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Test Bank for Garrison, Managerial Accounting, 12th Edition Latest Verified Review 2024 All Chapters ||Complete A+ Guide
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Garrison, Managerial Accounting, 12th Edition
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Garrison, Managerial Accounting, 12th Edition
Test Bank for Garrison, Managerial Accounting, 12th Edition Latest Verified Review 2024 All Chapters ||Complete A+ Guide
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Garrison, fManagerial fAccounting, f12th fEdition 3
, Chapter 1 Managerial Accounting and the Business Environment
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True/False Questions
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1. Although financial and managerial accounting differ in many ways, they are similar in
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that both rely on the same underlying financial data.
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Answer: True Level: Medium f f f f LO: 1 f
2. Managerial accounting is a branch of financial accounting and serves essentially the
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same purposes as financial accounting.
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Answer: False Level: Medium f f f f LO: 1 f
3. Managerial accounting places greater emphasis on the future than financial
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accounting, which is primarily concerned with the past.
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Answer: True Level: Easy LO: 1 f f f fff f
4. Managerial accounting is not needed in a non-profit or governmental organization.
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Answer: False Level: Easy f ff f f LO: 1 f
5. When carrying out their planning activities, managers select a course of action and
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specify how the action will be implemented.
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Answer: True Level: Easy LO: 2 f f f fff f
6. When carrying out their planning activities, managers obtain feedback to ensure that
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the plan is actually carried out and is appropriately modified as circumstances change.
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Answer: False Level: Medium f f f f LO: 2 f
7. The controller occupies a line position in an organization.
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Answer: False Level: Easy f ff f f LO: 2 f
8. Decentralization means the delegation of decision-making authority throughout an f f f f f f f f
organization by allowing managers at various operating levels to make key decisions
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relating to their own area of responsibility.
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Answer: True Level: Easy LO: 2 f f f fff f
4 Garrison, fManagerial fAccounting, f12th fEdition
, 9. A firm's organization chart will normally show both the formal and informal lines of
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reporting and communication.
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Answer: False Level: Easy f ff f f LO: 2 f
10. The Chief Financial Officer of an organization is responsible for ensuring that line
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operations run smoothly.
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Answer: False Level: Medium f f f f LO: 2 f
11. Traditionally, companies have maintained large amounts of raw materials, work in
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process, and finished goods inventories to act as buffers so that operations can proceed
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smoothly even if there are unanticipated disruptions.
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Answer: True Level: Medium f f f f LO: 3 f
12. Process Reengineering is generally considered to be a more radical approach to
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improvement than Total Quality Management.
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Answer: True Level: Easy LO: 3
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13. Process Reengineering emphasizes a team approach involving front-line workers,
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whereas Total Quality Management is usually implemented using outside specialists
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and is imposed from above.
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Answer: False Level: Medium f f f f LO: 3 f
14. If ethical standards were not generally followed, one of the results would probably be
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fewer goods and services available in the marketplace.
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Answer: True Level: Medium f f f f LO: 4 f
15. The Standards of Ethical Conduct for Management Accountants promulgated by the
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Institute of Management Accountants specifically state that management accountants'
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sole ethical responsibility is to not break any laws.
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Answer: False Level: Easy f ff f f LO: 4 f
Garrison, fManagerial fAccounting, f12th fEdition 5
, Chapter 1 Managerial Accounting and the Business Environment
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Multiple Choice Questions
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16. Management accounting focuses primarily on providing data for: f f f f f f f
A) internal uses by managers. f f f
B) external uses by stockholders and creditors. f f f f f
C) external uses by the Internal Revenue Service. f f f f f f
D) external uses by the Securities and Exchange Commission.
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Answer: A Level: Easy f f f f LO: 1 f
17. Managerial accounting: f
A) is more future oriented than financial accounting.
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B) tends to summarize information more than financial accounting
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C) is primarily concerned with providing information to external users.
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D) is more concerned with precision than timeliness.
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Answer: A Level: Easy f f f f LO: 1 f
18. Compared to financial accounting, managerial accounting places more emphasis on:
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A) the flexibility of information.
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B) the precision of information.
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C) the timeliness of information.
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D) both A and C above. f f f f
Answer: D Level: Easy f f f f LO: 1 f
19. The function of management that compares planned results to actual results is known
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as:
f
A) planning.
B) directing and motivating. f f
C) controlling.
D) decision making. f
Answer: C Level: Easy f f f f LO: 2 f
20. Which of the functions of management involves overseeing day-to-day activities?
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A) Planning
B) Directing and motivating f f
C) Controlling
D) Decision making f
Answer: B Level: Easy f f f f LO: 2 f
6 Garrison, fManagerial fAccounting, f12th fEdition