Ivy software mba prepworks managerial accounting questions with correct answers If Elli Inc sells 20,000 units of x and 60,000 units of y, the composite unit consists of .25x and .75y (T/F) CORRECT ANSWER True. Adding 20,000 and 60,000 we get 80,000 units. Splitting this up into proportions we have 20,000/80,000=25%x and 60,000/80,000=75%y.
If the quantity sold is greater than the quantity produced there has to be:
CORRECT ANSWER Finished goods beginning inventory. If you sell more than you produce, you must obtain the units somewhere. You obtain them from the finished goods beginning inventory.Contribution margin and contribution margin per unit are the same. CORRECT ANSWER False Breakeven indicates that the sales dollars cover all fixed and variable costs of manufacturing CORRECT ANSWER True Inventoriable costs using variable costing is appropriate for external reporting CORRECT ANSWER False Essex company sells two products- A and B. Product A sales are two times that of product B. The contribution per unit for A is $4 and B is $1. What is the weighted average contribution margin per unit? CORRECT ANSWER $3 Absorption costing clearly separates fixed costs from variable costs CORRECT ANSWER false 1 / 3
Converse company has two products- A and B. The weighted average contribution margin per unit is $4. Converse sells twice as many As as Bs. The contribution margin per unit for B is $2. What is it for A? CORRECT ANSWER $5 If the breakeven is 5000 units and fixed costs are $50,000, what is the contribution margin per unit? CORRECT ANSWER $10 Which of the following will be found on an absorption costing income statement but not on a variable costing income statement? CORRECT ANSWER Gross Margin and Cost of Goods Sold If units produced are less than units sold, net income using absorption costing is CORRECT ANSWER Less than variable costing If the selling price is $5 per unit the variable cost is $1 per unit and the fixed cost is $20,000, what is the breakeven in units? CORRECT ANSWER $5,000 (5x - 1x - 20000 = 0, 4x - 20,000=0, 4x=20000, x = 5000) The total of ALL the right-hand sides of the T-accounts must equal the total of ALL the left-hand sides of the T-Accounts (T/F) CORRECT ANSWER True. The double-entry system of accounting means that for each transaction recorded, there is a left-hand (debit) entry offset by a right-hand (credit) entry.Since the total of all the R sides of accounts equals the total of L sides, then the total amount of increases entered in the general ledger must equal the total amount of decreases (T/F) CORRECT ANSWER False. Cash (Asset) and Common Stock (Owners' Equity) is used to record the sale of company stock. While the R side equals the L side, they both increase, thus, the total amount of increases does not equal the decreases. 2 / 3
Almost all the data necessary to prepare an income statement is contained in the retained earnings account. CORRECT ANSWER False. not Almost all. ALL.A transaction is an event that affects the financial position of a company.CORRECT ANSWER True.Credits are generally good and debits are generally bad. CORRECT ANSWER False. credit means nothing more than the R side while a debit means the L side.Neither is good or bad.Bookkeeping accounts are a method of accumulating financial transactions and summarizing their effects on balance sheet items. CORRECT ANSWER True.Bookkeeping accounts provide an easy means for recording, collecting, and reporting financial transactions of a firm.Liabilities normally have a L balance CORRECT ANSWER False. Liabilities and OE usually have R balances while assets have L balances It is possible to have the books in balance but with mistakes. CORRECT ANSWER Having the books in balance simply means that each time you entered a transaction you placed equal amounts on the R and L sides. Books which balance do not rule out the possibility that a transaction could have been posted to the wrong account.The main purpose of the trial balance is to make sure you have not committed any math errors in your T- Accounts (T/F) CORRECT ANSWER True. The trial balance is taken as a partial check of the arithmetic accuracy of the entries previously made.
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