Introduction to Cost Accounting

Which one of the following is least likely to be an objective of cost accounting system?

• Product Costing and Inventory Valuation

• Sales Commission Determination

• Department Efficiency

• Income Determination

It is sacrificed resource to achieve a specific objective

• Losses

• Cost

• Expenses

• Expenses

It is expired costs with producing any revenue benefit.

• Cost

• Losses

• Expenses

• Income

Financial accounting provides the primary source of information for:

• decision making in the finishing department

• improving customer service

• preparing the income statement for shareholders

• planning next year's operating budget

Costs that remain the same in total regardless of changes in the activity level.

• Variable Cost

• Fixed Cost

• Relevant Cost

• Sunk Cost

Are costs that vary in total directly and proportionately with changes in the activity level.

• Fixed Cost

• Variable Cost

• Mixed Cost

• Irrelevant Cost

Cost that cannot be changed by any present and future decision, therefore irrelevant cost.

• Variable Cost

• Fixed Cost

• Sunk Cost

• Relevant Cost

What is/are the importance(s) of cost management?

• To improve overall business profitability.

• To explore opportunity through cost optimization.

• To analyze and improve internal and external cost driver.

• I think all answers are correct.

Cost unit is calculated as

• Total Expense/Quantity
• Quantity/Total Cost
• Total Cost/Quantity
• Quantity/Total Expense

Cost is classified into:

• Cost and expense
• Expense and revenue
• Indirect expense and Overheads
• Direct cost and Indirect cost