ACCT 2302 Exam 2 Questions with Correct Answers Latest Update 2025/2026
A volume based allocation measure is directly related to the number of units produced or the
number of customers served . - Answers True
In a traditional volume - based cost system , total manufacturing costs are calculated by : -
Answers adding manufacturing overhead cost , direct materials cost , and direct labor cost .
An activity that is performed to support a specific product line is a ( n ) : - Answers product -
level activity .
Activity - based costing divides activities into two categories : unit - level activities and facility
level activities . - Answers False
Which of the following is the best example of a unit - level activity ? - Answers Painting a final
product
Which of the following is the best example of a facility - level activity ? - Answers Human
resources
Using non - volume - based cost drivers allows activity - based costing to : - Answers assign
more indirect costs to products whose complexity is higher .
Portland , Incorporated , has formed four activity pools : Product Design , Machining and
Production , Machine Setup , and Inspection . Gina Taylor , Production Manager at Portland ,
oversees processes that are considered part of Machining and Production , Machine Setup , and
Inspection . Taylor's salary should be : - Answers allocated among Machining and Production ,
Machine Setup , and Inspection .
An activity cost driver is : - Answers a measure of the underlying activity that occurs in each
activity pool .
The activity - rate method involves : - Answers calculating an activity rate that is similar to the
predetermined overhead rate .
Using the activity - proportion method results in : - Answers the same cost allocations as the
activity rate method .
Volume - based cost systems tend to : - Answers undercost low - volume products and overcost
high - volume products .
Garfield Personal Training Services is owned by Gina Garfield . Gina provides personal training
group training room at the local fitness facility or the pool for scheduled classes . For one - on -
one and coaching to individuals or small groups using the local fitness facility and pool . Gina
rents the training , she meets clients at the fitness facility where she is a member . Gina is
currently learning Zumba and plans to offer a Zumba class in the group training room on
, Wednesday mornings starting next month . The development of Zumba is considered a activity
for Garfield - Answers Service level
Appraisal or inspection costs are costs that : - Answers are incurred to identify defective
products before products are shipped to the customer .
External failure costs are costs that : - Answers occur when a defective product makes its way
into the hands of the customer .
Under activity - based management , cost management is achieved by : - Answers managing the
underlying activities .
Managers who use activity - based management should begin by asking all of the following
questions except : - Answers " How am I evaluated annually based on these activities ? "
Life cycle cost management takes into consideration the fact that costs and revenues : -
Answers are not constant across different stages of the product's life cycle .
The relevant range is : - Answers the range of activity over which we expect our assumptions
about cost behavior to hold true .
Cost behavior is : - Answers the way in which costs change when the activity level changes .
Which of the following statements is correct about relevant range ? - Answers The relevant
range helps managers make decisions operations , but the relevant range is not prescriptive
beyond the range . based on normal
All else being equal , if sales revenue doubles , fixed costs will : - Answers decrease on a per -
unit basis .
Which of the following is true about the visual fit method ? - Answers Assuming the relationship
between total cost and the visual fit method is an approximation of total fixed costs and
variable activity is ( mostly ) linear , costs per unit .
A scattergraph is useful in recognizing unusual patterns in the cost data . - Answers True
The high - low method requires three observations of costs to calculate the cost formula . -
Answers False
The least - squares regression method uses all of the available data to find the best - fitting line
on the scattergraph . - Answers True
A statistical method for finding the best - fitting cost equation to a set of data is the : - Answers
least - squares regression method
Contribution margin is equal to : - Answers fixed costs plus net operating income .
A volume based allocation measure is directly related to the number of units produced or the
number of customers served . - Answers True
In a traditional volume - based cost system , total manufacturing costs are calculated by : -
Answers adding manufacturing overhead cost , direct materials cost , and direct labor cost .
An activity that is performed to support a specific product line is a ( n ) : - Answers product -
level activity .
Activity - based costing divides activities into two categories : unit - level activities and facility
level activities . - Answers False
Which of the following is the best example of a unit - level activity ? - Answers Painting a final
product
Which of the following is the best example of a facility - level activity ? - Answers Human
resources
Using non - volume - based cost drivers allows activity - based costing to : - Answers assign
more indirect costs to products whose complexity is higher .
Portland , Incorporated , has formed four activity pools : Product Design , Machining and
Production , Machine Setup , and Inspection . Gina Taylor , Production Manager at Portland ,
oversees processes that are considered part of Machining and Production , Machine Setup , and
Inspection . Taylor's salary should be : - Answers allocated among Machining and Production ,
Machine Setup , and Inspection .
An activity cost driver is : - Answers a measure of the underlying activity that occurs in each
activity pool .
The activity - rate method involves : - Answers calculating an activity rate that is similar to the
predetermined overhead rate .
Using the activity - proportion method results in : - Answers the same cost allocations as the
activity rate method .
Volume - based cost systems tend to : - Answers undercost low - volume products and overcost
high - volume products .
Garfield Personal Training Services is owned by Gina Garfield . Gina provides personal training
group training room at the local fitness facility or the pool for scheduled classes . For one - on -
one and coaching to individuals or small groups using the local fitness facility and pool . Gina
rents the training , she meets clients at the fitness facility where she is a member . Gina is
currently learning Zumba and plans to offer a Zumba class in the group training room on
, Wednesday mornings starting next month . The development of Zumba is considered a activity
for Garfield - Answers Service level
Appraisal or inspection costs are costs that : - Answers are incurred to identify defective
products before products are shipped to the customer .
External failure costs are costs that : - Answers occur when a defective product makes its way
into the hands of the customer .
Under activity - based management , cost management is achieved by : - Answers managing the
underlying activities .
Managers who use activity - based management should begin by asking all of the following
questions except : - Answers " How am I evaluated annually based on these activities ? "
Life cycle cost management takes into consideration the fact that costs and revenues : -
Answers are not constant across different stages of the product's life cycle .
The relevant range is : - Answers the range of activity over which we expect our assumptions
about cost behavior to hold true .
Cost behavior is : - Answers the way in which costs change when the activity level changes .
Which of the following statements is correct about relevant range ? - Answers The relevant
range helps managers make decisions operations , but the relevant range is not prescriptive
beyond the range . based on normal
All else being equal , if sales revenue doubles , fixed costs will : - Answers decrease on a per -
unit basis .
Which of the following is true about the visual fit method ? - Answers Assuming the relationship
between total cost and the visual fit method is an approximation of total fixed costs and
variable activity is ( mostly ) linear , costs per unit .
A scattergraph is useful in recognizing unusual patterns in the cost data . - Answers True
The high - low method requires three observations of costs to calculate the cost formula . -
Answers False
The least - squares regression method uses all of the available data to find the best - fitting line
on the scattergraph . - Answers True
A statistical method for finding the best - fitting cost equation to a set of data is the : - Answers
least - squares regression method
Contribution margin is equal to : - Answers fixed costs plus net operating income .
