True / False Questions
80.A manager believes that the number of units sold drives the company's selling costs. The number of units sold would be referred to as the cost driver.
True False
81.The accuracy of managerial accounting information usually is more important than timeliness.
True False
82.The first step in cost accumulation is to identify cost objects.
True False
83.An allocation base has a cause-and-effect relationship with a cost object.
True False
84.A cost object is anything for which management desires a separate tracking of costs, while a cost driver is the factor that causes the cost object to increase or decrease.
True False
85.The terms "cost tracing" and "cost allocation" may be used interchangeably because they mean the same thing.
True False
86.Both direct and indirect costs can be relevant to a particular decision.
True False
87.Costs that can be traced to a cost object in a cost-effective way are called direct costs.
True False
88.How a particular cost behaves (fixed versus variable) is dependent of whether the cost is classified as direct or indirect.
True False
89.It is possible that the same cost might be direct with respect to one cost object but indirect with respect to another cost object.
True False