ĐỀ CƯƠNG MÔN F5

PART A
DAY- 1
Q1. A company produces a range of products and uses an absorption costing system.
Which of the following are unlikely to be a consequence of the company switching to
an activity based costing (ABC) system?
A. Indirect overheads will be shared between products on fairer bases
B. Product pricing decisions will be improved
C. Cost control on indirect overheads will be harder to achieve
D. Total production cost of each product will change
Q2. A company which makes 2 products, Ay and Be, uses activity-based costing to
absorb its overheads. It has recently identified a new overhead cost pool for inspection
costs and has decided that the cost driver is the number of inspections.
The following information has been provided:
Total inspection costs $500,0000

Ay Be

Production volume (units) 5,000 16,000000

Machine hours per unit 2 33
Units per batch 1,000 2,000000
Inspection per batch 8 2
What is the inspection cost per unit of product Ay?
A. $29.76
B. $8.93
C. $71.43
D. $80.00
1> cost per inspection: $500,000 / [(5,000/1,000)x8 + (16,000/2,000)x2] = $8.93
2> cost per batch of Ay: $8.93 x 8 = $71.43
Q3. Which of the following statements about activity based costing is true?
A. The cost driver for quality ínpection is likely to be batch size
B. The cost driver for materials handling and despatch costs ís likely to
be the number of orders handled
C. In the short run, all the overhead costs for an activity vary with the
amount of the cost driver for the activity
D. A cost is an activity based cost
Q4. Which of the following statements about activity based costing is true?
A. ABC recognises the complexity of modern manufacturing by use of
multiple cost drivers
 B. ABC reapportions support activity costs
C. ABC is an apportion costing system when overheads vary with time spent on
production
D. Implementation of ABC is unlikely to be cost effective when variable
production cost are a low proportion of total production costs are a low
proportion of total production costs
Q5. A company makes 2 products using the same type of materials and skilled
workers. The following information is available:
Product A Product B

Budgeted volume (units) 1,000 2,000

Material per unit (kg) 10 20
Labour per unit (hours) 5 20
Fixed costs relating to material handling amount to $100,000. The cost driver for these
costs is the volume of material purchased. General fixed costs, absorbed on the basis
of labor hours, amount to $180,000.
Using activity-based costing, what is the total fixed overhead amount to be absorbed
into each unit of product A ( to be nearest whole 5)?
A. $113
B. $120
C. $40
D. $105
1> material handling: [$100,000 / (1,000x10 + 2,000x20)] x 10 = $20 / unit A
2> general FC: ($180,000x5) / (1,000x5 + 2,000x20) = $20 / unit A
Total = $40
Q6. In target costing, which of the following would be an appropriate strategy to
reduce a cost gap for a product that existed in a competitive industry with demanding
shareholders?
A. Increase the selling price
B. Reduce the expectation gap by reducing the selling price
C. Reducing the desired margin on the product
D. Mechanising production in order to reduce average production cost
Q7. Which of the following strategies would be an immediately acceptable method to
reduce an identified cost gap?
A. Reduce the desired margin without discussion with business owners
B. Reduce the predicted selling price
C. Source similar quality material from another supplier at reduced cost
D. Increase the predicted selling price
Q8. Which of the following techniques is NOT relevant to target costing?
 A. Value analysis
B. Variance analysis
C. Functional analysis
D. Activity analysis
Q9. The selling price of product Z is set to be $250 for each unit and sales for the
coming year are expected to be 500 units. The company requires a return of 15% in
the coming year on its investment of $350,000 in product Z.
What is the target cost for each unit of Z for the coming year? Select from the list as
appropriate.
A. $105
B. $145
C. $212.5
D. $250

[($250/unit + 500 units) - 15% x $350,000] / 500 units = $145/unit

15% = ($250 x 500 - target cost) / $350,000 => = $145

10. Dimo Co wants to calculate a target cost for a new product X. The price of X
will be set at $20,950. The company requires a 12% profit margin on sales.
What is the target cost?
A. $18,436
B. $18,705
C. $20,950
D. $23,464
=> Target cost = $20950 x (1-12%)=$18,436

11. Dimo Co. Is in the process of introducing a new product Z. The target selling
price has been set at $78 per unit in order to achieve the required sales volume.
Costs estimates have been prepared based on the proposed product specification.
$ per unit

Direct material 7.5

Direct labour 32

Direct machinery costs 5.5

Ordering and receiving 2.25
Quality assurance 8.5
 Marketing 2.5
Distribution 0.25
After-sales service 1
The target profit margin for the product in 30% of the target selling price
What is the target cost gap?
A. $1.15
B. $3.65
C. $3.9
D. $4.9
Cost gap = Designed cost - Target cost
Target cost = $78 - $78 x 30% = $54.6 / unit
Designed cost = $59.5 = tổng các số trong bảng => cost gap = $4.9
12. Which of the following is the correct formula to calculate target cost gap?
A. Target cost gap = Target selling price - Target profit
B. Target cost gap = Estimated cost - Target cost
C. Target cost gap = Target selling price - Target cost
D. Target cost gap = Target selling price - Estimated cost
13. A company has produced the following information for a product it is about
to launch. The product is expected to have a life of three years.

Year 1 2 3
Expected Sale units 2,000 5,000 7,000
$ $ $
Variable production cost per unit 2.3 1.8 1.2
Fixed production costs 3,500 4,000 4,500
Variable selling cost per unit 0.5 0.4 0.4
Fixed selling costs 2,000 2,100 2,100
Administrative costs 1,000 1,000 1,000
What is the life-cycle cost per unit?
A. $2.64
B. $2.84
C. $3.29
D. $3.5
 14. A manufacturing company which produces a range of products has
developed a budget for this life-cycle of a new product, X. The information is the
following table relates exclusively to product X:
Lifetime total Per unit
Design costs $1,600,000
Direct manufacturing costs $20
Depreciation costs $1,000,000
Decommissioning costs $40,000
Machine hours 4
Production and sales units 600,000
The company’s total fixed production overheads are budgeted to be $72 million
each year and total machine hours are budgeted to be 96 million hours. The
company absorbs overheads on a machine hour basis.
What is the budgeted life-cycle cost per unit for product X?
A. $25.08
B. $25.15
C. $27.33
D. $27.4
QAR = $72M / $96M = 0.75/ hours
( $ 1.000 .000+ $ 1.000.000+ $ 40.000)
Fixed OH per unit = 0.75 x 4 = $3/unit +
600.000
=$4.4/unit
Budgeted life cycle = 20+3+4.4=27.4
15. Which of the following are said to be benefits of life-cycle costing?
(i) It provides the true financial cost of a product
(ii) The length of the life-cycle can be shortened
(iii) Lower costs can be achieved earlier by designing our costs
(iv) Better selling prices can be set
A. (i), (ii) and (iii) only
B. (i), (iii) and (iv) only
C. (ii), (iii) and (iv) only
D. All of the above
16. Which of the following is NOT the benefit of life-cycle costing?
A. Decline stages of the life-cycle can be avoided
B. Lower costs can be achieved earlier by designing out costs
C. Expensive error can be avoided in that potentially failing products can be
avoided
 D. It provides the true financial cost of a product
17. In which of the following ways might financial returns be improved over the
life-cycle of a product?
(i) Minimizing the breakeven time
(ii) Minimizing the time to the market
(iii) Maximizing the length of the life-cycle
A. (i) only
B. (i) and (ii) only
C. (ii) and (iii) only
D. All of the above
18. BL Co. is about to start developing a new product for launch in its existing
market. They have forecast sales of 30,000 units and the marketing department
suggests a selling price of $45/unit. The company seeks to make a mark-up of
40% product cost. It is estimated that the lifetime costs of the product will be as
follows:
Design and development costs $45,000
Manufacturing costs $15/unit
Plant decommissioning costs $30,000
The company estimates that if it were to spend an additional $15,000 on design
manufacturing costs/unit could be reduced
What is the life-cycle cost per unit of the new product?
A. $17.5
Design and development per unit: $45,000 / 30,000 units = $1.5 / unit
Plant decommissioning costs: $30,000 / 30,000 units = $1 / unit
$15 + $1.5 + $1 = $17.5
19. The following information relates to the expected cost of a new product over
its expected three-year life.What is the expected average life-cycle cost per unit?

Year 0 Year 1 Year 2 Year 3

Units made and sold 30,000 100,000 70,000
R&D costs $100,000,000 $100,000
Production costs
Variable per unit $25 $20 $15

Fixed costs $500,000 $500,000 $500,000

Selling and distribution costs
Variable per unit $5 $4 $3
Fixed costs $700,000 $500,000 $300,000
Customer service costs
Variable per unit $3 $2 $1

D. $45.10
Q20. The following costs have arisen in relation to the production of a product:
(i) Planning and design costs
(ii) Testing costs
(iii) Production costs
(iv) Customer service costs
In calculating the life-cycle cost of a product, which of the above items would be
included?
A. (iii) only
B. (i) and (iii) only
C. (i), (ii) and (iii) only
D. All of the above
Q21. Which of the following statements about life-cycle costing is TRUE?
A. A product is usually most profitable during the growth of its life-cycle
B. Life-cycle costing is useful for deciding the selling price for a product
C. An important use of life-cycle costing is to decide whether to go
ahead with the development of a new product
D. Life-cycle costing is most useful for products with an even weighting of
cost over their life
Q22. Different management accounting techniques can be used to account for
environmental costs. One of these techniques involves analyzing costs under
three distinct categories: material, system and delivery and disposal?
What is this technique known as?
A. Activity based costing
B. Life-cycle costing
C. Input-output analysis
D. Flow cost accounting
Q23.Which of the following statements is/are true regarding the issue faced by
business in the management of their environmental costs?
(i) The costs involved are difficult to define
(ii) Environmental costs can be categorized as quality related cost
(iii) Cost control can be an issue, in particular if costs have been identified incorrectly
in the first place.
 A. (i) only
B. (ii) and (iii) only
C. None of them
D. All of them
Q24. Flow cost accounting is a technique which can be used to account for
environmental costs. Inputs and outputs are measured through each individual
process of production
Which of the following is NOT a category within flow cost accounting?
A. Material flows
B. Waste flows
C. System flows
D. Delivery and disposal flows
Q25. Accountants usually find it difficult to deal with environmental costs.
Which of the following is NOT a reason for this?
A. Costs are often hidden
B. Costs are mostly minor
C. Cost are often very long term
D. Accounting systems rarely split off these costs automatically

PART B
Q26. The contribution ratio of product A is 40%. The manufacturer of product
A wishes to make a contribution of $100,000 towards fixed costs. If the selling
price is $ per unit, the number of units of A that must be sold is:
50,000 units
40,000 units
20,000 units
8,000 units
Q27. A company makes a single product and incurs fixed costs of $100,000 per
month. Variable cost per unit is $10 and each unit sells for $20. It’s budgeted to
sell 10,000 unit monthly.
How much is contribution earned from each $1 of sales revenue?
$2
$1
$0.5
$0.25
Q28. Taylor. Co makes a single product, which it sells for $25 per unit. Fixed
costs are $87,500 per month and the product has a contribution ratio of 25%.
In a month when actual sales were $425,000, Taylor’s margin of safety, in units, was:
17,000 units
14,000 units
 3,500 units
3,000 units
Q29. The following information is available for a manufacturing company
which procedures multiple products:
(i) The production mix ratio
(ii) Contribution to sales ratio for each product
(iii) General fixed cost
(iv) Method of apportioning general fixed costs
Which of the above are required in order to calculate breakeven sales revenue for the
company?
(i), (ii) and (iii) only
(i), (ii) and (iv) only
(ii) and (iii) only
All of the above
Q30. A company makes a single product and incurs fixed costs of $90,000 per
month. Variable cost per unit is $10 and each unit sells for $25.
The breakeven point in terms of monthly sales units is:
9,000 units
6,000 units
3,600 units
None of the answers are correct
31. Taylor is producing 2 products with the following information:What is the
breakeven point in value for Taylor company?

Product A Product B
Sales price per unit $40 $50
Variable cost per unit $20 $25
Budgeted sales per mix 1 unit 2 units
Total fixed costs $500,000 $500,000

Impossible to calculate without more information

$1,000,000
$1,125,000
$1,500,000

32. Taylor is producing 2 products with the following information.

 Product A Product B
Sales price per unit $40 $50
Variable cost per unit $20 $25
Budgeted sales per mix 1 unit 2 units
Total fixed costs $600,000 $500,000
What is the sales revenue required to make a profit of $250,000 for Taylor company?
A. Impossible to calculate without more information
B. $1,500,000
C. $1,700,000
D. $2,000,000
Contribution per mix = ($40 - $20) x 1 + ($50 - $25) x 2 = 70
-> Qtp = (FC + TP) / (P - vc) = ($600,000 +$250,000) / 70 = 12,142
-> Sales revenue required = 12,142 x 1 x $40 + 12,142 x 2 x $50 = 1,700,000

33. Which of the following statements regarding cost-volume-profit analysis are

correct?
(i) It assumes that selling prices remain constant
(ii) It ignores non-production costs
(iii) It ignore economies of scale that impact on the cost per unit
(iv) It assumes that fixed costs remain constant throughout the range of production
and sales volumes
(i) and (ii) only
(i), (ii) and (iii) only
(ii), (iii) and (iv) only
(i), (iii) and (iv) only
34. A company has fixed costs of $1.3 million. Variable costs are 55% of sales up
to a sales level of $1.5 million, but at higher volumes of production and sales, the
variable cost for incremental production units falls to 52% of sales.
What is the breakeven point in sales revenue, to the nearest $1,000?
D. 2,802,000

35. A company makes three products to which the following budget information
relates:
Product A Product B Product C
$ per unit $ per unit $ per unit
Selling price ($ per unit) 50 35 60
 Material @ $5/kg 10 7.5 12.5
Labour @ $8/hour 12 8 16
Variable production OH 1.5 1 2
Fixed OH 6 4 8
Maximum annual demand in for 2.000 units of product A, 1500 unit of product B and
1200 unit of product C, and the factory has budgeted to produce that number of
units.It has just been discover that next year material will be limited to 9000kg and
labor to 7000 hours
If the company wishes to maximize profit, the priority in which the products should be
made and sold is:
A. A then B then C

36. Taylor manufactories 3 components, X, Y and Z , using the same machine for
each and assembles them into a single product .The budget for the next period
call for the production and assembly of 1,000 of each component .The variable
for production cost per unit of the final product is as follow:
Variable cost per unit ($) Machine hour(s) per unit
(hours)
X 10 2
Y 9 1.0
Z 12 2.5
Only 5,000 hours of machine time will be available during the period, and
subcontractor has quoted the following unit prices of supplying components : X$14,
Y$12, Z$18.
What should production mix be to maximize profit?
A. 1000 units of X, 1000 units of Y, 800 units of Z
B. 750 units of X, 1000 units of Y, 1000 units of Z
C. 1000 units of X, 500 units of Y, 1000 units of Z
D. None of the answer are correct

37. A company makes 3 products to which the following budget information

relates:
Contribution per unit Labor hours per unit
Product X 10 2
Product Y 9 1.5
 Product Z 12 2.5
Due to industrial action only 5,000 labour hours are available next period , when
expected demand is 1000 units of each product. Fix cost are $12000 for the
period .This company has no plan for outsourcing or hiring extra labour from the
outside .What is the maximum profit that can be achieved next period
A. $ 26,200
B. $ 14,200
38. The following statement have been made about the use of the
i
ii )It can only be used to solve problems with two constraints
iii) It assumes the objective function is a linear function
iv ) There will always be one enquire solution
Which of the above statements are/is correct?
A. (i) and ( iii)

Q39: Which of the following costs are not identified as relevant

A. Opportunity cost
B. Incremental cost
C. Futured cost
D. Committed cost
Q40. A machine owned by a company has been idle for some months but could
now be used on a one year contract which is under consideration. The net book
value of the machine is $1,000. If not used on this contract, the machine could be
sold now for a net amount of $1,200. After use on the contract, the machine
would have no saleable value and the cost of disposing of it in one year's time
would be $800.
What is the total relevant costs of the machine to the contract?
A. $400
B. $800
C. $1,200
D. $2,000

Q41. "The value of a benefit sacrificed in favor of an alternative course of

action"
Which term is best described by the definition above?
A. Avoidable cost
B. Opportunity cost
C. Relevant cost
D. Variable cost
42. A contract is under consideration which requires 600 labour hours to
complete. There are 350 hours of spare labour capacity. The remaining hours for
the contract can be found either by weekend overtime working paid at double the
normal rate of pay or diverting labour from the production of product A. If the
contract is undertaken and labour is diverted, then sales of product A will be
lost. Product A takes three labour hours per unit to produce and makes a
contribution of $12 per unit. The normal rate of pay for labour is $9 per hour.
What is the total relevant cost of labour for the contract?
A. $1,000
B. $2,250
C. $3,250
D. $4,500
Over time: 250 hours x $9 x 2 = $4,500

44. Your company is launching a brand new product that would require two
types of labour: 10 hours of skilled labour along with 5 hours of semi skilled. If a
skilled worker is free and can work on the product, the payment would be $8 per
hour. On the other hand, if the skilled worker must be taken from another job,
replacement would cost $6 per hour for the work they supposed to do in the
presettleed job. For semi-skilled workers, the rate is $3 per hour and workers
appointed for this work is additional.
Determine the relevant cost of labour needed for one unit of the new product?
A. $95
B. $155
C. $15
D. $75
Chat gpt ra 155$ or 95 :> ai biết làm thì check nhá
45. Annual rent of the store is $500,000. The annual rent cost is not a relevant
cost.
Why is this cost NOT a relevant cost?
A. It is an uncontrollable cost
B. It is not an opportunity cost
C. It occurs in every plans
D. It is a notional cost

46. The price of a good is $5 per unit and annual demand is 1,000,000 units.
Market research indicates that an increase in price of 25 cents per unit will result
in a fall in annual demand of 100,000 units.
What is the price elasticity of demand? (Ignore the negative sign)
A. 2
 % change in quantity = 100,000/1000,000 = 0.1
% change in price = 0.25/5 = 0.05
PED = %change in quantity / %change in price = 0.1/0.05 = 2
47. The following statements have been made about price elasticity of demand.
(i) When sales demand is inelastic, a company can increase profits by rising the
selling price of its product.
(ii) Price elasticity of demand is a measure of the extent of change in market demand
for a good in response to a change in its price.
Which of the above statements is/are true?
A. (i) only
B. (ii) only
C. Neither (i) or (ii)
D. Both (i) and (ii)
(check lại nha)
48. In a traditional pricing environment which of the following “C” words is
NOT traditionally considered when setting a price?
A. Cost
B. Cash flow
C. Competition
D. Customers

49. If the demand for a product is 5,000 units when the price is $400 and 6,000
units when price is $380, what is the optimal price to be charged in order to
maximise profit if the variable cost of the product is $200?
A. $150
B. $200
C. $350
D. $700
=> Giải: (P = a + bQ and b = –20/1,000 or –0.02 => By substitution: 400 = a – 0.02
(5,000)=> a = 500 => So demand equation is: P = 500 – 0.02Q MR = 500 – 0.04Q)

50. The following price and demand combinations have been given:
P1 = 400, Q1 = 5,000
P2 = 380, Q2 = 5,500
The variable cost is a constant $80 per unit and fixed costs are $600,000 per annum.
What is optimal price and maximum profit?
A. Price = 340. Maximum profit = $1,090,000
51. Blake produces one single product A. Variable costs per unit are $15. Total
fixed overheads are $120,000 per annum. Budgeted sales per month are 400 units
to allow the product to break even.
Calculate the budgeted price for product A.
A. $315 120.000/12/400 + 15 = 40
B. $300
C. $40
D. $10
52. The following statements have been made about cost plus pricing.
(i) A price in excess of full cost per unit will always ensure that a company will cover
all its costs and make a profit.
(ii) Cost plus pricing is an appropriate pricing strategy when jobs are carried out to
customer specifications.
Which of the above statements is/are true?
A. (i) only
B. (ii) only
C. Neither (i) nor (ii)
D. Both (i) and (ii)

53. Which of the following terms would NOT normally be used to describe a
relevant cost for a decision?
A. Incremental
B. Future
C. Cash flow
D. Fixed cost

54. Which of the following pricing policies is the most appropriate for a new
product for which the price elasticity of demand is expected to be inelastic?
A. Marginal cost plus
B. Market skimming
C. Penetration pricing
D. Price discrimination

55. A company currently sells a products for $100 and at this price, demand is
2,000 units per month. It has been estimated that for every $4 increase or
reduction in the price, monthly demand will fall or increase by 100 units.
What is the formula for the demand curve for this product?
A. P = 180 - 0.04*Q
a = 100 + 2000/100 *4 = 180
b = 4/ 100 = 0.04 ( câu này t tự làm nên check lại thử nhá :> )
56. Which one of the following is not the objective of a budgetary system?
A. Planning
B. Control
C. Ensuring success
D. Motivation

57. Which one of the following is the best description of “top-down budgeting
approach”?
A. Senior manage set budget targets and prepare budgets that meet the targets
B. Senior managers set budget targets; Lower managers prepare budgets
that meet the targets
C. Lower managers set budget targets and prepare budgets that meet the targets
D. All above are wrong.

58. Which one of the following is the best description of “bottom-up budgeting
approach”?
A. Lower managers draft the budgets: Senior managers combine lower
budgets
B. Lower managers draft the budgets and combine those budgets.
C. Senior managers draft the budgets and combine lower budgets
D. All above are wrong.

59. ‘Next year’s budget is prepared by using the current year’s actual results as a
starting point, and making adjustments for expected inflation, sales growth or
decline and other known changes’ is the principle of which following budgeting
approaches?
A. Incremental budgeting
B. Zero-based budgeting
C. Activity-based budgeting
D. Rolling budgets

60. Which of the following is the advantage of ‘incremental budgeting

approach’?
A. Builds in previous problems and inefficiencies
B. Managers may spend for the sake of spending in order to use up their budget
for year and thus ensure that they get the same (or a larger) budget next year
C. Uneconomical activities may be continued
D. Suitable for organizations that operate in a stable environment
Q61. The budget for each cost center should be made from 'scratch' or zero' is
the principle of which following budgeting approaches?
A. Incremental budgeting
B. Zero-based budgeting
C. Activity-based budgeting
D. Rolling budgets

Q62. Defining the key activities that account for overhead spending, and
considering the costs of the activity' is the principle of which following budgeting
approaches?
A. Incremental budgeting
B. Zero-based budgeting
C. Activity-based budgeting
D. Rolling budgets

Q63. Which of the following budgets may be used when the pace of change in the
business environment is fast and continual?
A. Incremental budgeting
B. Zero-based budgeting
C. Activity-based budgeting
D. Rolling budgets

Q64. The first unit of output of a new product requires 80 hours. An 85%
learning curve applies. Output is being doubled each time. What's the average
time per unit if there are 4 units produced?
A. 68 hours.
B. 57.8 hours.

Q65. The first unit of output of a new product requires 80 hours. An 85%
learning curve applies. Output is being doubled each time. What's total time for
production if there are 4 units produced?
A. 272 hours.
B. 231.2 hours = 57.8x4

Q66. A company operates in export and import markets, and its operational cash
flows are affected by movements in exchange rates, which are highly volatile. As
a result, the company has great difficulty in establishing a budgeting system that
is reliable for more than three months ahead.
Which of the following approaches would be most appropriate for this
company's situation?
A. Flexible budget
B. Incremental budget
C. Rolling budget
D. Zero based budget

Q67. 'Ideal standard':

A. Can be attained under perfect operating conditions
B. Can be attained if production is carried efficiently, machines are properly
operated and/or materials are properly used
C. Based on current working conditions
D. Remains unchanged over the years and is used to show trends

Q68. 'Attainable standard':

A. Can be attained under perfect operating conditions
B. Can be attained if production is carried out efficiently, machines are
properly operated and/or materials are properly used
C. Based on current working conditions
D. Remains unchanged over the years and is used to show trends

Q69. The following statements have been made about standard mix and yield
variances.
(1) Mix variances should be calculated whenever a standard product contains
two or more direct materials.
(2) When a favorable mix variance is achieved, there may be a counterbalancing
adverse yield variance.
Which of the above statements is/are true?
A. 1 only
B. 2 only

Q70. The following statements have been made about standard mix and yield
variances.
(1) Mix and yield variances enable management to resolve problems with the
quality of production output.
(2) Persistent adverse mix variances may have an adverse effect on sales volume
variances and direct labour efficiency variances.
Which of the above statements is/are true?
A. 1 only
B. 2 only
 C. Neither 1 nor 2
Q71. The following information is given about standard and actual material costs
during one month for a production process.
Material Standard cost Actual cost standard mix actual mix
per kg per kg (kg)
P 3.00 3.50 10% 820
Q 2.50 2.75 20% 1,740
R 4.00 3.50 30% 2,300
S 5.25 5.00 40% 2,640

What was the materials mix variance?

A. 880 (F)

Q72. The following information is given about standard and actual material costs
during one month for a production process.

Material Standard cost Actual cost standard mix actual mix

per kg per kg (kg)
P 3.00 3.50 20% 820
Q 2.50 2.75 30% 1,740
R 4.00 3.50 50% 2,300

What was the materials mix variance?

A. 270 (F)
B. 270 (A)
C. 271 (F)

Q73. The following information is given about standard and actual material costs
during one month for a production process.

Material Standard cost Actual cost standard mix actual mix

per kg per kg (kg)
P 3.00 3.50 10% 820
Q 2.50 2.75 40% 1,740
 R 4.00 3.50 50% 2,300

What was the materials mix variance?

A. 25 (F)
B. 26 (F)
C. 27 (F)
D. 28 (F)

Q74. The following information is given about standard and actual material costs
during one month for a production process.
Material Standard cost Actual cost standard mix actual mix
per kg per kg (kg)
P 3.00 3.50 30% 820
Q 2.50 2.75 70% 1,740

What was the materials mix variance?

A. 26 (A)

Q75. The following information is given about standard and actual material costs
during one month for a production process.
Material Standard cost Actual cost standard mix actual mix
per kg per kg (kg)
P 3.00 3.50 40% 820
Q 2.50 2.75 60% 1,740

What was the materials mix variance?

A. 100 (F)
B. 101 (F)
C. 102 (F)
D. 103 (F)

Q76. For which one of the following variances should a production manager usually
be held responsible?
D. Material usage operational variance

Q77. A standard product uses 3 kilograms of direct material costing $4 per kg. During
the most recent month, 120 units of the product were manufactured. These required
410 kilograms of material costing $4.50 per kg. It is decided in retrospect that the
standard usage quantity of the material should have been 3.5 kg, not 3 kg.
What is the materials operational usage variance, if it is chosen to use planning and
operational variances for reporting performance?
A. 40 (F)
(120 * 3.5 - 410)*4
Q78. A standard product uses 3 kilograms of direct material costing $4 per kg. During
the most recent month, 120 units of the product were manufactured. These required
410 kilograms of material costing $4.50 per kg. It is decided in retrospect that the
standard usage quantity of the material should have been 2.5 kg, not 3 kg.
What is the materials operational usage variance, if it is chosen to use planning and
operational variances for reporting performance?
A. 440 (F)
B. 440 (A)
C. 450 (F)
D. 450 (A)

Q79. A standard product uses 3 kilograms of direct material costing $4 per kg.
During the most recent month, 120 units of the product were manufactured.
These required 410 kilograms of material costing $4.50 per kg. It is decided in
retrospect that the standard usage quantity of the material should have been 3.5
kg, not 3 kg.
What is the materials planning usage variance, if it is chosen to use planning and
operational variances for reporting performance?
A. 240 (F)
B. 240 (A)
C. 250 (F)
D. 250 (A)

Q80. A standard product uses 3 kilograms of direct material costing $4 per kg.
During the most recent month, 120 units of the product were manufactured.
These required 410 kilograms of material costing $4.50 per kg. It is decided in
retrospect that the standard usage quantity of the material should have been 2.5
kg, not 3 kg.
What is the materials planning usage variance, if it is chosen to use planning and
operational variances for performance?
A. 240 (F)
B. 240 (A)
C. 250 (F)
D. 250 (A)
 Day - 3
Q81. Which one of the following is not a financial performance indicator?
A. Revenues
B. Cost
C. Profit
D. Innovation
Q82. Which one of the following is NOT a financial performance indicator?
A. Service quality
B. Reliability
C. Assets value
D. Flexibility
Q83. Which one of the following is NOT the perspective of a balanced scorecard?
A. Financial
B. Customer
C. Digital transformation
D. Innovation
Q84. In which one of the following centers, a manager is responsible for cost,
revenue and asset?
A. Investment center
B. Profit center
C. Revenue center
D. Cost center

Q85. “A cost pool is an activity which consumes resources and for which
overhead costs are identified and allocated”
TRUE
Q86.“A cost driver is any factor that cause a change in the cost of an activity”
TRUE
Q87. “Life-cycle costing takes into account all cost incurred in a product like
life-cycle with exception of sunk costs incurred on research and development”
FALSE
Q88. “Life-cycle costing ensures a profit is generated over the life of the product”
TRUE
Q89. “Products should be discontinued if there is a target cost gap”
TRUE
Q90. “A target cost gap is the difference between the target cost for a product and its
projected cost”
TRUE
Q91. “A risk with target costing is that cost reductions may affect the perceived value
of the product”
TRUE
Q92. “Cost may be reduced in target costing by removing product features that do not
add value”
TRUE
Q93. “The high cost of (for ex) research, design and marketing in the early stages in a
product’s life-cycle necessitate a high initial selling price”
FALSE
Q94. “In MFCA, output costs are allocated between positive and negative product
costs”
TRUE

Q95. Breakeven point in units = Total fixed costs - Contribution per unit
TRUE

Q96. “The breakeven point is at the intersection of the sales line and the total costs
line”
TRUE

Q97. It needs 3 kg of material X and 2 machine hours to produce one unit of product
A and those of 2 kg and 1.5 hours for product B. It was expected that 6,000 machine
hours and 10,000 kg of X being available for production. Sales demand was 2,000
units for each product
FALSE

Q98. “Surplus occurs when maximum availability of a other constraining factor is not
used”
FALSE

Q99. “The price elasticity of demand (PED) is a measure of the extent of change in
demand for a good in response to a change in its price”
TRUE

Q100. “Full cost-plus is a method of deciding the sales price by adding a percentage
mark-up for profit to the marginal cost of the product”
FALSE

Q101. “Sunk costs are costs that have already been incurred. Sunk costs can be
relevant costs”
FALSE
Q102. “In a decision about whether or not to sell a joint product at the split-off point
or after further processing joint costs are irrelevant”
TRUE

Q103. “Price skimming strategy in suitable for new and innovative products”
TRUE

Q104. “Cost plus pricing methods take the approach of adding a specified of
MARGIN to the cost of a product”
FALSE

Q105. “Cost plus pricing method always consider the relationship between price and
demand”
FALSE

Q106. “If there is one limiting factor, the best contribution would be earned by
maximizing the contribution per unit of that limiting factor”
TRUE

Q107. “Depreciation is not a relevant cost because it is not a cash flow”

TRUE

Q108. “When there are no limiting factors restricting the in - house production
capacity , the relevant costs are the differential costs between the two options”
TRUE

Q109. "The outsourcing option is likely to give management more direct control over
the work of products or services from external suppliers”
FALSE

110. A budget is a quantified plan of action for a forthcoming accounting period ?

TRUE
111. ‘Control’ is not one of the objectives of a budgeting system?
FALSE

112. Planning forces management to look ahead, to set out detailed plans for
achieving the targets for each department, operation and each manager?
TRUE
113. The activities of different departments or subunits of the organization do not need
to be co-ordinated to ensure maximum integration of effort towards common goal?
FALSE
114. Budgetary planning and control systems require that managers of budget centers
are made responsible for the achievement of budget targets for the operations under
their personal control
TRUE
115. A budget is a yardstick against which actual performance is measured and
assessed ?
TRUE
116. Actual performance is a yardstick in which a budget is measured and assessed ?
FALSE
117. With top down budgeting , budget targets are set at sealer management level for
the organization as a whole and for each major department or activity within the
organization ?
TRUE
118. With bottom up budgeting, the budgeting process starts at senior management
level?
FALSE
119. Incremental budgeting is a method of budgeting in which next year's budget is
prepared by using the current year's actual results as a starting point , and making
adjustments for expected inflation , sales growth or decline and other known changes
TRUE
120. Incremental budgeting method of hudgeling to watch next year's budget is
prepared by using the current year's budgets as a starting point , and making
adjustments for expected station , sales growth or decline and other known changes
FALSE
121. The principle behind zero based budgeting ( ZBB ) is that the budget for each
cost center should be made from the previous year's actual performance ?
FALSE
122. The principle behind zero based budgeting ( ZBB ) is that the budget for each
cost center should be made from scratch or zero . Every item of expenditure must be
justified in its entirety in order to be included in the next year's budget ?
TRUE
123. Activity based budgeting differs from traditional budgeting in the way that
budgets are prepared for overhead costs . Overhead costs are budgeted on the basis of
activities , rather than on a departmental basis ?
TRUE
124. Activity based budgeting is similar to traditional budgeting in the way that
budgets are prepared for overhead costs ?
FALSE
125. Rolling budgets are budgets which are continuously updated throughout a
financial year , by adding a further period ( say a month or a quarter ) and removing
the corresponding period that has just ended ?
TRUE
126. Rolling budgets are budgets which are continuously updated throughout a
financial year, by reviewing the current period (say a month or a quarter) and
removing when it has just ended?
FALSE
127. In the “Learning curve theory”, the workers are likely to become more confident
and knowledgeable about the work as they gain experience, to become more efficient,
and to do the work more quickly?
TRUE
128. In the “Learning curve theory”, the more units that a worker makes, the longer
time spent for producing a unit
FALSE
129. A standard cost is an estimate unit cost built up of standards for each cost
element (standard resource price and standard resource usage)
TRUE
130. Standard costing is used to value inventories, prepare cost budgets for production
and provide control information (variances)
FALSE
131. The essence of control is “measurement of results” and “comparing” them with
“the original plan”. Any “deviation from the plan” indicates that “control actions are
required” to make the “result more closely with the plan”
TRUE
132. The essence of control is “measurement of results” and “comparing” them with
“the original plan”. Any “deviation from the plan” always indicates that “there is some
problems with the actual performance”
TRUE
133. The essence of control is 'measurement of results' and 'comparing' them 'with the
original plan". Any 'deviation from the plan’ always indicates that ‘there is some
problems with the original plan’
TRUE
134. A variance is the difference between an actual result and an expected result?
TRUE
135. Variance analysis is the process by which the total difference between standard
and actual results is analyzed
TRUE
136. When actual results are better than expected results, we have an adverse variance
FALSE
137. If actual results are worse than expected results, we have an favorable variance
FALSE
138. The selling price variance measures the effect on expected profit of selling price
different to the standard selling price
TRUE
139. The selling price variance measures the effect on expected profit of a sales
volume different to expected sales volume
FALSE
140. “Unforeseen discounts received” is one of the reasons for a favorable material
variance
TRUE
141. “Material price increase” is one of the reasons for a favorable material variance
FALSE
142. “More effective use made of material” is one of the reasons for an adverse
material variance
FALSE
143. “Theft” is one of the reasons for an adverse material variance
TRUE
144. “Use of workers at a lower rate of pay than standard” is one of the reasons for a
favorable material variance
FALSE
145. “Use of workers at a lower rate of pay than standard” is one of the reasons for an
adverse material variance
TRUE
146. “Machine breakdown” always makes a favorable labor variance
FALSE
147. “Better quality of equipment or materials” may be a reason for a favorable labor
efficiency variance
TRUE
148. The material usage variance can be subdivided into a sales mix variance and a
material yield variance when more than one material is used in the product
TRUE
149. Calculating a mix and yield variance is only meaningful for control purposes
when management is in a position to control the mix of materials used in production
TRUE
150. The sales volume variance can be analyzed further into a sales mix variance and
a sales quantity variances
TRUE
151. If a company sells only one product, it is possible to analyze the overall sales
volume variance into a sales mix variance and a sales quantity variance
False
152. When circumstances may occur that make the original budget or standard cost
invalid or inappropriate, it may be appropriate to revise a budget or standard cost
TRUE
153. Planning variance have arisen because of inaccurate planning or faulty standards
TRUE
154. “Operational variances” have been caused by an adverse or favorable operational
performance
TRUE
155. In a system of standard costing, idle time is an adverse labour efficiency
variance, and is undesirable. But in JIT manufacturing, idle time variance should
therefore be expected
TRUE
156. Idle time variances should be reported in “just in time” manufacturing
FALSE
157. The philosophy in TQM of “right first time” may be inconsistent with a standard
cost that includes an allowance for wastage
TRUE
158. A standard cost is based on an assumption of a desirable steady state: this view is
inconsistent with the principle of continuous improvement in TQM.
TRUE
159. A budgetary control and variance reporting system can only motivate managers
and employees to improve performances, and it can’t produce undesirable negative
reactions
FALSE
160. Performance measures may be divided into 2 types: financial and non-financial
performance indicators
TRUE
DAY - 3
161. Financial measures are typically measures relating to revenues, cost, return on
capital, asset values or cash flows and service quality
FALSE
162. Performance measures should only include factors which managers can control
by their decisions, and for which they can be held responsible
TRUE
163. We should use only one performance measure for one manager
FALSE
164. The balanced scorecard focuses on 4 different perspectives as follow: Financial,
Customer, Internal and Innovation and Learning
TRUE
165. The balanced scorecard focuses on 4 different perspectives as follow: Financial,
Customer, Internal and Competitor
FALSE
166. Each divisional manager is responsible for the performance of the division
TRUE
167. A profit center often includes cost center and revenue center
TRUE
168. A manager of a revenue center is never responsible for the cost incurred in this
center
FALSE