Cost Accounting and Management Accounting Flashcards
7 cards from real BEC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Cost Accounting and Management Accounting flashcards as text
Which of the following is an example of a variable cost?
Answer: Direct materials
Direct materials are variable costs because they increase or decrease proportionally with the level of production.
Under absorption costing, which of the following costs is included in product cost?
Answer: Fixed manufacturing overhead
Under absorption costing, fixed manufacturing overhead is included in product cost, unlike variable costing where it is treated as a period cost.
Contribution margin is best defined as:
Answer: Sales revenue minus variable costs
Contribution margin is sales revenue minus variable costs, representing the amount available to cover fixed costs and generate profit.
Which costing method assigns manufacturing overhead using a single plant-wide rate?
Answer: Traditional costing
Traditional costing assigns overhead using a single plant-wide rate, while activity-based costing uses multiple cost drivers to allocate overhead more accurately.
In a job order costing system, which document accumulates all costs for a specific customer order?
Answer: Job cost sheet
A job cost sheet accumulates direct materials, direct labor, and applied overhead costs for a specific job or customer order.
A company has fixed costs of $100,000, a variable cost ratio of 60%, and sales of $300,000. What is the operating income?
Answer: $20,000
Contribution margin = $300,000 × (1 - 0.60) = $120,000; Operating income = $120,000 - $100,000 fixed costs = $20,000.
Which of the following best describes a sunk cost?
Answer: A cost that has already been incurred and cannot be recovered
A sunk cost is one that has already been incurred and cannot be recovered regardless of future decisions, making it irrelevant for decision-making purposes.