Management Accounting Quiz II

Data is information that has been processed in such a way as to make it meaningful for use by management in making decisions.

• True

• False

Which of the following is not a fundamental attribute of good information?

• Complete

• Concise

• Timely

• Accurate

Which of the following could higher level management carry out?

• taking long-term decisions

• taking short-term decisions

• taking long-term and short-term decisions

Which of the following are direct expenses?

• The cost of special designs, drawing or layouts

• The hire of tools or equipment for a particular job

• Salesman's wages

• Rent, rates and insurance of a factory

A cost which contains both fixed and variable elements, and so is partly affected by changes in the level of activity, is called

• A direct cost

• An unavoidable cost

• A semi-variable cost

A cost unit is

• A measure of output of work in a standard hour

• A unit of product or service in relation to which costs are ascertained

• The cost per hour of operating a machine

Variable costs are conventionally deemed to

• be constant per unit of output

• vary per unit of output as production volume changes

• be constant in total when production volume changes

In a marginal costing system, the formula "Sales - Variable Costs" is used to calculate

• Net profit

• Gross profit

• Contribution

• Under/Over Absorption

A company absorbs overheads based on labour hours. Data for the latest period are as follows.

Budgeted labour hours                           8,500

Budgeted overheads                              $148,750

Actual labour hours                               7,928

Actual overheads                                  $146,200

Based on the data given above, what is the labour hour overhead absorption rate?

• $17.20 per hour

• $18.44 per hour

• $17.50 per hour

• $18.76 per hour

Which of the following would be appropriate cost units for a transport business?

i. Cost per tonne-kilometre

ii. Fixed cost per kilometre

iii. Maintenance cost of each vehicle per kilometre

• i only

• i and iii only

• i and ii only

• All options