FORBES COLLEGE, INC.

LEGAZPI CITY
2nd SEMESTER ACADEMIC YEAR 2022 – 2023

PRELIMINARY EXAMINATION
MANAGEMENT ACCOUNTING

Name: ________________________ Course/Year: ____________ Date:____________ Score: ___________

I. MULTIPLE CHOICE. Encircle the letter that corresponds to the best answer.
1. Management accounting
a. focuses on estimating future revenues, costs, and other measures to forecast activities and their
results.
b. provides information about a company as whole.
c. reports information that has occurred in the past that is verifiable and reliable.
d. Provides information that is generally available only on a quarterly or annual basis.
2. The person most likely to use management accounting information is a (n)
a. banker evaluating a credit application.
b. shareholder evaluating a stock investment.
c. government taxing authority.
d. assembly department supervisor
3. which of the following descriptors refers to management accounting information?
a. it is verifiable and reliable.
b. it is driven by rules.
c. it is prepared for shareholders.
d. it provides reasonable and timely estimates.
4. Which of the following groups would be least likely to receive detailed management accounting reports?
a. Stockholders
b. Sales representative
c. Production Supervisor
d. Managers
5. Management accounting information includes
a. tabulated results of customer satisfaction survey.
b. the cost of producing the product.
c. the percentage of units produces that are defective.
d. all of the above.
6. Which of the following types of information are used in management accounting?
a. Financial information. c. information focused in long term
b. Nonfinancial information. d. all of the above.
7. Management accounting includes
a. implementing strategy. c. preparing special studied.
b. developing projects. d. all of the above.
8. Control includes
a. implementing planning decisions.
b. evaluating performance.
c. providing feedback to help with the future decision making.
d. all of the above.
9. Linking rewards to performance
a. Helps to motivate managers.
b. Allows the companies to charge premium prices.
 c. Should only be based on financial information.
d. All of the above.
10. For control decision, emphasis is placed on the ________ role (s) of management accounting.
a. problem - solving
b. score keeping
c. attention – directing
d. both (b) and (c)
11. line management includes
a. manufacturing managers c. information – technology managers
b. human – resource manager d. distribution managers
12. Line management includes
a. manufacturing manager c. purchasing manager
b. human – resource manager d. management - accounting manager
13. Responsibility of a CFO include all EXCEPT
a. providing financial reports to shareholder.
b. managing short – term and long – term financing.
c. investing in new equipment.
d. Preparing tax returns
14. _____________ produces information that helps works, managers and executives in an organization make
better decisions.
a. Government accounting c. Auditing
b. Management accounting d. Financial accounting
15. _____________ is the recognition and evaluation of business transaction and other economic events for
appropriate accounting action.
a. Identification c. Communication
b. Analysis d. Evaluation
16. ____________ is the quantification of business transactions or other economic events that have occurred
or forecasts of those that may occur.
a. Accumulation c. Measurement
b. External reporting d. Internal reporting
17. ____________ includes strategic, tactical and operating aspects.
a. Controlling c. Planning
b. Communicating d. Evaluating
18. Which of the following is a basic feature of financial accounting system?
a. Internal audience c. Subjective information
b. Historical data d. Disaggregate information
19. Which of the following is a basic feature of managerial accounting system?
a. external audience
b. reports are current and future oriented
c. objective data only
d. report on the entire organization
20. ___________ indicate whether the organization is creating long – term value and profitability
a. Strategic information c. Net income
b. ROI d. Critical success factors
21. __________ when firm compares itself with the best practice of competitors or other comparable
organizations.
a. Process improvement c. Employee empowerment
b. Bench marking d Total quality philosophy
22. Which of the following is NOT a function of management accounting system?
a. operational control
b. product and customer costing
c. management control
d. financial reporting
 23. Certified Management Accountants are required to adhere to the following ethical standards, EXCEPT
a. Competence. c. integrity.
b. Ingenuity. d. objectivity.
24. ___________ is the generation of, and experimentation with, ideas related to new products, services, or
processes.
a. Research and development
b. Design of products, services, or processes
c. Production
d. Marketing
25. __________ is the acquisition, coordination, and assembly of resources to produce a product or deliver a
service.
a. Research and development c. Production
b. Customer Services d. Marketing
26. __________ is an operational factor that directly affects the economic viability of the organization.
a. Customer focus c. Continuous improvement
b. A key success factor d. Supply chain
27. The sequence activities that creates a good or service is
a. an organization. c. a customer chain.
b. a value chain. d. an information system.
28. Which of the following would NOT happen when quality is bad?
a. Rework c. Zero-defects
b. Scrap d. an increase in the cost of good unit increases
29. A management approach that emphasizes the importance of managing constraints
a. Decentralization c. Control
b. Theory of Constraints d. Business Process
30. A production system in which units are produced and materials are purchased only as needed to must
actual customer demand is called
a. Total quality management c. Process reengineering
b. Just-in-time d. Benchmarking
II. PROBLEM SOLVING. (ROLE OF MANAGEMENT ACCOUNTANTS)
1. Management accountants are actively involved in the process of managing the entity. This
process includes marketing strategies, tactical and operating decisions while helping to
coordinate the efforts to the entire organization. To fulfill these objectives, the management
accountants accepts certain responsibilities that can be de identified as (1) planning, (2)
controlling, (3) evaluating performance, (4) ensuring accountability resources, and (5) external
reporting.
Describe each of these responsibilities. (30 points)
III. ESSAY TYPE
1. The opening paragraph of an accounting textbook says, “Managers needs accounting information
and need to know how to use it.” Critically evaluate this statement. (10 points)
2. Which is the most important function of management? Explain why. (10 points)