MANAGERIAL ACCOUNTING EXAMINATION QUESTIONS
AND CORRECT ANSWER&EXPLANATION|GRADED A+
STUDY GUIDE SOUTHERN NEW HAMPSHIRE UNIVERSITY
1. Managerial accounting primarily serves:
A. External investors only
B. Internal management decision-making
C. Government tax agencies only
D. Customers only
Answer: B
Rationale: Managerial accounting supports planning, control, and decision-making.
2. Financial accounting differs from managerial accounting because managerial accounting:
A. Follows only tax laws
B. Focuses on internal users
C. Is mandatory for public reporting
D. Ignores operational data
Answer: B
Rationale: Managerial accounting is internally focused.
3. Cost accounting is primarily concerned with:
A. Marketing only
B. Measuring and analyzing costs
C. Payroll taxes only
D. Investment management only
Answer: B
Rationale: Cost accounting tracks operational costs.
4. A fixed cost remains:
,A. Constant per unit
B. Constant in total within relevant range
C. Variable with production volume
D. Zero during operations
Answer: B
Rationale: Fixed costs do not change in total within a relevant range.
5. Variable costs:
A. Stay constant regardless of activity
B. Change in total with activity level
C. Are always indirect costs
D. Never affect profits
Answer: B
Rationale: Variable costs fluctuate with production or sales volume.
6. Mixed costs contain:
A. Only fixed elements
B. Fixed and variable components
C. No operational relationship
D. Only direct labor
Answer: B
Rationale: Mixed costs combine fixed and variable behavior.
7. Direct materials are:
A. Factory utilities only
B. Materials traceable to finished products
C. Administrative salaries only
D. Marketing expenses only
Answer: B
Rationale: Direct materials become part of the product.
8. Direct labor refers to:
, A. Office management salaries
B. Labor directly involved in production
C. Marketing staff wages
D. Executive bonuses only
Answer: B
Rationale: Direct labor contributes directly to manufacturing.
9. Manufacturing overhead includes:
A. Direct materials only
B. Indirect manufacturing costs
C. Sales commissions only
D. Dividend payments only
Answer: B
Rationale: Overhead includes indirect production costs.
10. Prime costs equal:
Prime\ Costs = Direct\ Materials + Direct\ Labor
A. Direct Materials + Direct Labor
B. Overhead + Selling Expenses
C. Revenue − Expenses
D. Fixed Costs + Variable Costs
Answer: A
Rationale: Prime costs are direct production costs.
11. Conversion costs equal:
Conversion\ Costs = Direct\ Labor + Manufacturing\ Overhead
A. Direct Materials + Selling Expenses
B. Direct Labor + Manufacturing Overhead
C. Revenue − Variable Costs
D. Fixed Costs only
Answer: B
Rationale: Costs converting materials into products.
AND CORRECT ANSWER&EXPLANATION|GRADED A+
STUDY GUIDE SOUTHERN NEW HAMPSHIRE UNIVERSITY
1. Managerial accounting primarily serves:
A. External investors only
B. Internal management decision-making
C. Government tax agencies only
D. Customers only
Answer: B
Rationale: Managerial accounting supports planning, control, and decision-making.
2. Financial accounting differs from managerial accounting because managerial accounting:
A. Follows only tax laws
B. Focuses on internal users
C. Is mandatory for public reporting
D. Ignores operational data
Answer: B
Rationale: Managerial accounting is internally focused.
3. Cost accounting is primarily concerned with:
A. Marketing only
B. Measuring and analyzing costs
C. Payroll taxes only
D. Investment management only
Answer: B
Rationale: Cost accounting tracks operational costs.
4. A fixed cost remains:
,A. Constant per unit
B. Constant in total within relevant range
C. Variable with production volume
D. Zero during operations
Answer: B
Rationale: Fixed costs do not change in total within a relevant range.
5. Variable costs:
A. Stay constant regardless of activity
B. Change in total with activity level
C. Are always indirect costs
D. Never affect profits
Answer: B
Rationale: Variable costs fluctuate with production or sales volume.
6. Mixed costs contain:
A. Only fixed elements
B. Fixed and variable components
C. No operational relationship
D. Only direct labor
Answer: B
Rationale: Mixed costs combine fixed and variable behavior.
7. Direct materials are:
A. Factory utilities only
B. Materials traceable to finished products
C. Administrative salaries only
D. Marketing expenses only
Answer: B
Rationale: Direct materials become part of the product.
8. Direct labor refers to:
, A. Office management salaries
B. Labor directly involved in production
C. Marketing staff wages
D. Executive bonuses only
Answer: B
Rationale: Direct labor contributes directly to manufacturing.
9. Manufacturing overhead includes:
A. Direct materials only
B. Indirect manufacturing costs
C. Sales commissions only
D. Dividend payments only
Answer: B
Rationale: Overhead includes indirect production costs.
10. Prime costs equal:
Prime\ Costs = Direct\ Materials + Direct\ Labor
A. Direct Materials + Direct Labor
B. Overhead + Selling Expenses
C. Revenue − Expenses
D. Fixed Costs + Variable Costs
Answer: A
Rationale: Prime costs are direct production costs.
11. Conversion costs equal:
Conversion\ Costs = Direct\ Labor + Manufacturing\ Overhead
A. Direct Materials + Selling Expenses
B. Direct Labor + Manufacturing Overhead
C. Revenue − Variable Costs
D. Fixed Costs only
Answer: B
Rationale: Costs converting materials into products.
