Management Accounting - Study Mode
[#296] An example of quantitative factor is
Correct Answer
(D) cost of materials
Explanation
Solution: An example of quantitative factor is cost of materials. Material cost is the cost of materials used to manufacture a product or provide a service.
[#297] relevant costs are classified in relevance concepts as
Correct Answer
(A) expected future costs
Explanation
Solution: Relevant costs are classified in relevance concepts as expected future costs. A relevant cost is a cost that only relates to a specific management decision, and which will change in the future as a result of that decision.
[#298] Financial factors measured in numerical terms, having some monetary value are considered as
Correct Answer
(B) quantitative factors
Explanation
Solution: Financial factors measured in numerical terms, having some monetary value are considered as quantitative factors. Quantitative factors are numerical outcomes from a decision that can be measured. These factors are commonly included in various financial analyses, which are then used to evaluate a situation.
[#299] Forgone contribution of resources, in to revenues because of not using resources, in next best use is classified as
Correct Answer
(B) opportunity cost
Explanation
Solution: Forgone contribution of resources, in to revenues because of not using resources, in next best use is classified as opportunity cost. Opportunity cost refers to what you have to give up to buy what you want in terms of other goods or services.
[#300] Difference of cost, which occurs while considering alternatives can be classified as
Correct Answer
(D) differential cost
Explanation
Solution: Difference of cost, which occurs while considering alternatives can be classified as differential cost. Differential cost is the difference between the cost of two alternative decisions, or of a change in output levels. The concept is used when there are multiple possible options to pursue, and a choice must be made to select one option and drop the others.