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CMA –Part 3 Section D – Decision Making

Materials are kindly provided by the HOCK company

1) In decision-making, relevant costs are		expected future variable costs
		all expected future costs, whether variable or fixed
		all expected future costs, whether variable or fixed, that differ among alternatives
		historical costs that can be used to project future costs

2) An unavoidable cost is		an important cost to consider in making a decision, as it must be paid no matter which decision is made
		irrelevant in decision making, as it does not need to be paid
		any fixed cost
		irrelevant to the decision-making process, because it will make no difference

3) A book publisher is considering two different books for publication. It can publish only one of the two books. Which of the following would not be a relevant consideration in the decision?		The cost of the editor’s time to negotiate the author’s contract for each book
		The cost to print and bind each book
		The price each book can be sold for
		The expected sales volume for each book

4) Which of the following could be considered an opportunity cost?		The cost of an option to purchase a piece of property
		The amount that could be received for selling a piece of equipment that is still useful for production
		Costs to prepare the manufacturing equipment for an expected contract
		The cost to purchase a new piece of equipment for a new product that will fulfill a newly-perceived need in the market

5) A cost object is		any thing or activity for which costs can be measured
		any thing or activity to which only direct costs can be assigned
		any item whose purchase constitutes an expense
		any cost that is properly recorded in the accounting system

6) An indirect cost is a cost that		is traceable to a particular cost object
		can be allocated to particular cost objects
		cannot be allocated to any cost object
		is an unavoidable cost

7) Variable costs		are the same as direct costs
		vary within the relevant range of production
		vary on a per unit basis with the volume of production
		are constant on a per unit basis, regardless of the volume of production

8) The cost driver for a fixed cost, within the relevant range,		is anything that causes the fixed cost to vary in total
		is the volume or activity level
		is applicable only to direct costs
		is nonexistent

IASB IFRS 2007 (International Financial Reporting Standards; Interpretations as at 1 January 2007)
Price: 6500 Rub.
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U.S. Master GAAP Guide 2008
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IASB A Guide through IFRS 2007 (International Financial Reporting Standards; Interpretations as at 1 January 2007)
Price: 9500 Rub.
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Wiley IFRS 2006( International Financial Reporting Standarts)
Price: 4450 Rub.
2006г. [Content]

Wiley GAAP 2008 : Interpretation and Application of Generally Accepted Accounting Principles
Price: 4450 Rub.
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