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CA Final Strategic Cost Management and Emerging Business Models — practice questions

Explore 46 free Strategic Cost Management and Emerging Business Models 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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Strategic Cost Management and Emerging Business Models questions and exercises with answers

Showing questions 1–30 of 46.

Target cost equals competitive market price less what?Read the answer and worked solution →What does the target cost of a product represent?Read the answer and worked solution →Which stage studies markets to find the allowable cost?Read the answer and worked solution →Why may an allowable cost need revising into an achievable target cost?Read the answer and worked solution →Besides cutting cost, value engineering also aims to improve what?Read the answer and worked solution →In target value design for construction, when is the target cost developed?Read the answer and worked solution →Actual cost is below target cost. What does the contractor get?Read the answer and worked solution →Before the project ends, how is the contractor paid?Read the answer and worked solution →Target costing decomposes the target cost from product level down to which level?Read the answer and worked solution →Target costing deducts a sustainable profit margin from which price?Read the answer and worked solution →What does the Japanese dictionary say kaizen originally means?Read the answer and worked solution →Adopting kaizen costing requires a change in which of these?Read the answer and worked solution →Which cost does kaizen costing take into account at the manufacturing stage?Read the answer and worked solution →A cost driver is best described as a factor that does what?Read the answer and worked solution →Which writer defines cost drivers as structural determinants of an activity's cost?Read the answer and worked solution →Which driver explains why a small cargo vessel costs more per unit than a large bulk carrier?Read the answer and worked solution →In Porter's approach, under-utilised capacity has what effect on cost per unit?Read the answer and worked solution →Which is a structural cost driver in the Shank and Govindarajan classification?Read the answer and worked solution →A resource cost driver assigns the cost of a resource to what?Read the answer and worked solution →An activity cost driver is used to assign activity costs to what?Read the answer and worked solution →Which cost driver suits indirect maintenance cost?Read the answer and worked solution →In marketing, which of these is cited as a cost driver?Read the answer and worked solution →For which analysis is ABC called a necessary tool?Read the answer and worked solution →Under throughput accounting, throughput equals net sales less which cost?Read the answer and worked solution →Throughput is Rs 9,00,000 and operating expense is Rs 6,50,000. What is net profit?Read the answer and worked solution →Net profit is Rs 60,000 and investment is Rs 4,00,000. What is the return on investment?Read the answer and worked solution →Who proposed throughput accounting as an alternative to traditional cost accounting?Read the answer and worked solution →Throughput accounting serves as the performance measure in which theory?Read the answer and worked solution →Which item forms part of operating expense in throughput accounting?Read the answer and worked solution →Unsold goods produced and stored in a warehouse count as what in throughput accounting?Read the answer and worked solution →

Worked practice questions

Target cost equals competitive market price less what?

  1. The desired profit margin
  2. Last year's actual cost
  3. The fixed overhead pool
  4. The standard labour cost
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Correct answer: A. The desired profit margin

Target cost is the market price less the profit the firm wants, so cost is made to fit the price rather than the reverse.

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What does the target cost of a product represent?

  1. The minimum selling price
  2. The average past cost
  3. The maximum cost allowed
  4. The standard labour cost
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Correct answer: C. The maximum cost allowed

It is the ceiling on cost at which the firm still earns its required margin at the given selling price.

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Which stage studies markets to find the allowable cost?

  1. Market-driven target costing
  2. Component-level costing
  3. Post-launch variance review
  4. Supplier price negotiation
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Correct answer: A. Market-driven target costing

The first section of the process studies the market and profit objectives to identify what a product may cost.

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More Cost and Management Accounting topics

Specialist Cost Management TechniquesCost Volume Profit Analysis and Pricing DecisionsActivity-Based Costing and ManagementStrategic Performance MeasuresLean Manufacturing and KaizenIntroduction to Strategic Cost ManagementTotal Quality ManagementStrategic Performance Management