MANAGERIAL ACCOUNTING 18TH EDITION 2025-
2026 COMPLETE 100 QUESTIONS & CORRECT
DETAILED ANSWERS (VERIFIED ANSWERS)
|ALREADY GRADED A+||BRAND NEW VERSION!!
1. Which of the following best describes managerial accounting?
A. Accounting for external reporting purposes
B. Accounting for internal decision-making purposes
C. Accounting regulated by GAAP
D. Accounting used primarily by investors
Rationale: Managerial accounting focuses on providing information for
internal management to make decisions.
2. The primary difference between financial accounting and managerial
accounting is that managerial accounting:
A. Is primarily for external users
B. Must comply with GAAP
C. Focuses on internal decision-making and planning
D. Uses only historical data
Rationale: Managerial accounting provides information for managers rather
than external stakeholders.
3. Which of the following costs remains constant in total within the relevant
range?
A. Variable costs
B. Fixed costs
C. Mixed costs
D. Step costs
Rationale: Fixed costs do not change with changes in activity level within the
relevant range.
,4. Which cost varies directly with the level of production?
A. Fixed cost
B. Step cost
C. Variable cost
D. Sunk cost
Rationale: Variable costs change in total proportionally with activity.
5. Which of the following is considered a direct cost of manufacturing a
product?
A. Factory utilities
B. Direct materials
C. Factory rent
D. Office supplies
Rationale: Direct materials can be traced directly to the product.
6. Indirect costs that cannot be traced directly to a product are:
A. Direct labor
B. Direct materials
C. Manufacturing overhead
D. Variable costs
Rationale: Manufacturing overhead includes costs that support production
but cannot be traced to specific products.
7. Which of the following is an example of a period cost?
A. Direct materials
B. Direct labor
C. Manufacturing overhead
D. Selling and administrative expenses
Rationale: Period costs are expensed in the period incurred and are not part
of product costs.
8. The high-low method is used to:
A. Compute fixed costs only
B. Separate mixed costs into fixed and variable components
C. Determine contribution margin
, D. Compute sunk costs
Rationale: The high-low method estimates variable and fixed components of
a mixed cost.
9. Contribution margin is defined as:
A. Sales revenue minus fixed costs
B. Sales revenue minus variable costs
C. Net income plus fixed costs
D. Sales revenue minus total costs
Rationale: Contribution margin shows the amount available to cover fixed
costs and generate profit.
10.The break-even point in units is calculated as:
A. Fixed costs ÷ Selling price per unit
B. Fixed costs ÷ Contribution margin per unit
C. Variable costs ÷ Contribution margin per unit
D. Total costs ÷ Selling price per unit
Rationale: Break-even units are found by dividing total fixed costs by
contribution margin per unit.
11.A cost that can be avoided by choosing one alternative over another is
called:
A. Sunk cost
B. Relevant cost
C. Opportunity cost
D. Fixed cost
Rationale: Relevant costs are future costs that differ between alternatives.
12.Which of the following is a sunk cost?
A. Future repair costs
B. Original purchase price of equipment
C. Direct labor for a new order
D. Variable overhead
Rationale: Sunk costs have already been incurred and cannot be changed by
future decisions.
2026 COMPLETE 100 QUESTIONS & CORRECT
DETAILED ANSWERS (VERIFIED ANSWERS)
|ALREADY GRADED A+||BRAND NEW VERSION!!
1. Which of the following best describes managerial accounting?
A. Accounting for external reporting purposes
B. Accounting for internal decision-making purposes
C. Accounting regulated by GAAP
D. Accounting used primarily by investors
Rationale: Managerial accounting focuses on providing information for
internal management to make decisions.
2. The primary difference between financial accounting and managerial
accounting is that managerial accounting:
A. Is primarily for external users
B. Must comply with GAAP
C. Focuses on internal decision-making and planning
D. Uses only historical data
Rationale: Managerial accounting provides information for managers rather
than external stakeholders.
3. Which of the following costs remains constant in total within the relevant
range?
A. Variable costs
B. Fixed costs
C. Mixed costs
D. Step costs
Rationale: Fixed costs do not change with changes in activity level within the
relevant range.
,4. Which cost varies directly with the level of production?
A. Fixed cost
B. Step cost
C. Variable cost
D. Sunk cost
Rationale: Variable costs change in total proportionally with activity.
5. Which of the following is considered a direct cost of manufacturing a
product?
A. Factory utilities
B. Direct materials
C. Factory rent
D. Office supplies
Rationale: Direct materials can be traced directly to the product.
6. Indirect costs that cannot be traced directly to a product are:
A. Direct labor
B. Direct materials
C. Manufacturing overhead
D. Variable costs
Rationale: Manufacturing overhead includes costs that support production
but cannot be traced to specific products.
7. Which of the following is an example of a period cost?
A. Direct materials
B. Direct labor
C. Manufacturing overhead
D. Selling and administrative expenses
Rationale: Period costs are expensed in the period incurred and are not part
of product costs.
8. The high-low method is used to:
A. Compute fixed costs only
B. Separate mixed costs into fixed and variable components
C. Determine contribution margin
, D. Compute sunk costs
Rationale: The high-low method estimates variable and fixed components of
a mixed cost.
9. Contribution margin is defined as:
A. Sales revenue minus fixed costs
B. Sales revenue minus variable costs
C. Net income plus fixed costs
D. Sales revenue minus total costs
Rationale: Contribution margin shows the amount available to cover fixed
costs and generate profit.
10.The break-even point in units is calculated as:
A. Fixed costs ÷ Selling price per unit
B. Fixed costs ÷ Contribution margin per unit
C. Variable costs ÷ Contribution margin per unit
D. Total costs ÷ Selling price per unit
Rationale: Break-even units are found by dividing total fixed costs by
contribution margin per unit.
11.A cost that can be avoided by choosing one alternative over another is
called:
A. Sunk cost
B. Relevant cost
C. Opportunity cost
D. Fixed cost
Rationale: Relevant costs are future costs that differ between alternatives.
12.Which of the following is a sunk cost?
A. Future repair costs
B. Original purchase price of equipment
C. Direct labor for a new order
D. Variable overhead
Rationale: Sunk costs have already been incurred and cannot be changed by
future decisions.
