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CA Inter Direct Costs — practice questions

Explore 38 free Direct Costs questions in CA Inter Cost and Management Accounting. Open each question or exercise to read its content, reference answers and available explanation.

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Direct Costs questions and exercises with answers

Showing questions 1–30 of 38.

Costs directly accountable to a cost object are calledRead the answer and worked solution →In economics, the equivalent term for a direct cost isRead the answer and worked solution →Besides materials and labour, direct costs typically includeRead the answer and worked solution →A royalty paid to a patent holder for a production process isRead the answer and worked solution →Direct costs may beRead the answer and worked solution →Other direct costs (ODC) are project costs that excludeRead the answer and worked solution →A cost incurred to make several products or product lines is aRead the answer and worked solution →In construction, direct costs are materials, labour andRead the answer and worked solution →In project management, salaries for project staff areRead the answer and worked solution →Direct project costs are usually charged to projectsRead the answer and worked solution →For a furniture maker, which item is a direct material?Read the answer and worked solution →Plastic in a water tank is classed asRead the answer and worked solution →Materials inventory is classed as raw materials, finished goods andRead the answer and worked solution →Wages of workers who convert raw material into goods areRead the answer and worked solution →Wages paid to trainees and apprentices areRead the answer and worked solution →Wages of factory staff not working directly on the product areRead the answer and worked solution →Direct labour costs cover employees who spend all their timeRead the answer and worked solution →The basic cost elements are material, labour andRead the answer and worked solution →Classifying costs by traceability gives direct costs andRead the answer and worked solution →Costs not directly attributable are charged to cost objects byRead the answer and worked solution →Which is a classification of costs by function?Read the answer and worked solution →Costs unchanged by production volume over a period areRead the answer and worked solution →Costs that are partly fixed and partly variable are calledRead the answer and worked solution →A loss from a flood or accident is usually classed as anRead the answer and worked solution →Costs incurred in the past are calledRead the answer and worked solution →Costs computed in advance from cost factors areRead the answer and worked solution →Change in total cost from one extra unit of output is theRead the answer and worked solution →Difference in total cost from choosing one alternative over another is theRead the answer and worked solution →The cost to replace existing assets at present prices is theRead the answer and worked solution →Costs incurred only if operations are shut down areRead the answer and worked solution →

Worked practice questions

Costs directly accountable to a cost object are called

  1. Direct costs
  2. Indirect costs
  3. Sunk costs
  4. Joint costs
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Correct answer: A. Direct costs

A cost that can be accounted straight to a product, project or facility is a direct cost.

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In economics, the equivalent term for a direct cost is

  1. Specific cost
  2. Social cost
  3. Opportunity cost
  4. Marginal cost
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Correct answer: A. Specific cost

Economists call a cost tied to one cost object a specific cost.

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Besides materials and labour, direct costs typically include

  1. Security salaries
  2. General administration
  3. Head office rent
  4. Specific expenses
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Correct answer: D. Specific expenses

Direct costs are made up of materials, labour and expenses traceable to the cost object.

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More Cost and Management Accounting topics

Cost SheetProcess CostingCost AccountingMarginal CostingEmployee CostInventory ValuationActivity Based CostingBudgets and Budgetary Control