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Managerial Accounting And Cost Concepts

Subject : business-skills
Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • 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. The sum of direct materials cost and direct labor cost -






2. A cost that is incurred to support a number of cost objects - but cannot be traced to them individually.






3. (1.)Selling costs (2.)Administrative costs






4. A cost that remains constant - in total - regardless of changes in the level of activity.






5. Small groups of employees that meet on a regular basis to discuss ways of improving quality.






6. Beginning merchandise inventory + Purchase - Ending merchandise inventory






7. A cost that cannot be easily and conveniently traced to a specified cost object.






8. All costs involved in acquiring or making a product.






9. Product costs that were initially assigned to inventories.






10. Contains both variable and fixed cost elements. (Also known as semi-variable costs)






11. The materials that go into the final product.






12. Whenever a straight line is a reasonable approximation for the relation between cost and activity.






13. (Also known as the 'X' variable); Refers to activity because it causes variations in the cost.






14. An account is classified as either variable of fixed based on the analyst's prior knowledge of how the cost in the account behaves.






15. Cost that are incurred when a product or service that is defective is delivered to a customer.






16. The potential benefit that is given up when one alternative is selected over another.






17. A cost that has already been incurred and that cannot be changed by any decision made now or in the future.






18. Labor costs that cannot be physically traced to particular products or that can be traced only at great cost and inconvenience.






19. Include all costs that are incurred to secure customer orders and get the finished product to the customer.






20. The degree to which a product or service meets or exceeds its design specifications and is free of defects or other problems that mar its appearance or degrade its performance.






21. Method based on the rise-over-run formula for the slope of a straight line.






22. Refers to how a cost reacts to changes in the level of activity.






23. Provides managers with an income statement that clearly distinguishes between fixed and variable costs and therefore aids in planning - controlling - and decision making.






24. The sum of direct labor cost and manufacturing overhead cost. (Refers to converting the materials into the finished product.)






25. Costs that usually arise from annual decisions by management to spend on certain fixed cost items. (Also known as 'managed fixed costs').






26. All the costs that are not product costs.






27. A report that details prevention costs - appraisal costs - and the costs of internal and external failures.






28. Materials that are included as part of manufacturing overhead.






29. Represent organizational investments with a multiyear planning horizon that can't be significantly reduced even for short period of time without making fundamental changes.






30. A charting technique used to monitor the quality of work being done in a workstation for the purpose of immediately correcting any problems.






31. Anything for which cost data are desired-including products - customers - jobs - and organizational sub-units.






32. A difference in revenues between any two alternatives.






33. The amount remaining from sales revenues after variable expenses have been deducted. (This amount contributes toward covering fixed expenses and then towards profits for the period.)






34. (Y2-Y1)/(X2-X1)






35. Materials that become an integral part of the finished product and whose costs can be conveniently traced to the finished product.






36. (Also known as the 'Y' variable); The amount of cost incurred during a period depends on the level of activity for the period.






37. The third element of manufacturing cost - includes all manufacturing costs except direct materials and direct labor.






38. An approach to cost analysis that involves a detailed analysis of what cost behavior should be - based on an industrial engineer's evaluation of the production methods to be used - the materials specifications - labor requirements - equipment usage -






39. Costs that are incurred as a result of identifying defective products before they are shipped to the customers.






40. A difference in costs between any two alternatives.






41. Costs that are incurred to prevent defective products from falling into the hands of customers or that are incurred as a result of defective units.






42. Change in cost/ change in activity.






43. Consists of labor costs that can be easily (i.e. physically and conveniently) traced to individual units of product.






44. Quality control requirements issued by the International Organization for Standardization that relate to products sold in European Countries.






45. Refers to an increase in cost from one alternative to another.






46. The relative proportion of each type of cost in an organization.






47. Include all costs associated with the general management of an organization rather than with manufacturing or selling.






48. Costs that are incurred to identify defective products before the products are shipped to customers.






49. A cost which varies - in total - in direct proportion to changes in level of activity.






50. Cost that are incurred to keep defects from occurring.