INTRODUCTION TO MANAGEMENT ACCOUNTING 16TH EDITION By HORNGREN – TEST BANK
Introduction to Management Accounting, 16e (Horngren)
Chapter 4 Cost Management Systems and Activity-Based Costing
4.1 Questions
1) To support managers’ decisions, accountants develop cost management systems that are ________.
A) also used by external users such as investors and lenders
B) computer programs with specialized accounting language
C) a collection of tools and techniques that identify how decisions affect costs
D) composed of at least 400 cost pools
Answer: C
Diff: 1
LO: 4-1
AACSB: Reflective thinking skills
Learning Outcome: Describe the basics of managerial accounting and its function within an organization
2) External users of financial reports need ________ measures of inventory and cost of goods sold. Internal users of financial reports need ________ cost information about products.
A) strategic; operational
B) operational; strategic
C) aggregate; detailed
D) detailed; aggregate
Answer: C
Diff: 1
LO: 4-1
AACSB: Reflective thinking skills
Learning Outcome: Describe the basics of managerial accounting and its function within an organization
3) What is an example of a tool or technique that is used in a cost management system?
A) retail method
B) lower of cost or market rule
C) conservatism principle
D) cost-volume-profit analysis
Answer: D
Diff: 1
LO: 4-1
AACSB: Reflective thinking skills
Learning Outcome: Describe the basics of managerial accounting and its function within an organization
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