All Free Accounting MCQs with Answers
Every Accounting question in the bank, across all chapters, each with the correct answer and a written explanation. Free and unlimited, with no account needed.
1,971 questions · page 68 of 99
- A. investment decisions
- B. pricing decisions
- C. product mix decisions
- D. Both B and C
Explanation: Normal costing and standard costing provide cost information useful for setting prices and evaluating alternative product mixes.
Correct answer: Both B and C- A. 100 units
- B. 110 units
- C. 120 units
- D. 140 units
Explanation: Required units are calculated as target operating income divided by contribution margin per unit when no fixed costs are provided: $84,000…
Correct answer: 140 units- A. output costing
- B. standard costing
- C. achieved costing
- D. input costing
Explanation: In standard costing, the standard quantity allowed for the actual output is multiplied by the standard price to determine the standard…
Correct answer: standard costing- A. $20
- B. $5
- C. $10
- D. $15
Explanation: Budgeted fixed manufacturing cost per unit equals total fixed manufacturing cost divided by budgeted production: $35,000 ÷ 7,000 = $5 per…
Correct answer: $5- A. $21,300
- B. $148,700
- C. $138,700
- D. $118,700
Explanation: Throughput contribution equals revenue minus direct material cost, so direct material cost of goods sold is $85,000 − $63,700 = $21,300.
Correct answer: $21,300- A. $36,000
- B. $66,000
- C. $56,000
- D. $46,000
Explanation: Multiplying the budgeted per-unit cost by planned production gives $165 × 400 = $66,000.
Correct answer: $66,000- A. seasonal capacity utilization
- B. normal capacity utilization
- C. standard capacity utilization
- D. theoretical capacity utilization
Explanation: Normal capacity is based on the average customer demand expected over a representative period, including ordinary fluctuations in…
Correct answer: normal capacity utilization- A. standard capacity
- B. actual capacity
- C. practical capacity
- D. theoretical costing
Explanation: Practical capacity allows for unavoidable operating interruptions such as holidays, maintenance, and normal downtime.
Correct answer: practical capacity- A. must
- B. not a must
- C. non-inventoriable
- D. inventoriable
Explanation: Under variable costing, fixed manufacturing overhead is expensed in the period rather than included in inventory, so a production-volume…
Correct answer: not a must- A. inventoriable
- B. non-inventoriable
- C. high dividend
- D. low dividend
Explanation: Under variable costing, only variable manufacturing costs are included in inventory; fixed manufacturing overhead is expensed in the…
Correct answer: non-inventoriable- A. $7,000
- B. $3,000
- C. $4,000
- D. $5,000
Explanation: Contribution margin per unit equals selling price less all variable costs: $5,000 − $1,500 − $500 = $3,000.
Correct answer: $3,000- A. manufacturing costing
- B. absorption costing
- C. variable costing
- D. labor costing
Explanation: Variable costing treats variable manufacturing costs as inventoriable and charges fixed manufacturing overhead to the period.
Correct answer: variable costing- A. more sales
- B. more inventory units
- C. less inventory units
- D. less sales
Explanation: Absorption costing assigns fixed manufacturing overhead to units produced, so producing more units can place more fixed cost in inventory…
Correct answer: more inventory units- A. variable manufacturing cost
- B. budgeted fixed manufacturing cost
- C. adjusted manufacturing cost
- D. unadjusted labor cost
Explanation: A fixed manufacturing cost rate is calculated as budgeted fixed manufacturing cost divided by the selected allocation base.
Correct answer: budgeted fixed manufacturing cost- A. fixed manufacturing overhead cost
- B. variable manufacturing overhead cost
- C. indirect manufacturing overhead cost
- D. direct manufacturing overhead cost
Explanation: Multiplying the actual allocation base quantity by the actual fixed overhead rate gives the fixed manufacturing overhead cost allocated to…
Correct answer: fixed manufacturing overhead cost- A. $200
- B. $150
- C. $50
- D. $100
Explanation: Budgeted fixed manufacturing cost per unit is found by dividing total budgeted fixed cost by budgeted production: $45,000 ÷ 900 = $50.
Correct answer: $50- A. marginal cost per unit
- B. variable cost per unit
- C. fixed cost per unit
- D. contribution margin per unit
Explanation: Target-profit units equal total fixed costs plus target operating income, divided by contribution margin per unit.
Correct answer: contribution margin per unit- A. input costing
- B. output costing
- C. standard costing
- D. achieved costing
Explanation: Standard costing calculates cost by applying standard prices to the standard quantity of input allowed for the actual output.
Correct answer: standard costing- A. cyclical factors
- B. seasonal factors
- C. trend factors
- D. all of above
Explanation: Customer demand may vary because of cyclical movements, seasonal patterns, and long-term trends.
Correct answer: all of above- A. fixed cost does not change
- B. inventory changes
- C. inventory does not change
- D. fixed cost changes
Explanation: Under absorption and variable costing, operating income differs when inventory changes because absorption costing carries some fixed…
Correct answer: inventory changes