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IVY SOFTWARE MBA PREPWORKS MANAGERIAL
ACCOUNTING EXAM 2026 | ACTUAL EXAM
QUESTIONS WITH CORRECT SOLUTIONS | LATEST
UPDATED 2026/2027 | GRADED A+.
If Elli Inc sells 20,000 units of x and 60,000 units of y, the composite unit
consists of .25x and .75y (T/F) - correct answer- True. Adding 20,000
and 60,000 we get 80,000 units. Splitting this up into proportions we
have 20,000/80,000=25%x and 60,000/80,000=75%y.
If the quantity sold is greater than the quantity produced there has to be:
- correct answer- Finished goods beginning inventory. If you sell more
than you produce, you must obtain the units somewhere. You obtain
them from the finished goods beginning inventory.
Contribution margin and contribution margin per unit are the same. -
correct answer- False
Breakeven indicates that the sales dollars cover all fixed and variable
costs of manufacturing - correct answer- True Inventoriable costs using
variable costing is appropriate for external reporting - correct answer-
False
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Essex company sells two products- A and B. Product A sales are two
times that of product B. The contribution per unit for A is $4 and B is $1.
What is the weighted average contribution margin per unit? - correct
answer- $3
If the breakeven is 5000 units and fixed costs are $50,000, what is the
contribution margin per unit? - correct answer- $10
Which of the following will be found on an absorption costing income
statement but not on a variable costing income statement? - correct
answer- Gross Margin and Cost of Goods Sold
If units produced are less than units sold, net income using absorption
costing is - correct answer- Less than variable costing
Absorption costing clearly separates fixed costs from variable costs -
correct answer- false
Converse company has two products- A and B. The weighted average
contribution margin per unit is $4. Converse sells twice as many As as
Bs. The contribution margin per unit for B is $2. What is it for A? - correct
answer- $5
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If the selling price is $5 per unit the variable cost is $1 per unit and the
fixed cost is $20,000, what is the breakeven in units? - correct answer-
$5,000 (5x - 1x - 20000 = 0, 4x - 20,000=0, 4x=20000, x = 5000)
The total of ALL the right-hand sides of the T-accounts must equal the
total of ALL the left-hand sides of the T-Accounts (T/F) - correct answer-
True. The double-entry system of accounting means that for each
transaction recorded, there is a left-hand (debit) entry offset by a right-
hand (credit) entry.
A transaction is an event that affects the financial position of a company.
- correct answer- True.
Credits are generally good and debits are generally bad. - correct
answer- False. credit means nothing more than the R side while a debit
means the L side. Neither is good or bad.
Bookkeeping accounts are a method of accumulating financial
transactions and summarizing their effects on balance sheet items. -
correct answer- True. Bookkeeping accounts provide an easy means for
recording, collecting, and reporting financial transactions of a firm.
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Liabilities normally have a L balance - correct answer- False. Liabilities
and OE usually have R balances while assets have L balances
It is possible to have the books in balance but with mistakes. - correct
answer- Having the books in balance simply means that each time you
entered a transaction you placed equal amounts on the R and L sides.
Books which balance do not rule out the possibility that a transaction
could have been posted to the wrong account.
Since the total of all the R sides of accounts equals the total of L sides,
then the total amount of increases entered in the general ledger must
equal the total amount of decreases (T/F) - correct answer- False. Cash
(Asset) and Common Stock (Owners' Equity) is used to record the sale
of company stock. While the R side equals the L side, they both
increase, thus, the total amount of increases does not equal the
decreases.
Almost all the data necessary to prepare an income statement is
contained in the retained earnings account. - correct answer- False. not
Almost all. ALL.
The main purpose of the trial balance is to make sure you have not
committed any math errors in your T- Accounts (T/F) - correct answer-
True. The trial balance is taken as a partial check of the arithmetic
accuracy of the entries previously made.
Fixed costs are fixed per unit produced, but vary in total (true or false) -
correct answer- False. Fixed costs vary by unit produced but are fixed in
IVY SOFTWARE MBA PREPWORKS MANAGERIAL
ACCOUNTING EXAM 2026 | ACTUAL EXAM
QUESTIONS WITH CORRECT SOLUTIONS | LATEST
UPDATED 2026/2027 | GRADED A+.
If Elli Inc sells 20,000 units of x and 60,000 units of y, the composite unit
consists of .25x and .75y (T/F) - correct answer- True. Adding 20,000
and 60,000 we get 80,000 units. Splitting this up into proportions we
have 20,000/80,000=25%x and 60,000/80,000=75%y.
If the quantity sold is greater than the quantity produced there has to be:
- correct answer- Finished goods beginning inventory. If you sell more
than you produce, you must obtain the units somewhere. You obtain
them from the finished goods beginning inventory.
Contribution margin and contribution margin per unit are the same. -
correct answer- False
Breakeven indicates that the sales dollars cover all fixed and variable
costs of manufacturing - correct answer- True Inventoriable costs using
variable costing is appropriate for external reporting - correct answer-
False
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Essex company sells two products- A and B. Product A sales are two
times that of product B. The contribution per unit for A is $4 and B is $1.
What is the weighted average contribution margin per unit? - correct
answer- $3
If the breakeven is 5000 units and fixed costs are $50,000, what is the
contribution margin per unit? - correct answer- $10
Which of the following will be found on an absorption costing income
statement but not on a variable costing income statement? - correct
answer- Gross Margin and Cost of Goods Sold
If units produced are less than units sold, net income using absorption
costing is - correct answer- Less than variable costing
Absorption costing clearly separates fixed costs from variable costs -
correct answer- false
Converse company has two products- A and B. The weighted average
contribution margin per unit is $4. Converse sells twice as many As as
Bs. The contribution margin per unit for B is $2. What is it for A? - correct
answer- $5
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If the selling price is $5 per unit the variable cost is $1 per unit and the
fixed cost is $20,000, what is the breakeven in units? - correct answer-
$5,000 (5x - 1x - 20000 = 0, 4x - 20,000=0, 4x=20000, x = 5000)
The total of ALL the right-hand sides of the T-accounts must equal the
total of ALL the left-hand sides of the T-Accounts (T/F) - correct answer-
True. The double-entry system of accounting means that for each
transaction recorded, there is a left-hand (debit) entry offset by a right-
hand (credit) entry.
A transaction is an event that affects the financial position of a company.
- correct answer- True.
Credits are generally good and debits are generally bad. - correct
answer- False. credit means nothing more than the R side while a debit
means the L side. Neither is good or bad.
Bookkeeping accounts are a method of accumulating financial
transactions and summarizing their effects on balance sheet items. -
correct answer- True. Bookkeeping accounts provide an easy means for
recording, collecting, and reporting financial transactions of a firm.
, 4 | Page
Liabilities normally have a L balance - correct answer- False. Liabilities
and OE usually have R balances while assets have L balances
It is possible to have the books in balance but with mistakes. - correct
answer- Having the books in balance simply means that each time you
entered a transaction you placed equal amounts on the R and L sides.
Books which balance do not rule out the possibility that a transaction
could have been posted to the wrong account.
Since the total of all the R sides of accounts equals the total of L sides,
then the total amount of increases entered in the general ledger must
equal the total amount of decreases (T/F) - correct answer- False. Cash
(Asset) and Common Stock (Owners' Equity) is used to record the sale
of company stock. While the R side equals the L side, they both
increase, thus, the total amount of increases does not equal the
decreases.
Almost all the data necessary to prepare an income statement is
contained in the retained earnings account. - correct answer- False. not
Almost all. ALL.
The main purpose of the trial balance is to make sure you have not
committed any math errors in your T- Accounts (T/F) - correct answer-
True. The trial balance is taken as a partial check of the arithmetic
accuracy of the entries previously made.
Fixed costs are fixed per unit produced, but vary in total (true or false) -
correct answer- False. Fixed costs vary by unit produced but are fixed in
