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Test your basic knowledge |
Managerial Accounting And Cost Concepts
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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 relative proportion of each type of cost in an organization.
Opportunity Cost
Cost Structure
Differential Cost
Direct Cost
2. 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 -
Engineering Approach
Mixed Cost
External Failure Costs
Inventoriable Costs
3. Costs that are incurred as a result of identifying defective products before they are shipped to the customers.
Internal Failure Costs
Selling Costs
Differential Cost
Manufacturing Overhead
4. Materials that become an integral part of the finished product and whose costs can be conveniently traced to the finished product.
Raw Materials
Direct Materials
Product Costs
Quality Cost Report
5. The potential benefit that is given up when one alternative is selected over another.
Cost behavior is considered linear when...
Direct Cost
Opportunity Cost
Appraisal Costs
6. 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.
Sunk Cost
Independent Variable
Indirect Labor
Quality of Conformance
7. Materials that are included as part of manufacturing overhead.
Common Cost
Indirect Materials
Quality Cost
Engineering Approach
8. Beginning merchandise inventory + Purchase - Ending merchandise inventory
Opportunity Cost
Conversion Cost
Sunk Cost
Cost of Goods Sold Equation
9. The third element of manufacturing cost - includes all manufacturing costs except direct materials and direct labor.
Quality of Conformance
Cost Behavior
High-Low Method Formula
Manufacturing Overhead
10. 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.)
2 Categories of Non-manufacturing Costs
Differential Revenue
Inventoriable Costs
Contribution Margin
11. Include all costs that are incurred to secure customer orders and get the finished product to the customer.
Selling Costs
Direct Labor
Administrative Costs
Prevention Costs
12. All costs involved in acquiring or making a product.
Quality of Conformance
Contribution Approach
Product Costs
Independent Variable
13. A difference in revenues between any two alternatives.
Cost of Goods Sold Equation
Differential Revenue
Cost Structure
Product Costs
14. A charting technique used to monitor the quality of work being done in a workstation for the purpose of immediately correcting any problems.
Statistical Process Control
Cost of Goods Sold Equation
Fixed Cost
Cost Structure
15. Quality control requirements issued by the International Organization for Standardization that relate to products sold in European Countries.
ISO 9000 Standards
Discretionary Fixed Costs
Period Costs
Selling Costs
16. Refers to an increase in cost from one alternative to another.
Contribution Margin
Variable Cost =
Account Analysis
Incremental Cost
17. Cost that are incurred when a product or service that is defective is delivered to a customer.
Discretionary Fixed Costs
External Failure Costs
Cost of Goods Sold Equation
Variable Cost
18. Cost that are incurred to keep defects from occurring.
Prevention Costs
Direct Cost
Opportunity Cost
Sunk Cost
19. All the costs that are not product costs.
Selling Costs
Sunk Cost
Internal Failure Costs
Period Costs
20. A report that details prevention costs - appraisal costs - and the costs of internal and external failures.
Quality Cost Report
Discretionary Fixed Costs
Independent Variable
Incremental Cost
21. Consists of labor costs that can be easily (i.e. physically and conveniently) traced to individual units of product.
Appraisal Costs
Quality Cost Report
Direct Labor
Dependent Variable
22. Costs that usually arise from annual decisions by management to spend on certain fixed cost items. (Also known as 'managed fixed costs').
Cost of Goods Sold Equation
Discretionary Fixed Costs
Cost behavior is considered linear when...
Account Analysis
23. A cost that has already been incurred and that cannot be changed by any decision made now or in the future.
Sunk Cost
Manufacturing Overhead
Quality Cost
Inventoriable Costs
24. A cost that is incurred to support a number of cost objects - but cannot be traced to them individually.
Opportunity Cost
Statistical Process Control
Quality Cost
Common Cost
25. A measure of whatever causes the incurrence of a variable cost.
Quality of Conformance
Prime Cost
Activity Base
Appraisal Costs
26. A cost that cannot be easily and conveniently traced to a specified cost object.
Quality of Conformance
Direct Cost
Indirect Cost
Quality Circles
27. Contains both variable and fixed cost elements. (Also known as semi-variable costs)
Indirect Labor
Independent Variable
Quality Cost Report
Mixed Cost
28. A method that uses all of the date to separate a mixed cost into its fixed and variable cost components.
High-Low Method
Least-Squares Regression Method
External Failure Costs
Administrative Costs
29. The range of activity within which the assumption that cost behavior is strictly linear is reasonably valid.
Direct Cost
Relevant Range
Indirect Materials
High-Low Method Formula
30. (Also known as the 'Y' variable); The amount of cost incurred during a period depends on the level of activity for the period.
Account Analysis
Dependent Variable
Discretionary Fixed Costs
Variable Cost
31. Change in cost/ change in activity.
High-Low Method Formula
Committed Fixed Costs
Cost Structure
Variable Cost =
32. The sum of direct materials cost and direct labor cost -
Activity Base
Direct Labor
Least-Squares Regression Method
Prime Cost
33. 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.
Quality Cost
ISO 9000 Standards
Fixed Cost
Manufacturing Overhead
34. A cost that remains constant - in total - regardless of changes in the level of activity.
Variable Cost =
Manufacturing Overhead
Raw Materials
Fixed Cost
35. Labor costs that cannot be physically traced to particular products or that can be traced only at great cost and inconvenience.
Product Costs
Quality Circles
Least-Squares Regression Method
Indirect Labor
36. (Also known as the 'X' variable); Refers to activity because it causes variations in the cost.
Independent Variable
Differential Cost
Sunk Cost
Variable Cost =
37. (1.)Selling costs (2.)Administrative costs
Committed Fixed Costs
2 Categories of Non-manufacturing Costs
Appraisal Costs
Independent Variable
38. Include all costs associated with the general management of an organization rather than with manufacturing or selling.
Administrative Costs
Sunk Cost
Variable Cost
Variable Cost =
39. Refers to how a cost reacts to changes in the level of activity.
Variable Cost =
Cost Behavior
2 Categories of Non-manufacturing Costs
Opportunity Cost
40. The materials that go into the final product.
Raw Materials
Common Cost
Variable Cost
Administrative Costs
41. Whenever a straight line is a reasonable approximation for the relation between cost and activity.
Inventoriable Costs
Incremental Cost
Cost behavior is considered linear when...
Cost Behavior
42. Product costs that were initially assigned to inventories.
Inventoriable Costs
Cost behavior is considered linear when...
Administrative Costs
Period Costs
43. (Y2-Y1)/(X2-X1)
Quality Cost Report
Cost Object
Cost Structure
High-Low Method Formula
44. Method based on the rise-over-run formula for the slope of a straight line.
Statistical Process Control
High-Low Method
Inventoriable Costs
Quality Cost Report
45. Represent organizational investments with a multiyear planning horizon that can't be significantly reduced even for short period of time without making fundamental changes.
Quality Circles
Direct Materials
Cost Structure
Committed Fixed Costs
46. A cost which varies - in total - in direct proportion to changes in level of activity.
Contribution Margin
Direct Cost
Variable Cost
Appraisal Costs
47. Anything for which cost data are desired-including products - customers - jobs - and organizational sub-units.
Indirect Labor
Cost Object
Prevention Costs
Account Analysis
48. The sum of direct labor cost and manufacturing overhead cost. (Refers to converting the materials into the finished product.)
Differential Revenue
Conversion Cost
2 Categories of Non-manufacturing Costs
High-Low Method Formula
49. A difference in costs between any two alternatives.
Differential Cost
Cost behavior is considered linear when...
Conversion Cost
Inventoriable Costs
50. An account is classified as either variable of fixed based on the analyst's prior knowledge of how the cost in the account behaves.
Statistical Process Control
Account Analysis
Direct Cost
Raw Materials