Basic Cost Concepts Quiz

What type of cost remains the same regardless of changes in service volume?

• Variable cost

• Fixed cost

• Direct cost

• Opportunity cost

A cost that increases in total as the number of users grows is called:

• Fixed cost

• Sunk cost

• Variable cost

• Indirect cost

Installation technician wages in a fiber optic project are considered:

• Indirect cost

• Period cost

• Direct labor cost

• Overhead

Which of the following is classified as manufacturing overhead (MOH)?

• Optical cable

• Technician salary

• Server electricity cost

• Customer service salary

A past cost that cannot be recovered is known as:

• Period cost

• Direct cost

• Sunk cost

• Opportunity cost

Costs that can be directly influenced by operational managers are called:

• Non-controllable costs

• Indirect costs

• Controllable costs

• Fixed costs

Job Order Costing is most suitable for companies that:

• Produce identical units in large volume

• Provide customized services per client

• Have continuous manufacturing systems

• Sell software subscriptions

SG&A expenses fall under the category of:

• Direct cost

• Product cost

• Period cost

• Variable cost

Which of the following is NOT considered a product cost?

• Fiber cable

• Field technician wage

• Server cooling electricity

• Call center agent salary

Total Manufacturing Cost (TMC) includes:

• DM + SG&A + MOH

• DM + DL + MOH

• RM + FG + DL

• MOH + SG&A + COGS