Which of the following is NOT a primary objective of cost control?
a) Minimizing costs
b) Maximizing profits
c) Enhancing product quality
d) Optimizing resource allocation
Answer: b) Maximizing profits
What is the main purpose of cost control?
a) Reducing business expenses
b) Increasing revenue
c) Improving customer satisfaction
d) Enhancing employee morale
Answer: a) Reducing business expenses
Which of the following is an example of a variable cost?
a) Rent
b) Salaries
c) Raw materials
d) Insurance premiums
Answer: c) Raw materials
Cost control involves:
a) Tracking and analyzing expenses
b) Setting aggressive sales targets
c) Expanding product offerings
d) Hiring more employees
Answer: a) Tracking and analyzing expenses
Which cost control technique involves negotiating better prices with suppliers?
a) Standard costing
b) Activity-based costing
c) Value analysis
d) Vendor management
Answer: d) Vendor management
Which cost control measure focuses on eliminating non-value-added activities from a process?
a) Lean manufacturing
b) Six Sigma
c) Balanced scorecard
d) Total quality management
Answer: a) Lean manufacturing
Which of the following is an example of a cost control system?
a) Budgeting
b) Market research
c) Employee training
d) Advertising campaign
Answer: a) Budgeting
Cost control is most effective when it is:
a) Reactive
b) Proactive
c) Reactive and proactive
d) Irrelevant to business operations
Answer: b) Proactive
Which cost control technique involves analyzing the cost and benefits of alternative options?
a) Break-even analysis
b) Cost-volume-profit analysis
c) Return on investment analysis
d) Cost-benefit analysis
Answer: d) Cost-benefit analysis
Which of the following is a potential consequence of poor cost control?
a) Increased profitability
b) Enhanced productivity
c) Financial losses
d) Market expansion
Answer: c) Financial losses
Which of the following is a key component of effective cost control?
a) Continuous cost reduction
b) Increasing production capacity
c) Hiring more employees
d) Expanding market share
Answer: a) Continuous cost reduction
Cost control is most commonly associated with which type of business?
a) Non-profit organizations
b) Government agencies
c) Small and medium enterprises (SMEs)
d) Multinational corporations
Answer: c) Small and medium enterprises (SMEs)
Which cost control technique involves monitoring and managing the use of resources within a project?
a) Earned value analysis
b) Activity-based costing
c) Process costing
d) Absorption costing
Answer: a) Earned value analysis
Which of the following is an example of an indirect cost?
a) Direct labor
b) Raw materials
c) Factory rent
d) Production equipment
Answer: c) Factory rent
What is the primary benefit of implementing cost control measures?
a) Increased employee satisfaction
b) Higher customer loyalty
c) Improved financial performance
d) Enhanced brand reputation
Answer: c) Improved financial performance
Which cost control technique involves setting standard costs for materials, labor, and overhead?
a) Target costing
b) Standard costing
c) Marginal costing
d) Absorption costing
Answer: b) Standard costing
Which of the following is a limitation of cost control?
a) Increased operational efficiency
b) Reduced flexibility
c) Higher market share
d) Improved product quality
Answer: b) Reduced flexibility
Which cost control technique involves analyzing the activities that drive costs within an organization?
a) Activity-based costing
b) Value engineering
c) Just-in-time (JIT) inventory
d) Total quality management (TQM)
Answer: a) Activity-based costing
Which cost control measure focuses on reducing waste and defects in production processes?
a) Kaizen
b) Statistical process control (SPC)
c) Cost variance analysis
d) Customer relationship management (CRM)
Answer: b) Statistical process control (SPC)
Which of the following is an example of an external factor that can impact cost control?
a) Employee turnover
b) Technological advancements
c) Production capacity
d) Organizational culture
Answer: b) Technological advancements
Which cost control technique involves analyzing the cost and revenue relationship at different levels of production or sales?
a) Break-even analysis
b) Activity-based costing
c) Variance analysis
d) Target costing
Answer: a) Break-even analysis
Which of the following is a strategy for cost control in the service industry?
a) Implementing automation
b) Outsourcing production
c) Decreasing product variety
d) Increasing advertising expenditure
Answer: a) Implementing automation
Which cost control measure involves comparing actual costs against budgeted costs and identifying deviations?
a) Cost variance analysis
b) Cost of goods sold analysis
c) Cost-benefit analysis
d) Cost allocation analysis
Answer: a) Cost variance analysis
What is the purpose of implementing cost control measures?
a) To increase sales revenue
b) To reduce overall expenses
c) To improve product quality
d) To expand the customer base
Answer: b) To reduce overall expenses
Which cost control technique involves using historical cost data to estimate future costs?
a) Regression analysis
b) Benchmarking
c) Forecasting
d) Sensitivity analysis
Answer: c) Forecasting
Which of the following is an example of an intangible cost?
a) Raw material cost
b) Employee salaries
c) Equipment maintenance cost
d) Customer dissatisfaction
Answer: d) Customer dissatisfaction
Which cost control measure focuses on optimizing the allocation of resources to different activities or projects?
a) Activity-based costing
b) Resource leveling
c) Value stream mapping
d) Pareto analysis
Answer: b) Resource leveling
Which cost control technique involves identifying and eliminating unnecessary or redundant activities?
a) Value engineering
b) Target costing
c) Cost of quality analysis
d) Cost leadership strategy
Answer: a) Value engineering
Which of the following is a potential benefit of effective cost control?
a) Increased market share
b) Enhanced product innovation
c) Reduced financial risk
d) Higher employee turnover
Answer: c) Reduced financial risk
Which cost control measure involves negotiating favorable terms and conditions with suppliers?
a) Supplier relationship management
b) Economic order quantity (EOQ)
c) Zero-based budgeting
d) Cost reduction program
Answer: a) Supplier relationship management
Which cost control technique involves analyzing and reducing costs associated with inventory holding and ordering?
a) Just-in-time (JIT) inventory
b) Economic order quantity (EOQ)
c) Activity-based costing
d) Value stream mapping
Answer: b) Economic order quantity (EOQ)
Which of the following is a cost control measure that focuses on reducing energy consumption?
a) Energy efficiency audits
b) Employee incentive programs
c) Quality control inspections
d) Marketing campaigns
Answer: a) Energy efficiency audits
What is the primary goal of cost control in project management?
a) Maximizing project scope
b) Minimizing project duration
c) Minimizing project costs
d) Maximizing project risks
Answer: c) Minimizing project costs
Which cost control technique involves comparing actual performance against a predetermined standard?
a) Variance analysis
b) Activity-based costing
c) Value engineering
d) Quality control analysis
Answer: a) Variance analysis
Which of the following is a potential consequence of ineffective cost control?
a) Increased profitability
b) Improved cash flow
c) Cost overruns
d) Competitive advantage
Answer: c) Cost overruns
Which cost control measure focuses on optimizing the use of human resources within an organization?
a) Workforce planning
b) Break-even analysis
c) Target costing
d) Cost allocation
Answer: a) Workforce planning
Which cost control technique involves continuously monitoring and adjusting costs throughout the production process?
a) Kaizen costing
b) Total quality management (TQM)
c) Cost-volume-profit analysis
d) Lean accounting
Answer: a) Kaizen costing
What is the primary purpose of implementing cost control in healthcare organizations?
a) Maximizing patient satisfaction
b) Minimizing medical errors
c) Reducing healthcare costs
d) Expanding healthcare services
Answer: c) Reducing healthcare costs
Which cost control measure involves analyzing the cost and value of each component or feature of a product or service?
a) Value analysis
b) Benchmarking
c) Cash flow analysis
d) Cost estimation
Answer: a) Value analysis
Which of the following is a potential benefit of effective cost control in manufacturing?
a) Increased equipment downtime
b) Improved product quality
c) Higher production costs
d) Reduced customer satisfaction
Answer: b) Improved product quality