Acc 560 Wk 2 Quiz 1 All Possible Questions By Carolrlangston
Match each of the following accounts with the appropriate description that follows. Costs related to the overall management of an organization. Using Figure 1.2 “IMA Statement of Ethical Professional Practice” as a guide, discuss your options as the accountant at Drive Write. The person who assists in preparing tax reports for governmental agencies.
- Both Jorge’s boss and the CFO receive bonuses tied to the company’s profits.
- The treasurer, a volunteer member of the board of directors, is responsible for establishing the annual budget and providing monthly financial reports to the board of directors.
- GAAP may be provided by the managerial accountants.
- Prepare a schedule of raw materials placed in production for the month of September.
- Function is the process of evaluating whether the organization’s plans were implemented effectively.
- This does not comply with U.S.
The process of establishing goals and communicating these goals to employees of the organization. 30) An ideal database should store information in a way that allows different managers to access the information they need. 23) Managers always require the information in an accounting system to be presented in the same format. D) It primarily measures and records business transactions. B) The reports are generally delayed and historical.
Comparison With Financial Accounting Reports
Many companies have significantly lowered inventory levels and costs using just-in-time inventory methods. Managerial accounting applies to all forms of business organizations.
Related Accounting Q&a
In this case, they might issue internal reports monthly, but might provide a report sooner than planned if they discover critical information a manager needs. Reporting only once a year or once a period would not typically provide the most useful information to management at the most critical times. Managers need information in a timely manner in order to act on it appropriately, according to Colin Drury in “Management and Cost Accounting.” Managerial accountants issue internal managerial reports periodically to provide information on departments’ performances. Department managers, the general manager, company officers and other staff members working in a supervisory capacity might read the reports. Without that framework, the auditor would have no uniform standard for judging the presentation of financial position, results of operations, and cash flows in financial statements.
What is internal audit reporting?
What is an internal audit report? An internal audit report is a document with the formal results of an audit. It is used by the internal auditor to show what was examined, highlighting positives, negatives and conclusions, so that the company’s management knows what is going well and what needs to be improved.
Describe how to prepare an income statement for a manufacturing company. Costs that are not related to the production of goods; also called nonmanufacturing costs. In deciding whether to upgrade to an ERP system, organizations must be sure that the benefits of using the data from a new system outweigh the costs of implementing the system. If management does not intend to use the information to improve planning and decision making, then going with a less sophisticated accounting system may be the better approach. A set of accounting rules that must be followed to provide consistency in reporting financial information to external users. Determining the unit cost of manufacturing a product is an output of financial accounting. Describe the characteristics of managerial accounting and financial accounting.
Inventory Cost Flow Equation
The balance in Posada Company’s finished goods inventory account was $650,000 at the beginning of March and $625,000 at the end of March. Cost of goods manufactured for the month totaled $445,000. Schedule of Cost of Goods Manufactured. The balance in the work-in-process inventory account of Verdi Production, Inc., was $900,000 at the beginning of May and $750,000 at the end of May. Manufacturing costs for the month follow. The balance in Blue Oak Company’s finished goods inventory account was $25,000 at the beginning of September and $28,000 at the end of September.
- All costs related to the production of goods; also called manufacturing costs.
- The former chief executive, Martin Grass, was sentenced to eight years in prison and the former chief financial officer, Franklyn Bergonzi, was sentenced to 28 months in prison.
- Financial Versus Managerial Accounting.
- In today’s business environment, effective planning and control by managers can be the key to survival.
- Cost of goods manufactured represents the cost of goods completed and transferred out of work-in-process inventory into finished goods inventory.
- Using Figure 1.2 “IMA Statement of Ethical Professional Practice” as a guide, discuss your options as the accountant at Drive Write.
A series of reports used to quantify an organization’s plan for the future. The process of evaluating whether the organization’s plans were effectively implemented. 22) Cost management is narrowly focused on a continuous reduction of costs. Is constrained by the requirements of generally accepted accounting principles.
Explain. GAAP. Does the income statement provide enough detailed information for managers at Home Depot? Generally Accepted Accounting Principles (U.S. GAAP). Does the income statement provide enough detailed information for managers at Ford? Identify whether each item listed in item 2 should be categorized as direct materials, direct labor, manufacturing overhead, selling cost, or general and administrative cost. 25) The balance sheet, income statement, and statement of cash flows are used for financial accounting, and also for management accounting.
True False Cost Management Is Narrowly Focused On A Continuous Reduction Of Costs
Most ERP software is offered in modules for functional accounting areas, such as accounts receivable, accounts payable, payroll, inventory, and job costing. The more modules included, the higher the cost will be. Popular makers of ERP systems include Microsoft, Oracle, and SAP Corporation. Figure 1.1 “A Typical Organization Chart” is a typical organization chart; it shows how accounting and finance personnel fit within most companies. The personnel at the bottom of the chart report to those above them.
- GAAP, for those outside the company.
- If conflicts arise with the CFO, an internal auditor can report directly to the board of directors or to the audit committee, which consists of select board members.
- An expense account on the income statement that represents the product costs for all goods sold during the period.
- Costs incurred to obtain customer orders and provide customers with a finished product.
This illustrates how financial constraints and reporting requirements may require an organization to be creative in establishing its organizational structure. The person responsible for confirming that controls within the company are effective in ensuring accurate financial data. The person who assists in preparing financial information in accordance with U.S.
3 Key Finance And Accounting Personnel
Detailed financial information that goes beyond what is required by U.S. GAAP may be provided by the managerial accountants.
All costs related to the production of goods; also called product costs. The idea behind ERP software, and a central theme in managerial accounting, is that accurate and up-to-date financial information will help organizations make better decisions. Better decisions typically lead to improvements in profitability, efficiency, and customer satisfaction. Focuses on internal users, including executives, product managers, sales managers, and any other personnel in the organization who use accounting information for decision making. This information typically summarizes overall company results and does not provide detailed information. Direct materials and direct labour are the only product costs.
The costs of completed goods that are sold are recorded in the cost of goods sold account. This account appears on the income statement as an expense. The income statements of merchandising companies differ from those of manufacturing companies in several areas. In addition, they use the term net purchases instead of cost of goods manufactured and often include the schedule of cost of goods sold in the income statement rather than presenting it separately.
The former chief executive, Martin Grass, was sentenced to eight years in prison and the former chief financial officer, Franklyn Bergonzi, was sentenced to 28 months in prison. Rite Aid’s stock fell from a high of $50 per share to $5 per share in 2003. Using the cost flow equation, you can see how failing to record the $9,000,000 loss would understate cost of goods sold. Rite Aid Corporation operates 3,400 drug stores in the United States. In 2002, the Securities and Exchange Commission filed accounting fraud charges against several former executives of Rite Aid.
An expense account on the income statement that represents the product costs for all goods sold during the period. Examples of direct materials for each boat include the hull, engine, transmission, carpet, gauges, seats, windshield, and swim platform. Examples of indirect materials include glue, paint, and screws.
What is a analytical report?
Analytical reports are essentially a specified form of business reports that evaluate a particular issue or set of circumstances within the company. Analytical reports also include recommendations on how to address the issue or set of circumstances at hand.
For example, sales commissions and shipping costs for a specific product could be assigned to the product. This does not comply with U.S.
The “Resolution of Ethical Conflict” section provides specific guidance on how to resolve the conflict at Drive Write. It is important to understand the key accounting and finance positions within a typical company and how each position fits into the organizational structure. The chief financial officer oversees all accounting and finance personnel, including the controller, treasurer, and internal auditor. The controller is responsible for the managerial, financial, and tax accounting staff. The control function allows for an evaluation of how well you met the goals established in the planning process. Perhaps some goals were achieved (e.g., food expenditures were close to what was budgeted) while other goals were not (e.g., transportation expenditures were higher than what was budgeted). The control function identifies these areas and leads to refined goals in the future.
Use the information from the schedule of cost of goods sold prepared in requirement 1 and the income statement prepared in requirement 2 to prepare an income statement. Use the format shown in Figure 1.9 “Merchandising Company Income Statement for Fashion, Inc.”. Account. Cost of goods sold is an expense account on the income statement that represents the product costs of all goods sold during the period.
He also hints that some December expenses could be pushed back and recorded in January. How should Jorge handle this situation? Use the IMA’s Statement of Ethical Professional Practice shown in Figure 1.2 “IMA Statement of Ethical Professional Practice” as a guide to answering this question. Prepare a schedule of cost of goods manufactured for the year ended December 31, 2011. Provide at least three additional detailed pieces of financial information that would help managers evaluate performance at UPS. Prepare a schedule of cost of goods manufactured for the month of May. Provide at least three additional detailed pieces of financial information that would help managers evaluate performance at Home Depot.
All nonmanufacturing costs are not related to production and are classified as either selling costs or general and administrative costs. Figure 1.9 “Merchandising Company Income Statement for Fashion, Inc.” presents an income statement for Fashion, Inc., a retail company that sells clothing. Also, the schedule of cost of goods sold is simply included in the income statement.
Provide one example of a financial accounting report and two examples of managerial accounting reports that Maria might request. What are the three categories of product costs that flow through the work-in-process inventory account? Describe each one. We will apply this equation to the three inventory asset accounts discussed earlier to calculate the cost of raw materials used in production, cost of goods manufactured, and cost of goods sold. This company is a midsized company with $30,000,000 in revenues, although some would argue that this is a small company.