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Test your basic knowledge |
Cost Accounting Vocab
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Subject
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business-skills
Instructions:
Answer 50 questions in 15 minutes.
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Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.
This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. A variable - such as volume - that casually affects revenues
product-cost cross-subsidization
product undercosting
source document
revenue driver
2. All manufacturing costs that are related to the cost object (work in process and then finished goods) but that cannot be traced to that cost object in an economically feasible way.
decision table
factory overhead costs
process-costing system
unit cost
3. A costing system that traces direct costs to a cost object by using the actual direct-cost rates times the actual quantities of the direct-cost inputs and allocates the indirect costs based on the actual indirect-cost rates times the actual quantitie
cost
actual costing
batch-level costs
adjusted allocation-rate approach
4. Source document that records and accumulates all the costs assigned to a specific job - starting when work begins
indirect manufacturing costs
uncertainty
cost object
job-cost record
5. Budgeted annual indirect costs in a cost pool divided by the budgeted annual quanttity of the cost allocation base
budgeted indirect-cost rate
indirect manufacturing costs
relevant range
sensitivty analysis
6. Contribution margin per unit divided by selling price
direct material costs
normal costing
service-sector companies
contribution margin percentage
7. All manufacturing costs that are related to the cost object (work in process and then finished goods) but that cannot be traced to that cost object in an economically feasible way.
cost-application base
proration
overabsorbed indirect costs
manufacturing overhead costs
8. Costing outcome where one undercosted (overcosted) product results in at least one other product being overcosted (undercosted)
product-cost cross-subsidization
operating income
outcomes
event
9. Collection of cost data in some organized way by means of an accounting system
cost pool
manufacturing-sector companies
cost accumulation
overallocated indirect costs
10. Include the compensation of all manufacturing labor that can be traced to the cost object (work in process and then finished goods) in a economically feasible way
margin of safety
contribution margin ratio
direct manufacturing labor costs
choice criterion
11. The costs of activities related to a group of units of products or services rather than to each individual unit of product or service
contribution margin
cost
product undercosting
batch-level costs
12. Acquisition costs of all materials that eventually become part of the cost object (work in process and then finished goods) - and that can be traced to the costt object in an economically feasible way
batch-level costs
direct material costs
cost allocation
expected value
13. A possible relevant occurrence in a decision model
event
cost tracing
contribution margin percentage
finished goods inventory
14. Costs related to the particular cost object that can be traced to that object in an economicqally feasible (cost-effective) way
cost driver
direct costs of a cost object
adjusted allocation-rate approach
average cost
15. Companies that purchase and then sell tangible products without changing their basic form
cost pool
actual indirect-cost rate
merchandising-sector companies
underapplied indirect costs
16. Weighted average of the outcomes of a decision with the probability of each outcome serving as the weight
expected monetary value
service-sustaining costs
contribution margin percentage
cost allocation
17. Costing system in which the cost object is masses of identical or similar units of a product or service
process-costing system
actual indirect-cost rate
indirect costs of a cost object
expected value
18. Categorization of indirect costs into different cost pools on the basis of the different types of cost drivers - or cost-allocation bases - or different degrees of difficulty in determinig cause-and-effect (or benefits received) relationships
cost hierarchy
fixed cost
product costs
work-in-process inventory
19. Describes the assignment of direct costs to a particular cost object
cost object
proration
event
cost tracing
20. Cost computed by dividing total cost by the number of units
adjusted allocation-rate approach
product-sustaining costs
average cost
cost hierarchy
21. Inflows of assets (usually cash or accounts receivable) received for products or services provided to customers
finished goods inventory
batch-level costs
work-in-process inventory
revenues
22. Companies that provide services or intangible products to their customers
service-sector companies
labor-time record
expected value
degree of operating leverage
23. Describes the likelihood (or the probability) that each of the mutually exclusive and collectively exhaustive set of events will occur
product overcosting
contribution margin percentage
manufacturing overhead applied
probability distribution
24. Effects that fixed costs have on changes in operating income as changes occur in units sold and hence in contribution margin
job-costing system
operating leverage
indirect costs of a cost object
product overcosting
25. Goods completed - but not yet sold
cost tracing
finished goods inventory
inventoriable costs
facility-sustaining costs
26. Direct materials in stock and awaiting use in the manufacturing process
conversion costs
direct materials inventory
activity-based costing (ABC)
overapplied indirect costs
27. Source document that records and accumulates all the costs assigned to a specific job - starting when work begins
job-cost sheet
gross margin percentage
probability distribution
normal costing
28. Cost that remains unchanged in total for a given time period - despite wide changes in the related level of total activity or volume
adjusted allocation-rate approach
fixed cost
unit cost
average cost
29. Total revenues minus total variable costs
contribution margin
factory overhead costs
budgeted indirect-cost rate
product-cost cross-subsidization
30. Wage rate paid to workers (for both direct labor and indirect labor) in excess of their straight-time wage rates
period costs
service-sustaining costs
finished goods inventory
overtime premium
31. Predicted or forecasted cost (future cost) as distinguished from an actual or historical cost
margin of safety
budgeted cost
variable cost
work in progress
32. Allocated amount of indirect costs in an accounting period is greater than the actual (incurred) amount in that period.
cost accumulation
overallocated indirect costs
breakeven point (BEP)
sensitivty analysis
33. Costing system in which the cost object is a unit or multiple units of a distinct product or service called a job
cost accumulation
revenue driver
job-costing system
cost tracing
34. Costs related to the particular cost object that cannot be traced to that object in an economically feasible (cost-effective) way
source document
underallocated indirect costs
indirect costs of a cost object
proration
35. Allocated amount of indirect costs in an accounting period is less than the actual (incurred) amount in that period.
choice criterion
cost driver
contribution income statement
underabsorbed indirect costs
36. Cost-allocation base when the cost object is a job - product - or customer
labor-time record
uncertainty
cost-application base
cost object
37. A product consumes a high level of resources but is reported to have a low cost per unit
actual indirect-cost rate
product undercosting
probability
product-sustaining costs
38. Total revenues from operations minus cost of goods sold and operating costs (excluding interest expense and income taxes)
operating income
average cost
contribution margin
facility-sustaining costs
39. Shows how changes in the quantity of units sold affect operating income
source document
PV graph
underallocated indirect costs
margin of safety
40. Goods partially worked on but not yet completed
gross margin percentage
overabsorbed indirect costs
work in progress
activity
41. Allocated amount of indirect costs in an accounting period is greater than the actual (incurred) amount in that period.
factory overhead costs
batch-level costs
cost-application base
overabsorbed indirect costs
42. Approach to costing that focuses on individual activities as the fundamental cost objects. It uses costs of these activities as the basis for assigning costs to other cost objects such as products or services
revenues
direct costs of a cost object
work-in-process inventory
activity-based costing (ABC)
43. Allocated amount of indirect costs in an accounting period is greater than the actual (incurred) amount in that period.
manufacturing overhead applied
product-sustaining costs
overapplied indirect costs
actual cost
44. Weighted average of the outcomes of a decision with the probability of each outcome serving as the weight
expected value
product-cost cross-subsidization
cost pool
period costs
45. Method of management decision-making that uses activity-based costing information to improve customer satisfaction and profitability
idle time
activity-based management (ABM)
conversion costs
expected value
46. All direct manufacturing costs
contribution income statement
prime costs
sensitivty analysis
cost hierarchy
47. All costs in the income statement other than cost of goods sold
inventoriable costs
period costs
overabsorbed indirect costs
work in progress
48. Companies that purchase materials and components and convert them into various finished goods
service-sector companies
manufacturing-sector companies
facility-sustaining costs
variable cost
49. Summary of alternative actions - events - outcomes - probabilities of events in a decision model
decision table
contribution margin per unit
cost driver
product undercosting
50. Objective that can be quantified in a decision model
job
indirect costs of a cost object
variable cost
choice criterion