of employee work hours for the upcoming week.
b. Directing: An example of directing is when the manager of the local McDonald's adjusts the menu to reflect
local tastes and preferences.
c. Controlling: An example of controlling is when the manager of the local McDonald's compares the actual
number of hamburger patties used over the past week to the budgeted number of hamburger patties.
d. Decision- making: The owners of the local McDonald's franchise analyze the potential of the current location
and decide to open a second location five miles away in a popular shopping plaza.
Note that student examples of each type of responsibility may vary.
MATCHING. Choose the item in column 2 that best matches each item in column 1.
Match the following:
25) Setting goals and objectives.
Answer: D
26) The process in which management
engages while it plans directs and
controls operations.
Answer: A
27) Evaluating results of business
operations.
Answer: C
28) Determining how to achieve company
goals.
Answer: D
29) Overseeing the company's day to day
operations.
Answer: B
A) Decision making
B) Directing
C) Controlling
D) Planning
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Match the following:
30) Setting a 20% increase in sales as goal
for the next fiscal period.
Answer: D
31) Streamline company procedures to
reduce the time required per unit of
product produced.
Answer: A
32) Selecting the best corporate website
design from a number of proposals.
Answer: B
33) Monitor both voluntary and
involuntary employee turnover.
Answer: C
34) Making a determination about the
appropriate level of advertising
expenditures.
Answer: B
35) Increasing marketing efforts.
Answer: A
36) Implement an employee training
program to improve moral.
Answer: A
37) Setting a target level of employee
turnover.
Answer: D
38) Determine that R & D costs should be
increased by 10% in the upcoming
fiscal quarter.
Answer: D
39) Set prices at a competitive level.
Answer: A
40) Improve the design of the corporate
website.
Answer: A
41) Monitor web traffic through the use of
an online counting device.
Answer: C
A) Directing
B) Decision making
C) Controlling
D) Planning
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TRUE/FALSE. Write 'T' if the statement is true and 'F' if the statement is false.
42) The design of a management accounting system should consider how reports affect employees' behaviour.
Answer: True False
43) International Financial Reporting Standards (IFRS) must be followed when managerial accounting reports are
prepared.
Answer: True False
44) Accounting Standards for Private Enterprise (ASPE) must be followed when managerial accounting reports are
prepared.
Answer: True False
45) Management accounting requires independent audits of the firm's books.
Answer: True False
46) The primary purpose of managerial accounting information is to help external users make investing and
lending decisions.
Answer: True False
47) The primary users of managerial accounting information are internal users such as managers.
Answer: True False
48) The primary managerial accounting product is the company's audited financial statements.
Answer: True False
49) Managerial accounting information emphasizes relevance, more than reliability and objectivity.
Answer: True False
50) Managerial accounting information tends to report on segments of the business.
Answer: True False
51) Managerial accounting reports are always prepared on a quarterly and annual basis.
Answer: True False
52) Managerial information is always based on historical transactions with external parties.
Answer: True False
53) Employee behaviour is one of the factors that must be considered when designing the managerial accounting
control system.
Answer: True False
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
54) Which of the following statements is TRUE about managerial accounting information?
A) It is audited.
B) It must be prepared in conformity with generally accepted accounting principles (GAAP).
C) It emphasizes relevance.
D) It is prepared annually and quarterly.
Answer: C
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55) Management accounting focuses on
A) tax preparation. B) external reporting. C) internal reporting. D) auditing.
Answer: C
56) The person MOST likely to use ONLY financial accounting information would be the
A) bank loan officer. B) plant manager.
C) product manager. D) vice president of plant operations.
Answer: A
57) Which of the following persons or groups would be LEAST likely to receive detailed managerial accounting