ACTG 244 T/F FINAL EXAM QUESTIONS WITH
VERIFIED ANSWERS
Managerial accounting emphasizes the use of generally accepted accounting principles
in developing its information - Answers - FALSE, GAAP is the rules for financial
accounting
While financial accounting focuses on the entity as a whole, managerial accounting may
focus on individual products, services, or activities - Answers - True
Managerial accounting is intended for internal users - Answers - True
-financial accounting is for investors/banks/etc.
A variable cost is constant per unit of activity - Answers - True
-ex. $27 per unit
A direct relationship exists between fixed costs and activity - Answers - False
Fixed cost per unit stay the same regardless of the level of activity - Answers - False
-fixed cost per unit varies inversely with the activity level
A mixed cost is one that has both a direct and an indirect cost component - Answers -
False, a fixed and a mixed variable component
The equation for total mixed costs is: Fixed cost + (variable cost * number of units of
activity) - Answers - True
In calculating total cost, it is important to use the correct cost driver - Answers - True
-the independent variable is "activity level", which is usually quantity of goods or
services sold, but the independent variable needs to be defined precisely, not roughly.
Contribution margin is the excess of revenues over cost of goods sold - Answers - False
revenues - variable costs
Cost of goods sold is a variable expense - Answers - True (for manufacturing, it is
mixed/semivariable)
The wages of employees who are paid based on the number of customers served are
variable expenses - Answers - True
Insurance, depreciation and advertising are typically mixed costs - Answers - False
-these are typical examples of fixed costs, but they can sometimes be at least slightly
mixed
VERIFIED ANSWERS
Managerial accounting emphasizes the use of generally accepted accounting principles
in developing its information - Answers - FALSE, GAAP is the rules for financial
accounting
While financial accounting focuses on the entity as a whole, managerial accounting may
focus on individual products, services, or activities - Answers - True
Managerial accounting is intended for internal users - Answers - True
-financial accounting is for investors/banks/etc.
A variable cost is constant per unit of activity - Answers - True
-ex. $27 per unit
A direct relationship exists between fixed costs and activity - Answers - False
Fixed cost per unit stay the same regardless of the level of activity - Answers - False
-fixed cost per unit varies inversely with the activity level
A mixed cost is one that has both a direct and an indirect cost component - Answers -
False, a fixed and a mixed variable component
The equation for total mixed costs is: Fixed cost + (variable cost * number of units of
activity) - Answers - True
In calculating total cost, it is important to use the correct cost driver - Answers - True
-the independent variable is "activity level", which is usually quantity of goods or
services sold, but the independent variable needs to be defined precisely, not roughly.
Contribution margin is the excess of revenues over cost of goods sold - Answers - False
revenues - variable costs
Cost of goods sold is a variable expense - Answers - True (for manufacturing, it is
mixed/semivariable)
The wages of employees who are paid based on the number of customers served are
variable expenses - Answers - True
Insurance, depreciation and advertising are typically mixed costs - Answers - False
-these are typical examples of fixed costs, but they can sometimes be at least slightly
mixed
