Question

1. Choose the answer that is not a distinguishing characteristic of financial accounting information.

1. It is global information that reflects the performance of the whole company.
2. It is used primarily by internal users to facilitate decision making within the company.
3. It is more concerned with financial data than physical or economic data.
4. It is more highly regulated than managerial accounting information.

2. What types of businesses can use a job costing system?

            A. Manufacturing and merchandising businesses

            B. Service and manufacturing businesses

            C. Service and merchandising businesses

            D. Service, manufacturing, and merchandising businesses

3. What are the two basic types of costing systems?

            A. Job costing and process costing

            B. Periodic costing and perpetual costing

            C. Product costing and materials inventory costing

            D. Periodic costing and process costing

4. What type of product costing system would a manufacturer of luxury yachts use?

            A. Job costing

            B. Process costing

            C. Either job or process

            D. Both job and process

5. Select the correct statement regarding fixed costs.

1. Since they do not change, fixed costs should be ignored in all decision making.
2. The fixed cost per unit will increase when volume increases.
3. The fixed cost per unit will decrease when volume decreases.
4. The fixed cost per unit will increase when volume decreases.

6. Which of the following should be recorded as an expense?

1. Paid production machinery setup costs
2. Paid factory maintenance costs
3. Paid production labor costs
4. Paid sales commissions

7. Choose the answer that is not a distinguishing characteristic of financial accounting information.

1. It is global information that reflects the performance of the whole company.
2. It is used primarily by internal users to facilitate decision making within the company.
3. It is more concerned with financial data than physical or economic data.
4. It is more highly regulated than managerial accounting information.

8. Which of the following statements is true with regard to product costs versus general, selling, and administrative costs?

1. Product costs associated with unsold units appear on the balance sheet.
2. General, selling, and administrative costs appear on the balance sheet.
3. Product costs associated with units sold appear on the Income Statement as cost of good sold expense.
4. A and C

9. Which of the following statements is FALSE?

A. Financial accounting provides sufficient information for managers to effectively plan and control operations.

B. Financial accounting reports help creditors make decisions.

C. Financial accounting helps investors make decisions.

D. Financial accounting provides external reports.

Answer 1

Question No. (1)

Answer -

Option - (B) - It is used primarily by internal users to facilitate decision making within the company, is Correct, because it is not a distinguishing characteristic of financial accounting information.

.

Question No. (2)

Answer -

Service, manufacturing, and merchandising businesses uses a job costing system.

Hence, Option - (D) is Correct.

.

Question No. (3)

Answer -

Job costing and Process costing are the two basic types of costing systems.

Hence, Option - (A) is Correct.

.

Question No. (4)

Answer -

A manufacturer of luxury yachts uses Job costing system, because Job costing is used for small production of unique products such as yachts.

Hence, Option - (A) is Correct.

.

Question No. (5)

Answer -

The correct statement regarding fixed costs ​​​​​is - Since they do not change, fixed costs should be ignored in all decision making.

Hence, Option - (A) is Correct.

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