Managerial Accounting Exam Questions
With All Complete Solutions New Update
Marginal Cost - Answers -✔✔ Extra cost of producing one additional unit of production.
Unit Cost - Answers -✔✔ The average production cost per unit
Continuous Improvement - Answers -✔✔ Ongoing small, incremental improvements in
all parts of an organization
Kaizan - Answers -✔✔ short term approach to enhancing efficiency that focuses on
improving an existing process or an activity within a process
Direct Cost - Answers -✔✔ a cost that can be easily and conveniently traced to a
specified cost object.
Direct Labor - Answers -✔✔ the labor specifically used in the creation of a good.
Direct Materials - Answers -✔✔ the materials specifically used in the creation of a good.
Indirect Cost - Answers -✔✔ a cost that cannot be easily and conveniently traced to a
specified cost object, a part of manufacturing overhead.
Manufacturing Overhead - Answers -✔✔ everything that is indirectly involved with the
production of a good. not direct materials and not direct labor
Product/ Inventorial Cost - Answers -✔✔ costs that are a necessary and integral part of
producing the finished product. shows up on the balance sheet until product is sold.
Period Cost - Answers -✔✔ all non-manufacturing costs, deducted as an expense in the
accounting period in which they are incurred.
Variable Cost - Answers -✔✔ a cost that rises or falls depending on how much is
produced. they are constant.
Fixed Cost - Answers -✔✔ a cost that does not change, no matter how much of a good
is produced
Differential Cost - Answers -✔✔ A relevant costs: costs that can be avoided when
alternatives are changed.
, Opportunity Cost - Answers -✔✔ Cost of the next best alternative use of money, time, or
resources when one choice is made rather than another
Sunk Cost - Answers -✔✔ Any cost that has already been incurred and that cannot be
changed by any decision made now or in the future. It is never relevant
TQM - Answers -✔✔ Total Quality Management: A process developed by Dr. W. Ed
Deming to increase productivity through quality control techniques.
Theory of Constraints - Answers -✔✔ A specific approach used to identify and manage
constraints in order to achieve the company's goals.
Gross Margin a.k.a. Gross Profit - Answers -✔✔ Net Sales - COGS
Linear Equation - Answers -✔✔ Y= a+bx
Y - total mixed cost
a - fixed costs
b - y intercept
Committed Fixed Cost - Answers -✔✔ Cannot be changed or eliminated with ease.
Discretionary Fixed Cost - Answers -✔✔ Can change/eliminate the fixed cost.
Contribution Margin - Answers -✔✔ Amount of money available after subtracting your
variable costs. Sales Revenue-Variable Cost
Prime Costs - Answers -✔✔ Direct Materials + Direct Labor
Conversion Costs - Answers -✔✔ Direct Labor + Manufacturing Overhead
Direct Costs - Answers -✔✔ a.k.a. Product Costs, Inventorial Costs
Product Costs - Answers -✔✔ Direct Labor, Direct Materials, Manufacturing Overhead
Inventories - Answers -✔✔ Raw Materials, Work in Progress, FG
Performance Report - Answers -✔✔ A report showing a comparison of projected and
actual amounts for a specific period of time.
High-Low Method - Answers -✔✔ A mathematical method that uses the total costs
incurred at the high and low levels of activity to classify mixed costs into fixed and
variable components.
With All Complete Solutions New Update
Marginal Cost - Answers -✔✔ Extra cost of producing one additional unit of production.
Unit Cost - Answers -✔✔ The average production cost per unit
Continuous Improvement - Answers -✔✔ Ongoing small, incremental improvements in
all parts of an organization
Kaizan - Answers -✔✔ short term approach to enhancing efficiency that focuses on
improving an existing process or an activity within a process
Direct Cost - Answers -✔✔ a cost that can be easily and conveniently traced to a
specified cost object.
Direct Labor - Answers -✔✔ the labor specifically used in the creation of a good.
Direct Materials - Answers -✔✔ the materials specifically used in the creation of a good.
Indirect Cost - Answers -✔✔ a cost that cannot be easily and conveniently traced to a
specified cost object, a part of manufacturing overhead.
Manufacturing Overhead - Answers -✔✔ everything that is indirectly involved with the
production of a good. not direct materials and not direct labor
Product/ Inventorial Cost - Answers -✔✔ costs that are a necessary and integral part of
producing the finished product. shows up on the balance sheet until product is sold.
Period Cost - Answers -✔✔ all non-manufacturing costs, deducted as an expense in the
accounting period in which they are incurred.
Variable Cost - Answers -✔✔ a cost that rises or falls depending on how much is
produced. they are constant.
Fixed Cost - Answers -✔✔ a cost that does not change, no matter how much of a good
is produced
Differential Cost - Answers -✔✔ A relevant costs: costs that can be avoided when
alternatives are changed.
, Opportunity Cost - Answers -✔✔ Cost of the next best alternative use of money, time, or
resources when one choice is made rather than another
Sunk Cost - Answers -✔✔ Any cost that has already been incurred and that cannot be
changed by any decision made now or in the future. It is never relevant
TQM - Answers -✔✔ Total Quality Management: A process developed by Dr. W. Ed
Deming to increase productivity through quality control techniques.
Theory of Constraints - Answers -✔✔ A specific approach used to identify and manage
constraints in order to achieve the company's goals.
Gross Margin a.k.a. Gross Profit - Answers -✔✔ Net Sales - COGS
Linear Equation - Answers -✔✔ Y= a+bx
Y - total mixed cost
a - fixed costs
b - y intercept
Committed Fixed Cost - Answers -✔✔ Cannot be changed or eliminated with ease.
Discretionary Fixed Cost - Answers -✔✔ Can change/eliminate the fixed cost.
Contribution Margin - Answers -✔✔ Amount of money available after subtracting your
variable costs. Sales Revenue-Variable Cost
Prime Costs - Answers -✔✔ Direct Materials + Direct Labor
Conversion Costs - Answers -✔✔ Direct Labor + Manufacturing Overhead
Direct Costs - Answers -✔✔ a.k.a. Product Costs, Inventorial Costs
Product Costs - Answers -✔✔ Direct Labor, Direct Materials, Manufacturing Overhead
Inventories - Answers -✔✔ Raw Materials, Work in Progress, FG
Performance Report - Answers -✔✔ A report showing a comparison of projected and
actual amounts for a specific period of time.
High-Low Method - Answers -✔✔ A mathematical method that uses the total costs
incurred at the high and low levels of activity to classify mixed costs into fixed and
variable components.
