Intermediate Managerial Accounting Practice Exam
Course Introduction
Intermediate Managerial Accounting builds upon foundational accounting concepts to explore the strategies and techniques managers use to drive decision-making and optimize organizational performance. The course covers advanced topics such as budgeting, cost behavior and analysis, performance measurement, variance analysis, and capital budgeting. Students will develop skills in interpreting financial data, preparing internal reports, and utilizing accounting information for planning, control, and evaluation within a business environment. Emphasis is placed on real-world applications and ethical considerations, preparing students for higher-level accounting roles and effective managerial decision-making.
Recommended Textbook
Horngren's Accounting The Managerial Chapters 10th Edition by Tracie L. Miller Nobles
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9 Chapters
1348 Verified Questions
1348 Flashcards
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Page 2
Chapter 1: Introduction to Managerial Accounting
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179 Verified Questions
179 Flashcards
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Sample Questions
Q1) Which of the following would appear as a line item on the income statements of both, a merchandiser and a manufacturer?
A) Direct Labor
B) Cost of Goods Manufactured
C) Direct Materials
D) Cost of Goods Sold
Answer: D
Q2) The primary activity of manufacturing businesses is to purchase goods from a wholesaler and resell them.
A)True
B)False
Answer: False
Q3) What is the cost of goods sold for March?
A) $83,420
B) $73,150
C) $76,850
D) $82,150
Answer: C
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3
Chapter 2: Job Order Costing
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152 Verified Questions
152 Flashcards
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Sample Questions
Q1) Gia Machine Shop uses a predetermined overhead allocation rate of $63.20 per direct labor hour. In January, Gia completed Job A23 which utilized 15 direct labor hours. Which of the following correctly describes the journal entry to allocate overhead to the job?
A) Debit Finished Goods Inventory $948, credit Manufacturing Overhead $948
B) Debit Manufacturing Overhead $63.20, credit Work-in-Process Inventory $63.20
C) Debit Work-in-Process Inventory $948, credit Manufacturing Overhead $948
D) Debit Cost of Goods Sold $63.20, credit Finished Goods Inventory $63.20 Answer: C
Q2) The records at Smith and Jones Company show that Job 110 is charged with $11,000 of direct materials and $12,500 of direct labor. Smith and Jones Company allocate manufacturing overhead at 85% of direct labor cost. What is the total cost of Job No. 110?
A) $20,625
B) $34,125
C) $22,500
D) $21,625
Answer: B
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Page 4
Chapter 3: Process Costing
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144 Verified Questions
144 Flashcards
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Sample Questions
Q1) Which of the following is used to calculate the number of units accounted for under first-in, first-out (FIFO) method of inventory valuation of process costing?
A) Accounted for = Beginning balance + Started and completed + In process
B) Accounted for = Beginning balance + Started and completed
C) Accounted for = Beginning balance + In process
D) Accounted for = Beginning balance + Amount transferred in
Answer: A
Q2) Production cost reports prepared using first-in, first-out (FIFO) method assumes that the first units started in the production process are the first units completed and sold.
A)True
B)False
Answer: True
Q3) Under process costing, the costs incurred by each department are recorded in:
A) a job cost sheet.
B) the Finished Goods Inventory account.
C) the Cost of Goods Sold account.
D) a production cost report.
Answer: D
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Chapter 4: Cost-Volume-Profit Analysis
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172 Verified Questions
172 Flashcards
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Sample Questions
Q1) McDaniel Company sells two products-J and B. McDaniel predicts that it will sell 7,200 units of J and 5,600 units of B in the next period. The unit contribution margins are $2.85 and $6.30, respectively. What is the weighted-average unit contribution margin?
A) $9.96 per product
B) $4.58 per product
C) $7.75 per product
D) $4.36 per product
Q2) The fixed costs per unit will:
A) increase as production decreases.
B) decrease as production decreases.
C) remain the same as production levels change.
D) increase as production increases.
Q3) The degree of operating leverage can be measured by:
A) dividing the contribution margin by operating income.
B) dividing the fixed costs by the sales price per unit.
C) multiplying the contribution margin to sales revenue.
D) dividing the fixed costs by contribution margin.
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6
Chapter 5: Master Budgets
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114 Verified Questions
114 Flashcards
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Sample Questions
Q1) Uncle's Caps, a merchandiser, wants to prepare the budgeted balance sheet for the next budget period. For this purpose the amount of ending cash balance can be retrieved from:
A) the sales budget.
B) the budgeted funds flow statement.
C) the cash budget.
D) the Cost of Goods Sold budget.
Q2) A company has prepared the operating budget and the cash budget and is now preparing the budgeted balance sheet. While doing so, the cash balance can be taken from:
A) the operational budget.
B) the budgeted income statement.
C) the cash budget.
D) the sales budget.
Q3) While preparing the budgeted income statement of a merchandiser, the amount of cost of goods sold can be taken from:
A) the budgeted balance sheet.
B) the budgeted cash flow statement.
C) the inventory, purchases and COGS budget.
D) the payment for cost of goods sold.
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Chapter 6: Flexible Budgets and Standard Cost Systems
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174 Verified Questions
174 Flashcards
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Sample Questions
Q1) Wood Designs Company, a custom cabinet manufacturing company, is setting standard costs for one of its products. The main material is cedar wood, sold by the square foot. The current cost of cedar wood is $4.00 per square foot from the supplier. Delivery costs are $0.25 per board foot. Carpenters' wages are $25.00 per hour. Payroll costs are $3.60 per hour and benefits are $5.00 per hour. How much is the direct materials cost standard (per square foot)?
A) $9.25 per square foot
B) $7.85 per square foot
C) $4.25 per square foot
D) $4.00 per square foot
Q2) A standard cost system helps management set performance standards.
A)True
B)False
Q3) Calculate the total variable overhead variance of Alpha Company.
A) $3,000 F
B) $10,050 F
C) $7,000 F
D) $3,050 F
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8
Chapter 7: Cost Allocation and Responsibility Accounting
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130 Verified Questions
130 Flashcards
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Sample Questions
Q1) A unique factor of responsibility accounting performance reports is the focus on responsibility and controllability.
A)True
B)False
Q2) A company that uses a balanced scorecard has established a KPI for product quality. If the actual warranty claims are higher than expected it indicates that the quality standards have been met.
A)True
B)False
Q3) The practice of comparing a company's achievements against the best practices in the industry is known as goal congruence.
A)True
B)False
Q4) The transfer price should be an amount between the market price and the variable cost.
A)True
B)False
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Chapter 8: Short-Term Business Decisions
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161 Verified Questions
161 Flashcards
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Sample Questions
Q1) When a company is considering the possibility of processing their product further to achieve higher sales revenues, the rule is as follows: as long as the additional processing generates higher sales revenues, it is the preferred alternative.
A)True
B)False
Q2) Which of the following is the key to choose the product type to be maximized, in making product mix decisions under constraining factors?
A) revenue per unit
B) contribution margin per unit of product
C) contribution margin per unit of the constraining factor
D) gross profit per unit using traditional costing
Q3) If there are no constraints on sales of either of the products, and the company could choose any proportions of product mix that they wanted, the maximum contribution margin that the company could earn will be:
A) $250,000
B) $425,000
C) $330,000
D) $325,000
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10
Chapter 9: Capital Investment Decisions
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122 Verified Questions
122 Flashcards
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Sample Questions
Q1) Gamma Company is considering an investment opportunity with the following expected net cash inflows: Year 1, $250,000; Year 2, $350,000; Year 3, $395,000. The company uses a discount rate of 12% and the initial investment is $750,000. The following table is available:
Present Value of $1:
\[\begin{array} { | c | r | r | r | r | }
\hline & 10 \% & 12 \% & 14 \% & 15 \% \\
\hline 1 & 0.909 & 0.893 & 0.877 & 0.870 \\
\hline 2 & 0.826 & 0.797 & 0.769 & 0.756 \\
\hline 3 & 0.751 & 0.712 & 0.675 & 0.658 \\
\hline 4 & 0.683 & 0.636 & 0.592 & 0.572 \\
\hline \underline { 5 } & \underline { 0.621 } & \underline { 0.567 } & \underline { 0.519 } & \underline { 0.497 } \\
\hline
\end{array}\] The IRR of the project will be:
A) less than 12%.
B) between 12% and 13%.
C) between 14% and 15%.
D) more than 12%.
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