All Free Accounting MCQs with Answers
Every Accounting question in the bank, across all chapters, each with the correct answer and a written explanation. Free and unlimited, with no account needed.
1,971 questions · page 43 of 99
- A. cost allocation
- B. sales tracing
- C. sales allocation
- D. cost tracing
Explanation: Cost allocation assigns an indirect cost to a cost object using a reasonable allocation base because the cost cannot be traced directly.
Correct answer: cost allocation- A. relevant total costs
- B. contribution costs
- C. throughput costs
- D. optimized costs
Explanation: Relevant total cost in inventory decisions combines relevant ordering costs with relevant carrying or holding costs.
Correct answer: relevant total costs- A. carrying costs
- B. relevant total costs
- C. economic order quantity
- D. reorder point
Explanation: The reorder point equals demand during the purchasing lead time, calculated as lead time multiplied by usage or sales per unit of time.
Correct answer: reorder point844. The reorder point is divided by number of sold units for per unit of time to calculate ___________?
- A. relevant carrying cost
- B. relevant ordering cost
- C. purchase order lease time
- D. number of purchase orders
Explanation: Dividing the reorder point by demand per unit of time gives the purchase-order lead time.
Correct answer: purchase order lease time- A. chaining point
- B. recording point
- C. lead point
- D. trigger point
Explanation: A trigger point is the stage in the manufacturing cycle that initiates the relevant accounting journal entries.
Correct answer: trigger point- A. in-time costing
- B. trigger costing
- C. back flush costing
- D. lead time costing
Explanation: Backflush costing postpones or omits many routine journal entries until the later stages of production or sale, using fewer accounting…
Correct answer: back flush costing- A. purchase order costs
- B. relevant inventory carrying costs
- C. irrelevant inventory carrying costs
- D. relevant ordering costs
Explanation: Relevant inventory carrying cost includes the opportunity cost of capital tied up in inventory plus other incremental carrying costs, such…
Correct answer: relevant inventory carrying costs- A. annual irrelevant ordering costs
- B. annual relevant carrying costs
- C. annual relevant ordering costs
- D. annual irrelevant carrying costsFinance
Explanation: Multiplying average inventory by the relevant carrying cost per unit gives the annual relevant carrying cost.
Correct answer: annual relevant carrying costs- A. supply chain
- B. value chain
- C. material flow chain
- D. manufacturing flow chain
Explanation: A supply chain covers the flow of materials, goods, services and information from suppliers through production and distribution to…
Correct answer: supply chain850. The required rate of return, is multiplied per unit cost of purchased units to calculate __________?
- A. irrelevant inventory carrying costs
- B. relevant opportunity cost of capital
- C. relevant purchase order costs
- D. relevant inventory carrying costsFinance
Explanation: The opportunity cost of capital tied up in purchased inventory is calculated by multiplying the required rate of return by the cost of the…
Correct answer: relevant opportunity cost of capital851. The cost of product failure, error prevention and appraisals can be classified under ___________?
- A. stocking costs
- B. stock-out costs
- C. costs of quality
- D. shrinkage costs
Explanation: Costs of product failure, error prevention and appraisal are components of the costs of quality.
Correct answer: costs of quality- A. 678 packages
- B. 648 packages
- C. 658 packages
- D. 668 packages
Explanation: Economic order quantity is √(2DS/H), where D = 25,000 units, S = $210 and H = $25: √(2 × 25,000 × 210 ÷ 25) ≈ 648 packages.
Correct answer: 648 packages- A. decisional management
- B. throughput management
- C. inventory management
- D. manufacturing management
Explanation: Inventory management covers planning, coordinating, and controlling the movement and level of inventory.
Correct answer: inventory management- A. stock-out costs
- B. ordering costs
- C. carrying costs
- D. purchasing costsCompare Credit Cards
Explanation: The amount paid to acquire goods from suppliers is a purchasing cost. Ordering costs relate to placing and processing orders, while…
Correct answer: purchasing costsCompare Credit Cards- A. relevant purchase order costs
- B. relevant inventory carrying costs
- C. irrelevant inventory carrying costs
- D. relevant opportunity cost of capitalHire An Accountant
Explanation: Capital tied up in inventory cannot earn its return elsewhere, so the forgone profit is an opportunity cost of carrying inventory.
Correct answer: relevant opportunity cost of capitalHire An Accountant- A. $7,500
- B. $7,000
- C. $6,500
- D. $6,000Try Asset Software
Explanation: Relevant inventory carrying cost combines the relevant incremental carrying costs with the opportunity cost of invested capital: $5,000 +…
Correct answer: $7,500- A. annual irrelevant ordering costs
- B. annual relevant carrying costs
- C. annual relevant ordering costs
- D. annual irrelevant carrying costsCompare Credit Cards
Explanation: Annual relevant ordering cost is calculated by multiplying the number of orders placed during the year by the relevant cost per order.
Correct answer: annual relevant ordering costs- A. economic accounting
- B. back-flush accounting
- C. lean accounting
- D. lead accountingHire An Accountant
Explanation: Lean accounting evaluates performance across the entire value stream so that customer value, waste reduction, and flow are emphasised.
Correct answer: lean accounting- A. 14000 units
- B. 14500 units
- C. 15000 units
- D. 15500 units
Explanation: The reorder point equals demand during purchase-order lead time: 35 minutes × 400 units per minute = 14,000 units.
Correct answer: 14000 units- A. stock-out costs
- B. ordering costs
- C. carrying costs
- D. purchasing costsCompare Credit Cards
Explanation: Issuing purchase orders, preparing delivery records, and inspecting received items are ordering costs because they arise from placing and…
Correct answer: ordering costs