cost accounting

What is cost management?

• Process to create more value for customer with few resource

• Tool to control the budget and expenses of a business.

• Process of planning and controlling the budget and expenses

• Process to plan the operating and expanding expenditure.

What is/are the importance(s) of cost management?

• To improve overall business profitability.

• To explore opportunity through cost optimization.

• To analyze and improve internal and external cost driver.

• I think all answers are correct.

The first step in implementing target pricing and target costing is

• choosing a target price

• determining a target cost.

• developing a product that satisfies needs of potential customers.

• performing value engineering

What is EOQ?

• Economics Order Quality

• Economics Output Order

• Economics Order Quantity

• Ergonomics Order Quantity

What is ABC system?

• A method of dividing on hand inventory into 3 classifications,

• A method of segregate the inventory into 3 classifications.

The cost of Insurance and Taxes are included in

• Cost of ordering

• Set up cost

• Inventory Carrying cost

• Cost of shortage

The transfering of work from a specific area of the company ( e.g. accounting, manufacturing) to an outside supplier, which can be done to a company that is located in the home country or anywhere else is called______.

• Offshoring

• Outsourcing

• Globalization

Dividing costs of the department into activity cost pools is known as:

• Second-stage allocation

• First-stage allocation

• No allocation stage

• Full allocation

In activity based costing, a cost driver is:

• an overhead cost

• a direct product cost

• a resource consuming activity that causes overheads

• a variable cost

What is not correct about ABC:

• Less accurate

• Difficult to implement

• Time consuming

• Massive amount of data