Free Cost Accounting MCQs with Answers
941 Cost Accounting MCQs from Accounting, each with the correct answer and a written explanation of why it is correct. Free and unlimited, with no account needed.
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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941 questions · page 10 of 48
- A. resourcing
- B. value acquiring
- C. production
- D. value acquaintance
Explanation: Production covers coordinating and assembling resources such as materials, labour and equipment to create goods or services.
Correct answer: production- A. address management
- B. issue management
- C. strategic cost management
- D. managerial costGet Executive Coaching
Explanation: Strategic cost management links cost information with long-term competitive and strategic decisions, rather than addressing isolated…
Correct answer: strategic cost management- A. resource research
- B. market research
- C. utilization
- D. distribution
Explanation: Distribution is the value-chain activity concerned with delivering finished products or services to end customers.
Correct answer: distribution- A. cost of ongoing operations
- B. investments in physical assets
- C. training of managers
- D. all of above
Explanation: A cost-benefit analysis can include recurring operating costs, capital investment in physical assets and employee or management training…
Correct answer: all of above- A. help management
- B. cost management
- C. past management
- D. future managementHire An Accountant
Explanation: Cost management uses resources efficiently to increase the value received by customers while controlling costs.
Correct answer: cost management- A. quality
- B. management chain
- C. customer chain
- D. cost chain
Explanation: Quality management focuses on improving processes and the value delivered by products so that customer expectations are met or exceeded.
Correct answer: quality- A. technology management
- B. people management
- C. customer relationship management
- D. resource management
Explanation: Customer relationship management combines people, processes, and technology to build and improve relationships with customers across…
Correct answer: customer relationship management- A. cost format
- B. decided plan
- C. coordination plan
- D. budgetGet Executive Coaching
Explanation: A budget converts a plan into quantified amounts, such as expected revenues, costs, and resources, and helps coordinate its…
Correct answer: budgetGet Executive Coaching- A. value chain
- B. useful chain
- C. product chain
- D. services chain
Explanation: The value chain is the sequence of business activities that adds value to a product or service for the customer, from inputs through…
Correct answer: value chain- A. past orientation
- B. help banks make decisions
- C. help managers make decisions
- D. help investors make decision
Explanation: Management accounting provides internal information such as budgets, forecasts, and cost analyses to help managers plan and make…
Correct answer: help managers make decisions- A. $1,775,000
- B. $1,675,000
- C. $1,875,000
- D. $1,975,000
Explanation: Total direct labor cost is found by multiplying hours by the hourly rate: 3,550 × $500 = $1,775,000.
Correct answer: $1,775,000- A. budget overhead applied
- B. manufacturing overhead applied
- C. labor overhead applied
- D. none of aboveAccounting & Auditing
Explanation: Under normal costing, the predetermined overhead rate is multiplied by the actual allocation-base quantity to determine manufacturing…
Correct answer: manufacturing overhead applied- A. 69.72%
- B. 79.72%
- C. 99.75%
- D. 89.72%
Explanation: The budgeted indirect cost rate is calculated as cost divided by the allocation base: $139,600 ÷ $155,600 = 0.8972, or 89.72%.
Correct answer: 89.72%- A. $168,750
- B. $148,570
- C. $186,750
- D. $125,680
Explanation: Budgeted annual indirect cost equals the rate per hour multiplied by budgeted hours: $225 × 750 = $168,750.
Correct answer: $168,750- A. $803.571 per labor hour
- B. $805 per labor hour
- C. $905 per labor hour
- D. $802 per labor hour
Explanation: The budgeted manufacturing overhead rate is computed as $2,250,000 ÷ 2,800 labor hours = $803.571 per labor hour.
Correct answer: $803.571 per labor hour- A. $93,450
- B. $94,560
- C. $96,450
- D. $95,450
Explanation: Annual budgeted indirect cost is obtained by multiplying the rate by the allocation base: $115 × 830 hours = $95,450.
Correct answer: $95,450- A. 67.30%
- B. 87.31%
- C. 55.50%
- D. 45.50%Accounting & Auditing
Explanation: The budgeted indirect cost rate is $144,500 ÷ $165,500 = 0.8731, or 87.31%.
Correct answer: 87.31%- A. 109.87
- B. $107.78
- C. $106.56
- D. $104.34
Explanation: The overhead rate is calculated as actual manufacturing overhead divided by actual allocation-base usage: $485,000 ÷ 4,500 hours = $107.78…
Correct answer: $107.78- A. priced costing
- B. actual costing
- C. direct costing
- D. indirect costing
Explanation: Actual costing uses actual direct-cost input quantities multiplied by their actual direct rates, while normal costing typically uses…
Correct answer: actual costing- A. under allocated indirect cost
- B. over allocated direct cost
- C. over allocated budget
- D. under allocated budgetAccounting & Auditing
Explanation: Indirect cost is underallocated when the actual cost exceeds the amount allocated: $800 − $700 = $100 underallocated.
Correct answer: under allocated indirect cost