MANG ACC Final Exam Review

Units sold to meet Goal

FC + Target Goal ($) / CM

High-Low Method formula

H Cost - L Cost / H Act. - L Act.

What is NOT true about Material Accounting?

Users consist of investors and creditors

Which of the four main responsibilities is best defined as “comparing budgets to actual results”?

Controlling

Cost behavior of a VC as Units increase

TC increases, CPU stays the same

What is the purpose of High-Low method?

Estimate a mixed costs from a specific level of activity

Common fixed cost

Rent

Decreases as activity level increases

FC / Unit

CM Formula

Sales - VC

More units sold causes…

Higher CM

More units sold causes…

Higher VC

More units sold causes…

Higher OI

Margin of Safety formula

Act. Sales - Breakeven Sales

Indirect Labor is considered a…

Variable Cost

Depreciation is considered a…

Fixed Cost

Total Cost formula

FC + (VC/hr x Hours)

Breakeven formula (units)

FC / (CM/unit)

Breakeven formula ($)

[FC / (CM/unit)] x Selling Price

CMR formula

CM / Selling Price

NOI after $X increase in sales

$X x CMR

Required units formula

(FC + Target $) / (CM / unit)

Markup formula

Resell value / Purchase price

New NOI after purchase decision formula

(CM x New Sales in units) - New Fixed Costs

New Breakeven point after reducing VC

Total New Fixed Costs / New CM

If COGM > COGS then…

FG inventory increased

RM used formula

B. RM + Purchases - E. RM

COGM formula

B. WIP + TMC - E. WIP

TMC formula

DM + DL + MOH

If DM isn’t given when calculating TMC, use…

DM purchase from previous calculations

POHR formula

Est. OH / Est. Labor Hours

Applied OH formula

Act. Hours x POHR

Under/overapplied OH formula

Actual - Applied

COGS formula

B. FG + COGM - E. FG

When there are batch-level or product-level costs, in comparison to a traditional cost system, an activity-based costing system ordinarily will shift costs from…

High-volume to low-volume products

VC / unit formula

(RM + DL + MOH) / Units

In an activity-based costing system, which of the following is not a category in which activities are classified?

Industry-level

What is considered to NOT be a customer-level activity?

Preparing purchase orders