Management
Accounting Practice
2026-VERSION WITH
QUALITY QUESTIONS
AND 100% CORRECT
ANSWERS WITH
RATIONELS.
1. What is the primary purpose of
management accounting?
A. External reporting
B. Tax compliance
,C. Internal decision-making
D. Auditing
Answer: C
Management accounting focuses on
providing information for internal
managers to make decisions.
2. Which cost varies directly with
production volume?
A. Fixed cost
B. Variable cost
C. Sunk cost
D. Opportunity cost
,Answer: B
Variable costs change in proportion to
output.
3. Rent paid for a factory is an example
of:
A. Variable cost
B. Fixed cost
C. Direct cost
D. Marginal cost
Answer: B
Rent remains constant regardless of
production level.
, 4. Which of the following is a direct
material cost?
A. Factory rent
B. Supervisor salary
C. Raw materials
D. Electricity
Answer: C
Raw materials are directly traceable to
production.
5. Contribution margin is defined as:
A. Sales minus fixed costs
B. Sales minus variable costs
C. Sales minus total costs
D. Profit plus fixed costs
Accounting Practice
2026-VERSION WITH
QUALITY QUESTIONS
AND 100% CORRECT
ANSWERS WITH
RATIONELS.
1. What is the primary purpose of
management accounting?
A. External reporting
B. Tax compliance
,C. Internal decision-making
D. Auditing
Answer: C
Management accounting focuses on
providing information for internal
managers to make decisions.
2. Which cost varies directly with
production volume?
A. Fixed cost
B. Variable cost
C. Sunk cost
D. Opportunity cost
,Answer: B
Variable costs change in proportion to
output.
3. Rent paid for a factory is an example
of:
A. Variable cost
B. Fixed cost
C. Direct cost
D. Marginal cost
Answer: B
Rent remains constant regardless of
production level.
, 4. Which of the following is a direct
material cost?
A. Factory rent
B. Supervisor salary
C. Raw materials
D. Electricity
Answer: C
Raw materials are directly traceable to
production.
5. Contribution margin is defined as:
A. Sales minus fixed costs
B. Sales minus variable costs
C. Sales minus total costs
D. Profit plus fixed costs
