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Cost Accounting Vocab

Subject : business-skills
Instructions:
  • Answer 50 questions in 15 minutes.
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  • Match each statement with the correct term.
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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. General term that encompasses both (1) tracing accumulated costs that have a direct relationship to a cost object and (2) allocating accumulated costs that have an indirect relationship to a cost object






2. A factor that links in a systematic way an indirect cost or group of indirect costs to a cost object






3. Examines the behavior of total revenues - total costs - and operating income as changes occur in the units sold - the selling price - the variable cost per unit - or the fixed costs of a product






4. 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






5. Companies that purchase materials and components and convert them into various finished goods






6. Method of management decision-making that uses activity-based costing information to improve customer satisfaction and profitability






7. 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






8. Actual total indirect costs in a cost pool divided by the actual total quantity of the cost-allocation base for that cost pool






9. The costs of activities related to a group of units of products or services rather than to each individual unit of product or service






10. Allocated amount of indirect costs in an accounting period is greater than the actual (incurred) amount in that period.






11. 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






12. A product consumes a high level of resources but is reported to have a low cost per unit






13. 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.






14. The costs of activities undertaken to support individual services






15. Restates all overhead entries in the general ledger and subsidiary ledgers using actual cost rates rather than budgeted cost rates






16. Effects that fixed costs have on changes in operating income as changes occur in units sold and hence in contribution margin






17. Wages paid for unproductive time caused by lack of orders - machine breakdowns - material shortages - poor scheduling - and the like






18. Likelihood or chance that an event will occur






19. A product consumes a low level of resources but is reported to have a high cost per unit






20. Source documents that contains information about the cost of direct materials used on a specific job and in a specific department






21. 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






22. Cost computed by dividing total cost by the number of units






23. Allocated amount of indirect costs in an accounting period is greater than the actual (incurred) amount in that period.






24. Total revenues from operations minus cost of goods sold and operating costs (excluding interest expense and income taxes)






25. All manufacturing costs other than direct material costs






26. Allocated amount of indirect costs in an accounting period is less than the actual (incurred) amount in that period.






27. Quantity of output sold at which total revenues equal total costs - that is where the operating income is zero






28. Band of normal activity level or volume in which there is a specific relationship between the level of activity or volume and the cost in question






29. A variable - such as volume - that casually affects revenues






30. Summary of alternative actions - events - outcomes - probabilities of events in a decision model






31. Source document that contains information about the amount of labor time used for a specific job in a specific department






32. Goods partially worked on but not yet completed






33. 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






34. Income statement that groups costs into variable costs and fixed costs to highlight the contribution margin






35. The costs of activities undertaken to support individual products regardless of the number of units or batches in which the units are produced






36. Inflows of assets (usually cash or accounts receivable) received for products or services provided to customers






37. 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.






38. A possible relevant occurrence in a decision model






39. Allocated amount of indirect costs in an accounting period is less than the actual (incurred) amount in that period.






40. Sum of the costs assigned to a product for a specific purpose






41. Operating income plus nonoperating revenues (such as interest revenue) minus nonoperating costs (such as interest cost) minus income taxes






42. A variable - such as the level of activity or volume - that casually affects costs over a given time span






43. Total revenues minus total variable costs






44. Weighted average of the outcomes of a decision with the probability of each outcome serving as the weight






45. A what-if technique that managers use to examine how an outcome will change if the original predicted data are not achieved or if an underlying assumption changes






46. Objective that can be quantified in a decision model






47. Goods partially worked on but not yet completed






48. Cost incurred (a historical or past cost) - as distinguished from a budgeted or forecaster cost






49. Contribution margin divided by operating income at any given level of sales






50. The possibility that an actual amount will deviate from an expected amount