COST ACCOUNTING ACTUAL TEST BANK
UPDATED QUESTIONS AND SOLUTIONS
ALREADY PASSED
●● Period Cost
Answer: Cost expensed in the period (e.g., admin, sales).
●● Variable Cost
Answer: Changes with activity (e.g., raw materials).
●● Fixed Cost
Answer: Stays constant regardless of volume (e.g., rent).
●● Mixed Cost
Answer: Has fixed and variable components (e.g., utilities).
●● Contribution Margin
Answer: Sales minus variable costs.
●● Break-even Point
Answer: When sales = total costs, no profit/loss.
, ●● Relevant Cost
Answer: Costs that change between decisions.
●● Sunk Cost
Answer: A past cost that can't be recovered.
●● Differential Cost
Answer: Cost difference between two options.
●● Overhead (MOH)
Answer: Indirect manufacturing costs.
●● Direct Cost
Answer: Easily traced to a product/job.
●● Indirect Cost
Answer: Shared or allocated to many products.
●● Predetermined Overhead Rate
Answer: Budgeted MOH / Base (e.g. DLH).
UPDATED QUESTIONS AND SOLUTIONS
ALREADY PASSED
●● Period Cost
Answer: Cost expensed in the period (e.g., admin, sales).
●● Variable Cost
Answer: Changes with activity (e.g., raw materials).
●● Fixed Cost
Answer: Stays constant regardless of volume (e.g., rent).
●● Mixed Cost
Answer: Has fixed and variable components (e.g., utilities).
●● Contribution Margin
Answer: Sales minus variable costs.
●● Break-even Point
Answer: When sales = total costs, no profit/loss.
, ●● Relevant Cost
Answer: Costs that change between decisions.
●● Sunk Cost
Answer: A past cost that can't be recovered.
●● Differential Cost
Answer: Cost difference between two options.
●● Overhead (MOH)
Answer: Indirect manufacturing costs.
●● Direct Cost
Answer: Easily traced to a product/job.
●● Indirect Cost
Answer: Shared or allocated to many products.
●● Predetermined Overhead Rate
Answer: Budgeted MOH / Base (e.g. DLH).
