Cost Allocation MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Cost Allocation, a fundamental topic in the field of Cost Accounting. Whether you're preparing for competitive exams, honing your problem-solving skills, or simply looking to enhance your abilities in this field, our Cost Allocation MCQs are designed to help you grasp the core concepts and excel in solving problems.

In this section, you'll find a wide range of Cost Allocation mcq questions that explore various aspects of Cost Allocation problems. Each MCQ is crafted to challenge your understanding of Cost Allocation principles, enabling you to refine your problem-solving techniques. Whether you're a student aiming to ace Cost Accounting tests, a job seeker preparing for interviews, or someone simply interested in sharpening their skills, our Cost Allocation MCQs are your pathway to success in mastering this essential Cost Accounting topic.

Note: Each of the following question comes with multiple answer choices. Select the most appropriate option and test your understanding of Cost Allocation. You can click on an option to test your knowledge before viewing the solution for a MCQ. Happy learning!

So, are you ready to put your Cost Allocation knowledge to the test? Let's get started with our carefully curated MCQs!

Cost Allocation MCQs | Page 2 of 6

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Q11.
In customer cost hierarchy, the costs of all activities incurred to sell group of units to end consumers are classified as

a.

customer sustaining costs

b.

customer output unit-level costs

c.

customer batch-level costs

d.

corporate sustaining costs

Discuss
Answer: (c).customer batch-level costs
Q12.
If an actual result is $5500 and corresponding amount of flexible budget on the basis of actual level of output is $3500, then flexible budget variance will be

a.

$2,500

b.

$5,500

c.

$3,500

d.

$2,000

Discuss
Answer: (d).$2,000
Q13.
If the flexible budget amount is $7500 and the sales volume variance is $6500, then the static budget amount would be

a.

$7,500

b.

$6,500

c.

$1,000

d.

$10,000

Discuss
Answer: (c).$1,000
Q14.
For increasing sales, the decrease in selling price, below the selling price list is known as

a.

partial discount

b.

corporate discount

c.

treasury discount

d.

price discount

Discuss
Answer: (d).price discount
Q15.
The customer sustaining costs, customer batch-level costs and customer output-unit level costs are classified as

a.

customer level indirect costs

b.

customer level direct costs

c.

corporate level direct costs

d.

corporate level indirect costs

Discuss
Answer: (a).customer level indirect costs
Q16.
If the budgeted contribution margin for budgeted and actual sales mix are $35000 and $27000, then the sales mix variance will be

a.

$8,000

b.

$80,000

c.

$62,000

d.

$35,000

Discuss
Answer: (a).$8,000
Q17.
In corporate costs, the cost incurred to finance construction of new equipment are classified as

a.

treasury costs

b.

discretionary costs

c.

human resource management costs

d.

corporate administration costs

Discuss
Answer: (a).treasury costs
Q18.
In the static budget, the difference between corresponding budgeted amount and actual result is called

a.

sales mix variance

b.

sales volume variance

c.

flexible budget variance

d.

static budget variance

Discuss
Answer: (d).static budget variance
Q19.
An analysis and reporting of revenues earned, and the incurred costs to earn these revenues from customers is classified as

a.

partial productivity analysis

b.

treasury cost analysis

c.

customer profitability analysis

d.

customer cost analysis

Discuss
Answer: (c).customer profitability analysis
Q20.
The cost of particular cost object which cannot be traced in economically plausible way is termed as

a.

indirect cost

b.

partial cost

c.

benchmark cost

d.

direct cost

Discuss
Answer: (a).indirect cost
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