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1. Which of the following is NOT a component in cost
accounting?
a) Direct costs
b) Indirect costs
c) Operating costs
d) Variable costs
Answer: c) Operating costs
Rationale: Operating costs typically refer to ongoing
expenses for running a business, whereas cost accounting
primarily focuses on the classification and analysis of
direct and indirect costs.
2. Which of the following best describes direct costs in cost
accounting?
a) Costs that can be easily traced to a specific product or
service.
b) Costs incurred for general business operations.
c) Costs that remain constant regardless of production
levels.
d) Costs that fluctuate based on the production volume.
Answer: a) Costs that can be easily traced to a specific
product or service.
Rationale: Direct costs can be directly attributed to a
specific product, service, or department, such as direct
materials and direct labor.
3. Indirect costs in cost accounting:
a) Cannot be allocated to specific products or services.
b) Are always included in the calculation of variable costs.
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