Purdue University MGMT 201MGMT 201 Online Exam

Purdue University MGMT 201MGMT 201 Online Exam

• Review ANSWERS

MGMT 201 Exam 1 Review Questions – Answers

Chapter 1

• Which of the following is true?

• Managerial Accountants are "number crunchers" who provide critical information to

decision makers but do not themselves contribute to the decision making process.

• The role of the managerial accountant has not changed in the last twenty years.
• Managerial accountants play an integral leadership role on an organization's

management team.

• The activities performed by the management accountant are administrative in

nature and typically do not add value to the company.

• Which of the following end users would be most likely to include information

provided by the managerial accounting system in their decision making process?

• Stockholders.
• Lenders.
• Consumer groups.
• Product

managers.

• Which of the below choices correctly depicts the four day-to-day management activities?

• Decision making

ii. Planning iii. Innovation & Feedback iv. Directing operational activities

• Controlling

• i, ii, iii & iv.
• ii, iii, iv & v.
• i, iii,

iv & v. d. 1 / 3

ii, iv, v & i.

• Which of the following is false?

• Managerial accounting need not conform to GAAP.
• Managerial accounting reports typically focus on the enterprise in its entirety.
• Managerial accounting is not required.
• Financial accounting is required. 2 / 3

Chapter 2

• The sacrifice made, usually measured by the resources given up, to achieve a

particular purpose is called which of the following?

• A cost.
• An expense.
• A product cost.
• An inventorial cost.

6. Product costs are:

• Expensed in the period incurred.
• Initially capitalized on the Balance Sheet.
• Treated in the same manner as period costs.
• Always classified as an indirect cost.

• Which of the following is true?

• Product costs affect only the Balance Sheet.
• Product costs affect only the Income Statement.
• Period costs affect only the Balance Sheet.
• Product costs eventually affect both the Balance Sheet and the Income Statement.

• Manufacturers, such as Caterpillar, have three broad types of inventory accounts

showing up on their Balance Sheet. Which of the following statements correctly depicts these accounts?

• Direct Materials, Work-in-Process, Finished Goods.
• Indirect Material, Job Shop, Manufacturing Overhead.
• Raw Materials, Work In Process, Cost of Goods Manufactured.
• Raw Materials, Work-in-Process, Finished Goods.

• Which of the following types of business would not incur a product cost?

• Retailer.
• Wholesaler.
• Manufacturer.
• Service provider.

• Which of the following types of business would not incur a period cost?

• Retailer.
• Wholesaler.
• Manufacturer.
• All of the above could incur a period cost.
• / 3