Trends in Cost Management/cost Accounting Include All of the Following

question 103

Multiple Choice

Trends in cost management/cost accounting include all of the following except:

• A) reductions in the administrative costs of gathering data
• B) a trend toward job order cost systems and away from process cost systems
• C) adding a fourth cost category called direct technology
• D) reduction in the direct labor cost component

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Definitions:

Absorption Costing

An accounting method where all manufacturing costs, both fixed and variable, are attributed to the production of products.

Variable Costing

A costing method in which variable manufacturing costs are included in product costs, while fixed manufacturing costs are treated as period costs.

Absorption Costing

An accounting method that assigns all manufacturing costs, both variable and fixed, to products, thereby impacting the inventory valuation on the balance sheet.

Net Operating Income

The profit a company makes from its operations, calculated as total revenue minus operating expenses, excluding taxes and interest.