WGU D101 COST AND
MANAGERIAL
ACCOUNTING EXAM
QUESTIONS WITH
CORRECT ANSWERS
, WGU D101 COST AND MANAGERIAL ACCOUNTING EXAM
QUESTIONS WITH CORRECT ANSWERS
A company has a warehouse supervisor whose annual costs to the company are $40,000. The
warehouse is used to receive and store packaged goods in boxes. Once a customer's order is
received, the boxes are removed and shipped. The company is trying to determine what the
best way is to allocate the warehouse supervisor's annual costs to each customer order that is
shipped during the year.
What is the appropriate cost driver to allocate the warehouse supervisor's annual costs to each
customer order?
a. The number of boxes received in the warehouse throughout the year
b. The number of boxes in the warehouse at the beginning of the year
c. The number of boxes shipped to customers throughout the year
d. The number of boxes in the warehouse at the end of the year - - Answer --c. Correct! The
number of boxes shipped to customers throughout the year is the appropriate cost driver in this
situation as the company's objective is to determine the best way to allocate the warehouse
person's annual costs to each customer order shipped during the year.
A company has accrued but has not paid direct labor wages in cash. What is part of the journal
entry to record the amount of direct labor wages earned?
a. Debit finished goods inventory
b. Debit work-in-process inventory
c. Debit manufacturing overhead
d. Credit work-in-process inventory - - Answer --b.
A company is using process costing, which cost step should be followed?
a. Calculate the manufacturing overhead costs for each product
b. Calculate the direct labor costs for each product
c. Calculate the direct materials costs for each product
d. Calculate the average cost using total manufacturing costs for each product - - Answer --d.
An overapplication of manufacturing overhead would be corrected by which entry?
a. Debiting cost of goods sold and crediting manufacturing overhead
b. Debiting manufacturing overhead and crediting cost of goods sold
c. Debiting work-in-process inventory and crediting manufacturing overhead
d. Debiting finished goods inventory and crediting manufacturing overhead - - Answer --b.
Applied manufacturing overhead is directly recorded as a credit to which account?
a. Cost of goods sold
b. Work-in-process inventory
c. Manufacturing overhead
d. Finished goods inventory - - Answer --c.
Assume a production process using process costing starts with a certain number of units in
beginning inventory that are partially completed, a certain number of units are started and
, completed during the period, and the ending inventory at the end of the period is partially
complete.
How would you determine the equivalent units of production in this situation for the period?
a. You would add the work required to complete the units in beginning inventory plus the degree
of completion of the ending inventory units.
b. You would add the work required to start and complete the units started during the period
plus the degree of completion of the ending inventory units.
c. You would add the work required to complete the units in beginning inventory to the number
of units started and completed during the period to the degree of completion of the ending
inventory units.
d. You would add the work required to complete the - - Answer --c. Correct! To determine the
equivalent units of production in this situation in this period, you would add the work required to
complete the units in beginning inventory plus the number of units started and completed during
the period plus the degree of completion of the ending inventory units.
At the end of an accounting period, the manufacturing overhead account has debits totaling
$25,000 and credits totaling $28,000. In this case, which statement is true?
a. Actual manufacturing costs were $28,000.
b. Manufacturing overhead is underapplied by $3,000.
c. Manufacturing overhead is overapplied by $3,000.
d. Applied manufacturing overhead costs were $25,000. - - Answer --c.
Filler Rox Company is concerned about current tariffs being put in place by different countries
where it operates. Filler Rox's management wants to know how the company could handle an
inability to get the raw materials it needs to make products.
When considering how a shock like this could affect Filler Rox's profitability, which of the
following tools would be most helpful?
a. Margin of safety
b. Gross margin
c. Degree of operating leverage
d. Operating leverage - - Answer --a. Correct! Margin of safety is a measure of how close a
company currently is to breakeven, and, therefore, is a measure of how well it could handle a
decrease in sales before it starts to lose money.
How are actual manufacturing overhead costs incurred throughout the year journalized?
a. As debits to the work-in-process account
b. As debits into the manufacturing overhead account
c. As credits into the manufacturing overhead account
d. As credits to the work-in-process account - - Answer --b.
How is an ABC cost driver activity rate computed?
a. Direct labor hours divided by the cost pool total
MANAGERIAL
ACCOUNTING EXAM
QUESTIONS WITH
CORRECT ANSWERS
, WGU D101 COST AND MANAGERIAL ACCOUNTING EXAM
QUESTIONS WITH CORRECT ANSWERS
A company has a warehouse supervisor whose annual costs to the company are $40,000. The
warehouse is used to receive and store packaged goods in boxes. Once a customer's order is
received, the boxes are removed and shipped. The company is trying to determine what the
best way is to allocate the warehouse supervisor's annual costs to each customer order that is
shipped during the year.
What is the appropriate cost driver to allocate the warehouse supervisor's annual costs to each
customer order?
a. The number of boxes received in the warehouse throughout the year
b. The number of boxes in the warehouse at the beginning of the year
c. The number of boxes shipped to customers throughout the year
d. The number of boxes in the warehouse at the end of the year - - Answer --c. Correct! The
number of boxes shipped to customers throughout the year is the appropriate cost driver in this
situation as the company's objective is to determine the best way to allocate the warehouse
person's annual costs to each customer order shipped during the year.
A company has accrued but has not paid direct labor wages in cash. What is part of the journal
entry to record the amount of direct labor wages earned?
a. Debit finished goods inventory
b. Debit work-in-process inventory
c. Debit manufacturing overhead
d. Credit work-in-process inventory - - Answer --b.
A company is using process costing, which cost step should be followed?
a. Calculate the manufacturing overhead costs for each product
b. Calculate the direct labor costs for each product
c. Calculate the direct materials costs for each product
d. Calculate the average cost using total manufacturing costs for each product - - Answer --d.
An overapplication of manufacturing overhead would be corrected by which entry?
a. Debiting cost of goods sold and crediting manufacturing overhead
b. Debiting manufacturing overhead and crediting cost of goods sold
c. Debiting work-in-process inventory and crediting manufacturing overhead
d. Debiting finished goods inventory and crediting manufacturing overhead - - Answer --b.
Applied manufacturing overhead is directly recorded as a credit to which account?
a. Cost of goods sold
b. Work-in-process inventory
c. Manufacturing overhead
d. Finished goods inventory - - Answer --c.
Assume a production process using process costing starts with a certain number of units in
beginning inventory that are partially completed, a certain number of units are started and
, completed during the period, and the ending inventory at the end of the period is partially
complete.
How would you determine the equivalent units of production in this situation for the period?
a. You would add the work required to complete the units in beginning inventory plus the degree
of completion of the ending inventory units.
b. You would add the work required to start and complete the units started during the period
plus the degree of completion of the ending inventory units.
c. You would add the work required to complete the units in beginning inventory to the number
of units started and completed during the period to the degree of completion of the ending
inventory units.
d. You would add the work required to complete the - - Answer --c. Correct! To determine the
equivalent units of production in this situation in this period, you would add the work required to
complete the units in beginning inventory plus the number of units started and completed during
the period plus the degree of completion of the ending inventory units.
At the end of an accounting period, the manufacturing overhead account has debits totaling
$25,000 and credits totaling $28,000. In this case, which statement is true?
a. Actual manufacturing costs were $28,000.
b. Manufacturing overhead is underapplied by $3,000.
c. Manufacturing overhead is overapplied by $3,000.
d. Applied manufacturing overhead costs were $25,000. - - Answer --c.
Filler Rox Company is concerned about current tariffs being put in place by different countries
where it operates. Filler Rox's management wants to know how the company could handle an
inability to get the raw materials it needs to make products.
When considering how a shock like this could affect Filler Rox's profitability, which of the
following tools would be most helpful?
a. Margin of safety
b. Gross margin
c. Degree of operating leverage
d. Operating leverage - - Answer --a. Correct! Margin of safety is a measure of how close a
company currently is to breakeven, and, therefore, is a measure of how well it could handle a
decrease in sales before it starts to lose money.
How are actual manufacturing overhead costs incurred throughout the year journalized?
a. As debits to the work-in-process account
b. As debits into the manufacturing overhead account
c. As credits into the manufacturing overhead account
d. As credits to the work-in-process account - - Answer --b.
How is an ABC cost driver activity rate computed?
a. Direct labor hours divided by the cost pool total
