Exam 1: The Role of Accounting Information in Management Decision Making

Most managers follow a standard template and format when writing a vision statement.

Relevant cash flows are

Organisational core competencies are the tactics that managers use to take advantage of the vision.

Irrelevant cash flows are

Relevant information for decisions can focus both on learning from the past and anticipating the future.

The Marriott Corporation operates hotels all over the world. Which of the following is the best example of a potential bias associated with its operations?

A vision statement helps employees understand how to deal with various stakeholder groups.

Information gathered outside the organisation includes

Rick is an accountant. His boss has asked him to make a recommendation about buying or leasing new computer equipment for the accounting department. A decision has already been made to acquire a particular type of equipment. The only remaining decision is whether the equipment will be purchased or leased. Several pieces of information Rick might consider in his decision are listed below. Indicate whether each of the following items is: R relevant or I irrelevant to the decision. 1 cost of current computer equipment 2 interest rate for lease 3 employee feelings about the type of new computer equipment 4 cost of purchasing new equipment 5 depreciation on old equipment 6 future reliability of new equipment 7 independent quality ratings on new equipment 8 trade-in value of old equipment 9 tax incentives to lease 10 personal relationship with equipment vendor

The cost of your old car is relevant in the decision to purchase a new car.

Managers can make higher-quality decisions by relying on all of the following except

The process of making higher quality business decisions requires each of the following except

Indicate whether each of the following items is primarily: I an internal report or E an external report. Each item has only one correct response. 1 analysis of potential acquisitions 2 analysis of product mix 3 capital budgets 4 cash flow plan 5 credit reports 6 financial statements 7 inventory reports for suppliers 8 news release 9 analysis of supplier quality 10 tax returns

Uncertainty may hinder a manager's ability to: I Adequately define a problem II Identify all potential solution options III Predict the outcome of various solution options

Uncertainties and biases can affect I Organisational vision II Core competencies III Operating plans

A value chain is the sequence of business processes in which value is added to a product or service. Consider a manufacturing company that produces and sells dog food. Match each business activity listed on the left with the element of the value chain that best describes it. Each item has only one correct answer.

Cost accounting information is used for

Which of the following is the best example of an internal report that might come from an organisation's information system?

Financial statements are

How are organisational strategies related to core competencies?