Cost Accounting Final Exam Newest 2026/2027
Questions and Correct Detailed Answers
Already Graded A+
A cost incurred in the past that is not relevant to any current decision is classified
as a(n):
A) differential cost
B) opportunity cost
C) sunk cost
D) period cost - CORRECT ANSWER-sunk cost
To obtain the dollar sales volume necessary to attain a given target profit, which
of the following formulas should be used?
A) (Fixed expenses + Target net profit)/Contribution margin ratio
B) (Fixed expenses + Target net profit)/Total contribution margin
C) Fixed expenses/Contribution margin per unit
D) Target net profit/Contribution margin ratio - CORRECT ANSWER-(Fixed
expenses + Target net profit)/Contribution margin ratio
,If the degree of operating leverage is 4, then a one percent change in quantity
sold should result in a four percent change in:
A) unit contribution margin
B) variable expense
C) revenue
D) net operating income - CORRECT ANSWER-net operating income
For an automobile manufacturer, the cost of a driver's side air bag purchased
from a supplier and installed in every automobile would best described as a:
A) fixed cost
B) mixed cost
C) variable cost
D) step-variable cost - CORRECT ANSWER-variable cost
When manufacturing overhead is applied to production, it is added to:
A) the Raw Materials account
B) the Finished Goods inventory account
C) the Work in Process account
D) the Cost of Goods Sold account - CORRECT ANSWER-the Work in Process
account
,Cassius
A) 16,400 units
B) 9,400 units
C) 42,000 units
D) 35,000 units - CORRECT ANSWER-9,400 units
In a job-order costing system that is based on machine-hours, which of the
following formulas is correct?
A) Predetermined overhead rate = Estimated manufacturing overhead / Actual
machine-hours
B) Predetermined overhead rate = Estimated manufacturing overhead / Estimated
machine-hours
C) Predetermined overhead rate = Actual manufacturing overhead / Estimated
machine-hours
D) Predetermined overhead rate = Actual manufacturing overhead / Actual
machine-hours - CORRECT ANSWER-Predetermined overhead rate = Estimated
manufacturing overhead / Estimated machine-hours
The journal entry to record applying overhead during the production process is:
A) Finished Goods XXX
, Manufacturing Overhead XXX
B) Manufacturing Overhead XXX
Finished Goods XXX
C) Work in Process XXX
Manufacturing Overhead XXX
D) Manufacturing Overhead XXX
Work in Process XXX - CORRECT ANSWER-Work in Process XXX
Manufacturing Overhead XXX
When computing the cost per equivalent unit, weighted-average method of
process costing considers:
A) costs incurred during the current period less cost of beginning work in process
inventory
B) costs incurred during the current period plus cost beginning work in process
inventory
C) costs incurred during the current period only
D) costs incurred during the current period plus cost of ending work in process
inventory - CORRECT ANSWER-costs incurred during the current period plus
cost of beginning work in process inventory
Questions and Correct Detailed Answers
Already Graded A+
A cost incurred in the past that is not relevant to any current decision is classified
as a(n):
A) differential cost
B) opportunity cost
C) sunk cost
D) period cost - CORRECT ANSWER-sunk cost
To obtain the dollar sales volume necessary to attain a given target profit, which
of the following formulas should be used?
A) (Fixed expenses + Target net profit)/Contribution margin ratio
B) (Fixed expenses + Target net profit)/Total contribution margin
C) Fixed expenses/Contribution margin per unit
D) Target net profit/Contribution margin ratio - CORRECT ANSWER-(Fixed
expenses + Target net profit)/Contribution margin ratio
,If the degree of operating leverage is 4, then a one percent change in quantity
sold should result in a four percent change in:
A) unit contribution margin
B) variable expense
C) revenue
D) net operating income - CORRECT ANSWER-net operating income
For an automobile manufacturer, the cost of a driver's side air bag purchased
from a supplier and installed in every automobile would best described as a:
A) fixed cost
B) mixed cost
C) variable cost
D) step-variable cost - CORRECT ANSWER-variable cost
When manufacturing overhead is applied to production, it is added to:
A) the Raw Materials account
B) the Finished Goods inventory account
C) the Work in Process account
D) the Cost of Goods Sold account - CORRECT ANSWER-the Work in Process
account
,Cassius
A) 16,400 units
B) 9,400 units
C) 42,000 units
D) 35,000 units - CORRECT ANSWER-9,400 units
In a job-order costing system that is based on machine-hours, which of the
following formulas is correct?
A) Predetermined overhead rate = Estimated manufacturing overhead / Actual
machine-hours
B) Predetermined overhead rate = Estimated manufacturing overhead / Estimated
machine-hours
C) Predetermined overhead rate = Actual manufacturing overhead / Estimated
machine-hours
D) Predetermined overhead rate = Actual manufacturing overhead / Actual
machine-hours - CORRECT ANSWER-Predetermined overhead rate = Estimated
manufacturing overhead / Estimated machine-hours
The journal entry to record applying overhead during the production process is:
A) Finished Goods XXX
, Manufacturing Overhead XXX
B) Manufacturing Overhead XXX
Finished Goods XXX
C) Work in Process XXX
Manufacturing Overhead XXX
D) Manufacturing Overhead XXX
Work in Process XXX - CORRECT ANSWER-Work in Process XXX
Manufacturing Overhead XXX
When computing the cost per equivalent unit, weighted-average method of
process costing considers:
A) costs incurred during the current period less cost of beginning work in process
inventory
B) costs incurred during the current period plus cost beginning work in process
inventory
C) costs incurred during the current period only
D) costs incurred during the current period plus cost of ending work in process
inventory - CORRECT ANSWER-costs incurred during the current period plus
cost of beginning work in process inventory
