Signup and view all the answers

    In what way does globalization impact the business environment?

    <p>It introduces competition from foreign companies</p> Signup and view all the answers

    The ethical guideline regarding monitoring subordinates emphasizes which principle?

    <p>Integrity and Due Care</p> Signup and view all the answers

    What is the primary purpose of data analytics?

    <p>To support decision-making with actionable insights</p> Signup and view all the answers

    Which step comes immediately after data collection in the data analytics process?

    <p>Utilize tools and technology</p> Signup and view all the answers

    Which cost is associated with reworking defective components after detection?

    <p>Internal Failure</p> Signup and view all the answers

    What is NOT a benefit of excellent data analytics?

    <p>Promotes slower decision-making processes</p> Signup and view all the answers

    Which of the following factors is described as influencing data analytics today?

    <p>Increased speed and volume of data</p> Signup and view all the answers

    In which context is data analytics applied to enhance organizational goals?

    <p>In any context where data is used for insights</p> Signup and view all the answers

    Which of the following reflects a cost of appraisal in production?

    <p>Costs of inspecting components</p> Signup and view all the answers

    What is the final step in the data analytics process?

    <p>Act; choose and implement the plan</p> Signup and view all the answers

    Study Notes

    Managerial vs. Financial Accounting

    • Financial Accounting: Provides information to external parties like investors and creditors.
    • Managerial Accounting: Supports internal decision making by company managers.
    • Financial Accounting: Reports on historical transactions with external parties.
    • Managerial Accounting: Not required by authoritative bodies.
    • Managerial Accounting: Reports on company subunits like products, departments, and geographical areas.
    • Financial Accounting: Used by creditors and investors.
    • Financial Accounting: Follows ASPE or IFRS.
    • Both: Used to support decision making.

    Organizational Structure

    • Typical organizational structure shows departments like Marketing, Production, Sales, Finance, Human Resources, and Research & Development.
    • Management accountants have senior roles in all departments and industries.

    Roles & Skills Required

    • Management accountants are no longer just "bean counters," they are senior managers and advisors.
    • Accountants ensure accurate financial records, and provide decision support.
    • Required Skills: Communication, Leadership Skills, Business Acumen, Analytical Skills, Ethics, & Technology Proficiency.

    CPA (Certified Professional Accountant) Guidelines for Ethical Behavior

    • Adherence to Rules of Professional Conduct: Includes allowed and disallowed behaviors.
    • Enabling Competencies: Follows laws and professional standards.
    • Assessing the Situation: Recognizes ethical issues in work.
    • Integrative Analysis: Anticipates issues and identifies potential alternatives.
    • Conclude/Advise and Communicate: Makes clear and transparent ethical decisions.

    Steps to Resolve Ethical Dilemmas

    • Follow company policies: Report any unethical behavior.
    • If unresolved: Discuss with supervisors, an objective advisor, or an attorney.
    • All illegal behavior is unethical.

    Ethical Guidelines

    • Competence and Objectivity: Communicate information fairly and objectively.
    • Confidentiality: Refrain from unethical use of confidential information and inform relevant parties about its use.
    • Integrity and Due Care: Monitor subordinates' activities to ensure compliance.
    • Integrity and Competence: Mitigate actual conflicts of interest.
    • Integrity and Competence: Regularly communicate with business associates to avoid apparent conflicts of interest.
    • Competence: Maintain professional expertise by continually developing knowledge and skills.

    Regulatory & Business Issues

    • The business world is constantly changing.
    • Sarbanes-Oxley Act of 2002 (SOX): US law focused on corporate governance.
    • International Financial Reporting Standards (IFRS): Global accounting standards.
    • Extensible Business Reporting Language (XBRL): Data reporting standard used for financial and business reporting.
    • Shifting economy and globalization: Influence business practices.
    • Sustainability: Businesses are increasingly incorporating environmental and social factors into their operations.

    Tools for Time-Based Competition

    • Integrated Reporting: Concise communication about strategies, governance, performance, and prospects.
    • Advanced Information Systems: Enterprise resource planning (ERP) systems help companies save money and respond quickly to change.
    • Web-enabled Business: An important tool for supply-chain management.

    Lean Production System

    • Production occurs in self-contained cells.
    • Broad employee roles: Employees contribute to production improvements.
    • Small batches produced just-in-time.
    • Shortened set-up times and manufacturing cycle times.
    • Emphasis on quality.

    Total Quality Management (TQM)

    • Provide customers with superior products and services.
    • Continually set higher quality goals.
    • International Organization for Standardization (ISO): Sets quality management standards.

    Costs of Quality

    • Prevention Costs: Costs incurred to prevent defects.
    • Appraisal Costs: Costs incurred to detect defects.
    • Internal Failure Costs: Costs incurred when defects are detected before delivery to customers.
    • External Failure Costs: Costs incurred when defects are detected after delivery to customers.

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    Managerial Accounting Fifth Canadian Edition PDF

    Description

    Test your understanding of managerial and financial accounting concepts. This quiz covers their differences, roles within an organization, and the skills required for management accountants. Ideal for students aiming to grasp key accounting principles.

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