D101 Cost and Managerial Accounting Module 1 questions with
answers
1. Any organization whose main economic activity involves using
components or raw materials to make finished goods for sale to
customers: Manufacturing Organizations
2. Any organization whose main economic activity involves
producing a non- physical product that provides value to a customer:
Service Organizations
3. Any organization whose main economic activity involves
purchasing finished goods and reselling them to customers:
Merchandising Organizations
4. Without accurate , it is difficult to set
appropriate prices, evaluate per- formance, reward employees, or
make production decisions. It is even difficult to know whether a
company should be competing in a specific market.: Cost Information
5. When the product or service provided can be considered as
separate and distinct from other products or services provided,
companies use what is called
.: Job Order Costing
6. In most cases where a company
competes in a market by providing goods or services, the company is
a : price taker
7. That means that the market sets the price and the company must
1/
13
, then determine whether it can produce a product or provide a
service where, at the market price, it can earn an adequate return. A
company that competes in a market by providing goods or services.:
price taker
8. When a company is a , it must track
the costs of the product being produced or the service being
provided to be able to compare the cost of the product or service
with the price the market is offering.: price taker
9. The process of tracking the costs of an individual product. The
company will accumulate all of the costs associated with a job.
Those costs are then used to determine profit margins, among other
things.: Job Order Costing
10. A company that determines the price of a product based
on costs and markup: Price-maker
11. In cases where a company
is a , it still needs to track costs
to ensure an adequate return is generated. Being a means that
the product is customized and unique and that the maker of the
product is able to charge a price based on costs and a markup.: price
maker
2/
13
answers
1. Any organization whose main economic activity involves using
components or raw materials to make finished goods for sale to
customers: Manufacturing Organizations
2. Any organization whose main economic activity involves
producing a non- physical product that provides value to a customer:
Service Organizations
3. Any organization whose main economic activity involves
purchasing finished goods and reselling them to customers:
Merchandising Organizations
4. Without accurate , it is difficult to set
appropriate prices, evaluate per- formance, reward employees, or
make production decisions. It is even difficult to know whether a
company should be competing in a specific market.: Cost Information
5. When the product or service provided can be considered as
separate and distinct from other products or services provided,
companies use what is called
.: Job Order Costing
6. In most cases where a company
competes in a market by providing goods or services, the company is
a : price taker
7. That means that the market sets the price and the company must
1/
13
, then determine whether it can produce a product or provide a
service where, at the market price, it can earn an adequate return. A
company that competes in a market by providing goods or services.:
price taker
8. When a company is a , it must track
the costs of the product being produced or the service being
provided to be able to compare the cost of the product or service
with the price the market is offering.: price taker
9. The process of tracking the costs of an individual product. The
company will accumulate all of the costs associated with a job.
Those costs are then used to determine profit margins, among other
things.: Job Order Costing
10. A company that determines the price of a product based
on costs and markup: Price-maker
11. In cases where a company
is a , it still needs to track costs
to ensure an adequate return is generated. Being a means that
the product is customized and unique and that the maker of the
product is able to charge a price based on costs and a markup.: price
maker
2/
13
