Class Exercise

1. Which of the following statements about qualities of good information is false?

A. It should be relevant for its purposes
B. It should be communicated to the right person
C. It should be completely accurate
D. D It should be timely

2. Which of the following statements about management accounting information is/are true?
1 They must be stated in purely monetary terms
2 Limited companies must, by law, prepare management accounts
3 They serve as a future planning tool and are not used as an historical record
A. 1, 2 and 3
B. 1 and 2
C. 2 only
D. None of the statements is true

3. Good information should have certain qualities. Which of the following are qualities of good
information?
1 Complete
2 Extensive
3 Relevant
4 Accurate
A. 1, 2 and 3
B. 1, 3 and 4
C. 2 and 4
D. All of them

4. Which of the following statements is/are correct?

1 Information for decision-making should incorporate uncertainty in some way
2 The data used to prepare financial accounts and management accounts are the same
A. 1 is true and 2 is false
B. 2 is true and 1 is false
C. Both are true
D. Both are false

5. Which of the following statements is correct?

A. Management accounting systems provide information for use in fulfilling legal requirements
B. Management accounting systems provide information for the use of decision-makers within
an organisation
C. Management accounting systems provide information for use by shareholders
D. Management accounting systems provide information for use by tax authorities

6. Which of the following is not the feature of management accounting?

A. Emphasis on Timeliness
B. Emphasis on Precision
C. Emphasis on Future
D. Emphasis on Relevance