ACG 2071 Exam 1 Questions with all Correct & 100%
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Graded A+
T/F- The primary purpose of managerial accounting information is to help external users make
investing and lending decisions ✔Correct Answer-False
Which of the following is TRUE?
Managerial accounting reports are audited by CPAs
Managerial accounting reports provide detailed internal information
Managerial accounting reports aid potential investors
Managerial accounting reports must follow GAAP ✔Correct Answer-Managerial accounting
reports provide detailed internal information
The board of directors hires the chief executive officer (CEO)
to manage the company on a daily basis
to hire other executives to run various aspects of the organization
to manage the internal audit function on a day to day basis
All the answers are correct. ✔Correct Answer-All answers are correct
The ____________________ focuses on people, planet, and profit. ✔Correct Answer-Triple
bottom line
T/F- CPA's audit the budget plans of public companies. ✔Correct Answer-False
T/F- When managers are evaluating the company's performance compared to the plan, they are
performing the planning role of management. ✔Correct Answer-False
Snow Rides manufactures snowboards. Richard May, the CEO, is trying to decide whether to
adopt a lean thinking model. He expects that adopting lean production would save $104,116 in
warehousing expenses and $45,486 in spoilage costs. Adopting lean production will require
several one-time up-front expenditures: $12,660 for an employee training program, $95,111 to
streamline the plant's production process, and $8,250 to identify suppliers that will guarantee
zero defects and on-time delivery. What will be the net benefit to this company by adopting
lean production? ✔Correct Answer-Total benefits: $104,116 + $45,486= $149,602
Total benefits: total costs: $146,602 - $12,660 - $95,111 - $8,250= $33,581
T/F- Just-in-time is an inventory philosophy where customer orders are processed within a
week. ✔Correct Answer-False
Prime Costs ✔Correct Answer-Direct labor and direct material combined
, Conversion Costs ✔Correct Answer-Direct labor and manufacturing overhead
Direct Costs ✔Correct Answer-Outlays that can be easily identified to a particular cost object
Period Costs ✔Correct Answer-Expenditures that are not directly associated with the
production of a product, such as advertising costs and general administrative costs.
Fringe Benefits ✔Correct Answer-The cost of compensation provided to employees besides
the employees salaries and wages
Inventoriable Costs ✔Correct Answer-Raw materials, inventory, work in process inventory,
and finished goods are considered to be
What inventory account(s) appear on the balance sheet of a merchandising company?
✔Correct Answer-merchandise inventory
What inventory accounts appear on the balance sheet of a manufacturer? ✔Correct Answer-
work in process, raw materials, finished goods
You and two friends decide to rent an apartment off campus. You have found an apartment for
$750 per month. You and your two friends will share the rent equally. This is an example of a
✔Correct Answer-Fixed cost
Variable costs ✔Correct Answer-stay the same per unit as volume increases
Assume you are planning a spring break ski trip to Colorado. You are preparing a budget of your
costs. You are staying at a lodge that has a special where the lodge charges you $80 per week
for the ski lift regardless of how many times you ride. You believe you will ride the ski life 40
times during the week. The ski lift charge is an example of a ✔Correct Answer-Fixed cost
Fixed costs ✔Correct Answer-per unit decrease as volume increases
Which of the following is a characteristic of a fixed cost?
Both answers are correct
Neither answer is correct
The cost per unit varies inversely with changes in the level of activity.
The total cost remains constant, regardless of changes in the level of activity. ✔Correct
Answer-Both answers are correct
Costs and benefits that are the same for all alternatives being considered are ✔Correct
Answer-irrelevant
Beg. of Year End of Year
Verified Answers |Actual Complete Exam |Already
Graded A+
T/F- The primary purpose of managerial accounting information is to help external users make
investing and lending decisions ✔Correct Answer-False
Which of the following is TRUE?
Managerial accounting reports are audited by CPAs
Managerial accounting reports provide detailed internal information
Managerial accounting reports aid potential investors
Managerial accounting reports must follow GAAP ✔Correct Answer-Managerial accounting
reports provide detailed internal information
The board of directors hires the chief executive officer (CEO)
to manage the company on a daily basis
to hire other executives to run various aspects of the organization
to manage the internal audit function on a day to day basis
All the answers are correct. ✔Correct Answer-All answers are correct
The ____________________ focuses on people, planet, and profit. ✔Correct Answer-Triple
bottom line
T/F- CPA's audit the budget plans of public companies. ✔Correct Answer-False
T/F- When managers are evaluating the company's performance compared to the plan, they are
performing the planning role of management. ✔Correct Answer-False
Snow Rides manufactures snowboards. Richard May, the CEO, is trying to decide whether to
adopt a lean thinking model. He expects that adopting lean production would save $104,116 in
warehousing expenses and $45,486 in spoilage costs. Adopting lean production will require
several one-time up-front expenditures: $12,660 for an employee training program, $95,111 to
streamline the plant's production process, and $8,250 to identify suppliers that will guarantee
zero defects and on-time delivery. What will be the net benefit to this company by adopting
lean production? ✔Correct Answer-Total benefits: $104,116 + $45,486= $149,602
Total benefits: total costs: $146,602 - $12,660 - $95,111 - $8,250= $33,581
T/F- Just-in-time is an inventory philosophy where customer orders are processed within a
week. ✔Correct Answer-False
Prime Costs ✔Correct Answer-Direct labor and direct material combined
, Conversion Costs ✔Correct Answer-Direct labor and manufacturing overhead
Direct Costs ✔Correct Answer-Outlays that can be easily identified to a particular cost object
Period Costs ✔Correct Answer-Expenditures that are not directly associated with the
production of a product, such as advertising costs and general administrative costs.
Fringe Benefits ✔Correct Answer-The cost of compensation provided to employees besides
the employees salaries and wages
Inventoriable Costs ✔Correct Answer-Raw materials, inventory, work in process inventory,
and finished goods are considered to be
What inventory account(s) appear on the balance sheet of a merchandising company?
✔Correct Answer-merchandise inventory
What inventory accounts appear on the balance sheet of a manufacturer? ✔Correct Answer-
work in process, raw materials, finished goods
You and two friends decide to rent an apartment off campus. You have found an apartment for
$750 per month. You and your two friends will share the rent equally. This is an example of a
✔Correct Answer-Fixed cost
Variable costs ✔Correct Answer-stay the same per unit as volume increases
Assume you are planning a spring break ski trip to Colorado. You are preparing a budget of your
costs. You are staying at a lodge that has a special where the lodge charges you $80 per week
for the ski lift regardless of how many times you ride. You believe you will ride the ski life 40
times during the week. The ski lift charge is an example of a ✔Correct Answer-Fixed cost
Fixed costs ✔Correct Answer-per unit decrease as volume increases
Which of the following is a characteristic of a fixed cost?
Both answers are correct
Neither answer is correct
The cost per unit varies inversely with changes in the level of activity.
The total cost remains constant, regardless of changes in the level of activity. ✔Correct
Answer-Both answers are correct
Costs and benefits that are the same for all alternatives being considered are ✔Correct
Answer-irrelevant
Beg. of Year End of Year
