Question 1

Robin Company has the following balances for the current month: What is Robin's total manufacturing overhead?

Accepted Answer

A)  $14,400
B)  $28,800
C)  $20,800
D)  $33,600E) B) and C)
F) A) and B)

Question 2

Which of the following describes one of the Directing/Leading functions of management?

Accepted Answer

A)  Setting short and long-term objectives
B)  Comparing actual to budgeted results and taking corrective action
C)  Taking actions to implement the plan
D)  Arranging the necessary resources to carry out the planE) C) and D)
F) B) and D)

Question 3

Costs that can be traced to a specific cost object are

Accepted Answer

A)  opportunity costs.
B)  direct costs.
C)  indirect costs.
D)  irrelevant costs.E) A) and C)
F) A) and B)

Question 4

Manufacturing costs are

Accepted Answer

A)  always relevant.
B)  always fixed.
C)  the costs incurred to produce a final product.
D)  split into prime costs and conversion costs.E) A) and C)
F) C) and D)

Question 5

What determines the difference between a variable and a fixed cost?

Accepted Answer

A)  Whether the total cost changes when activity levels change.
B)  Whether the total cost is relevant to a particular decision.
C)  Whether the total cost can be traced to a specific cost object.
D)  Whether the total cost is related to manufacturing or nonmanufacturing activities.E) A) and B)
F) A) and C)

Question 6

Accounting is primarily intended to facilitate

Accepted Answer

A)  starting a business.
B)  decision making.
C)  ethics investigations.
D)  cost tracing.E) B) and D)
F) None of the above

Question 7

Which of the following is an indirect cost of manufacturing a table made of wood and glass,for a firm that manufactures furniture?

Accepted Answer

A)  The cost of the wood in the table.
B)  The cost of the labor used to assemble the table.
C)  The cost of the glass in the table.
D)  The cost of rent on the factory where the table is manufactureD.Costs that cannot be traced to a specific cost object,or that are not worth the effort of tracing,are indirect costs,such as the cost of rent on the factory.E) B) and C)
F) All of the above

Question 8

Prime costs are the same as

Accepted Answer

A)  Manufacturing costs minus non-manufacturing costs.
B)  Manufacturing costs minus manufacturing overhead.
C)  Manufacturing costs minus fixed costs.
D)  Manufacturing costs minus direct materials.E) B) and D)
F) All of the above

Question 9

Product costs are reported

Accepted Answer

A)  only on the balance sheet.
B)  only on the income statement.
C)  on the balance sheet before goods are sold,and on the income statement after goods are sold.
D)  on the income statement before goods are sold,and on the balance sheet after goods are solD.Product costs are counted as inventory (an asset) until the product is sold,at which point they are reported as Cost of Goods Sold on the income statement.E) A) and B)
F) A) and C)

Question 10

For a cost to be relevant,it must

Accepted Answer

A)  differ between decision alternatives.
B)  have already been incurred.
C)  not influence a decision.
D)  not be a differential cost.E) B) and C)
F) A) and D)

Question 11

Properly applied,ethics provide a clear right or wrong answer to the business situations facing accountants and managers.Ethics refers to the standards of conduct for judging right from wrong,honest from dishonest,and fair from unfair.

Accepted Answer

A) True 
 B)False

Question 12

Variable costs are

Accepted Answer

A)  costs that are not worth the effort to trace to a specific cost object.
B)  costs that change,in total,in direct proportion to changes in activity levels.
C)  always irrelevant.
D)  costs that remain constant no matter the activity level.E) None of the above
F) B) and C)

Question 13

To earn summer money,Joe could mow lawns in his neighborhood,or he could work at a local grocery store.Which of the following is an opportunity cost of mowing lawns?

Accepted Answer

A)  Cash paid for gas to run the lawnmower.
B)  The time spent mowing the lawns.
C)  The wages he could have earned working at the grocery store.
D)  Depreciation on the lawnmower.E) C) and D)
F) A) and B)

Question 14

Which of the following statements concerning costs is incorrect?

Accepted Answer

A)  Costs are treated differently depending on how the information will be used.
B)  Out-of-pocket costs include the costs associated with not taking a particular course of action.
C)  Any single cost can be classified in more than one way.
D)  Costs can be categorized on the basis of relevant or irrelevant costs.E) C) and D)
F) A) and B)

Question 15

Which of the following types of reports is more characteristic of managerial accounting than financial accounting?

Accepted Answer

A)  An internal report used by management.
B)  An external report used by investors.
C)  A report prepared according to GAAP.
D)  A report prepared periodically (monthly,quarterly,annually) .E) B) and C)
F) B) and D)

Question 16

Financial accounting information is generally used exclusively by internal parties such as managers.Financial accounting information is used by external parties;managerial accounting information is used by internal business owners and manager.

Accepted Answer

A) True 
 B)False

Question 17

All manufacturing costs are treated as product costs.GAAP requires that all manufacturing costs be treated as product costs,or costs that are assigned to the product as it is being manufactured.

Accepted Answer

A) True 
 B)False

Question 18

What is the primary goal of accounting?

Accepted Answer

A)  To set long-term goals and objectives.
B)  To arrange for the necessary resources to achieve a plan.
C)  To provide information for decision making.
D)  To motivate others to work towards a plan's success.E) A) and B)
F) A) and C)

Question 19

What determines the difference between a product cost and a period cost?

Accepted Answer

A)  Whether the cost changes when activity levels change.
B)  Whether the cost is relevant to a particular decision.
C)  Whether the cost can be traced to a specific cost object.
D)  When the cost will be matched against revenue on the income statement.E) All of the above
F) A) and B)

Question 20

Which of the following is true about product and period costs?

Accepted Answer

A)  Product costs are usually manufacturing costs,and period costs are usually nonmanufacturing costs.
B)  Product costs are usually nonmanufacturing costs,and period costs are usually manufacturing costs.
C)  Both product and period costs are usually manufacturing costs.
D)  Both product and period costs are usually nonmanufacturing costs.E) C) and D)
F) A) and C)

Exam 1: Introduction to Managerial Accounting

All manufacturing costs are treated as product costs.GAAP requires that all manufacturing costs be treated as product costs,or costs that are assigned to the product as it is being manufactured.

Correct AnswerverifiedShow Answer

What determines the difference between a variable and a fixed cost?

Correct AnswerverifiedShow Answer

What is the primary goal of accounting?

Correct AnswerverifiedShow Answer

Which of the following types of reports is more characteristic of managerial accounting than financial accounting?

Correct AnswerverifiedShow Answer

Product costs are reported

Correct AnswerverifiedShow Answer

Accounting is primarily intended to facilitate

Correct AnswerverifiedShow Answer

For a cost to be relevant,it must

Correct AnswerverifiedShow Answer

Robin Company has the following balances for the current month: What is Robin's total manufacturing overhead?

Correct AnswerverifiedShow Answer

Costs that can be traced to a specific cost object are

Correct AnswerverifiedShow Answer

Prime costs are the same as

Correct AnswerverifiedShow Answer

Properly applied,ethics provide a clear right or wrong answer to the business situations facing accountants and managers.Ethics refers to the standards of conduct for judging right from wrong,honest from dishonest,and fair from unfair.

Correct AnswerverifiedShow Answer

Which of the following describes one of the Directing/Leading functions of management?

Correct AnswerverifiedShow Answer

Which of the following is an indirect cost of manufacturing a table made of wood and glass,for a firm that manufactures furniture?

Correct AnswerverifiedShow Answer

Manufacturing costs are

Correct AnswerverifiedShow Answer

Variable costs are

Correct AnswerverifiedShow Answer

Financial accounting information is generally used exclusively by internal parties such as managers.Financial accounting information is used by external parties;managerial accounting information is used by internal business owners and manager.

Correct AnswerverifiedShow Answer

To earn summer money,Joe could mow lawns in his neighborhood,or he could work at a local grocery store.Which of the following is an opportunity cost of mowing lawns?

Correct AnswerverifiedShow Answer

What determines the difference between a product cost and a period cost?

Correct AnswerverifiedShow Answer

Which of the following statements concerning costs is incorrect?

Correct AnswerverifiedShow Answer

Which of the following is true about product and period costs?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified