B. Acy Bachelor of Accountancy Cost and Managerial Accounting 1

Question 1

Which costing method assigns actual overhead costs to products as they are incurred throughout the year?

Accepted Answer

Actual costing

Answer

Actual costing assigns real overhead costs as they occur, though this can cause fluctuating per-unit costs.

Question 2

In a job-order costing system, manufacturing overhead is applied using a:

Accepted Answer

Predetermined overhead rate

Answer

A predetermined overhead rate, calculated before the period begins, is used to apply overhead to specific jobs.

Question 3

Which of the following is a period cost, not a product cost?

Accepted Answer

Selling and administrative expenses

Answer

Selling and administrative expenses are period costs expensed in the period incurred, not attached to inventory.

Question 4

The contribution margin ratio is calculated as:

Accepted Answer

Contribution margin divided by sales

Answer

The contribution margin ratio equals contribution margin (sales minus variable costs) divided by sales revenue.

Question 5

Under variable costing, fixed manufacturing overhead is:

Accepted Answer

Expensed in full in the period incurred

Answer

Variable costing treats fixed manufacturing overhead as a period cost, expensing it entirely in the period incurred.

B. Acy Bachelor of Accountancy Practice Test