WGU D559 Advanced Managerial Accounting: Final Exam
(Comprehensive)
50 questions
1. Beginning work in process $28,000; direct materials used $120,000; direct labor $100,000;
manufacturing overhead applied $85,000; ending work in process $13,000. What is cost of goods
manufactured?
A. $305,000
B. $346,000
C. $320,000
D. $292,000
Correct Answer: C. $320,000
Rationale: COGM = $28,000 + $120,000 + $100,000 + $85,000 - $13,000 = $320,000.
2. Beginning finished goods $38,000, cost of goods manufactured $300,000, ending finished
goods $24,000. What is cost of goods sold?
A. $314,000
B. $300,000
C. $362,000
D. $286,000
Correct Answer: A. $314,000
Rationale: COGS = $38,000 + $300,000 - $24,000 = $314,000.
3. The relevant range is:
A. The range of prices customers accept
B. The time period of the budget
C. The range of activity within which cost behavior assumptions are valid
D. The range of products produced
Correct Answer: C. The range of activity within which cost behavior assumptions are valid
Rationale: Outside it, fixed costs may change.
4. A product sells for $30 and has variable costs of $21 per unit. What is the contribution margin
ratio?
A. 70.0%
B. 42.9%
C. 57.1%
D. 30.0%
Correct Answer: D. 30.0%
Rationale: CM ratio = ($30 - $21) / $30 = 30.0%.
5. Why do companies use a predetermined overhead rate instead of actual overhead rates?
A. It is required by GAAP to use actual rates
B. Actual overhead is not known until period end and varies seasonally
C. It eliminates all overhead
D. It always equals actual costs
Correct Answer: B. Actual overhead is not known until period end and varies seasonally
Rationale: It smooths costs and allows timely pricing.
, 6. The predetermined overhead rate is $24 per direct labor-hour. Actual direct labor-hours were
28,500 and actual overhead was $679,000. What is the over- or underapplied overhead?
A. $5,000 underapplied
B. $5,000 overapplied
C. $7,000 underapplied
D. $10,000 overapplied
Correct Answer: B. $5,000 overapplied
Rationale: Applied = $24 x 28,500 = $684,000; actual $679,000 - applied = -$5,000, so overhead is
overapplied.
7. Job 47 used $6,000 of direct materials and $2,000 of direct labor (120 direct labor-hours).
Overhead is applied at $22 per direct labor-hour. What is the total cost of Job 47?
A. $8,000
B. $8,022
C. $8,640
D. $10,640
Correct Answer: D. $10,640
Rationale: $6,000 + $2,000 + (120 x $22) = $10,640.
8. If materials are added at the beginning of a process, ending work in process is:
A. 0% complete for materials
B. 50% complete for materials
C. Not counted
D. 100% complete with respect to materials
Correct Answer: D. 100% complete with respect to materials
Rationale: All materials are already in.
9. Using the weighted-average method, 9,000 units were completed and transferred out. Ending
work in process has 2,000 units that are 25% complete for conversion. What are the equivalent
units for conversion?
A. 9,000 units
B. 11,000 units
C. 8,500 units
D. 9,500 units
Correct Answer: D. 9,500 units
Rationale: 9,000 + (2,000 x 25%) = 9,500 equivalent units.
10. Weighted-average method: beginning WIP conversion cost was $17,000, conversion costs
added this period were $37,000, and equivalent units for conversion are 9,000. What is the cost
per equivalent unit for conversion?
A. $4.11
B. $6.00
C. $5.00
D. $2.22
Correct Answer: B. $6.00
Rationale: ($17,000 + $37,000) / 9,000 = $6.00.
(Comprehensive)
50 questions
1. Beginning work in process $28,000; direct materials used $120,000; direct labor $100,000;
manufacturing overhead applied $85,000; ending work in process $13,000. What is cost of goods
manufactured?
A. $305,000
B. $346,000
C. $320,000
D. $292,000
Correct Answer: C. $320,000
Rationale: COGM = $28,000 + $120,000 + $100,000 + $85,000 - $13,000 = $320,000.
2. Beginning finished goods $38,000, cost of goods manufactured $300,000, ending finished
goods $24,000. What is cost of goods sold?
A. $314,000
B. $300,000
C. $362,000
D. $286,000
Correct Answer: A. $314,000
Rationale: COGS = $38,000 + $300,000 - $24,000 = $314,000.
3. The relevant range is:
A. The range of prices customers accept
B. The time period of the budget
C. The range of activity within which cost behavior assumptions are valid
D. The range of products produced
Correct Answer: C. The range of activity within which cost behavior assumptions are valid
Rationale: Outside it, fixed costs may change.
4. A product sells for $30 and has variable costs of $21 per unit. What is the contribution margin
ratio?
A. 70.0%
B. 42.9%
C. 57.1%
D. 30.0%
Correct Answer: D. 30.0%
Rationale: CM ratio = ($30 - $21) / $30 = 30.0%.
5. Why do companies use a predetermined overhead rate instead of actual overhead rates?
A. It is required by GAAP to use actual rates
B. Actual overhead is not known until period end and varies seasonally
C. It eliminates all overhead
D. It always equals actual costs
Correct Answer: B. Actual overhead is not known until period end and varies seasonally
Rationale: It smooths costs and allows timely pricing.
, 6. The predetermined overhead rate is $24 per direct labor-hour. Actual direct labor-hours were
28,500 and actual overhead was $679,000. What is the over- or underapplied overhead?
A. $5,000 underapplied
B. $5,000 overapplied
C. $7,000 underapplied
D. $10,000 overapplied
Correct Answer: B. $5,000 overapplied
Rationale: Applied = $24 x 28,500 = $684,000; actual $679,000 - applied = -$5,000, so overhead is
overapplied.
7. Job 47 used $6,000 of direct materials and $2,000 of direct labor (120 direct labor-hours).
Overhead is applied at $22 per direct labor-hour. What is the total cost of Job 47?
A. $8,000
B. $8,022
C. $8,640
D. $10,640
Correct Answer: D. $10,640
Rationale: $6,000 + $2,000 + (120 x $22) = $10,640.
8. If materials are added at the beginning of a process, ending work in process is:
A. 0% complete for materials
B. 50% complete for materials
C. Not counted
D. 100% complete with respect to materials
Correct Answer: D. 100% complete with respect to materials
Rationale: All materials are already in.
9. Using the weighted-average method, 9,000 units were completed and transferred out. Ending
work in process has 2,000 units that are 25% complete for conversion. What are the equivalent
units for conversion?
A. 9,000 units
B. 11,000 units
C. 8,500 units
D. 9,500 units
Correct Answer: D. 9,500 units
Rationale: 9,000 + (2,000 x 25%) = 9,500 equivalent units.
10. Weighted-average method: beginning WIP conversion cost was $17,000, conversion costs
added this period were $37,000, and equivalent units for conversion are 9,000. What is the cost
per equivalent unit for conversion?
A. $4.11
B. $6.00
C. $5.00
D. $2.22
Correct Answer: B. $6.00
Rationale: ($17,000 + $37,000) / 9,000 = $6.00.
