Question 1

Cost-volume-proﬁt analysis and break-even calculations account for ﬁxed manufacturing overhead as a lump sum.

Accepted Answer

A) True 
 B)False  True

Question 2

Under absorption costing, which of the following is not considered a product cost?

Accepted Answer

A) direct labor. 
B) direct materials. 
C) variable manufacturing overhead. 
D) administrative costs. 
E) ﬁxed manufacturing overhead. 
A) direct labor. 
B) direct materials. 
C) variable manufacturing overhead. 
D) administrative costs. 
E) ﬁxed manufacturing overhead. D

Question 3

Income reported under absorption costing and variable costing is:

Accepted Answer

A) always the same. 
B) typically different. 
C) always higher under absorption costing. 
D) always higher under variable costing. 
E) always the same or higher under absorption costing. 
A) always the same. 
B) typically different. 
C) always higher under absorption costing. 
D) always higher under variable costing. 
E) always the same or higher under absorption costing. B

Question 4

Assuming the number of units sold and produced are the same, which of the following statements is true when comparing net income using absorption and variable costing?

Accepted Answer

A) Net income will be the same under both methods. 
B) Variable costing will yield a higher net income. 
C) Variable costing will have higher sales revenue. 
D) Absorption costing will yield a higher net income. 
E) None of these statements is true. 
A) Net income will be the same under both methods. 
B) Variable costing will yield a higher net income. 
C) Variable costing will have higher sales revenue. 
D) Absorption costing will yield a higher net income. 
E) None of these statements is true.

Question 5

What are three strategies of environmental cost management? Deﬁne each strategy.

Accepted Answer

The three strategies are:
1.End-of-pipe

Question 6

On an absorption-costing income statement, ﬁxed overhead costs are period costs.

Accepted Answer

A) True 
 B)False

Question 7

Jordan Manufacturing has the following cost information for year 20X9:   During 20X9, Jordan produced 12,500 units, out of which 11,000 were sold for $60 each. What is Jordan's net income assuming the company uses variable costing:

Accepted Answer

A) $421,600. 
B) $412,000. 
C) $425,000. 
D) $513,000. 
E) None of the answers is correct. 
A) $421,600. 
B) $412,000. 
C) $425,000. 
D) $513,000. 
E) None of the answers is correct.

Question 8

All of the following are inventoried under variable costing except:

Accepted Answer

A) direct materials. 
B) direct labor. 
C) variable manufacturing overhead. 
D) ﬁxed manufacturing overhead. 
E) variable manufacturing overhead and ﬁxed manufacturing overhead. 
A) direct materials. 
B) direct labor. 
C) variable manufacturing overhead. 
D) ﬁxed manufacturing overhead. 
E) variable manufacturing overhead and ﬁxed manufacturing overhead.

Question 9

Vega Enterprises has computed the following unit costs for the year just ended:   Under variable costing, each unit of the company's inventory would be carried at:

Accepted Answer

A) $35. 
B) $55. 
C) $65. 
D) $84. 
E) None of the answers is correct. 
A) $35. 
B) $55. 
C) $65. 
D) $84. 
E) None of the answers is correct.

Question 10

Fort Smith Technologies incurred the following costs during the past year when planned production and actual production each totaled 20,000 units:   If Fort Smith uses absorption costing, the total inventoriable costs for the year would be:

Accepted Answer

A) $400,000. 
B) $460,000. 
C) $560,000. 
D) $620,000. 
E) $660,000. 
A) $400,000. 
B) $460,000. 
C) $560,000. 
D) $620,000. 
E) $660,000.

Question 11

Riverton Corp., which began business at the start of the current year, had the following data: Planned and actual production: 40,000 units Sales: 37,000 units at $15 per unit Production costs: Variable: $4 per unit Fixed: $260,000 Selling and administrative costs: Variable: $1 per unit Fixed: $32,000 The contribution margin that the company would disclose on a variable-costing income statement is:

Accepted Answer

A) $97,500. 
B) $147,000. 
C) $166,500. 
D) $370,000. 
E) None of the answers is correct. 
A) $97,500. 
B) $147,000. 
C) $166,500. 
D) $370,000. 
E) None of the answers is correct.

Question 12

On a global scale, there are four primary environmental agreements addressing the atmosphere, hazardous substances, the marine environment, nature conservation, and nuclear power issues.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following situations would cause variable-costing income to be higher than absorption-costing income?

Accepted Answer

A) Units sold equaled 39,000 and units produced equaled 42,000. 
B) Units sold and units produced were both 42,000. 
C) Units sold equaled 55,000 and units produced equaled 49,000. 
D) Sales prices decreased by $7 per unit during the accounting period. 
E) Selling expenses increased by 10% during the accounting period. 
A) Units sold equaled 39,000 and units produced equaled 42,000. 
B) Units sold and units produced were both 42,000. 
C) Units sold equaled 55,000 and units produced equaled 49,000. 
D) Sales prices decreased by $7 per unit during the accounting period. 
E) Selling expenses increased by 10% during the accounting period.

Question 14

Income reported under absorption and variable costing can be reconciled by focusing on the effects of the ﬁve places where the two statements differ.

Accepted Answer

A) True 
 B)False

Question 15

ProTech began business at the start of the current year.The company planned to produce 40,000 units, and actual production conformed to expectations.Sales totaled 37,000 units at $42 each.Costs incurred were:   If there were no variances, the company's absorption-costing income would be:

Accepted Answer

A) $155,000. 
B) $230,000. 
C) $240,500. 
D) $592,000. 
E) None of the answers is correct. 
A) $155,000. 
B) $230,000. 
C) $240,500. 
D) $592,000. 
E) None of the answers is correct.

Question 16

What is the difference between a product's quality of design and its quality of conformance?

Accepted Answer

A product's quality of design is how wel

Question 17

Which of the following statements is false regarding absorption costing?

Accepted Answer

A) Variable overhead is treated as a product cost. 
B) Fixed overhead is treated as a product cost. 
C) Fixed overhead is expensed in the period incurred. 
D) Absorption costing is required for tax purposes. 
E) Absorption costing is required for external ﬁnancial statements prepared in accordance with generally 
A) Variable overhead is treated as a product cost. 
B) Fixed overhead is treated as a product cost. 
C) Fixed overhead is expensed in the period incurred. 
D) Absorption costing is required for tax purposes. 
E) Absorption costing is required for external ﬁnancial statements prepared in accordance with generally

Question 18

List and deﬁne four types of product quality costs.

Accepted Answer

Four types of product quality costs are

Question 19

The optimum level of product quality is where:

Accepted Answer

A) external failure costs are at a minimum. 
B) total quality costs are at a minimum. 
C) prevention costs are at a minimum. 
D) internal failure costs are at a minimum. 
E) all of the answers are correct. 
A) external failure costs are at a minimum. 
B) total quality costs are at a minimum. 
C) prevention costs are at a minimum. 
D) internal failure costs are at a minimum. 
E) all of the answers are correct.

Question 20

Foxtrot reported $65,000 of income for the year by using absorption costing.The company had no beginning inventory, planned and actual production of 20,000 units, and sales of 18,000 units.Standard variable manufacturing costs were $20 per unit, and total budgeted ﬁxed manufacturing overhead was $100,000.If there were no variances, income under variable costing would be:

Accepted Answer

A) $15,000. 
B) $55,000. 
C) $65,000. 
D) $75,000. 
E) $115,000. 
A) $15,000. 
B) $55,000. 
C) $65,000. 
D) $75,000. 
E) $115,000.

Cost-volume-proﬁt analysis and break-even calculations account for ﬁxed manufacturing overhead as a lump sum.

Under absorption costing, which of the following is not considered a product cost?

Income reported under absorption costing and variable costing is:

Assuming the number of units sold and produced are the same, which of the following statements is true when comparing net income using absorption and variable costing?

What are three strategies of environmental cost management? Deﬁne each strategy.

On an absorption-costing income statement, ﬁxed overhead costs are period costs.

Jordan Manufacturing has the following cost information for year 20X9: During 20X9, Jordan produced 12,500 units, out of which 11,000 were sold for $60 each. What is Jordan's net income assuming the company uses variable costing:

All of the following are inventoried under variable costing except:

Vega Enterprises has computed the following unit costs for the year just ended: Under variable costing, each unit of the company's inventory would be carried at:

Fort Smith Technologies incurred the following costs during the past year when planned production and actual production each totaled 20,000 units: If Fort Smith uses absorption costing, the total inventoriable costs for the year would be:

On a global scale, there are four primary environmental agreements addressing the atmosphere, hazardous substances, the marine environment, nature conservation, and nuclear power issues.

Which of the following situations would cause variable-costing income to be higher than absorption-costing income?

Income reported under absorption and variable costing can be reconciled by focusing on the effects of the ﬁve places where the two statements differ.

ProTech began business at the start of the current year.The company planned to produce 40,000 units, and actual production conformed to expectations.Sales totaled 37,000 units at $42 each.Costs incurred were: If there were no variances, the company's absorption-costing income would be:

What is the difference between a product's quality of design and its quality of conformance?

Which of the following statements is false regarding absorption costing?

List and deﬁne four types of product quality costs.

The optimum level of product quality is where:

The Changing Role of Managerial Accounting in a Dynamic Business Environment

Basic Cost Management Concepts

Product Costing and Cost Accumulation in a Batch Production Environment

Process Costing and Hybrid Product-Costing Systems

Activity-Based Costing and Management

Activity Analysis, Cost Behavior, and Cost Estimation

Cost-Volume-Profit Analysis

Financial Planning and Analysis: the Master Budget

Standard Costing and Analysis of Direct Costs

Flexible Budgeting and Analysis of Overhead Costs

Responsibility Accounting, Operational Performance Measures, and the Balanced Scorecard

Inventory Management and Economic Order Quantity (EOQ) Analysis

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Exam 8: Variable Costing and the Costs of Quality and Sustainability

Cost-volume-proﬁt analysis and break-even calculations account for ﬁxed manufacturing overhead as a lump sum.

Under absorption costing, which of the following is not considered a product cost?

Income reported under absorption costing and variable costing is:

Assuming the number of units sold and produced are the same, which of the following statements is true when comparing net income using absorption and variable costing?

What are three strategies of environmental cost management? Deﬁne each strategy.

On an absorption-costing income statement, ﬁxed overhead costs are period costs.

Jordan Manufacturing has the following cost information for year 20X9: During 20X9, Jordan produced 12,500 units, out of which 11,000 were sold for $60 each. What is Jordan's net income assuming the company uses variable costing:

All of the following are inventoried under variable costing except:

Vega Enterprises has computed the following unit costs for the year just ended: Under variable costing, each unit of the company's inventory would be carried at:

Fort Smith Technologies incurred the following costs during the past year when planned production and actual production each totaled 20,000 units: If Fort Smith uses absorption costing, the total inventoriable costs for the year would be:

On a global scale, there are four primary environmental agreements addressing the atmosphere, hazardous substances, the marine environment, nature conservation, and nuclear power issues.

Which of the following situations would cause variable-costing income to be higher than absorption-costing income?

Income reported under absorption and variable costing can be reconciled by focusing on the effects of the ﬁve places where the two statements differ.

ProTech began business at the start of the current year.The company planned to produce 40,000 units, and actual production conformed to expectations.Sales totaled 37,000 units at $42 each.Costs incurred were: If there were no variances, the company's absorption-costing income would be:

What is the difference between a product's quality of design and its quality of conformance?

Which of the following statements is false regarding absorption costing?

List and deﬁne four types of product quality costs.

The optimum level of product quality is where:

The Changing Role of Managerial Accounting in a Dynamic Business Environment

Basic Cost Management Concepts

Product Costing and Cost Accumulation in a Batch Production Environment

Process Costing and Hybrid Product-Costing Systems

Activity-Based Costing and Management

Activity Analysis, Cost Behavior, and Cost Estimation

Cost-Volume-Profit Analysis

Financial Planning and Analysis: the Master Budget

Standard Costing and Analysis of Direct Costs

Flexible Budgeting and Analysis of Overhead Costs

Responsibility Accounting, Operational Performance Measures, and the Balanced Scorecard

Inventory Management and Economic Order Quantity (EOQ) Analysis

Filters