Exam 9: Management Control Systems and Responsibility Accounting

A management control system is a logical integration of management accounting tools to gather and report data and to evaluate performance.

Revenue growth in segments is a measure of:

Productivity is a measure of inputs divided by outputs.

When comparing productivity measures over time, changes in the process or in the rate of inflation can cause the comparison to be misleading.

A balanced scorecard is used by for- profit companies, nonprofit organizations, and governmental agencies.

Organizational learning may be monitored by measuring employee turnover.

Managers on all levels are asked to explain the total segment contribution but are held responsible only for the:

The following information is available for Learning R' Us and its two divisions-Books and Periodicals: Company as Books Periodicals a whole Division Division Net sales \1 00,000 \6 0,000 \4 0,000 Fixed costs: Controllable by division man ager 16,500 12,500 4,000 Controllable by others 8,000 5,000 3,000 Variable costs: Cost of merch andise sold 24,500 17,500 7,000 Operating expenses 16,400 10,000 6,400 Unalloc ated costs 1,000 is the contribution margin for the Periodicals Division.

The following information is available for Yorkshire Consulting Company and its two offices: Berea Office North Royalton Office Net sales \2 50,000 \4 00,000 Fixed costs: Controllable by division manager 78,000 48,000 Controllable by others 4,000 8,000 Variable costs: Cost of merch andise sold 30,000 120,000 Operating expenses 15,000 60,000 Unallocated costs were $52,000. Required: a. Compute the contribution margin for the Berea Office. b. Compute the contribution controllable by the manager of the North Royalton Office. c. Compute the contribution by segment for the Berea Office. d. Compute the net income for Yorkshire Consulting Company.

A responsibility center for which a separate measure of revenues and/or costs is obtained is called a(n):

Groucho Corporation and Harpo Company are movie companies. Comparative data for 20X4 and 20X5 are given below. Groucho Harpo Corporation Company Sales revenue 20\times4 \ 8,400,000 \ 4,400,000 20\times5 9,600,000 6,200,000 Number of employees 20\times4 8,000 5,500 20\times5 9,000 7,000 Assume that each 20X4 dollar is equivalent to 1.50 of the 20X5 dollars, due to inflation. is Harpo Company's 20X5 productivity measure in terms of revenue per employee.

A designer of management control systems always must determine this

Exertion toward a goal or objective

Once a management control system is designed for an organization, it will meet the organization's goals indefinitely.

is an alternate term for cycle time.

The Desks R' Us Company provided the following information: Company as a Office Home whole Division Division Net sales \1 00,000 \6 6,000 \3 4,000 Fixed costs: Controllable by division managers 16,000 10,000 6,000 Controllable by others 10,000 5,000 5,000 V ariable costs: Cost of merchandise sold 38,000 22,000 16,000 Operating expenses 8,000 5,000 3,000 Unallocated costs 6,000 Required: Prepare a contribution approach income statement for the company as a whole and also for the divisions.

All of the following are nonfinancial objectives of responsibility centers except:

is not a measure of organizational learning.

is (are) concerned with quality control.

The four categories of quality cost include production costs, appraisal costs, internal failure costs, and external failure costs.