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Exam One Review1.In each of the following situations, identify whether the setting is primarily financial accounting or managerial accounting.a.Falcon Company sent its annual report to its stockholders.b.Genesis, Inc.’s controller sent a report of actual versus budgeted sales figures to the sales manager.c.Hurtz Rent-All Company determines that its investments have declined in value and should be adjusted.d.Inca, Inc. controller suspects that cash is being stolen by a sales clerk. As a result, she prepares an analysis to compare each sales clerk’s collections for each day.e.Jones Company executives are meeting to review the annual report to be submitted to the SEC.Unit 1-1 – LO2Ans: N/A, LO: 2, Bloom: E, Unit 1-1, Difficulty: Moderate, Min: 15, AACSB: Communication, AICPA FN: Reporting, AICPA PC: Communication, IMA: ReportingSolution:a.Financialb.Managerialc.Financiald.Manageriale.Financial
Unit 1-1, LO3 – True
4.Managerial accounting is used by managers toUnit 1-1, LO1 – D
5..An example of a variable cost for a cell phone manufacturer isUnit 2-1 – D
7.Suppose you are charged a $10 per month base charge for your electrical service. You are also charged an additional $0.08 for every kwh of electricity you use. Which of the following statement is not true?Unit 2-1 – C