Managerial Accounting - Ivy Software Quizzes 2025
with 100% Correct Answers
IMA
Institute of Management Accountants. IMA sponsors the CMA designation.
CMA
Certified Management Accountant. Must adhere to a strict code of ethics to practice management
accounting.
How does managerial accounting differ from financial accounting?
Managerial accounting deals with things that management is responsible for such as planning,
controlling and decision making. It typically involves documents prepared for INTERNAL
purposes and has NO set of rules for report preparation.
Performance Report
shows the budget amounts for certain expenses, the actual amounts and the variance between the
two. This report is the most useful to management in exercising their control functions.
Flexible Budget
accounts for different revenue levels and the corresponding expenses associated with those
levels. It determines which expenses are variable and how the total variable expenses change
according to different revenue levels.
What does a manufacturing firm's balance sheet have that a merchandising firm's does
not?
,On a manufacturing firm's balance sheet, inventory includes raw materials, work in progress and
finished goods. This also includes different types of costs: fixed, variable, semi-variable and
semi-fixed.
Opportunity Cost
the profit lost when one alternative is selected over another. All reasonable alternatives must be
considered before making a decision.
Fixed cost
In total do not change over any production level; however, on a per unit basis fixed costs
decrease as production increases
Fixed cost
business expenses that are not dependent on the level of goods or services produced by the
business. They tend to be time-related, such as interest, utilities or rent being paid per month.
Interest is an example of a fixed or variable cost?
Fixed cost
Rent is an example of fixed or variable cost?
Fixed cost
Variable cost
Costs per unit do not change over different production levels but the total variable cost increases
as you produce more products.
Variable cost
,Costs that change as the quantity of the good or service that a business produces changes.
Variable costs are the sum of marginal costs over all units produced.
Semi-variable cost
A cost which contains within it a fixed cost element and a variable cost element. Costs are fixed
for a set level of production or consumption, and become variable after this production level is
exceeded.
Equation for Prime Costs
Direct Materials + Direct Labor
Prime Costs
costs directly incurred to create a product or service such as direct materials, piece rate pay,
service labor and commission. Prime costs do not include overhead costs. Prime costs are
variable costs.
Prime costs to not include:
Overhead costs
Prime costs are variable or fixed costs?
Variable costs
Equation for Conversion Costs
Direct Labor + Manufacturing Overhead
Conversion Costs
, Costs incurred during the transformation of raw materials inventory into finished goods. Direct
Labor and Overhead.
Overhead
costs indirectly incurred - fixed costs. Costs that are used to create many products.
Costs for items like sandpaper or machine oil are an example of:
Overhead
List main portions of the Cost of Goods Manufactured Statement
Direct Materials
Direct Labor
Overhead
= Total Manufacturing costs
Plus: Beginning WIP inventory
Less: Ending WIP inventory
= Cost of Goods Manufactured
inventoriable costs
Direct materials + direct labor + overhead
Inventoriable costs are also known as:
A. variable costs.
B. conversion costs.
C. product costs.****
D. fixed costs.
with 100% Correct Answers
IMA
Institute of Management Accountants. IMA sponsors the CMA designation.
CMA
Certified Management Accountant. Must adhere to a strict code of ethics to practice management
accounting.
How does managerial accounting differ from financial accounting?
Managerial accounting deals with things that management is responsible for such as planning,
controlling and decision making. It typically involves documents prepared for INTERNAL
purposes and has NO set of rules for report preparation.
Performance Report
shows the budget amounts for certain expenses, the actual amounts and the variance between the
two. This report is the most useful to management in exercising their control functions.
Flexible Budget
accounts for different revenue levels and the corresponding expenses associated with those
levels. It determines which expenses are variable and how the total variable expenses change
according to different revenue levels.
What does a manufacturing firm's balance sheet have that a merchandising firm's does
not?
,On a manufacturing firm's balance sheet, inventory includes raw materials, work in progress and
finished goods. This also includes different types of costs: fixed, variable, semi-variable and
semi-fixed.
Opportunity Cost
the profit lost when one alternative is selected over another. All reasonable alternatives must be
considered before making a decision.
Fixed cost
In total do not change over any production level; however, on a per unit basis fixed costs
decrease as production increases
Fixed cost
business expenses that are not dependent on the level of goods or services produced by the
business. They tend to be time-related, such as interest, utilities or rent being paid per month.
Interest is an example of a fixed or variable cost?
Fixed cost
Rent is an example of fixed or variable cost?
Fixed cost
Variable cost
Costs per unit do not change over different production levels but the total variable cost increases
as you produce more products.
Variable cost
,Costs that change as the quantity of the good or service that a business produces changes.
Variable costs are the sum of marginal costs over all units produced.
Semi-variable cost
A cost which contains within it a fixed cost element and a variable cost element. Costs are fixed
for a set level of production or consumption, and become variable after this production level is
exceeded.
Equation for Prime Costs
Direct Materials + Direct Labor
Prime Costs
costs directly incurred to create a product or service such as direct materials, piece rate pay,
service labor and commission. Prime costs do not include overhead costs. Prime costs are
variable costs.
Prime costs to not include:
Overhead costs
Prime costs are variable or fixed costs?
Variable costs
Equation for Conversion Costs
Direct Labor + Manufacturing Overhead
Conversion Costs
, Costs incurred during the transformation of raw materials inventory into finished goods. Direct
Labor and Overhead.
Overhead
costs indirectly incurred - fixed costs. Costs that are used to create many products.
Costs for items like sandpaper or machine oil are an example of:
Overhead
List main portions of the Cost of Goods Manufactured Statement
Direct Materials
Direct Labor
Overhead
= Total Manufacturing costs
Plus: Beginning WIP inventory
Less: Ending WIP inventory
= Cost of Goods Manufactured
inventoriable costs
Direct materials + direct labor + overhead
Inventoriable costs are also known as:
A. variable costs.
B. conversion costs.
C. product costs.****
D. fixed costs.
