Cost Accounting MCQ

What Is Cost Accounting?

Cost accounting is a method of managerial accounting which aims to capture the total production cost of a business by measuring the variable costs of each production phase as well as fixed costs, such as a lease expense.

Examples include rent, depreciation, interest on loans and lease expenses. Direct, indirect, fixed, and variable are the 4 main kinds of cost. In addition to this, you might also want to look into operating costs, opportunity costs, sunk costs, and controllable costs. Best Management Accounting MCQs. 

1. Cost accounting mainly helps the management in
a) Earning profit
b) Providing information to management
c) Fixing prices of the products
d) All of the above

Answer:- b
2. Cost accounting provides all of the following information except
a) Product cost
b) Cost of goods sold
c) Inventory values
d) Cash forecasts

Answer:- d
3. Which of the following is cost – behavior oriented approach to
product costing
a) Absorption cost
b) Process costing
c) Marginal costing.
d) Job – order costing

Answer:- b
4. An item of cost that is direct for one business may be ……….for another business.
a) Direct
b) Indirect
c) Variable
d) Fixed

Answer:- b
5. The total of all direct expense is known as ……………… cost
a) Prime cost
b) Factory cost
c) Selling cost
d) Cost of products

Answer:- a
6. …………… costs are partly fixed and partly variable in relation to
Output
a) Variable
b) Fixed
c) Semi – variable
d) Marginal

Answer:- c
7. An opportunity cost is ……………………
a) The advantage foregone
b) Additional income
c) Cost incurred in post
d) Cost for replacement

Answer:- a
8. An opportunity cost does not involve
a) Incomes
b) Expenses
c) Cash outlays
d) Losses

Answer:- c
9. Total variable cost change ……….. With change in output
a) Constantly
b) Not proportionately
c) Proportionately

Answer:- c
10. Fixed cost per unit …………. With increase in output
a) Increases
b) Not –increase
c) Reduces
d) Not decrease

Answer:- c