Page 116 - DMGT403_ACCOUNTING_FOR_MANAGERS

Unit 5: Basic Cost Concepts

6. Cost is Notes
(a) Direct cost only (b) Indirect cost only
(c) Both (a) & (b) (d) None of the above
7. Direct cost is

(a) Direct Materials (b) Direct labour
(c) Direct Expenses (d) Prime cost
8. Factory cost is the total of
(a) Direct and indirect costs

(b) Product and administrative costs
(c) Cost of sales
(d) Profit margin
9. Selling price is the summation of

(a) Direct and indirect costs
(b) Product and administrative costs
(c) Cost of sales and profit margin
(d) Direct materials, direct labour and direct expenses

10. Prime cost is the summation of
(a) Direct and indirect costs
(b) Product and administrative costs
(c) Cost of sales and profit margin

(d) Direct materials, direct labour and direct expenses
11. Production cost is the summation of
(a) Direct and indirect costs
(b) Product and administrative costs

(c) Cost of sales and profit margin
(d) Direct materials, direct labour and direct expenses
12. Service center is the center which normally incurs
(a) Direct and indirect costs

(b) Product and administrative costs
(c) Cost of sales and profit margin
(d) Direct materials, direct labour and direct expenses
13. Which of the following is ascertained at the product center?

(a) Price (b) Cost
(c) Variability (d) Semi-variable cost

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