MBA 620 Final Exam Questions and
Actual Answers 2025.
A main difference between managerial and financial accounting is that:
a. This class will focus on generating and interpreting financial accounting reports.
b. financial accounting reports can include nonfinancial data.
c. Managerial accounting information is used only by people inside the organization for decision
making, planning, and control.
d. Managerial accounting reports provide information for investors and creditors to make
decisions. - Answer Managerial accounting information is used only by people inside the
organization for decision making, planning, and control
Which of the following would describe the planning function of managers?
a. Measuring the performance of managers.
b. Assessing whether the company is achieving its goals.
c. Communicating the goals of managers to the employees.
d. Evaluating how well plans were implemented. - Answer Communicating the goals of
managers to the employees
Which of the following would definitely be an example of a variable cost for Bikes Unlimited (a
company that produces and sells mountain bikes)?
a. Rent on the production facility.
b. Depreciation of production equipment.
c. The cost of pedals bought from a supplier.
d. The utilities cost (electricity). - Answer The cost of pedals bought from a supplier
Why do companies use cost estimation tools?
a. To record product costs on the income statement.
, Which cost estimation method will provide the most accurate (mathematically) cost equation?
a. Scattergraph method
b. Regression analysis method
c. High-low method
d. Account analysis method - Answer Regression analysis method
All of the following are good reasons why managers allocate overhead costs to products EXCEPT:
a. Because it is required by U.S. Generally Accepted Accounting Principles for external financial
reporting.
b. To give managers the information they need to make good decisions.
c. Because managers would otherwise have difficulty estimating the cost of direct materials and
labor.
d. To give managers incentive to efficiently use indirect manufacturing resources and activities. -
Answer Because managers would otherwise have difficulty estimating the cost of direct
materials and labor
Activity based costing is different from the other approaches because:
a. It is simple, using a single overhead cost pool and overhead rate.
b. It separates out overhead costs into the different processes or procedures that incur
overhead costs.
c. It is easily replicated between companies and industries (all companies should have the same
activities).
d. It separates out overhead costs across the different departments. - Answer It separates out
overhead costs into the different processes or procedures that incur overhead costs
Why is process costing needed in some companies or industries?
a. Because in process costing companies, product costs are recorded as expenses (on the
income statement) as they are incurred.
b. To separate out the costs of partially completed items as they move across the production
Actual Answers 2025.
A main difference between managerial and financial accounting is that:
a. This class will focus on generating and interpreting financial accounting reports.
b. financial accounting reports can include nonfinancial data.
c. Managerial accounting information is used only by people inside the organization for decision
making, planning, and control.
d. Managerial accounting reports provide information for investors and creditors to make
decisions. - Answer Managerial accounting information is used only by people inside the
organization for decision making, planning, and control
Which of the following would describe the planning function of managers?
a. Measuring the performance of managers.
b. Assessing whether the company is achieving its goals.
c. Communicating the goals of managers to the employees.
d. Evaluating how well plans were implemented. - Answer Communicating the goals of
managers to the employees
Which of the following would definitely be an example of a variable cost for Bikes Unlimited (a
company that produces and sells mountain bikes)?
a. Rent on the production facility.
b. Depreciation of production equipment.
c. The cost of pedals bought from a supplier.
d. The utilities cost (electricity). - Answer The cost of pedals bought from a supplier
Why do companies use cost estimation tools?
a. To record product costs on the income statement.
, Which cost estimation method will provide the most accurate (mathematically) cost equation?
a. Scattergraph method
b. Regression analysis method
c. High-low method
d. Account analysis method - Answer Regression analysis method
All of the following are good reasons why managers allocate overhead costs to products EXCEPT:
a. Because it is required by U.S. Generally Accepted Accounting Principles for external financial
reporting.
b. To give managers the information they need to make good decisions.
c. Because managers would otherwise have difficulty estimating the cost of direct materials and
labor.
d. To give managers incentive to efficiently use indirect manufacturing resources and activities. -
Answer Because managers would otherwise have difficulty estimating the cost of direct
materials and labor
Activity based costing is different from the other approaches because:
a. It is simple, using a single overhead cost pool and overhead rate.
b. It separates out overhead costs into the different processes or procedures that incur
overhead costs.
c. It is easily replicated between companies and industries (all companies should have the same
activities).
d. It separates out overhead costs across the different departments. - Answer It separates out
overhead costs into the different processes or procedures that incur overhead costs
Why is process costing needed in some companies or industries?
a. Because in process costing companies, product costs are recorded as expenses (on the
income statement) as they are incurred.
b. To separate out the costs of partially completed items as they move across the production
