AICPA Managerial Accounting Flashcards

Which costing method assigns all manufacturing costs (fixed and variable) to products and is required under US GAAP for external financial reporting?

Answer: Absorption costing

Absorption costing (full costing) includes both fixed and variable manufacturing overhead in product cost and is mandated by US GAAP for external reporting.

A company sells a product for $80, with variable costs of $50 per unit and total fixed costs of $90,000. What is the break-even point in units?

Answer: 3,000 units

Break-even units = Fixed costs ÷ Contribution margin per unit = $90,000 ÷ ($80 − $50) = $90,000 ÷ $30 = 3,000 units.

Which budgeting approach starts each budget period from zero and requires managers to justify all expenditures, rather than basing the budget on prior-year amounts?

Answer: Zero-based budgeting

Zero-based budgeting requires every budget item to be justified from scratch each period, eliminating the assumption that prior-year spending is automatically approved.

The balanced scorecard framework developed by Kaplan and Norton measures organizational performance across four perspectives. Which of the following is NOT one of those four perspectives?

Answer: Supply chain efficiency

The four balanced scorecard perspectives are Financial, Customer, Internal Business Processes, and Learning & Growth; supply chain efficiency is not a standalone perspective.

In a standard cost system, an unfavorable direct labor efficiency variance indicates that:

Answer: Actual labor hours exceeded standard hours allowed for actual production

An unfavorable labor efficiency variance means workers took more hours than the standard allowed for the number of units actually produced.

Which cost behavior pattern remains constant in total but decreases on a per-unit basis as production volume increases?

Answer: Fixed cost

Fixed costs stay constant in total regardless of volume, so the per-unit fixed cost falls as more units are produced and the total is spread over more units.