Cost Management and Pricing Decisions MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Cost Management and Pricing Decisions, 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 Management and Pricing Decisions 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 Management and Pricing Decisions mcq questions that explore various aspects of Cost Management and Pricing Decisions problems. Each MCQ is crafted to challenge your understanding of Cost Management and Pricing Decisions 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 Management and Pricing Decisions MCQs are your pathway to success in mastering this essential Cost Accounting topic.

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Cost Management and Pricing Decisions MCQs | Page 13 of 15

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Q121.
The department which provides assisting services to internal departments is classified as

a.

supply department

b.

support department

c.

production department

d.

allocation base department

Discuss
Answer: (b).support department
Q122.
If the employees of division A work for 8000 hours for $90 per hour, then the rate must be paid in division B in accordance of single rate method will be

a.

$90 per hour

b.

less than $90 per hour

c.

greater than $90 per hour

d.

none of above

Discuss
Answer: (a).$90 per hour
Q123.
The department which directly adds value to product or service is known as

a.

production department

b.

operating department

c.

allocation base department

d.

both a and b

Discuss
Answer: (d).both a and b
Q124.
According to incremental method, the party which receives the highest ranking in allocation of common cost is classified as

a.

Third incremental party

b.

second incremental party

c.

primary party

d.

First incremental party

Discuss
Answer: (c).primary party
Q125.
The method of revenue allocation, which ranks products included in bundle according to predetermined criteria of management is known as

a.

step down allocation method

b.

stand-alone revenue allocation method

c.

incremental revenue allocation method

d.

revenue mix allocation method

Discuss
Answer: (c).incremental revenue allocation method
Q126.
The method, which allocates cost of support department for operating departments by recognizing all the mutual services provided is classified as

a.

indirect method

b.

direct method

c.

step down method

d.

reciprocal method

Discuss
Answer: (d).reciprocal method
Q127.
The package which consists of two or more products to be sold for single price, but components of products in package have separate stand-alone price is called

a.

step down product

b.

dual mix product

c.

bundled product

d.

reciprocal product

Discuss
Answer: (c).bundled product
Q128.
The method, which allocates the cost of support department, to operating and support departments is known as

a.

indirect method

b.

direct method

c.

step down method

d.

reciprocal method

Discuss
Answer: (c).step down method
Q129.
The approaches to allocate costs of support department do not include

a.

sales mix allocation method

b.

dual-rate cost-allocation method

c.

single rate cost allocation method

d.

both b and c

Discuss
Answer: (d).both b and c
Q130.
In incremental cost allocation method, the cost object user who is ranked second in ranking order is known as

a.

First incremental user

b.

primary user

c.

secondary user

d.

second incremental user

Discuss
Answer: (a).First incremental user
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