CSAF Exam Questions + Verified
Answers 100% correct, Update 2026
Why is Cost Accounting Important? -
correct answer ✅Because reimbursement is predetermined,
management must focus primarily on finding way to manage costs,
so cost accounting is critical. Cost information is useful to a variety
of key decision-makers in a healthcare organization.
Incremental or Marginal Cost -
correct answer ✅This is when costing decisions are being made
with the understanding that there is a difference in cost at two
different activity or volume levels.
Contribution Margin -
correct answer ✅This is the difference between marginal revenue
and marginal cost. The contribution margin equals the revenue
received for one unit of service less the marginal expenses incurred
for one unit of service. The contribution margin is the amount of
revenues remaining after meeting marginal costs; this remaining
margin goes toward supporting fixed costs. Whatever is left goes to
profit.
Break-Even Point (BEP) -
correct answer ✅Break-even point is the level of sales volume of a
certain product (or service) producing the exact amount of
contribution margin needed to cover fixed costs.
,CSAF Exam Questions + Verified
Answers 100% correct, Update 2026
Break-Even Equation -
correct answer ✅BE= Fixed Cost/ Contribution margin per unit
Break-Even Point Calculation Example -
correct answer ✅Revenue: $100,000. Volume: 10,000. Revenue
per Unit: $10.
Less: Variable Cost: $50,000. Volume: 10,000. Variable Cost per
Unit: $5.
Contribution Margin: $50,000. Volume: 10,000. Contribution
Margin per Unit: $5.
Less: Fixed Cost: $40,000. Volume: 10,000. Fixed Cost per Unit: $4.
Net Profit: $10,000. Volume: 10,000. Net Profit per Unit: $1.
Break-Even Point Calculation per Volumes of Unit Example -
correct answer ✅Revenue: $100,000. Volume: 10,000. Revenue
per Unit: $10.
Less: Variable Cost: $50,000. Volume: 10,000. Variable Cost per
Unit: $5.
Contribution Margin: $50,000. Volume: 10,000. Contribution
Margin per Unit: $5.
Less: Fixed Cost: $40,000. Volume: 10,000. Fixed Cost per Unit: $4.
,CSAF Exam Questions + Verified
Answers 100% correct, Update 2026
Net Profit: $10,000. Volume: 10,000. Net Profit per Unit: $1.
BEP = $40,000 (total fixed costs) / $5 (contribution margin per unit)
BEP = 8,000 units.
Full Absorption Costing -
correct answer ✅Full absorption costing attempts to allocate all
overhead costs to all activities supported by those costs. Overhead,
or indirect costs, are allocated down to the revenue-producing
activities based on an objective methodology.
Differential Costing -
correct answer ✅Differential costing ignores the overhead costs
and only looks at incremental costs that are directly related to the
product.
Decision-Making Example -
correct answer ✅The decision to use full absorption costing or
differential cost is made based on how the information will be used.
For example, when management is assessing the profitability of all
hospital programs relative to one another, then it may be
appropriate to consider departmental costs on a full absorption
basis. This may be an effective way to identify marginally
performing departments for further action.
, CSAF Exam Questions + Verified
Answers 100% correct, Update 2026
If, however, the analysis was conducted to price a contract that
would bring incremental volume, but would require no additional
investment of equipment or indirect labor, then it would be
appropriate to consider only marginal direct (differential) costs.
Direct Costs -
correct answer ✅These may be fixed or variable, but they are
clearly and directly associated with the activity that is being costed.
Direct costs include direct salaries and supplies.
Indirect Costs -
correct answer ✅These may be fixed or variable, but they are NOT
clearly nor directly associated with the activity being costed.
Overhead is a common term for indirect costs. These costs are
assigned to a service using some acceptable allocation method. An
example would include administration provided in a hospital
setting.
Activity-Based Costing (ABC) -
correct answer ✅A method of determining product costs using
cost drivers or activity measures that cause indirect costs to be
incurred. Ideal cost drivers are activities that pertain to each
procedure in varying amounts. ABC provides an overview of
developing and analyzing cost information by service line.
Answers 100% correct, Update 2026
Why is Cost Accounting Important? -
correct answer ✅Because reimbursement is predetermined,
management must focus primarily on finding way to manage costs,
so cost accounting is critical. Cost information is useful to a variety
of key decision-makers in a healthcare organization.
Incremental or Marginal Cost -
correct answer ✅This is when costing decisions are being made
with the understanding that there is a difference in cost at two
different activity or volume levels.
Contribution Margin -
correct answer ✅This is the difference between marginal revenue
and marginal cost. The contribution margin equals the revenue
received for one unit of service less the marginal expenses incurred
for one unit of service. The contribution margin is the amount of
revenues remaining after meeting marginal costs; this remaining
margin goes toward supporting fixed costs. Whatever is left goes to
profit.
Break-Even Point (BEP) -
correct answer ✅Break-even point is the level of sales volume of a
certain product (or service) producing the exact amount of
contribution margin needed to cover fixed costs.
,CSAF Exam Questions + Verified
Answers 100% correct, Update 2026
Break-Even Equation -
correct answer ✅BE= Fixed Cost/ Contribution margin per unit
Break-Even Point Calculation Example -
correct answer ✅Revenue: $100,000. Volume: 10,000. Revenue
per Unit: $10.
Less: Variable Cost: $50,000. Volume: 10,000. Variable Cost per
Unit: $5.
Contribution Margin: $50,000. Volume: 10,000. Contribution
Margin per Unit: $5.
Less: Fixed Cost: $40,000. Volume: 10,000. Fixed Cost per Unit: $4.
Net Profit: $10,000. Volume: 10,000. Net Profit per Unit: $1.
Break-Even Point Calculation per Volumes of Unit Example -
correct answer ✅Revenue: $100,000. Volume: 10,000. Revenue
per Unit: $10.
Less: Variable Cost: $50,000. Volume: 10,000. Variable Cost per
Unit: $5.
Contribution Margin: $50,000. Volume: 10,000. Contribution
Margin per Unit: $5.
Less: Fixed Cost: $40,000. Volume: 10,000. Fixed Cost per Unit: $4.
,CSAF Exam Questions + Verified
Answers 100% correct, Update 2026
Net Profit: $10,000. Volume: 10,000. Net Profit per Unit: $1.
BEP = $40,000 (total fixed costs) / $5 (contribution margin per unit)
BEP = 8,000 units.
Full Absorption Costing -
correct answer ✅Full absorption costing attempts to allocate all
overhead costs to all activities supported by those costs. Overhead,
or indirect costs, are allocated down to the revenue-producing
activities based on an objective methodology.
Differential Costing -
correct answer ✅Differential costing ignores the overhead costs
and only looks at incremental costs that are directly related to the
product.
Decision-Making Example -
correct answer ✅The decision to use full absorption costing or
differential cost is made based on how the information will be used.
For example, when management is assessing the profitability of all
hospital programs relative to one another, then it may be
appropriate to consider departmental costs on a full absorption
basis. This may be an effective way to identify marginally
performing departments for further action.
, CSAF Exam Questions + Verified
Answers 100% correct, Update 2026
If, however, the analysis was conducted to price a contract that
would bring incremental volume, but would require no additional
investment of equipment or indirect labor, then it would be
appropriate to consider only marginal direct (differential) costs.
Direct Costs -
correct answer ✅These may be fixed or variable, but they are
clearly and directly associated with the activity that is being costed.
Direct costs include direct salaries and supplies.
Indirect Costs -
correct answer ✅These may be fixed or variable, but they are NOT
clearly nor directly associated with the activity being costed.
Overhead is a common term for indirect costs. These costs are
assigned to a service using some acceptable allocation method. An
example would include administration provided in a hospital
setting.
Activity-Based Costing (ABC) -
correct answer ✅A method of determining product costs using
cost drivers or activity measures that cause indirect costs to be
incurred. Ideal cost drivers are activities that pertain to each
procedure in varying amounts. ABC provides an overview of
developing and analyzing cost information by service line.
