WGU C253 ADVANCED MANAGERIAL ACCOUNTING
EXAM WITH QUESTIONS AND CORRECT ANSWERS |
LATEST UPDATE 2026/2027 | GRADED A+.
Absorption costing - ANSWER A costing method that includes all
manufacturing costs—direct materials, direct labor, and both variable
and fixed manufacturing overhead—in unit product costs.
Activity - ANSWER An event that causes the consumption of overhead
resources in an organization.
Activity base - ANSWER A measure of whatever causes the incurrence
of a variable cost. For example, the total cost of surgical gloves in a
hospital will increase as the number of surgeries increases. Therefore,
the number of surgeries is the activity base that explains the total cost of
surgical gloves.
Activity cost pool - ANSWER A "bucket" in which costs are accumulated
that relate to a single activity measure in an activity-based costing
system.
,Administrative costs - ANSWER All executive, organizational, and
clerical costs associated with the general management of an organization
rather than with manufacturing or selling.
Allocation base - ANSWER A measure of activity such as direct
laborhours or machine-hours that is used to assign costs to cost objects.
Avoidable cost - ANSWER A cost that can be eliminated by choosing one
alternative over another in a decision. This term is synonymous with
differential cost and relevant cost.
Batch-level activities - ANSWER Activities that are performed each time
a batch of goods is handled or processed, regardless of how many units
are in the batch. The amount of resource consumed depends on the
number of batches run rather than on the number of units in the batch.
Benchmarking - ANSWER A systematic approach to identifying the
activities with the greatest potential for improvement.
Bill of materials - ANSWER A document that shows the quantity of each
type of direct material required to make a product.
Bottleneck - ANSWER A machine or some other part of a process that
limits the total output of the entire system.
Break-even point - ANSWER The level of sales at which profit is zero.
, Budget - ANSWER A detailed plan for the future that is usually
expressed in formal quantitative terms.
Activity measure - ANSWER An allocation base in an activity-based
costing system; ideally, a measure of the amount of activity that drives
the costs in an activity cost pool.
Activity variance - ANSWER The difference between a revenue or cost
item in the flexible budget and the same item in the static planning
budget. An activity variance is due solely to the difference between the
actual level of activity used in the flexible budget and the level of
activity assumed in the planning budget.
Capital budgeting - ANSWER The process of planning significant
investments in projects that have long-term implications such as the
purchase of new equipment or the introduction of a new product.
Activity-based costing (ABC) - ANSWER A costing method based on
activities that is designed to provide managers with cost information for
strategic and other decisions that potentially affect capacity and therefore
fixed as well as variable costs.
Activity-based management (ABM) - ANSWER A management
approach that focuses on managing activities as a way of eliminating
waste and reducing delays and defects.
EXAM WITH QUESTIONS AND CORRECT ANSWERS |
LATEST UPDATE 2026/2027 | GRADED A+.
Absorption costing - ANSWER A costing method that includes all
manufacturing costs—direct materials, direct labor, and both variable
and fixed manufacturing overhead—in unit product costs.
Activity - ANSWER An event that causes the consumption of overhead
resources in an organization.
Activity base - ANSWER A measure of whatever causes the incurrence
of a variable cost. For example, the total cost of surgical gloves in a
hospital will increase as the number of surgeries increases. Therefore,
the number of surgeries is the activity base that explains the total cost of
surgical gloves.
Activity cost pool - ANSWER A "bucket" in which costs are accumulated
that relate to a single activity measure in an activity-based costing
system.
,Administrative costs - ANSWER All executive, organizational, and
clerical costs associated with the general management of an organization
rather than with manufacturing or selling.
Allocation base - ANSWER A measure of activity such as direct
laborhours or machine-hours that is used to assign costs to cost objects.
Avoidable cost - ANSWER A cost that can be eliminated by choosing one
alternative over another in a decision. This term is synonymous with
differential cost and relevant cost.
Batch-level activities - ANSWER Activities that are performed each time
a batch of goods is handled or processed, regardless of how many units
are in the batch. The amount of resource consumed depends on the
number of batches run rather than on the number of units in the batch.
Benchmarking - ANSWER A systematic approach to identifying the
activities with the greatest potential for improvement.
Bill of materials - ANSWER A document that shows the quantity of each
type of direct material required to make a product.
Bottleneck - ANSWER A machine or some other part of a process that
limits the total output of the entire system.
Break-even point - ANSWER The level of sales at which profit is zero.
, Budget - ANSWER A detailed plan for the future that is usually
expressed in formal quantitative terms.
Activity measure - ANSWER An allocation base in an activity-based
costing system; ideally, a measure of the amount of activity that drives
the costs in an activity cost pool.
Activity variance - ANSWER The difference between a revenue or cost
item in the flexible budget and the same item in the static planning
budget. An activity variance is due solely to the difference between the
actual level of activity used in the flexible budget and the level of
activity assumed in the planning budget.
Capital budgeting - ANSWER The process of planning significant
investments in projects that have long-term implications such as the
purchase of new equipment or the introduction of a new product.
Activity-based costing (ABC) - ANSWER A costing method based on
activities that is designed to provide managers with cost information for
strategic and other decisions that potentially affect capacity and therefore
fixed as well as variable costs.
Activity-based management (ABM) - ANSWER A management
approach that focuses on managing activities as a way of eliminating
waste and reducing delays and defects.
