LO 1.2Indicate whether the statement describes reporting by the financial accounting function or the managerial accounting function of an organization.
- The users of the report are managers who need a daily summary of work done each shift.
- The report is a job cost sheet for jobs completed in a 24-hour period.
- The annual report is released each year on the company’s website.
- The report is audited by the company’s certified public accountant firm.
- The report is prepared every day because the customer service manager needs information about inventory ready to be shipped to customers.
LO 1.2Identify the following as true or false:
- Financial accounting reports are not released to external users.
- Managerial accounting reports are not used by employees inside the organization.
- Managerial accounting reports include only monetary information.
- Financial accounting reports are monetary in nature.
- If a result of a company’s operations is nonmonetary in nature, it must be converted to monetary units for managerial reporting.
- Tax authorities and government regulatory agencies are external users of financial information.
LO 1.2Companies need to report both monetary and nonmonetary data and information.
- Define these two terms and provide examples of each.
- Discuss what sources are available that provide companies with both types of data and information.
LO 1.3Marvin has been thinking about the fields of managerial and financial accounting and the functions of management within an organization. He has the following list of statements to understand. Identify them as true or false.
- Managerial accounting reports are prepared only quarterly and annually.
- Financial accounting reports are general-purpose reports.
- Managerial accounting reports pertain to subunits of the business.
- Managerial accounting reports must comply with GAAP.
- The company treasurer reports directly to the vice president of operations.
LO 1.3Match the term with the description.
|A. Chief Executive Officer||i. has responsibilities that include transferring monies between accounts and monitoring deposits|
|B. Chief Financial Officer||ii. the corporation officer who has the overall responsibility of the management of a company|
|C. Enrolled Agent||iii. a corporate officer who reports to the chief executive officer and oversees all of the accounting and finance concerns of a company|
|D. Cash Management Accountant||iv. the financial officer of a corporation reporting to the chief financial officer who is responsible for the accounting records and financial statements|
|E. Controller||v. credential focusing on a career in taxation created by the IRS to signify significant knowledge of the US tax code|
|F. Financial Analyst||vi. Someone who assists in preparing budgets, tracking actual costs and performs other tasks that support other management personnel in organizing forecasts and projections|
LO 1.4The Foreign Corrupt Practices Act (FCPA) was implemented in 1977. Why was it enacted, and what are its major provisions?
LO 1.4Indicate whether each of the following statements is true or false.
- Section 302 of Sarbanes-Oxley requires the CEO and CFO to review all financial reports and sign the reports.
- One of the three questions put forth by the Institute of Business Ethics is “Do I mind others knowing what I have done?”
- Ethical issues may be faced on a small scale, such as making a business decision to produce excess inventory for the sole purpose of trying to influence managers’ bonuses.
- A manager who spends excess budgeted funds remaining at the end of a fiscal year on unnecessary expenditures thinking that it is better to “use it than lose it” is acting ethically.
- The Foreign Corrupt Practices Act was implemented in 2001 to protect investors by enhancing the accuracy and reliability of corporate financial statements and disclosures.