Managerial Accounting Includes the Controlling Function

question 30

Multiple Choice

Managerial accounting includes the controlling function. Which of the following items would be part of the controlling function of a business's managerial accounting?

• A) Comparing actual performance to previously budgeted amounts
• B) Creating detailed budgets
• C) Devising marketing and production plans
• D) Setting product prices

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Definitions:

Market Failure

A scenario in which the distribution of goods and services through an unregulated market leads to inefficiencies, resulting in a decrease in overall social welfare.

Lost Surplus

Refers to the welfare that is lost to consumers or producers due to market inefficiencies or interventions, such as taxes or price ceilings.

Public Good

A product that one individual can consume without reducing its availability to another individual and from which no one is excluded.

National Defense

The government functions and mechanisms aimed at protecting a country against external aggression, threats, and maintaining sovereignty.