WGU D101 COST AND MANAGERIAL ACCOUNTING
EXAM 2024 ACTUAL EXAM 2 VERSIONS (VERSION A
AND B) COMPLETE 300 QUESTIONS WITH
DETAILED VERIFIED ANSWERS (100% CORRECT
ANSWERS) /ALREADY GRADED A+
VERSION A
Miscellaneous materials like glue and nails would be classified as... -
ANSWERManufacturing overhead.
When the product or service provided can be considered as separate and distinct from
other products or services provided, and the manufacturing processes used are
different for different products. Doesn't track period costs. - ANSWERJob order costing.
When a company must must track the costs of the product being produced or the
service being provided to be able to compare the cost of the product or service with the
price the market is offering. - ANSWERPrice-taker.
In cases where the product is customized and unique and the maker of the product is
able to charge a price based on costs and a markup. - ANSWERPrice-maker.
Examples of such companies include manufacturers of paint, soft drinks, and
newspapers, and most food processing plants. Other examples include large-scale tax
preparation or loan processing firms, such as H&R Block, preparing typical income tax
returns for individuals. - ANSWERProcess costing.
Direct materials, direct labor, and manufacturing overhead. - ANSWERComponents
tracked in job order costing.
The cost of raw materials that are used directly in the manufacture of products and are
kept in the raw materials warehouse until used. - ANSWERDirect materials.
The wages and other payroll-related expenses of factory employees who work directly
on products. - ANSWERDirect labor.
Includes all manufacturing costs that are not classified as direct materials or direct
labor. This includes miscellaneous materials used in production, such as glue or nails;
,wages for the factory supervisor, controller, and custodians who work in the factory but
not directly on products; and other manufacturing costs, such as utilities, depreciation of
manufacturing facilities, insurance, and property taxes. - ANSWERManufacturing
overhead.
Costs related to the production facility, including property taxes on the plant. -
ANSWERProduct costs.
Costs not related to the production facility. - ANSWERPeriod costs.
Direct labor hours or machine hour time. - ANSWERWays to allocate manufacturing
overhead to a product.
An estimate of the overhead that will be incurred for each unit (in this case, allocated on
the basis of machine hours and direct labor hours). - ANSWERManufacturing overhead
rate.
A temporary holding tank for overhead costs that you do not immediately know how to
assign to production. - ANSWERManufacturing overhead account.
How are actual manufacturing overhead costs incurred throughout the year journalized?
- ANSWERDebits into the manufacturing overhead account.
Applied manufacturing overhead is directly recorded as a credit to which account? -
ANSWERManufacturing overhead.
How to close out the manufacturing overhead account at the end of the year? -
ANSWERApply to Cost of Goods Sold.
Overapplications of manufacturing overhead are corrected by ________ manufacturing
overhead and _________ cost of goods sold. - ANSWERDebiting/crediting
Underapplications of manufacturing overhead are corrected by ________
manufacturing overhead and _________ cost of goods sold. -
ANSWERCrediting/debiting
Always recorded as debits to manufacturing overhead and credits to the different
liability, asset, or contra-asset accounts. - ANSWERActual manufacturing overhead
expenditures.
Summarizes the cost flows in a manufacturing organization during a given period. This
report supports the cost of goods sold calculation on the income statement. -
ANSWERCost of Goods Manufactured schedule.
Raw materials used in production, direct labor, and applied manufacturing overhead. -
ANSWERIncluded in COGM.
,Total sales minus cost of goods sold or cost of revenues on the income statement. -
ANSWERGross margin.
Production costs for identical units are accumulated for a given period of time, e.g. one
month, and then the production volume is used to compute an overall average
production cost per unit. - ANSWERProcess costing.
All product costs necessary to "convert" raw materials into finished goods- direct labor
and overhead. - ANSWERConversion costs.
The sum of these components: one, cost of beginning work-in-process inventory, both
materials and conversion costs; two, the cost per equivalent unit required to complete
those units in beginning inventory, most or all of which is additional conversion cost; and
three, the cost per equivalent unit of the items started and completed this period, both
materials and conversion costs. - ANSWERThe cost associated with units completed
and transferred out this period.
All the overhead costs associated with a particular overhead cost activity. -
ANSWERCost pool.
A numerical measure that reflects how much effort has gone into an activity. -
ANSWERCost driver.
Those overhead activities that are performed each time a unit is produced: machine
maintenance, machine depreciation, electricity and other energy costs. - ANSWERUnit-
level.
Those overhead activities that are performed each time a new production batch is
started or ended. Inspections, machine setups,
movement of and accounting for materials. - ANSWERBatch-level.
Those overhead activities that are associated with the capability to produce different
types of products. Engineering product design,
storage in special warehouses, managing by a special supervisor of all activities
associated with a particular product line, ordering, purchasing, and receiving materials
unique to a particular product line. - ANSWERProduct line level.
Those overhead activities that must be in place before any of the other production
activities can take place. Property taxes, factory insurance, security, landscaping,
general accounting, general factory administration. - ANSWERFacility level.
Computed as the cost pool total divided by the number of cost driver events. -
ANSWERActivity rate.
, True or false: in an ABC system, direct labor hours can be used as a cost driver in some
situations. - ANSWERTrue.
Equal to sales revenue minus variable costs. - ANSWERContribution margin.
Proportion of sales revenue represented by each of a company's products. -
ANSWERSales mix.
Direct Materials + Direct Labor + Applied Overhead - ANSWERTotal Manufacturing
Costs
Total Manufacturing Costs + Beginning WIP Inventory - Ending WIP Inventory -
ANSWERCOGM
COGM + Beginning Finished Goods Inventory - Ending Finished Goods Inventory -
ANSWERUnadjusted COGS
Unadjusted COGS +/- Under/Overapplied Overhead - ANSWERAdjusted COGS
Reflects the amount of fixed costs a company has in its cost structure, relative to
variable costs. - ANSWEROperating leverage.
The percent increase in operating income for each percentage point increase in sales. -
ANSWERDegree of operating leverage.
A measure of how close the company currently is to breakeven, allowing the company
to see how much sales can decline from their current level before the company suffers a
loss. The sales units or dollars above the current break-even point. - ANSWERMargin of
safety.
Usually defined as the amount of income that will enable management to reach its
objectives—for example, paying dividends, meeting analysts' predictions, purchasing a
new plant and equipment, or paying existing loans. - ANSWERTarget income.
(Actual Sales - Break-even Point)/Actual Sales - ANSWERMargin of safety.
Isolates differences between actual and standard (or budgeted) costs to determine
whether costs are too high or too low as well as whether costs are improving
(decreasing) or getting worse (increasing). - ANSWERStandard costing system.
Managers are assigned and held accountable for costs, or even revenues and assets in
some units. - ANSWERResponsibility accounting.
The process of using variances from a standard to isolate problem areas. -
ANSWERManagement by exception.
