Exam 1

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EXAM 1
Question 1 1.5 out of 1.5 points
Managerial accounting stresses accounting concepts and procedures that are relevant to preparing reports for

Selected Answer: internal users of accounting information.
Correct Answer: internal users of accounting information.

Question 2 1.5 out of 1.5 points
The principle that managers follow when they only investigate departures from the plan that appear to be significant is commonly known as

Selected Answer: management by exception.
Correct Answer: management by exception.

Question 3 1.5 out of 1.5 points
Which of the following costs does not change when the level of business activity changes?

Selected Answer: total fixed costs
Correct Answer: total fixed costs

Question 4 1.5 out of 1.5 points
Which of the following is not likely to be a fixed cost?

Selected Answer: direct materials
Correct Answer: direct materials

Question 5 1.5 out of 1.5 points
A sunk cost is a cost

Selected Answer: incurred in the past which is not relevant to present decisions. Correct Answer: incurred in the past which is not relevant to present decisions.

Question 6 1.5 out of 1.5 points
In a period when anticipated production is 10,000 units, budgeted variable costs are $85,000 and budgeted fixed costs are $45,000. If 12,000 units are actually produced, what is the expected total cost?

Selected Answer: $147,000
Correct Answer: $147,000

Question 7 1.5 out of 1.5 points
Variable cost per unit

Selected Answer: does not change when the number of units produced increases. Correct Answer: does not change when the number of units produced increases.

Question 8 1.5 out of 1.5 points
You own a car and are trying to decide whether or not to trade it in and buy a new car. Which of the following costs is an opportunity cost in this situation?

Selected Answer: the trip to Europe that you will not be able to take if you buy the car Correct Answer: the trip to Europe that you will not be able to take if you buy the car

Question 9 1.5 out of 1.5 points
Which of the following is not one of the questions you should ask when faced with an ethical dilemma?

Selected Answer: Do I think I will get caught?
Correct Answer: Do I think I will get caught?

Question 10 1.5 out of 1.5 points
Which of the following costs is part of manufacturing overhead?

Selected Answer: Indirect labor
Correct Answer: Indirect labor

Question 11 1.5 out of 1.5 points
Product costs

Selected Answer: All of the above answers are correct.
Correct Answer: All of the above answers are correct.

Question 12 1.5 out of 1.5 points
Which of the following is not a period cost?

Selected Answer: Direct materials
Correct Answer: Direct materials

Question 13 1.5 out of 1.5 points
Which of the following companies is most likely to use a process costing system?

Selected Answer: A company that produces petroleum products Correct Answer: A company that produces petroleum products

Question 14 1.5 out of 1.5 points
An allocation base is

Selected Answer: a common characteristic that jobs share, which is used to spread the overhead costs among the various jobs. Correct Answer: a common characteristic that jobs share, which is used to spread the overhead costs among the various jobs.

Question 15 0 out of 1.5 points
Which of the following statements about job-order costing is not true?

Selected Answer: Manufacturing overhead cannot be traced directly to jobs, so it is assigned using the overhead allocation rate. Correct Answer: Indirect labor is traced to jobs using time tickets.

Question 16 1.5 out of 1.5 points
Which of the following is the most reasonable allocation base for a highly mechanized process?

Selected Answer: machine hours
Correct Answer: machine hours

Question 17 1.5 out of 1.5 points
A predetermined overhead rate is preferred over an actual overhead rate because a predetermined...
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