Unlock hundreds more features
Save your Quiz to the Dashboard
View and Export Results
Use AI to Create Quizzes and Analyse Results

OR
Sign inSign in with Facebook
Sign inSign in with Google
Quizzes > Business & Finance > Finance & Economics

ACC 202 Exam 1 Practice Quiz: Test Your Cost Accounting Skills Now!

Think you can ace the cost accounting quiz? Jump into our Accounting 202 practice now!

Difficulty: Moderate
2-5mins
Learning OutcomesCheat Sheet
Paper art illustration for ACC 202 Exam 1 practice quiz on sky blue background

Use this cost accounting practice quiz to prepare for ACC 202 Exam 1 with questions on manufacturing overhead, process costing, and cost-volume-profit. You'll see what you know, spot gaps before the exam, and build confidence; if you want a longer review, head to the full ACC 202 review .

Which of the following costs remains constant in total regardless of changes in the activity level?
Fixed selling and administrative expenses
Variable manufacturing overhead
Direct labor
Direct materials
Fixed costs do not change in total over a relevant range of activity. Fixed selling and administrative expenses remain constant regardless of production volume. For more details on fixed and variable costs, visit .
In job order costing, costs are traced and allocated to:
Specific jobs or batches
Departments
Processes
Cost pools
Job order costing assigns costs to individual jobs or batches, making it ideal when products are customized. This contrasts with process costing, which averages costs over continuous processes. Learn more at .
Which of the following best defines manufacturing overhead?
Direct labor costs
All manufacturing costs except direct materials and direct labor
Selling and administrative expenses
Direct materials costs
Manufacturing overhead includes all indirect manufacturing costs such as utilities, depreciation, and maintenance. These costs cannot be traced directly to units of product. For a deeper explanation, see .
What is the formula for the predetermined overhead rate?
Estimated total direct labor hours ÷ Estimated total manufacturing overhead
Actual total manufacturing overhead ÷ Estimated total machine hours
Actual total manufacturing overhead ÷ Actual total direct labor hours
Estimated total manufacturing overhead ÷ Estimated total direct labor hours
The predetermined overhead rate is based on estimated costs and activity for the period, allowing companies to apply overhead consistently. It is calculated by dividing estimated overhead by the chosen allocation base. Read more at .
Which of the following is classified as a product cost?
Sales commissions
Advertising expense
Factory rent
Office utilities
Product costs include all costs necessary to manufacture goods: direct materials, direct labor, and manufacturing overhead such as factory rent. These costs are inventoried until the goods are sold. For more, see .
Direct materials and direct labor together are known as:
Period costs
Conversion costs
Prime costs
Operating costs
Prime costs are the direct costs of manufacturing: direct materials and direct labor. Conversion costs, by contrast, combine direct labor and manufacturing overhead. More information can be found at .
Process costing is most appropriate when products are:
Sold at retail
Delivered as services
Custom-built to customer specifications
Homogeneous and mass-produced
Process costing applies when a company produces large volumes of identical or similar products. Costs are averaged over units, unlike job order costing. For more, visit .
Which cost would not be included in manufacturing overhead?
Factory supervisor's salary
Direct materials
Indirect materials
Factory utilities
Direct materials are traced directly to products and are not part of manufacturing overhead. Overhead includes indirect materials, indirect labor, and other factory-related costs. Learn more at .
What is the contribution margin per unit if sales price is $50 and variable cost per unit is $30?
$20
$50
$80
$30
Contribution margin per unit equals sales price minus variable cost per unit. Here, $50 - $30 = $20, which contributes to covering fixed costs and profit. See for more.
How many units must be sold to break even if fixed costs are $10,000 and contribution margin per unit is $25?
250 units
400 units
625 units
500 units
Break-even units = Fixed costs ÷ Contribution margin per unit. So $10,000 ÷ $25 = 400 units is incorrect; correct is 400. Actually $10,000/25 = 400. Correction: Answer should be 400 units. Ensure accuracy. Learn more at .
If a company overapplies overhead, what is the usual adjustment at year-end?
Debit Manufacturing Overhead
Debit Cost of Goods Sold
Credit Finished Goods Inventory
Credit Cost of Goods Sold
When overhead is overapplied, the applied overhead exceeds actual overhead, requiring a credit to COGS to reduce expense. This adjusts net income properly. More at .
Conversion costs consist of:
Direct labor and manufacturing overhead
Manufacturing overhead and selling expenses
Direct materials and direct labor
Direct materials and manufacturing overhead
Conversion costs are the costs to convert materials into finished goods: direct labor plus manufacturing overhead. Prime costs are direct materials plus direct labor. See .
Activity-based costing differs from traditional costing because it:
Allocates overhead based on multiple activities
Applies a single predetermined overhead rate
Ignores nonmanufacturing costs
Uses direct labor hours as the only cost driver
Activity-based costing uses multiple cost drivers linked to activities for more accurate overhead allocation. Traditional costing often uses a single driver like machine hours. Read more at .
A differential cost is best described as:
A sunk cost
A cost that remains unchanged between alternatives
An indirect cost
The difference in cost between two alternatives
Differential cost (or incremental cost) is the difference in total cost between two decision alternatives, helpful for decision making. It excludes sunk costs. More at .
Which of the following is not considered a period cost?
Office rent
Sales commissions
Indirect manufacturing supplies
Advertising expense
Period costs are non-manufacturing costs expensed in the period incurred. Indirect manufacturing supplies are part of manufacturing overhead and thus product costs. See .
Which cost concept is irrelevant to future decisions because it has already been incurred?
Sunk cost
Opportunity cost
Differential cost
Variable cost
Sunk costs are past costs that cannot be changed by current decisions and are therefore irrelevant in decision-making. They should not influence future choices. More at .
If the contribution margin ratio is 40% and fixed costs are $50,000, what are the break-even sales dollars?
$200,000
$62,500
$50,000
$125,000
Break-even sales dollars = Fixed costs ÷ Contribution margin ratio = $50,000 ÷ 0.40 = $125,000. This tells you the sales needed to cover all fixed costs. See .
A company estimates annual overhead of $600,000 and 50,000 machine hours. What is its predetermined overhead rate?
$12 per machine hour
$8 per machine hour
$15 per machine hour
$10 per machine hour
Predetermined overhead rate = Estimated overhead ÷ Estimated machine hours = $600,000 ÷ 50,000 = $12. Correction: That's $12 per hour; ensure calculation accuracy when applying. More at .
In activity-based costing, if Activity A has overhead costs of $200,000 and cost driver volume of 10,000 units, what is the activity rate?
$0.05 per driver unit
$2 per driver unit
$200 per driver unit
$20 per driver unit
Activity rate = Overhead cost ÷ Cost driver volume = $200,000 ÷ 10,000 = $20 per driver unit. This rate is used to allocate costs in ABC. For more, see .
Under FIFO process costing, beginning work in process inventory is completed before current period units. True or False?
False
Only if variable costing
True
Not enough information
Under the FIFO method, units in beginning WIP are completed first, and only current period work is applied to units started during the period. This ensures correct equivalent unit calculation. See .
What is the margin of safety percentage if budgeted sales are $500,000 and break-even sales are $350,000?
70%
40%
30%
50%
Margin of safety % = (Budgeted sales - Break-even sales) ÷ Budgeted sales = ($500,000 - $350,000) ÷ $500,000 = 30%. Correction: That equals 30%, not 40%. Verify your work. Learn more at .
A department's actual overhead was $120,000 and applied overhead was $110,000. What is the overhead variance?
$10,000 underapplied
$120,000 overapplied
$10,000 overapplied
$110,000 underapplied
Underapplied overhead occurs when actual > applied. Here, $120,000 - $110,000 = $10,000 underapplied. The variance must be closed or prorated. See .
The relevant range refers to:
The point where total cost is minimized
The activity span over which fixed and variable cost behavior is valid
The range where fixed costs per unit remain constant
Any level of production
Relevant range defines the span of activity where cost relationships (fixed total, variable per unit) hold true. Outside this range, cost behavior may change. More at .
In joint product costing, costs are allocated at the split-off point based on:
Machine hours used
Net realizable value of each product
Sales price per unit only
Production volume of each product
A common method allocates joint costs based on relative net realizable values at the split-off point. This reflects each product's revenue-generating potential. For details, see .
A company uses a standard cost system. If the standard direct materials cost is $5 per unit and they used 1,000 units but paid $4.80 per unit, what is the materials price variance?
$4,800 favorable
$200 favorable
$5,000 unfavorable
$200 unfavorable
Materials price variance = (Actual price - Standard price) × Actual quantity = ($4.80 - $5.00) × 1,000 = - $200, which is favorable. Favorable variances occur when actual cost is less than standard. Learn more at .
0
{"name":"Which of the following costs remains constant in total regardless of changes in the activity level?", "url":"https://www.quiz-maker.com/QPREVIEW","txt":"Which of the following costs remains constant in total regardless of changes in the activity level?, In job order costing, costs are traced and allocated to:, Which of the following best defines manufacturing overhead?","img":"https://www.quiz-maker.com/3012/images/ogquiz.png"}

Study Outcomes

  1. Analyze Cost Behavior -

    Analyze how variable, fixed, and mixed costs influence pricing and decision-making in ACC 202 Exam 1 scenarios.

  2. Calculate Predetermined Overhead Rates -

    Compute manufacturing overhead rates accurately using direct labor hours or machine hours based on cost accounting quiz data.

  3. Allocate Manufacturing Overhead -

    Apply overhead costs to job orders and process costing systems to master the manufacturing overhead quiz challenges.

  4. Interpret Overhead Variances -

    Compare actual versus applied overhead to identify and explain favorable and unfavorable variances in your ACC 202 exam review.

  5. Apply Key Cost Accounting Formulas -

    Recall and use essential formulas for cost allocation, break-even analysis, and contribution margin during the Accounting 202 practice quiz.

Cheat Sheet

  1. Predetermined Overhead Rate (POHR) -

    Review how to calculate the POHR by dividing estimated manufacturing overhead by the chosen allocation base (e.g., machine hours). For example, if estimated MOH is $250,000 and machine hours are 50,000, POHR = $5 per machine hour. Remember the mantra "Est. MOH over Est. Base" to nail this formula on your acc 202 exam 1.

  2. Over- or Under-applied Overhead -

    Understand that applied overhead equals POHR multiplied by actual activity, and compare it to actual MOH to find under- or over-application. If applied MOH of $48,000 is less than actual MOH of $50,000, you have $2,000 underapplied overhead to adjust. This adjustment step is key for mastering the manufacturing overhead quiz section.

  3. Job Order vs. Process Costing -

    Distinguish job order costing (individual job cost sheets) from process costing (continuous flow per department). In job order costing, track direct materials, direct labor, and applied MOH per job - ideal for custom orders. A simple mnemonic: "Jobs Jump to Sheets, Processes Pass Through Departments."

  4. Activity-Based Costing (ABC) -

    Learn to create multiple cost pools and assign drivers (e.g., setups, inspections) for more accurate product costing. For instance, if the setup cost pool is $30,000 and there are 300 setups, the rate is $100 per setup. This approach appears often in advanced cost accounting quiz questions.

  5. Variance Analysis Fundamentals -

    Memorize key variances: Materials Price Variance = (Actual Price - Standard Price) × Actual Qty, and Materials Quantity Variance = (Actual Qty - Standard Qty) × Standard Price. Similarly, labor rate and efficiency variances help you diagnose performance issues. A helpful tip: "Price Varies in Price, Quantity Varies in Quantity" to keep formulas straight on the ACC 202 exam review.

Make a Quiz (FREE) Copy & Edit This Quiz Create a Quiz with AI

Finance & Economics Quizzes

Powered by: Quiz Maker