BEC Cost Accounting and Management Accounting

Question 1

Which of the following is an example of a variable cost?

Accepted Answer

Direct materials

Answer

Rent expense

Answer

Depreciation on equipment

Answer

Insurance premiums

Question 2

Under absorption costing, which of the following costs is included in product cost?

Accepted Answer

Fixed manufacturing overhead

Answer

Selling expenses

Answer

Administrative salaries

Answer

Interest expense

Question 3

Contribution margin is best defined as:

Accepted Answer

Sales revenue minus variable costs

Answer

Total revenue minus total costs

Answer

Gross profit minus operating expenses

Answer

Operating income plus depreciation

Question 4

Which costing method assigns manufacturing overhead using a single plant-wide rate?

Accepted Answer

Traditional costing

Answer

Activity-based costing

Answer

Process costing

Answer

Job order costing

Question 5

In a job order costing system, which document accumulates all costs for a specific customer order?

Accepted Answer

Job cost sheet

Answer

Production report

Answer

Cost of production summary

Answer

Materials requisition form

Question 6

A company has fixed costs of $100,000, a variable cost ratio of 60%, and sales of $300,000. What is the operating income?

Accepted Answer

$20,000

Answer

$80,000

Answer

$120,000

Answer

$200,000

Question 7

Which of the following best describes a sunk cost?

Accepted Answer

A cost that has already been incurred and cannot be recovered

Answer

A cost that will be incurred in the future

Answer

A cost that varies with production volume

Answer

A cost that can be avoided if a specific action is taken