Concept explainers
Identifying Steps in Decision-Making Process
Listed below are a number of statements concerning management’s decision-making process. Identify whether each statement is correct or incorrect. For all incorrect statements, indicate how to correct the statement.
1. The final step in management’s decision-making process is to actually make the decision.
2. In making business decisions, management w ordinary only consider financial information because s objectively determined.
3. The first step in management’s decision-making process is to determine the decision alternatives.
4. Relevant costing is used for short-term decision making because focuses only on the costs and benefits that are relevant to the decision at hand.
5. Under incremental analysis, variable costs w change under different courses of action, but fled costs fl never change.
6. Decisions involve a choice among alternative courses of action.
7. When using differential analysis, some costs will change under alternative courses of action, but revenues will not change.
Trending nowThis is a popular solution!
Chapter 7 Solutions
Managerial Accounting
- The managerial decision-making process has which of the following as its third step? A. Review, analyze and evaluate the results of the decision. B. Decide, based upon the analysis, the best course of action. C. Identify alternative courses of action to achieve a goal or solve a problem. D. Perform a comprehensive differential (differential) analysis of potential solutions.arrow_forwardWhen managerial accountants design an evaluation system that is based on criteria for which a manager is responsible, and it is structured to encourage managers to make decisions that will meet the goals of the company as well as their own personal job goals, the framework used is _______. A. a controllable factors framework B. an uncontrollable factors framework C. a strategic plan framework D. a responsibility accounting frameworkarrow_forwardWhat is business ethics? Is it possible to teach ethical behavior in a management accounting course?arrow_forward
- Which of the following does not describe a management control system? A. establishes a companys strategic goals B. implements a companys strategic goals C. monitors a companys strategic goals D. a system that only measures profitabilityarrow_forwardManagerial accounting produces information: to meet the needs of external users that is often focused on the future to meet the needs of investors that follows the rules of GAAParrow_forwardBriefly explain the overall objective of a financial manager. Include in your response any one of the three fundamental decisions a financial manager would be faced with. You may want to refer to the fundamental accounting equation in your response.arrow_forward
- The person MOST likely to use management accounting information is a: Select one: O a. banker evaluating a credit application. Ob. shareholder evaluating a stock investment. Oc assembly department supervisor. Od. governmental taxing authority.arrow_forwardWhat exactly is management accounting, in your own words? What is the significance of management accounting, in your own words, and why?arrow_forwardDiscussion Forum Question: As a decision- maker, what are the major differences between managerial accounting and financial accounting and how would you apply the information from each?arrow_forward
- Planning, control, and decision-making are all activities that management accounting aims to aid. Do management accountants have any tricks up their sleeves to help them accomplish the aforementioned goals? Also, let's talk about it.arrow_forwardManagerial accounting produces information: Select one: a. that follows the rules of GAAP b. to meet the needs of investors c. to meet the needs of external users d. that is often focused on the futurearrow_forwardManagement accounting has the following features: Select one: O A. Future orientated focus O B. Stewardship orientation focus O C. Focus on detailed annual reports O D. Focus on decision-making needs of shareholdersarrow_forward
- Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax CollegeAuditing: A Risk Based-Approach (MindTap Course L...AccountingISBN:9781337619455Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:Cengage LearningAuditing: A Risk Based-Approach to Conducting a Q...AccountingISBN:9781305080577Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:South-Western College Pub
- Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning