1. The idea that a company will forego some benefit by choosing one option over another is called:

A. Relevant costs B. Sunk costs

C. Opportunity costs

D. Decision costs

2. Which of the following are factors to consider when deciding whether to accept a special order?

A. The fixed costs that will be allocated to the units produced B. Whether there is sufficient excess production capacity

C. The projected salvage value of current production equipment D. Last year's budgeted level of production

3. A budget used to plan for the acquisition of long-term assets is called a: A. Participative budget

B. Continuous budget C. Capital budget

D. Zero-based budget

4. Which of the following are advantages of budgeting?

A. It helps management to get out of just doing things the same way and notice what can be B. improved.

C. It helps a company achieve their long-range goals. D. It can be used for performance evaluation.

E. All of the above

5. The difference between the split cost and the standard cost for direct materials is called the: A. Materials Price Variance

B. Materials Efficiency Variance C. Materials Usage Variance

D. Materials Budget Variance