ACC 241 COMPREHENSIVE EXAM 2026 QUESTIONS AND
ANSWERS SURE A+
✔✔Account analysis - ✔✔Based on the management's judgement on classifying each
general ledger account as fixed, variable, or mixed.
✔✔What is the formula to calculate the high-low method? - ✔✔CHANGE IN
COST/CHANGE IN VOLUME
✔✔What does r-square tell you? - ✔✔- If it is greater than .80 then it means it's very
reliable
- If it is between .50 - .80 then use with caution
- If it is below .50 then use a different activity base
✔✔Absorption/traditional/full costing - ✔✔Products that absorb both fixed and variable
manufacturing costs.
✔✔Variable/direct costing - ✔✔Assigns only variable manufacturing costs to products.
All fixed manufacturing costs are expensed as period costs.
✔✔In absorption costing fixed MOH - ✔✔Is not expensed as a period cost until it is sold.
✔✔What is the formula to calculate the contribution margin? - ✔✔SALES REVENUE -
VARIABLE EXPENSE
✔✔Contribution margin - ✔✔Tells how much profit has been made on sales before fixed
costs.
✔✔When inventory levels increase which costing method yields the highest operating
income? How about when inventory levels decrease? - ✔✔- When inventory levels
increase absorption costing yields the highest operating income
- When inventory levels decrease variable costing yields the highest operating income
✔✔What are the characteristics of fixed cost? - ✔✔- Total fixed cost remains constant
over the relevant range
- Fixed cost per unit decreases as volume increases
- Horizontal line with a slope of 0
✔✔Variable income statement - ✔✔Sales revenue
Less: Variable expense
Variable cogs
Variable operating expense
Less: Fixed expense
Fixed MOH
, Fixed operating expense
= Operating income
✔✔Absorption income statement - ✔✔Sales revenue
Less: Cogs
= Gross profit
Less: Operating expense
= Operating income
✔✔What is the formula to calculate cogs in absorption costing? - ✔✔(FIXED
MOH/UNITS MANUFACTURED)(UNITS SOLD) + (VARIABLE MANUFACTURING
COST PER UNIT X UNITS SOLD)
✔✔What is the formula to calculate total fixed cost? - ✔✔TOTAL OPERATING COST -
TOTAL VARIABLE COST
✔✔What do managers use CVP for? - ✔✔- Breakeven
- Cover costs
- Determine how much sales volume is needed to reach target profit
- Prepare for economic changes
✔✔Contribution margin income statement - ✔✔Sales revenue
Less: Variable expense
Contribution margin
Less: Fixed expense
Operating income
✔✔How can you use the unit contribution margin to forecast income at different levels
of output? - ✔✔(UNIT CM)(UNITS YOU EXPECT TO SELL) - FIXED COSTS
✔✔What are the 2 formulas to calculate contribution margin ratio? - ✔✔1.
CONTRIBUTION MARGIN PER UNIT/SALE PRICE PER UNIT
2. CONTRIBUTION MARGIN/SALES REVENUE
✔✔How can you use the contribution margin to forecast income in your relevant range?
- ✔✔(SALES REVENUE X CONTRIBUTION MARGIN RATIO) - FIXED EXPENSE
✔✔Breakeven point - ✔✔Where operating income is 0 and total revenue = total
expense.
✔✔What is the formula to calculate the breakeven point in units? - ✔✔SALES IN UNITS
= (FIXED EXPENSE + OPERATING INCOME)/CONTRIBUTION MARGIN PER UNIT
ANSWERS SURE A+
✔✔Account analysis - ✔✔Based on the management's judgement on classifying each
general ledger account as fixed, variable, or mixed.
✔✔What is the formula to calculate the high-low method? - ✔✔CHANGE IN
COST/CHANGE IN VOLUME
✔✔What does r-square tell you? - ✔✔- If it is greater than .80 then it means it's very
reliable
- If it is between .50 - .80 then use with caution
- If it is below .50 then use a different activity base
✔✔Absorption/traditional/full costing - ✔✔Products that absorb both fixed and variable
manufacturing costs.
✔✔Variable/direct costing - ✔✔Assigns only variable manufacturing costs to products.
All fixed manufacturing costs are expensed as period costs.
✔✔In absorption costing fixed MOH - ✔✔Is not expensed as a period cost until it is sold.
✔✔What is the formula to calculate the contribution margin? - ✔✔SALES REVENUE -
VARIABLE EXPENSE
✔✔Contribution margin - ✔✔Tells how much profit has been made on sales before fixed
costs.
✔✔When inventory levels increase which costing method yields the highest operating
income? How about when inventory levels decrease? - ✔✔- When inventory levels
increase absorption costing yields the highest operating income
- When inventory levels decrease variable costing yields the highest operating income
✔✔What are the characteristics of fixed cost? - ✔✔- Total fixed cost remains constant
over the relevant range
- Fixed cost per unit decreases as volume increases
- Horizontal line with a slope of 0
✔✔Variable income statement - ✔✔Sales revenue
Less: Variable expense
Variable cogs
Variable operating expense
Less: Fixed expense
Fixed MOH
, Fixed operating expense
= Operating income
✔✔Absorption income statement - ✔✔Sales revenue
Less: Cogs
= Gross profit
Less: Operating expense
= Operating income
✔✔What is the formula to calculate cogs in absorption costing? - ✔✔(FIXED
MOH/UNITS MANUFACTURED)(UNITS SOLD) + (VARIABLE MANUFACTURING
COST PER UNIT X UNITS SOLD)
✔✔What is the formula to calculate total fixed cost? - ✔✔TOTAL OPERATING COST -
TOTAL VARIABLE COST
✔✔What do managers use CVP for? - ✔✔- Breakeven
- Cover costs
- Determine how much sales volume is needed to reach target profit
- Prepare for economic changes
✔✔Contribution margin income statement - ✔✔Sales revenue
Less: Variable expense
Contribution margin
Less: Fixed expense
Operating income
✔✔How can you use the unit contribution margin to forecast income at different levels
of output? - ✔✔(UNIT CM)(UNITS YOU EXPECT TO SELL) - FIXED COSTS
✔✔What are the 2 formulas to calculate contribution margin ratio? - ✔✔1.
CONTRIBUTION MARGIN PER UNIT/SALE PRICE PER UNIT
2. CONTRIBUTION MARGIN/SALES REVENUE
✔✔How can you use the contribution margin to forecast income in your relevant range?
- ✔✔(SALES REVENUE X CONTRIBUTION MARGIN RATIO) - FIXED EXPENSE
✔✔Breakeven point - ✔✔Where operating income is 0 and total revenue = total
expense.
✔✔What is the formula to calculate the breakeven point in units? - ✔✔SALES IN UNITS
= (FIXED EXPENSE + OPERATING INCOME)/CONTRIBUTION MARGIN PER UNIT
