#1
Which of the following is NOT a common performance metric in cost accounting?
Earnings per Share (EPS)
ExplanationEarnings per Share (EPS) is not a common performance metric in cost accounting.
#2
Which of the following statements best describes the Break-even Point?
The point where total revenue equals total costs
ExplanationBreak-even Point is where total revenue equals total costs.
#3
What is the primary purpose of using performance metrics in cost accounting?
To evaluate the company's financial health
ExplanationPerformance metrics in cost accounting evaluate the company's financial health.
#4
Which of the following is a measure of how efficiently a company uses its assets to generate revenue?
Asset Turnover Ratio
ExplanationAsset Turnover Ratio measures the efficiency of utilizing assets to generate revenue.
#5
What is the formula for calculating Gross Margin?
Net Sales - Cost of Goods Sold
ExplanationGross Margin is the proportion of revenue remaining after deducting the cost of goods sold.
#6
Which of the following is a measure of a company's profitability relative to its shareholders' equity?
Return on Equity (ROE)
ExplanationReturn on Equity (ROE) measures profitability relative to shareholders' equity.
#7
What is the formula for calculating Return on Investment (ROI)?
(Net Profit / Cost of Investment) x 100%
ExplanationReturn on Investment (ROI) calculates the return relative to the cost of investment.
#8
What does the Cost Variance metric indicate?
The difference between actual costs and planned costs
ExplanationCost Variance indicates the difference between actual and planned costs.
#9
Which of the following statements about Operating Income is true?
It is calculated by subtracting total expenses from net sales
ExplanationOperating Income is derived by deducting total expenses from net sales.
#10
What does Return on Assets (ROA) measure?
The efficiency of utilizing assets to generate revenue
ExplanationROA measures the efficiency of assets in generating revenue.
#11
Which of the following statements about Return on Investment (ROI) is true?
It is a measure of a company's efficiency in managing its assets to generate revenue
ExplanationROI measures a company's efficiency in managing assets to generate revenue.