WOLLEGA UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICs

DEPARTMENT OF ACCOUNTING AND FINANCE
COST& MANAGEMENTACCOUNTINGT EST I FOR LOGISTIC & CHAIN MANAGEMENT 2nd yr

Weight: 30% Time allowed: 40 minute

Name: ____________________________________ id no: _______ sec: ______ sign ______

Part one: say true if the statement is Correct and false if not (2point each)

1. Helps in decision making is cost accounting helps in controlling costs with special
techniques like standard costing and budgetary control.
2. Financial accounting is not bound by GAAPs.

3. Financial accounting is places considerable weight on non-monetary data

4. Cost assignment is the allocation of cost data in some organized way by means of an accounting
system.
5. Relevant costs are future costs that differ with the various decision alternatives.

Part two: choose the best answer among the given alternatives(2pt each)

1. Wich one is true about Management accounting & financial accounting .

A. Financial accounting is primarily concerned with reporting for the company as a whole &
Management accounting is primary focuses much more on the parts.

B. Financial accounting focuses on internal reporting &Management accounting focuses on reporting to

external parties.

C. Management Accounting is analysis of relevant cost data for interpretation and presentation for
various problems of management & Financial Accounting is which has been developed to meet the
managerial needs of business.

D. ALL E. None

2.-------is a cost that has already been incurred and that cannot be changed by any decision made
now or in the future.

A. Sunk Cost B. Opportunity Cost C. Period Cost D. Product Cost

3.-------------- is a concern may not be working to full capacity due to reasons such as shortage of
demand, machine break down or other bottlenecks in production.

A .Reveals idle capacity B. Helps in cost reduction C. Helps in cost control D.NONE

4. A difference in cost between any two alternatives is known as ------------------.

A. differential revenue B. differential cost. C. Opportunity Cost D. Sunk Cost

5. Wich one is true about Variable cost in total?

A. Total fixed cost is not affected by changes in the activity level within the relevant range.

B. Variable cost remains constant per unit.

C. Total variable cost increases and decreases in proportion to changes in the activity level.

D. All E .None F.A&C

PART THREE: WORK OUT (10pt)

1. XYZ Company manufactures and sells one product. The production can vary from 10,000 to
50,000 units.
Given
Fixed cost for total cost………100,000
Variable cost per unit…………8

Required:
1. Compute the schedule for XYZ Company’s total and per unit costs.
2. Determine the cost formula in the format of Y=a + bx