WGU D101 cost and managerial Accounting Exam

1. What is an example of a cost center?

   A. Human resources in a hospital   A. Human resources in a hospital

   B. Reservations for an airline

   C. Convention sales team at a resort hotel

   D. Truck division of a vehicle manufacturer

2. A pharmaceutical company has nine divisions that operate relatively independently with local decision‑making power. Which overall management type is ideal for a company structured like this?

   A. Centralized management

   B. Hierarchical management

   C. Human resource management

   D. Decentralized management   D. Decentralized management

3. A company wants to increase overall profitability by only increasing its product’s selling price. Which effect should this have?

   A. Increased breakeven point in units

   B. Increased risk of customers seeking substitutes

   C. Increased fixed cost per unit

   D. Decreased contribution margin per unit   D. Decreased contribution margin per unit

4. Which of these costs are variable costs?

   A. Production worker wages, machine maintenance, and lease on factory

   B. Plant supervisor salary, lumber, and production worker wages

   C. Lumber, production worker wages, and machine maintenance   C. Lumber, production worker wages, and machine maintenance

   D. Machine maintenance, lease on factory, and plant supervisor salary

5. Which cost is categorized as manufacturing overhead cost?

   A. Plant assembly line worker wages

   B. Oil

   C. Plant maintenance costs   C. Plant maintenance costs

   D. CEO salary

6. Which costs are considered prime costs?

   A. Indirect materials and indirect labor

   B. Direct labor and indirect labor

   C. Direct materials and direct labor   C. Direct materials and direct labor

   D. Direct materials and indirect materials

7. Which type of organization purchases finished goods from a supplier or wholesaler to resell them to customers for profit?

   A. Service

   B. Manufacturing

   C. Governmental

   D. Merchandising   D. Merchandising

8. How are direct materials and direct labor costs assigned to jobs in a job order costing system?

   A. Based on department averages

   B. Distributed evenly across all jobs

   C. Traced straight to the specific job or order   C. Traced straight to the specific job or order

   D. Based on the company’s overall budget

9. What is the difference between job order costing and process costing?

   A. Product costs are assigned to departments or processes in job order costing

   B. Product costs are traced to the product in job order costing   B. Product costs are traced to the product in job order costing

   C. Finished goods inventory consists of completed units at per‑unit cost in job order costing

   D. Finished goods inventory includes unsold completed products in process costing

10. What allows a company to increase its contribution margin per unit?

   A. Decreasing accounting salaries

   B. Using cheaper materials   B. Using cheaper materials

   C. Increasing salary of plant manager

   D. Increasing quality of material

11. How can the breakeven formula assist in setting a new selling price?

   A. It highlights cost inefficiencies

   B. It shows the company’s total cash flow

   C. It simulates how different prices affect target profit and break‑even point   C. It simulates how different prices affect target profit and break‑even point

   D. It indicates which fixed costs can be eliminated

12. Which item is a fixed cost for the bakery?

   A. Electricity costs that vary based on production level

   B. Cost of butter and eggs

   C. Wages paid to hourly employees

   D. Monthly lease on equipment   D. Monthly lease on equipment

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