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 60 of 99
- A. constant
- B. variable
- C. exponent
- D. base
Explanation: In a linear cost function, fixed cost does not change with the activity level within the relevant range, so it is constant.
Correct answer: constant- A. badness of residual
- B. goodness of residual
- C. badness of fit
- D. goodness of fit
Explanation: Goodness of fit describes the strength of the relationship between the cost driver and the cost, or how closely the estimated values match…
Correct answer: goodness of fit- A. residual term
- B. positive term
- C. negative term
- D. squared term
Explanation: The vertical difference between an actual cost and its estimated cost is called the residual term.
Correct answer: residual term- A. U=A-b
- B. u=A-a
- C. u=Y-y
- D. u=X-x
Explanation: The residual is the difference between the actual dependent-variable value, Y, and its estimated value, y.
Correct answer: u=Y-y- A. higher setup cost
- B. lower repair cost
- C. higher setup cost
- D. higher repair cost
Explanation: Repair cost generally varies with the level of production, so producing fewer units results in lower repair cost.
Correct answer: lower repair cost1186. In the specification analysis, the assumptions related to variance state that: ________________?
- A. variance of residuals is constant
- B. variance of goodness is constant
- C. goodness of fit is constant
- D. standard error is constant
Explanation: A standard regression assumption is homoscedasticity, meaning the variance of the residuals remains constant across observations.
Correct answer: variance of residuals is constant- A. incremental unit time learning model
- B. incremental price learning model
- C. incremental unit average model
- D. incremental cost learning model
Explanation: The incremental unit-time learning model applies the learning effect to the time required for each successive unit.
Correct answer: incremental unit time learning model- A. linear coefficient
- B. cost coefficient
- C. slope coefficient
- D. price coefficient
Explanation: The high-low method calculates variable cost per unit of activity as the change in cost divided by the change in activity.
Correct answer: slope coefficient- A. x-axis at one
- B. y-axis at constant
- C. x-axis at constant
- D. y-axis at one
Explanation: In the cost equation Y = a + bX, a zero slope means cost does not change with activity and remains at the constant intercept a.
Correct answer: y-axis at constant- A. cost object hierarchy
- B. management hierarchy
- C. price hierarchy
- D. cost hierarchy
Explanation: Different cost pools are driven by different levels of activity, such as unit, batch, product, or facility-level activities.
Correct answer: cost hierarchy- A. price index
- B. cost index
- C. profit index
- D. cost driver index
Explanation: To remove changes caused by inflation, the recorded cost is adjusted by dividing it by an appropriate price index.
Correct answer: price index- A. goodness of each activity
- B. handling of each activity
- C. cost driver for each activity
- D. cost object for each activity
Explanation: Activity-based costing assigns overhead by linking each activity to the factor that causes its cost.
Correct answer: cost driver for each activity- A. discrete curve
- B. fixed curve
- C. mixed curve
- D. experience curve
Explanation: The experience curve broadens the learning-curve idea beyond labor time to include improvements in costs, productivity, and overall…
Correct answer: experience curve- A. plotting the data
- B. plotting the costs
- C. plotting the cost drivers
- D. plotting curved line
Explanation: Plotting the data means placing cost-driver observations and their corresponding costs on a graph, allowing the relationship and unusual…
Correct answer: plotting the data- A. 57
- B. 43
- C. 67
- D. 47
Explanation: The disturbance or residual equals observed cost minus predicted cost: 50 − 7 = 43.
Correct answer: 431196. In the 'specification analysis', the assumptions related to residuals states must be __________?
- A. worst
- B. independent
- C. dependent
- D. good
Explanation: Independent residuals do not systematically depend on one another, which is a key regression assumption.
Correct answer: independent- A. incremental unit average model
- B. incremental cost learning model
- C. incremental unit time learning model
- D. incremental price learning model
Explanation: The incremental unit time learning model focuses on the time required for the latest unit, which decreases whenever cumulative production…
Correct answer: incremental unit time learning model- A. cost estimation
- B. price estimation
- C. unit estimation
- D. production estimation
Explanation: Cost estimation uses past cost information and activity levels to measure or predict the relationship between cost and the cost driver.
Correct answer: cost estimation- A. marketing and financing
- B. price and costs
- C. input and output
- D. units and batches
Explanation: Industrial engineering estimates cost by studying the physical relationship between inputs, such as labor and materials, and outputs.
Correct answer: input and output- A. coefficient of residual
- B. coefficient of prediction
- C. coefficient of determination
- D. coefficient of index
Explanation: The coefficient of determination, R², measures the proportion of variation in dependent variable Y explained by independent variable X.
Correct answer: coefficient of determination