Managerial Accounting Exam Bank
Course Introduction
Managerial Accounting provides students with an in-depth understanding of how accounting information is used by managers to plan, control, and make decisions within organizations. The course covers key concepts such as cost behavior, budgeting, performance evaluation, variance analysis, and decision-making techniques, emphasizing the role of accounting data in internal business processes. Through real-world case studies and practical exercises, students learn to analyze financial information, develop managerial strategies, and apply accounting tools to improve organizational efficiency and effectiveness.
Recommended Textbook
Managerial Accounting 4th Edition by
Karen W. Braun
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15 Chapters
3456 Verified Questions
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Page 2
Chapter 1: Introduction to Managerial Accounting
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Sample Questions
Q1) Managerial accounting reports are always prepared on a quarterly and annual basis.
A)True
B)False
Answer: False
Q2) Managers and other internal users are the primary users of managerial accounting information.
A)True
B)False
Answer: True
Q3) ________ is the business philosophy and a strategy of manufacturing without waste.
A)ISO 9001
B)Lean thinking
C)TQM
D)Thin manufacturing
Answer: B
Q4) Discuss at least four differences between financial accounting and managerial accounting.
Answer: 11ea7fd5_6646_833a_99dd_2fd8089c57d5_TB1766_00
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Chapter 2: Building Blocks of Managerial Accounting
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Sample Questions
Q1) To forecast total costs at a given level of production,management would use which of the following calculations?
A)Average cost × total units predicted
B)Total fixed cost × total units predicted
C)Total fixed cost + (variable cost per unit × total units predicted)
D)Total fixed cost + variable cost per unit
Answer: C
Q2) Which of the following would not be considered a direct cost of a mattress?
A)Fabric
B)Lumber
C)Glue
D)Steel
Answer: C
Q3) The total cost of a cost object can only include the direct costs that are directly traced to that cost object.
A)True
B)False
Answer: False
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4
Chapter 3: Job Costing
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Sample Questions
Q1) In the basic flow of inventory through a manufacturing system,which of the following occurs second in the job costing system?
A)Cost of goods sold
B)Finished goods inventory
C)Work in process inventory
D)Raw materials inventory
Answer: C
Q2) Which of the following would be an example of a typical manufacturing overhead cost?
A)Direct materials
B)Sales revenue
C)Direct labor
D)Depreciation on factory equipment
Answer: D
Q3) The journal entries needed for job costing at a service company
A)are more complicated than those needed at a manufacturing company.
B)are virtually the same as those needed at a manufacturing company.
C)include the movement of inventory.
D)are simpler than those needed at a manufacturing company.
Answer: D
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Chapter 4: Activity-Based Costing, lean Operations, and the Costs of Quality
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Sample Questions
Q1) The costs incurred when poor quality goods or services are detected and corrected before delivery to customers are called ________ costs.
A)appraisal
B)external failure
C)prevention
D)internal failure
Q2) Which of the following cost of quality categories represent the cost incurred to "rework a defective product" before the product is shipped to a consumer?
A)Prevention costs
B)Appraisal costs
C)Internal failure costs
D)External failure costs
Q3) The goal of value-engineering is to eliminate all waste in the system by making the company's processes as effective and efficient as possible.
A)True
B)False
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6
Chapter 5: Process Costing
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Sample Questions
Q1) The journal entry to record the use of direct materials in Processing Department #1 would include a credit to Raw Materials Inventory.
A)True
B)False
Q2) On a production cost report,the following cost(s)would appear
A)beginning work in process.
B)costs added during the period.
C)total operating costs during the period.
D)Both A and B are included on a production cost report.
Q3) The full-time employees at Rocky Corporation work 8 hours per day,while the part-time employees work 6 hours per day.Rocky has 2,250 full-time employees and 900 part-time employees.What is the number of full-time equivalent employees?
A)2,363
B)2,925
C)3,150
D)2,250
Q4) Costs are transferred,along with the units,from one WIP Inventory to the next.
A)True
B)False
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Chapter 6: Cost Behavior
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Sample Questions
Q1) Managers should consider which of the following when predicting costs at different volumes?
A)The relevant range of the cost
B)The type of cost behavior
C)Both of the above should be considered.
D)Neither of the above should be considered.
Q2) The contribution margin is equal to
A)sales minus cost of goods sold.
B)sales minus operating expenses.
C)sales minus fixed expenses.
D)sales minus variable expenses.
Q3) When using the high-low method,what is the correct order of the following three steps?
I.write the cost equation
Ii.find the vertical intercept
Iii.find the slope
A)i,ii,iii
B)ii,iii,i
C)iii,ii,i
D)iii,i,ii
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Chapter 7: Cost-Volume-Profit Analysis
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Sample Questions
Q1) Wallace Incorporated sells its products for $520 per unit.Variable costs are currently 45% of sales revenue.Fixed expenses are $125,840 per year. What is the breakeven point in units at the current selling price?
A)167 units
B)286 units
C)440 units
D)538 units
Q2) CVP assumes that inventory levels will not change.
A)True
B)False
Q3) To calculate the weighted average contribution margin,divide the sum of the individual product contribution margins by the sales mix in units.
A)True
B)False
Q4) Which of the following is not an approach used to calculate the breakeven point?
A)The income statement approach
B)The shortcut approach using the unit contribution margin
C)The balance sheet approach
D)The shortcut approach using the contribution margin ratio
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Chapter 8: Relevant Costs for Short-Term Decisions
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Sample Questions
Q1) Mountaintop golf course is planning for the coming season.Investors would like to earn a 12% return on the company's $45 million of assets.The company primarily incurs fixed costs to groom the greens and fairways.Fixed costs are projected to be $20,000,000 for the golfing season.About 400,000 golfers are expected each year.Variable costs are about $15 per golfer.The Mountaintop golf course is a price-taker and won't be able to charge more than its competitors who charge $75 per round of golf.What profit will it earn in terms of dollars?
A)$16,000,000
B)$(4,000,000)
C)$4,000,000
D)$(20,000,000)
Q2) Sunk costs should be considered when deciding whether to sell a product as is or process it further.
A)True
B)False
Q3) When setting prices,managers need to consider all costs.
A)True
B)False
Q4) Buy the part and use facilities to make another product
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Chapter 9: The Master Budget
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Sample Questions
Q1) Strategic planning involves setting short-term goals that extend three to four months into the future.
A)True
B)False
Q2) The capital expenditures budget is not a component of the operating budget.
A)True
B)False
Q3) Budget committees include all of the following people except A)CEO.
B)Research and development manager.
C)Shareholder.
D)Marketing manager.
Q4) The master budget is the set of budgeted financial statements and supporting schedules in the entire organization.
A)True
B)False
Q5) The sales budget must be prepared after every other component of the operating budget.
A)True
B)False
Page 11
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Chapter 10: Performance Evaluation
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Sample Questions
Q1) The ________ is a budget based on multiple levels of projected sales or production.
A)standard budget
B)flexible budget
C)static budget
D)fixed budget
Q2) All favorable variances are investigated when using management by exception.
A)True
B)False
Q3) Management by exception would dictate that the manager investigate which of the following variances?
A)Variances which are less than budget and actual dollar amount or percentage
B)Variances which are greater than a budget and actual dollar amount or percentage
C)All unfavorable variances
D)All favorable and unfavorable variances
Q4) The weighted average cost of capital is a component of the Return on Investment (ROI)calculation.
A)True
B)False
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Chapter 11: Standard Costs and Variances
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Sample Questions
Q1) The direct labor rate variance is calculated by multiplying the standard hours that should have been worked for the actual output by the difference between the standard labor rate and the actual labor rate.
A)True
B)False
Q2) A(n)________ "arises because the number of units actually sold differs from the static budget units."
A)flexible budget
B)sales volume variance
C)benchmarking
D)overhead flexible budget variance
Q3) Theresa Corporation,which manufactures baskets,is developing direct labor standards.The basic direct labor rate is $23.00 per hour.Payroll taxes are 10% of the basic direct labor rate,while fringe benefits such as vacation and health care insurance,are $8.00 per hour.What is the standard rate per direct labor hour?
A)$33.30
B)$23.00
C)$25.30
D)$31.00
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Chapter 12: Capital Investment Decisions and the Time
Value of Money
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Sample Questions
Q1) (Present value tables required)If you invest $1,200 at the end of every year for five years at an interest rate of 10%,the balance of your investment in 5 years will be closest to
A)$1,933.
B)$6,000.
C)$7,326.
D)$4,549.
Q2) The Future Value of $1 table is used to calculate how much $100 in hand today would be worth in 5 years.
A)True
B)False
Q3) Self-check-in machines at airports are an example of capital assets.
A)True
B)False
Q4) The internal rate of return is used as the discount rate when calculating the net present value of a project.
A)True
B)False
Page 14
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Chapter 13: Statement of Cash Flows
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Sample Questions
Q1) Which of the following statements is true about information in a statement of cash flows?
A)The statement of cash flows is one of the required financial statements for publicly-held companies.
B)The statement of cash flows is prepared at the option of management.
C)The statement of cash flows is combined with the income statement.
D)The statement of cash flows is not completed when an income statement is prepared.
Q2) Money borrowed for a mortgage would be a(n)________ activity.
A)operating
B)financing
C)investing
D)non-cash
Q3) A company uses the indirect method to prepare the statement of cash flows.In determining the net cash flow from operating activities,which of the following items would be added to net income?
A)An increase in dividends paid would be added to net income.
B)An increase in accrued liabilities would be added to net income.
C)A decrease in accounts payable would be added to net income.
D)A gain on the sale of land would be added to net income.
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Page 15
Chapter 14: Financial Statement Analysis
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Sample Questions
Q1) A table that lists items of a balance sheet in dollars and percentages for two companies would be
A)used for vertical analysis.
B)a common-size balance sheet.
C)used for benchmarking.
D)used for horizontal analysis.
Q2) Rate of return on net sales is a measure of a company's profitability.
A)True
B)False
Q3) The inventory turnover ratio is the ratio of cost of goods sold to average inventory.
A)True
B)False
Q4) The inventory turnover ratio indicates how rapidly inventory is sold.
A)True
B)False
Q5) A trend percentage is computed by dividing the dollar amount of change by the base-year amount.
A)True
B)False
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Chapter 15: Sustainability
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Sample Questions
Q1) There are several reasons an organization might pursue sustainable initiatives."As a result of significant increase in the number of non-compliance notices it received in a recent year,an organization increased sustainability training and focused management attention on sustainability." This situation is an example of which type of reason to implement sustainable initiatives?
A)Cost reduction
B)Regulatory compliance
C)Stakeholder influence
D)Competitive strategy
Q2) Due to the relative infancy of environmental management accounting,the tools utilized are continuously being developed and improved.
A)True
B)False
Q3) Sustainability considers not only the needs of the present generation,but also the needs of future generations.
A)True
B)False
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