ACCT 201 Exam 2

Total fixed costs change as the level of activity changes.

Which of the following is most associated with financial accounting?

For purposes of analysis, mixed costs are

Variable costs are costs that vary in total in direct proportion to changes in the activity level.

The task of preparing a budget should be the sole task of the most important department in an organization.

Contribution margin divided by income from operations

Direct materials and direct labor costs are examples of variable costs of production.

Goal conflict can be avoided if budget goals are carefully designed for consistency across all areas of the organization

Comparing actual performance against budgeted goals is an example of

A production supervisor's salary that does not vary with the number of units produced is an example of a fixed cost.

A process cost system company has 5 production departments. How many work-in-process accounts will it use?

The fixed cost per unit varies with changes in the level of activity.

In a process costing system, each process will have a work-in-process inventory account.

Cost behavior refers to the manner in which

Managerial accounting information is used by external and internal users equally.

The financial budgets of a business include a cash budget, a budgeted income statement, and a budgeted balance sheet.

Which of the following budgets allow for adjustments in activity levels?

Actions to achieve budgeted goals are part of which of the following?

Managerial accounting uses only past data in reports to aid management in the decision-making process.

Custom-made goods would be accounted for using a process costing system.

Both job order and process cost accounting use equivalent units of production to determine costs.

A sales budget is a plan showing the units of goods to be sold and the sales to be derived.

The relative distribution of sales among products sold by a company

A capital expenditures budget is a report that presents predicted amounts of the company's revenues & expenses.

Managerial accounting reports are designed to meet the specific needs of a company's management.

Graphically shows costs, sales, and operating profit or loss at various levels of units sold

Consulting the persons affected by a budget when it is prepared provides effective means of motivation and cooperation.

What can occur when employee self interests are different from company goals?

The relevant range is useful for analyzing cost behavior for management decision-making purposes.

The budgeting process does not involve which of the following activities?

The excess of sales revenues over variable costs is

Budgets are normally used only by profit-making businesses.

Variable costs are costs that remain constant in total dollar amount as the level of activity changes.

The three most common cost behavior classifications are

Costs that remain constant in total dollar amount as the level of activity changes are called

Cost behavior refers to the manner in which a cost changes as the related activity changes.

A budget can be an effective means of communicating management's plans to the owners of a business.

What can occur when budgets are too loose?

A separate account for each material is found in a job cost sheet.

Cost behavior refers to the methods used to estimate costs for use in managerial decision-making.

Indicates the possible decrease in sales that may occur before operating loss results

Where a business's revenues exactly equal costs is called the

Which of the following costs is a mixed cost?

Most operating decisions of management focus on a narrow range of activity called the

Direct materials cost that varies with the number of units produced is an example of a fixed cost of production.

A formal written statement of management's plans for the future, expressed in financial terms, is called a budget.

The sales account is on which of the following financial statements?

Costs that vary in proportion to changes in activity levels are called

Estimating the number of units to be manufactured to meet sales and inventory levels is the

Employees view budgeting more positively when goals are established for them by senior management.