ACCY CHAPTER 12 EXAM QUESTIONS
WITH 100% CORRECT ANSWERS
Which of the following is the correct calculation for the contribution margin ratio?
A. sales revenue divided by variable costs.
B. sales revenue divided by contribution margin.
C. contribution margin divided by sales revenue.
D. contribution margin divided by variable costs. - Answer- C
The cost of a single unit of production in excess of the break-even point in units is:
A. its fixed cost and variable cost.
B. its fixed cost only.
C. its variable cost only.
D. none of the above. - Answer- C
What percentage of the contribution margin is profit on units sold in excess of the break-
even point?
A. It's 50% to the contribution margin ratio.
B. It's equal to the variable cost ratio.
C. It's equal of the gross profit ratio.
D. It's 100%. - Answer- D
To which function of management is CVP analysis most applicable?
A. Planning.
B. Organizing.
C. Directing.
D. Controlling. - Answer- A
Managerial accounting supports the management process most significantly by:
A. measuring and reporting financial results after the fact.
B. determining the goals and objectives of the entity.
C. helping management identify and achieve goals and measure the degree to which
the goals have been accomplished.
D. establishing operating policies to be followed during a period of time. - Answer- c
Activities included in a generally accepted definition of management accounting include:
A. planning, organizing, controlling.
B. planning, operating, reporting.
C. preparing, operating, creating.
D. preparing, organizing, converting. - Answer- A
, Which of the following activities is not part of the management planning and control
cycle?
A. data collection and performance feedback.
B. implementation of plans.
C. providing information to investors and creditors.
D. revisiting plans. - Answer- C
Performance analysis in the planning and control cycle relates to the act of:
A. planning.
B. managing.
C. controlling.
D. revising plans. - Answer- C
Which of the following statements does not describe a characteristic of management
accounting?
A. Management accounting must conform to GAAP.
B. Approximate amounts rather than accurate amounts or refined estimates are often
used in management accounting.
C. Management accounting places a great deal of emphasis on the future.
D. Management accounting is more concerned with units of the organization rather than
with the organization as a whole. - Answer- A
Managerial accounting, as compared to financial accounting:
A. must conform to GAAP.
B. places a great deal of emphasis on historical transactions.
C. uses frequent and prompt control reports.
D. focuses on information prepared for the investors and creditors. - Answer- C
Management accounting is:
A. a highly technical subject that people in personnel or engineering should not be
expected to understand.
B. performed by individuals who seldom work with people in other functional areas of
the organization.
C. the principal activity involved in determining the goals and objectives of the entity.
D. an activity that gets involved with virtually all of the other functional areas of the
organization. - Answer- D
Managerial accounting, as opposed to financial accounting, is primarily concerned with:
A. preparing the current balance sheet of the company.
B. present and future planning and control.
C. providing information to investors and creditors.
D. historical results of operations. - Answer- B
Managerial accounting can best be described as:
A. the preparation and distribution of the financial statements.
WITH 100% CORRECT ANSWERS
Which of the following is the correct calculation for the contribution margin ratio?
A. sales revenue divided by variable costs.
B. sales revenue divided by contribution margin.
C. contribution margin divided by sales revenue.
D. contribution margin divided by variable costs. - Answer- C
The cost of a single unit of production in excess of the break-even point in units is:
A. its fixed cost and variable cost.
B. its fixed cost only.
C. its variable cost only.
D. none of the above. - Answer- C
What percentage of the contribution margin is profit on units sold in excess of the break-
even point?
A. It's 50% to the contribution margin ratio.
B. It's equal to the variable cost ratio.
C. It's equal of the gross profit ratio.
D. It's 100%. - Answer- D
To which function of management is CVP analysis most applicable?
A. Planning.
B. Organizing.
C. Directing.
D. Controlling. - Answer- A
Managerial accounting supports the management process most significantly by:
A. measuring and reporting financial results after the fact.
B. determining the goals and objectives of the entity.
C. helping management identify and achieve goals and measure the degree to which
the goals have been accomplished.
D. establishing operating policies to be followed during a period of time. - Answer- c
Activities included in a generally accepted definition of management accounting include:
A. planning, organizing, controlling.
B. planning, operating, reporting.
C. preparing, operating, creating.
D. preparing, organizing, converting. - Answer- A
, Which of the following activities is not part of the management planning and control
cycle?
A. data collection and performance feedback.
B. implementation of plans.
C. providing information to investors and creditors.
D. revisiting plans. - Answer- C
Performance analysis in the planning and control cycle relates to the act of:
A. planning.
B. managing.
C. controlling.
D. revising plans. - Answer- C
Which of the following statements does not describe a characteristic of management
accounting?
A. Management accounting must conform to GAAP.
B. Approximate amounts rather than accurate amounts or refined estimates are often
used in management accounting.
C. Management accounting places a great deal of emphasis on the future.
D. Management accounting is more concerned with units of the organization rather than
with the organization as a whole. - Answer- A
Managerial accounting, as compared to financial accounting:
A. must conform to GAAP.
B. places a great deal of emphasis on historical transactions.
C. uses frequent and prompt control reports.
D. focuses on information prepared for the investors and creditors. - Answer- C
Management accounting is:
A. a highly technical subject that people in personnel or engineering should not be
expected to understand.
B. performed by individuals who seldom work with people in other functional areas of
the organization.
C. the principal activity involved in determining the goals and objectives of the entity.
D. an activity that gets involved with virtually all of the other functional areas of the
organization. - Answer- D
Managerial accounting, as opposed to financial accounting, is primarily concerned with:
A. preparing the current balance sheet of the company.
B. present and future planning and control.
C. providing information to investors and creditors.
D. historical results of operations. - Answer- B
Managerial accounting can best be described as:
A. the preparation and distribution of the financial statements.
