ASIAN DEVELOPMENT FOUNDATION COLLEGE

ACCOUNTANCY PROGRAM

MANAGERIAL SERVICES REVIEW – 01

1. Which of the following statements about managerial accountants is false? \
a. Managerial accountants more and more are considered "business
partners."
b. Managerial accountants often are part of cross-functional teams.
c. An increasing number of organizations are segregating managerial
accountants in separate managerial-accounting departments.
d. In a number of companies, managerial accountants make significant
business decisions and resolve operating problems.
e. The role of managerial accountants has changed considerably over the
past decade.

2. The day-to-day work of management teams will typically comprise all of the
following activities except:
a. decision making.
b. planning.
c. cost minimizing.
d. directing operational activities.
e. controlling.

3. Management accounting focuses primarily on providing data for:

a. internal uses by managers.
b. external uses by stockholders and creditors.
c. external uses by the Internal Revenue Service.
d. external uses by the Securities and Exchange Commission.

4. Which of the following functions is best described as choosing among

available alternatives?
a. Decision making.
b. Planning.
c. Directing operational activities.
d. Controlling.
e. Budgeting.

5. Which of the following managerial functions involves a detailed financial

and operational description of anticipated operations?
a. Decision making.
b. Planning.
c. Directing operational activities.
d. Controlling.
e. Measuring.

6. Compared to financial accounting, managerial accounting places more

emphasis on:
a. the flexibility of information.
b. the precision of information.
c. the timeliness of information.
d. both A and C above.

7. Which of the following involves the coordination of daily business

functions within an organization?
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 a. Decision making. ]
b. Planning.
c. Directing operational activities.
d. Controlling.
e. Motivating.

8. Which of the following is not an objective of managerial accounting?

a. Providing information for decision making and planning.
b. Assisting in directing and controlling operations.
c. Maximizing profits and minimizing costs.
d. Measuring the performance of managers and subunits.
e. Motivating managers toward the organization's goals.

9. The role of managerial accounting information in assisting management is

a(n):
a. financial-directing role.
b. attention-directing role.
c. planning and controlling role.
d. organizational role.
e. problem-solving role.

10. The function of management that compares planned results to actual results
is known as:
a. planning.
b. directing and motivating.
c. controlling.
d. decision making.

11. Employee empowerment involves encouraging and authorizing workers to take

initiatives to:
a. improve operations.
b. reduce costs.
c. improve product quality.
d. improve customer service.
e. all of the above.

12. Which of the functions of management involves overseeing day-to-day

activities?
a. Planning
b. Directing and motivating
c. Controlling
d. Decision making

13. The process of encouraging and authorizing workers to take appropriate

initiatives to improve the overall firm is commonly known as:
a. planning and control.
b. employee empowerment.
c. personnel aggressiveness.
d. decision making.
e. problem recognition and solution.

14. Which of the following is not one of the three basic activities of a
manager?
a. Planning
b. Controlling
c. Directing and motivating

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 d. Compiling management accounting reports

15. Which of the following business models considers financial, customer,

internal operating, and other measures in the evaluation of performance?
a. Deterministic simulation.
b. Balanced scorecard.
c. Payoff matrix.
d. Decision tree.
e. Chart of operating performance (COP).

16. Which of the following statements are false concerning line and staff
functions?
I. Persons occupying staff functions have authority over persons
occupying line functions.
II. Both line and staff functions are depicted on the organization
chart.
III. Line functions are directly related to the basic objectives of an
organization.

a. Only I
b. Only II
c. Only I and II
d. I, II, and III

17. Which of the following perspectives is normally absent in a balanced

scorecard?
a. Financial.
b. Customer.
c. Internal operations.
d. Learning and innovation/growth.
e. None of the above.

18. Managerial accounting:

a. is unregulated.
b. produces information that is useful only for manufacturing
organizations.
c. is based exclusively on historical data.
d. is regulated by the Securities and Exchange Commission (SEC).
e. generally focuses on reporting information about the enterprise in its
entirety rather than by subunits.

19. The Standards of Ethical Conduct for Management Accountants developed by

the Institute of Management Accountants contain a policy regarding
confidentiality that requires management accountants to refrain from
disclosing confidential information acquired in the course of their work:
a. except when authorized by management.
b. in all situations.
c. except when authorized by management, unless legally obligated to do
so.
d. in all cases not prohibited by law

20. Which of the following would likely be considered an internal user of

accounting information rather than an external user?
a. Stockholders.
b. Consumer groups.

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 c. Lenders.
d. Middle-level managers.
e. Government agencies.

21. The Institute of Management Accountants (IMA) has developed ethical

standards for management accountants. What four categories has the IMA
classified these standards into?
a. Reliability, Objectivity, Commitment, and Competence
b. Objectivity, Integrity, Commitment, and Confidentiality
c. Observation, Integrity, Closure, and Competence
d. Competence, Objectivity, Integrity, and Confidentiality
e. Reliability, Understandability, Flexibility, and Integrity

22. Financial accounting focuses primarily on reporting:

a. to parties outside of an organization.
b. to parties within an organization.
c. to an organization's board of directors.
d. to financial institutions.
e. for financial institutions.

23. Which of the following statements represents a similarity between

financial and managerial accounting?
a. Both are useful in providing information for external users.
b. Both are governed by GAAP.
c. Both draw upon data from an organization's accounting system.
d. Both rely heavily on published financial statements.
e. Both are solely concerned with historical transactions.

24. Which of the following employees at American Airlines would not be

considered as holding a line position?
a. Pilot.
b. Chief financial officer (CFO).
c. Flight attendant.
d. Ticket agent.
e. Baggage handler.

25. Which of the following employees would be considered as holding a line

position?
a. The controller of Exxon Corporation.
b. The vice-president for government relations of Microsoft.
c. The manager of food and beverage services at Disney's Magic Kingdom.
d. A secretary employed by Hewlett-Packard.
e. None of the above.

26. Which of the following typically does not relate to the role of a
controller?
a. A controller supervises the accounting department.
b. A controller safeguards an organization's assets.
c. A controller oversees the preparation of reports required by
governmental authorities.
d. A controller normally assumes a narrow role within the organization,
often preventing the individual's rise to top management ranks.
e. Choices "B" and "D" above.

27. A controller is normally involved with:

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 a. preparing financial statements.
b. managing investments.
c. raising capital.
d. safeguarding assets.
e. managing the firm's credit policy.

28. Which of the following is not a function of the treasurer?

a. Safeguarding assets.
b. Managing investments.
c. Preparing financial statements.
d. Being responsible for an entity's credit policy.
e. Raising capital.

29. Much of managerial accounting information is based on:

a. a cost-benefit theme.
b. profit maximization.
c. cost minimization.
d. the generation of external information.
e. effectiveness but not efficiency.

30. Managerial accounting has changed in recent years because of:

a. the growth of e-business.
b. increased global competition.
c. the emergence of new industries.
d. an increased focus on the customer.
e. all of the above factors.

31. Which of the following is not an ethical standard of managerial

accounting?
a. Competence.
b. Confidentiality.
c. Efficiency.
d. Integrity.
e. Credibility.

32. Which of the following is not an element of competency?

a. To develop appropriate knowledge about a particular subject.
b. To perform duties in accordance with relevant laws.
c. To perform duties in accordance with relevant technical standards.
d. To refrain from engaging in an activity that would discredit the
accounting profession.
e. To prepare clear reports after an analysis of relevant and reliable
information.

~end~

GOOD LUCK AND GOD BLESS!

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