Managerial Accounting: Final Exam Questions – ACC561, Week 6

Summary

Managerial accounting is a field of accounting that focuses on the financial information needed by managers within an organization. Students get multiple-choice questions on topics such as organizational structures, financial statements, costing methods, budgeting and decision-making.

Organizational Structures

Sole traders, partnerships and corporations differ in who owns them and who carries the risk. Managers are the group of users of accounting information charged with achieving the goals of the business.

Financial Statements

Financial statements show the company's financial position at a point in time or over a period of time. An income statement presents the revenues and expenses for a specific period of time.

Costing Methods

Process costing and job order costing are methods used to assign costs to products. Activity-based costing is a method that allocates overhead to multiple activity cost pools.

Budgeting and Decision-Making

Budgetary control compares actual results with planned objectives. Incremental analysis evaluates financial data that change under alternative courses of action.

Key terms

liquidity ratio

measures the short-term ability of a company to pay its maturing obligations and to meet unexpected needs for cash.

horizontal analysis

a technique for evaluating a series of financial statement data over a period of time.

vertical analysis

a technique that expresses each item in a financial statement as a percent of a base amount.

break-even point

where total sales equal total fixed costs.

responsibility accounting

the accumulation of accounting data on the basis of the individual manager who has the authority to make day-to-day decisions.

incremental analysis

the process of evaluating financial data that change under alternative courses of action.

Questions this document helps with

• What are the advantages of corporations over partnerships and sole proprietorships?
• How do financial statements show a company's financial position?
• What is the difference between process costing and job order costing?

Summary written with AI from the document's text.