FAC FAC Managerial Accounting & Cost Concepts

Question 1

What is the term for costs that change in total in direct proportion to changes in the level of production activity?

Accepted Answer

Variable costs

Answer

Fixed costs

Answer

Sunk costs

Answer

Opportunity costs

Question 2

What is the break-even point in units when fixed costs are $50,000, selling price per unit is $25, and variable cost per unit is $15?

Accepted Answer

5,000 units

Answer

2,000 units

Answer

3,333 units

Answer

10,000 units

Question 3

Which of the following is a period cost rather than a product cost?

Accepted Answer

Selling expenses

Answer

Direct materials

Answer

Manufacturing overhead

Answer

Direct labor

Question 4

What does the contribution margin ratio represent?

Accepted Answer

Contribution margin divided by sales

Answer

Net income divided by sales

Answer

Gross profit divided by sales

Answer

Operating income divided by sales

Question 5

In job order costing, which document accumulates all costs assigned to a specific production job?

Accepted Answer

Job cost sheet

Answer

Materials requisition form

Answer

Production budget

Answer

Bill of materials

Question 6

Which costing method assigns manufacturing overhead to products using multiple activity-based cost drivers?

Accepted Answer

Activity-based costing

Answer

Traditional costing

Answer

Process costing

Answer

Absorption costing