Cost Controls Practice Test

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• Which statement best reflects the responsibility of staff handling time cards and quantity reports in relation to the cost control system?
• Which term describes the detailed reporting of when events occur on the project?
• Explain the difference between prime cost and conversion cost.
• Explain the concept of incremental (differential) cost in decision making.
• What is an example of using the Units Completed method?
• Explain the concept of cost-to-serve in service operations.
• What is the formula for Weighted or Equivalent Units given in the material?
• How does target costing address price reductions in competitive markets?
• How do variance analyses inform procurement decisions?
• Which term refers to a detailed reporting of what is happening, and when it is happening on the project?
• What best describes standard costing and its typical variances?
• In absorption costing, what happens to fixed overhead?
• Which term is a provision for an increase in the cost of equipment, material, labor, etc., over the costs specified in the contract, due to continuing price-level changes over time?
• Which rule governs production reporting in relation to costs?
• How is working capital managed to support cost control?
• Which ethical principle should guide cost-control practices?
• Which term refers to percentage applications above the general overhead and other indirect costs?
• Cost Trending involves cost in comparison to accomplishment.
• Which statement correctly describes the scope of Cost Engineering?
• What does BAC stand for?
• Accurate and complete cost records can be used for documentation to substantiate legal claims.
• Fixed Costs are defined as
• Indirect Costs are defined as:
• What is the purpose of forecasting in project management?
• Which costs make up prime cost?
• Understand the contracts and documents.
• How does ABC differ from traditional costing?
• Which metric is the profit on an investment over a period of time, expressed as a proportion of the original investment?
• A Cost Element is determined by
• Define absorption costing versus variable costing.
• In procurement, variance analysis typically leads to which outcome?
• Which metric summarizes the overall relationship between costs and benefits of a proposed project?
• Cost Engineering includes
• What is the formula for percent complete using the Cost Ratio method?
• Which of the following is an example of a fixed cost?
• What is variance analysis and why is it important?
• Which cost category includes taxes and insurance costs paid by the employer on behalf of laborers?
• What is emphasized in Labor Reporting?
• Which term is a relative measure of labor efficiency, either good or bad, when compared to an established base or norm?
• What is activity-based costing (ABC) and its purpose?
• What is the Social Security tax rate listed?
• Taxation’s relation to economic costs as described in the material.
• Which practice would undermine the cost control system's integrity?
• In making make-or-buy decisions, what factors should be considered beyond cost?
• Which analysis technique can identify drivers of high costs in a project?
• Which description matches the Rules of Credit as it applies to progress increments?
• What is the purpose of comparing actual progress and costs to the baseline?
• Which term describes the loss of potential gain from other alternatives when one option is chosen?
• What is job order costing and when is it used?
• What is the focus of cost control in project management?
• Which statement correctly contrasts direct and indirect costs?
• Which term describes inflation caused by demand pulling ahead of supply?
• Cost Categories include which of the following?
• Which term represents the annual cost of owning, operating, and maintaining an asset over its life?
• How do you calculate the cost of quality as a percentage of sales?
• Which variance is primarily driven by changes in production volume?
• Which term is the amount of money asked or given for a product?
• How is progress determined using the Start/Finish method?
• Life cycle costing phases?
• Which term refers to the cost incurred due to an additional unit of product being produced?
• In the Cost Ratio method, which expression represents Percent Complete?
• Allowance
• Which concept represents the annual equivalent cost or benefit of owning an asset when considering its entire life?
• Which costing system would be appropriate for homogeneous products in continuous production?
• Which term denotes a provision for an increase in the cost of equipment, material, labor, etc., over the costs specified in the contract, due to continuing price-level changes over time?
• What is the primary purpose of cost controls in an organization?
• Which term describes the equipment and materials to be provided and the work to be completed?
• Which statement best defines cost-to-serve?
• What is a keep or drop analysis?
• Explain life cycle costing.
• A Cost Element is determined by
• What is the payback period in project evaluation?
• Which term denotes the cost incurred by producing an extra unit beyond current production levels?
• Which option best represents the most common form of progress measurement?
• Which term is described as one of the factors that may involve economic costs?
• What is the present value of the cash flows compared to your initial investment?
• How is a weighted-average contribution margin ratio calculated for a multi-product firm?
• What is process costing and when is it used?
• Which statement best defines Labor Cost?
• Workers Compensation is represented by what metric?
• Which term describes inflation where the increased cost of goods is 'pushed' to others?
• What does cost-volume-profit (CVP) analysis examine?
• Which term refers to the contract documents collection including the contract forms, general and specific conditions, drawings, specifications, and addenda describing the project scope and contract terms?
• Which term includes the contract forms, general and specific conditions, drawings, specifications, and addenda describing the project scope and contract terms?
• Which term describes the tax rate on total taxable income paid?
• Which term refers to unrecoverable costs incurred on decisions made in the past?
• Which statement best differentiates fixed and variable costs with examples?
• Which description best characterizes Labor Burden?
• Cost Element Groups are used to
• Cost Categories include which of the following?
• Which progress measurement approach would most likely be used to value progress based on an expert's judgment rather than verifiable data?
• Allowance
• Which term means a quantity of output?
• What does ACWP stand for in earned value management?
• Which term is defined as data used must reflect actual conditions?
• Which concept refers to the value of a dollar in the future due to its potential earning capacity?
• Which method assigns progress increments to subtasks strictly based on time requirements?
• Which term describes the tax rate on the total taxable income paid?
• Which statement best defines Labor Rates?
• Which term means a quantity of output?
• Health insurance may be required by law.
• Alternate
• What is the purpose of a variance report?
• What is the formula for gross margin?
• What is the COQ (cost of quality) framework?
• What does the Incremental Milestones method involve?
• What is target costing?
• Variable Costs are defined as
• Which concept is described as changes in the cost or price of specific goods over time?
• Which term is defined as a document created by the Architect or Engineer requesting a change or correction to the contract drawings and/or specifications after the contract award?
• Fringe Benefits includes which items?
• Which formula represents Estimated at Completion (EAC) when assuming work will progress at the planned rate?
• How is margin of safety defined?
• What are the two controls needed for a baseline plan?
• Currency variations can influence economic costs.
• Which term represents the value of an item as reflected in the accounting books?
• Buy-Out.
• How is material price variance calculated?
• What is the purpose of statusing in project management?
• Which term concerns the devaluation of currency that influences import/export dynamics between countries?
• Which term denotes the value of an item as recorded on financial statements?
• In standard costing, what are overhead variances and how do expenditure and volume variances differ?
• Distributable Cost is best described as
• Which term describes inflation when demand grows faster than supply?
• How is material usage variance calculated?
• Health Insurance rate in this material is described as?
• Which statement describes labor rate variance and labor efficiency variance?
• In incremental analysis, which costs are considered relevant?
• Which pairing best reflects the relationship between production and costs for a valid report?
• Direct Costs are defined as:
• What does Scope describe in cost-control terms?
• Which statement reflects Production Reporting requirement?
• Which formula gives the contribution margin per unit?
• Which term refers to an amount added to the estimate to allow for changes that experience shows will likely be required?
• Addendum
• Which term is used to describe costs associated with producing additional units beyond base production?
• What are key ethical considerations in cost control?
• What is the standard expansion of EAC in project cost management?
• How is the break-even point defined in units and dollars?
• Pareto's Law in the context of cost control states which of the following?
• Which term is the relative measure of labor efficiency when compared to a base or norm?
• Economic costs may be beyond the ability of an individual to control.
• Which option is NOT listed as a factor involving economic costs?
• Which of the following is NOT listed as one of the six common methods to determine project progress?
• Fringe Benefits includes which items?
• Loading costs or production units to make a cost report look good is described as what in the cost control system?
• What is rolling budgeting and how does it differ from static budgeting?
• What is the difference between cash flow forecasting and profit forecasting?
• Which term is associated with rising wages increasing firms' costs and increasing consumers' disposable income?
• How does product mix affect CVP analysis and the use of a weighted-average contribution margin?
• State Unemployment rate as given is Varies; example which percentage?
• What is the 'Rules of Credit' in project management?
• Which term describes the advertisement for bids, instructions to bidders, information available to bidders, bid form with all attachments, and proposed contract documents?
• What is the purpose of cost management in project management contexts?
• Which rate goes directly to the employee?
• Which term describes the primary collection of documents that initiate the bidding process, including the advertisement for bids, instructions to bidders, information available to bidders, bid form with attachments, and proposed contract documents?
• How does budgeting differ from forecasting?
• What is a baseline in project management?
• Which action best aligns with the purpose of a variance report in management?
• Cost is defined as the value of an activity or asset.
• Which of the following is a factor that may involve economic costs due to policy or macroeconomic conditions?
• COQ components included in numerator for COQ percentage?
• What does BCWP stand for?
• What does break-even point represent?
• What is the Retirement contribution rate listed?
• What is a make or buy decision and how is it analyzed?
• Paid Time Off (PTO) typically includes which components?
• Which term describes a specific portion of the contract documents that states the responsibilities and relationships of all parties to the contract, as well as any conditions applicable to the contract?
• Which term is defined as the tax rate on the next dollar of taxable income?
• Distributable Cost is defined as
• Which term describes unrecoverable costs incurred from past decisions?
• Which term describes the recording of costs and expenditures on a project?
• Which expression correctly defines the contribution margin ratio?
• Which term describes the fall of the price level of goods and services?
• Which ratio summarizes the overall relationship between relative costs and benefits of a proposed project?
• Which concept compares the present value of expected cash inflows to the initial investment?
• Who must understand the cost control system?
• Addendum
• Which term is defined as base salary plus fringe benefits and labor burdens assigned to one item of work?
• What is a spend analysis and how does it support cost control?
• Target costing is best described as which of the following?
• How do you allocate fixed overhead under normal costing?
• What best describes a flexible budget?
• BCWS stands for which term in earned value management?
• What is the purpose of measuring work progress in a project?
• Under normal costing, how is overhead allocated?
• Which statement best describes the difference between static and flexible budgets?
• Which term is defined as the cost added by producing one additional unit of a product or service?
• Which term represents the overall process of tracking and controlling project costs to avoid overruns?
• Which incentive for business investment allowing deduction of a percentage of investment costs from taxes?
• Which term refers to changes in the cost or price of specific goods or services over a period of time?
• Which list contains all six common ways to determine project progress?
• When is the Units Completed method used?
• What is the formula for break-even in dollars for multiple products?