Start learning →

CA Final Introduction to Strategic Cost Management — practice questions

Explore 65 free Introduction to Strategic Cost Management questions in CA Final Cost and Management Accounting. Open each question or exercise to read its content, reference answers and available explanation.

Practise Introduction to Strategic Cost Management with Quill →

Introduction to Strategic Cost Management questions and exercises with answers

Showing questions 1–30 of 65.

Who introduced the value chain concept in his 1985 book?Read the answer and worked solution →How many primary activities does Porter's value chain list?Read the answer and worked solution →Which one is a support activity, not a primary activity, in Porter's value chain?Read the answer and worked solution →Inbound logistics in the value chain mainly deals with what?Read the answer and worked solution →Which primary activity turns raw materials, labour and energy into outputs?Read the answer and worked solution →Keeping a product working for the buyer after delivery is which primary activity?Read the answer and worked solution →Recruiting, training and compensating staff is which support activity?Read the answer and worked solution →Accounting, legal work and general management form which support activity?Read the answer and worked solution →Equipment and software used to transform inputs fall under which support activity?Read the answer and worked solution →Porter says the right level for building a value chain is which one?Read the answer and worked solution →Porter calls the linked chains of suppliers, firm, channels and buyers by what name?Read the answer and worked solution →Who created the virtual value chain model?Read the answer and worked solution →CIMA defines a cost driver as any factor that causes what?Read the answer and worked solution →A small cargo vessel costs more per unit than a large bulk carrier. Which Porter driver explains it?Read the answer and worked solution →Which Porter driver raises unit cost when plant capacity sits idle?Read the answer and worked solution →Traditional costing allocates indirect cost mainly on which driver?Read the answer and worked solution →Activity-based costing rests on the belief that what causes costs?Read the answer and worked solution →In ABC, which item links activities to the cost of the product?Read the answer and worked solution →Shank and Govindarajan split cost drivers into which two groups?Read the answer and worked solution →Which of these is a structural cost driver?Read the answer and worked solution →Structural cost drivers arise mainly from what?Read the answer and worked solution →A resource cost driver measures what?Read the answer and worked solution →Which driver assigns activity costs to cost objects?Read the answer and worked solution →Machine hours is a likely driver of which indirect cost?Read the answer and worked solution →Inspection costs are most often driven by what?Read the answer and worked solution →The number of service calls attended drives costs in which function?Read the answer and worked solution →A product sells at Rs 500 in the market and needs a profit of Rs 80 a unit. What is its target cost?Read the answer and worked solution →The price is Rs 1,500 and the required margin is 20% of price. Find the target cost.Read the answer and worked solution →Current unit cost is Rs 950 and the target cost is Rs 820. How much cost must be cut per unit?Read the answer and worked solution →A target cost is what kind of limit on cost per product?Read the answer and worked solution →

Worked practice questions

Who introduced the value chain concept in his 1985 book?

  1. Michael Porter
  2. Peter Drucker
  3. Henry Mintzberg
  4. Igor Ansoff
Show answer and solution

Correct answer: A. Michael Porter

The value chain framework was proposed by Porter in Competitive Advantage (1985) to analyse how firms create value.

Open this question →

How many primary activities does Porter's value chain list?

  1. Six
  2. Five
  3. Four
  4. Nine
Show answer and solution

Correct answer: B. Five

Porter lists inbound logistics, operations, outbound logistics, marketing and sales, and service, which makes five.

Open this question →

Which one is a support activity, not a primary activity, in Porter's value chain?

  1. Core operations
  2. Procurement work
  3. After-sales service
  4. Outbound logistics
Show answer and solution

Correct answer: B. Procurement work

Procurement is one of the four support activities, along with infrastructure, technology and human resources.

Open this question →

How to practise

  1. Choose a Introduction to Strategic Cost Management question and try to work out your answer.
  2. Open the question to check the correct answer and read its worked solution.
  3. Continue in the app for bite-sized lessons, explanations and review with Quill. You can start without creating an account.

More Cost and Management Accounting topics

Specialist Cost Management TechniquesCost Volume Profit Analysis and Pricing DecisionsActivity-Based Costing and ManagementStrategic Performance MeasuresLean Manufacturing and KaizenTotal Quality ManagementStrategic Performance ManagementPerformance Measurement and Variance Reporting