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CA Final Specialist Cost Management Techniques — practice questions

Explore 84 free Specialist Cost Management Techniques questions in CA Final Cost and Management Accounting. Open each question or exercise to read its content, reference answers and available explanation.

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Specialist Cost Management Techniques questions and exercises with answers

Showing questions 1–30 of 84.

Target costing finds the target cost by doing what to the market price?Read the answer and worked solution →A gadget will sell at Rs 2,400 and the firm wants a 25% margin on selling price. Target cost?Read the answer and worked solution →In target costing, when is cost planning mainly carried out?Read the answer and worked solution →Target costing breaks the product target cost down to which level?Read the answer and worked solution →Target costing passes competitive pressure on to which two groups?Read the answer and worked solution →The target costing process is divided into how many main sections?Read the answer and worked solution →Which target costing section transmits cost responsibility to suppliers?Read the answer and worked solution →Allowable cost in target costing is derived from which factor, ignoring design capability?Read the answer and worked solution →Value engineering is also known by which other name?Read the answer and worked solution →Target costing emerged in Japan mainly in which period?Read the answer and worked solution →Greater product innovation affects the value of historical cost information how?Read the answer and worked solution →More products in a firm's line affects target costing benefits how?Read the answer and worked solution →Which costing technique applies while a product is still being developed?Read the answer and worked solution →Kaizen costing is applied once a product's design is at what stage?Read the answer and worked solution →Monden describes kaizen costing as the maintenance of what?Read the answer and worked solution →Adopting kaizen costing needs a change in the method of setting what?Read the answer and worked solution →The Japanese word kaizen is translated as the act of what?Read the answer and worked solution →Who proposed throughput accounting as an alternative to cost accounting?Read the answer and worked solution →In throughput accounting, throughput equals sales less what?Read the answer and worked solution →A firm sells output for Rs 900 and the raw material in it costs Rs 350. Throughput is what?Read the answer and worked solution →Throughput is Rs 600 and operating expense Rs 450. What is the net profit?Read the answer and worked solution →Throughput is Rs 600 and investment Rs 1,000. What are the investment turns?Read the answer and worked solution →In throughput accounting, operating expense is all expenses except what?Read the answer and worked solution →Which cost does throughput accounting allocate to products?Read the answer and worked solution →In TOC, inventory is valued strictly on which cost?Read the answer and worked solution →Goods made but sitting unsold in a warehouse count as what in TA?Read the answer and worked solution →Goldratt argued that labour efficiency measures lead to what?Read the answer and worked solution →The goal of a profit-maximising firm in TA is increasing what?Read the answer and worked solution →How does TA relate to formal company accounts?Read the answer and worked solution →When cost accounting developed in the 1890s, which was the largest fraction of product cost?Read the answer and worked solution →

Worked practice questions

Target costing finds the target cost by doing what to the market price?

  1. Deducting desired profit
  2. Dividing by sales units
  3. Applying a cost markup
  4. Adding a profit margin
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Correct answer: A. Deducting desired profit

The desired profit is taken out of the competitive price, so what remains is the most the product may cost.

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A gadget will sell at Rs 2,400 and the firm wants a 25% margin on selling price. Target cost?

  1. Rs 3,000
  2. Rs 2,160
  3. Rs 1,800
  4. Rs 600
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Correct answer: C. Rs 1,800

A 25% margin on Rs 2,400 is Rs 600, and subtracting it from the price leaves a target cost of Rs 1,800.

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In target costing, when is cost planning mainly carried out?

  1. During design phase
  2. After the sale phase
  3. At disposal stage
  4. At year-end close
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Correct answer: A. During design phase

Costs are planned out of the product early, while it is still being designed and developed.

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More Cost and Management Accounting topics

Cost Volume Profit Analysis and Pricing DecisionsActivity-Based Costing and ManagementStrategic Performance MeasuresLean Manufacturing and KaizenIntroduction to Strategic Cost ManagementTotal Quality ManagementStrategic Performance ManagementPerformance Measurement and Variance Reporting