Top 150+ Solved Cost Management MCQ Questions Answer
Q. A just in time manufacturing system should lead to:
a. A wider range of stock items being made available
b. An increase in the number of suppliers of stocks.
c. Higher levels of stock being held in the warehouse
d. Lower stock holding costs being incurred
Q. TQM revolves around the concept of:
a. Providing adequate back up support once the product leaves the factory
b. Recruiting the best managers in their field
c. Making the best quality products regardless of the cost
d. Getting things right first time
Q. Which of the following management accounting systems places a very strong emphasis onincorporating external data into the preparation of management reports?
a. Sales variance analysis
b. Activity based management
c. Strategic management accounting
d. Flexible budgeting
Q. What term is given to the idea that traditional budgeting should be replaced by a new type of budgeting?
a. Behavioural budgeting
b. Beyond budgeting
c. Flexible budgeting
d. Better budgeting
Q. Which of the following statements is true?
a. There is an accounting standard covering environmental reporting
b. Professional accountancy bodies are encouraging the development of environmental reporting
c. By law company directors must report to shareholders on environmental matters.
d. The Chartered Institute of Management Accountants (CIMA) requires its members to prepare reports on environmental issues for company directors
Q. What term best describes the use of both financial and non-financial measures in assessingwhether an entity has achieved its objectives?
a. balanced scorecard
b. Benchmarking
c. performance measurement
d. target setting
Q. Which management accounting technique is sometimes referred to as super variable costing?
a. Throughput accounting
b. Marginal costing
c. Direct costing
d. Product life cycle costing
Q. Which management accounting technique involves the identification of value adding activities?
a. Backflush costing
b. Target costing
c. Activity based management
d. Value chain analysis
Q. Which one of the following items is relatively unimportant in decision making?
a. Relevant costs
b. Net cash flow
c. Opportunity costs
d. Accruals and prepayments
Q. What is an alternative term for expected value?
a. Estimated profit
b. Forecasted profit
c. Eventual outcome
d. Weighted average
Q. Which of the following cost classification categories is almost identical to a relevant cost?
a. Opportunity cost
b. Sunk cost
c. Committed cost
d. Avoidable cost
Q. Which costs may normally be ignored when determining whether to close a factory for a short period?
a. Fixed costs
b. Opportunity costs
c. Variable costs
d. Total costs
Q. What is the minimum cost below which a company would be unwilling to price a one-off special contract?
a. Between variable cost and total cost
b. Total cost
c. Variable cost
d. Below variable cost
Q. What is the ideal transfer price?
a. Market price
b. Total cost
c. Total cost less internal savings
d. Opportunity cost
Q. In what circumstances might a company be prepared to price a special contract at less than itsrelevant cost?
a. When sales of other products will not increase
b. When the company is operating at almost full capacity
c. In the expectation that additional profitable orders will be placed by the same customer
d. When there are signs of improved market conditions