Management Accounting For 10th Grade Quiz

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Management Accounting For 10th Grade Quiz - Quiz

Management accounting involves preparing timely and accurate managerial reports and accounts that help managers to make day to day decisions about the operations of a business. Having covered the basics in class you should be able to answer the quiz below with ease. Give it a try and keep revising!


Questions and Answers
  • 1. 

     Which of the following components are part of SAP CO? (4 correct answers)

    • A.

      Cost Center Accounting

    • B.

      Maintenance Orders

    • C.

      Product Cost Controlling

    • D.

      Cost Element Accounting

    • E.

      Activity Based Costing

    • F.

      Profit Center Accounting

    Correct Answer(s)
    A. Cost Center Accounting
    C. Product Cost Controlling
    D. Cost Element Accounting
    E. Activity Based Costing
    Explanation
    The correct answers are Cost Center Accounting, Product Cost Controlling, Cost Element Accounting, and Activity Based Costing. These components are part of SAP CO, which is the module in SAP that deals with controlling and managing costs within an organization. Cost Center Accounting involves tracking and analyzing costs by cost center. Product Cost Controlling focuses on calculating and analyzing the costs associated with producing a product. Cost Element Accounting tracks and analyzes costs by cost elements such as material costs or labor costs. Activity Based Costing assigns costs to specific activities or processes based on their consumption of resources. Profit Center Accounting, Maintenance Orders are not part of SAP CO.

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  • 2. 

    Which of the following organizational units belong to SAP CO? (3 correct answers) 

    • A.

      Controlling Area

    • B.

      Company Code

    • C.

      Business Area

    • D.

      Operating Concern

    • E.

      Plant

    • F.

      Purchasing Organization

    • G.

      Cost Center

    • H.

      Sales organization

    Correct Answer(s)
    A. Controlling Area
    D. Operating Concern
    G. Cost Center
    Explanation
    The correct answer is Controlling Area, Operating Concern, and Cost Center. These three organizational units are part of SAP CO. The Controlling Area is responsible for managing and controlling costs and revenues. The Operating Concern is used for profitability analysis and reporting. The Cost Center is a unit within the organization where costs are incurred and monitored. These units are essential for financial and managerial accounting in SAP CO.

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  • 3. 

     A controlling area is the basic organizational unit in Management Accounting. A controlling area represents a closed entity for cost accounting. Which of the following statements are true regarding controlling areas in SAP ERP? (2 correct answers)

    • A.

      Costs can only be allocated within a controlling area.

    • B.

      You can allocate costs between cost centers that do not belong to the same controlling area. Therefore, you must use the cross-controlling area allocation.

    • C.

      You can assign several company codes to a controlling area, which allows for cross-company code controlling.

    • D.

      To allow for a cross-company code allocation of costs, the controlling area and the company codes assigned must have the same country-specific chart of accounts and the same fiscal year variant.

    • E.

      You can assign several operating concerns to one controlling area.

    Correct Answer(s)
    A. Costs can only be allocated within a controlling area.
    C. You can assign several company codes to a controlling area, which allows for cross-company code controlling.
    Explanation
    The first statement is true because costs can only be allocated within a controlling area. The second statement is also true because you can assign several company codes to a controlling area, which allows for cross-company code controlling.

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  • 4. 

     Which of the following master data are part of SAP CO? (4 correct answers)

    • A.

      Cost Elements

    • B.

      Work Centers

    • C.

      Profitability Segments

    • D.

      Cost Centers

    • E.

      Internal Orders

    • F.

      Activity Types

    • G.

      Statistical Key Figures

    Correct Answer(s)
    A. Cost Elements
    D. Cost Centers
    F. Activity Types
    G. Statistical Key Figures
  • 5. 

     Cost Elements are classifications of the organization's valuated consumption of product factors within a controlling area. Which of the following statements are true regarding cost elements? (5 correct answers)

    • A.

      Primary Cost Elements are cost elements whose costs originate outside of SAP CO.

    • B.

      Secondary Cost Elements are cost elements that are used to allocate costs for internal activities.

    • C.

      Each primary cost element corresponds to an account in a chart of accounts.

    • D.

      Each secondary cost element corresponds to an account in a chart of accounts.

    • E.

      When creating primary cost elements, you must also create a general ledger account with the same number in the chart of accounts in SAP FI.

    • F.

      When creating secondary cost elements, you must also create a general ledger account with the same number in the chart of accounts in FI.

    • G.

      Each revenue element corresponds to an account in a chart of accounts.

    Correct Answer(s)
    A. Primary Cost Elements are cost elements whose costs originate outside of SAP CO.
    B. Secondary Cost Elements are cost elements that are used to allocate costs for internal activities.
    C. Each primary cost element corresponds to an account in a chart of accounts.
    E. When creating primary cost elements, you must also create a general ledger account with the same number in the chart of accounts in SAP FI.
    G. Each revenue element corresponds to an account in a chart of accounts.
    Explanation
    Primary Cost Elements are cost elements whose costs originate outside of SAP CO. This means that the costs associated with these elements are not directly incurred within the SAP CO module, but rather come from external sources.

    Secondary Cost Elements, on the other hand, are used to allocate costs for internal activities. These elements are used to distribute costs among different cost centers or internal orders within the organization.

    Each primary and secondary cost element corresponds to an account in a chart of accounts. This means that there is a direct mapping between the cost elements and the accounts in the chart of accounts, allowing for easy tracking and reporting of costs.

    When creating primary cost elements, it is necessary to also create a general ledger account with the same number in the chart of accounts in SAP FI. This ensures that the costs associated with the primary cost elements are properly recorded in the financial accounting module.

    Finally, each revenue element corresponds to an account in a chart of accounts. This allows for tracking and reporting of revenue generated by the organization.

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  • 6. 

     An activity type is a unit in SAP CO that classifies the activities performed in a cost center. Which of the following statements are true regarding activity types in SAP CO? (2 correct answers)

    • A.

      You can allocate activities manually using direct activity allocation.

    • B.

      You can assign multiple activity types to one cost center.

    • C.

      You can assign the same activity type to different cost centers.

    • D.

      Activity types are defined on company code level.

    • E.

      You can assign a planned price for one unit of an activity only manually.

    Correct Answer(s)
    A. You can allocate activities manually using direct activity allocation.
    B. You can assign multiple activity types to one cost center.
    Explanation
    The first statement is true because you can allocate activities manually using direct activity allocation in SAP CO. The second statement is also true because you can assign multiple activity types to one cost center in SAP CO.

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  • 7. 

     Which of the following master data groups exist in SAP CO? (3 correct answers)

    • A.

      Cost Element Group

    • B.

      Profitability Group

    • C.

      Cost Center Standard Hierarchy

    • D.

      Activity Type Group

    • E.

      Statistics Group

    Correct Answer(s)
    A. Cost Element Group
    C. Cost Center Standard Hierarchy
    D. Activity Type Group
    Explanation
    The correct answer is Cost Element Group, Cost Center Standard Hierarchy, and Activity Type Group. These three master data groups exist in SAP CO. The Cost Element Group is used to classify cost elements according to various criteria. The Cost Center Standard Hierarchy is a hierarchical structure that represents the organizational structure of cost centers. The Activity Type Group is used to group activity types according to specific criteria. These master data groups are important for organizing and analyzing cost-related data in SAP CO.

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  • 8. 

     The main focus of SAP CO is to allocate costs in a company to chose company units that produce costs by consuming resources. To plan ahead and execute these cost allocations, SAP provides several allocation methods. Which of the following statements are true regarding direct and indirect allocation methods in SAP CO? (2 correct answers)

    • A.

      An Assessment is an indirect allocation method that is carried out for allocating primary and secondary costs from a sender cost center to receiver controlling objects. Thereby, only cost centers or business processes can serve as sender of the costs.

    • B.

      An Assessment uses secondary cost elements category 43 to allocate costs.

    • C.

      Direct Activity allocation is a transaction based method for allocating costs between a sender and receivers directly by using activity types as tracing factor.

    • D.

      Direct and Manual Cost Allocation can be used to plan costs ahead.

    • E.

      The Direct Cost Allocation credits the sender cost center and debits the receiver controlling objects by using a secondary cost element with category 42.

    Correct Answer(s)
    A. An Assessment is an indirect allocation method that is carried out for allocating primary and secondary costs from a sender cost center to receiver controlling objects. Thereby, only cost centers or business processes can serve as sender of the costs.
    C. Direct Activity allocation is a transaction based method for allocating costs between a sender and receivers directly by using activity types as tracing factor.
    Explanation
    The given answer is correct because it accurately identifies two true statements about direct and indirect allocation methods in SAP CO. The first statement explains that an Assessment is an indirect allocation method used to allocate primary and secondary costs from a sender cost center to receiver controlling objects, and only cost centers or business processes can serve as senders of the costs. The second statement states that Direct Activity allocation is a transaction-based method for allocating costs directly between a sender and receivers using activity types as a tracing factor.

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  • 9. 

     SAP FI and SAP CO are highly integrated. Which of the following statements are true regarding postings in SAP CO and SAP FI? (1 correct answer)

    • A.

      Postings to a general ledger account in SAP FI lead to a corresponding posting in SAP CO, if a primary cost element is involved.

    • B.

      Postings to a general ledger account in SAP FI lead to a corresponding posting in SAP CO, if a secondary cost element is involved.

    • C.

      You pay an employee wages and therefore credit the P&L account for wages and credit the balance sheet bank account. This posting immediately debits the controlling object using the corresponding primary cost element with the same number as the general ledger accounting. The corresponding credit posting in SAP CO is posted to an allocation cost element.

    Correct Answer
    A. Postings to a general ledger account in SAP FI lead to a corresponding posting in SAP CO, if a primary cost element is involved.
    Explanation
    When a posting is made to a general ledger account in SAP FI, it will result in a corresponding posting in SAP CO only if a primary cost element is involved. This means that the posting will be recorded in both the financial accounting module (FI) and the controlling module (CO) of SAP. The use of a primary cost element ensures that the posting is properly allocated and tracked in both modules.

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  • 10. 

     SAP MM and SAP CO are highly integrated. Goods issues that are posted in materials management can be assigned to a cost center. From a cost center point of view, this procedure is referred to as material consumption. Which of the following statements are true regarding this posting? (2 correct answers)

    • A.

      The combination of material number and movement type determines which inventory and cost accounts are affected.

    • B.

      A goods issue to a cost center initiates a transaction in financial accounting resulting in debit posting to a material consumption expense account and a credit posting to a material stock account.

    • C.

      The cost center is debited by the amount of the goods issue by using a secondary cost element.

    • D.

      There is no posting in Financial Accounting, if the material is not a stock material.

    Correct Answer(s)
    A. The combination of material number and movement type determines which inventory and cost accounts are affected.
    B. A goods issue to a cost center initiates a transaction in financial accounting resulting in debit posting to a material consumption expense account and a credit posting to a material stock account.
    Explanation
    The combination of material number and movement type determines which inventory and cost accounts are affected. A goods issue to a cost center initiates a transaction in financial accounting resulting in debit posting to a material consumption expense account and a credit posting to a material stock account.

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  • 11. 

     Internal orders can be used for many different purposes. Internal order types in SAP CO are... (3 correct answers)

    • A.

      Overhead orders

    • B.

      Investment orders

    • C.

      Orders with expenses

    • D.

      Controlling Orders

    • E.

      Accrual orders

    • F.

      Cost collector orders

    Correct Answer(s)
    A. Overhead orders
    B. Investment orders
    E. Accrual orders
    Explanation
    Internal orders in SAP CO can be used for various purposes. Overhead orders are used to allocate and monitor overhead costs. Investment orders are used to track and control costs related to capital investments. Accrual orders are used to track expenses that are not immediately paid but will be settled in the future. These three types of internal orders serve different functions in controlling and managing costs within an organization.

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  • 12. 

     Cost planning is usually carried out for orders with a long life cycle. There are three cost planning levels for planning internal orders. Those are... (3 correct answers)

    • A.

      Internal Planning

    • B.

      Primary/secondary cost and revenue planning

    • C.

      Cost center planning

    • D.

      Overall planning

    • E.

      Unit costing

    Correct Answer(s)
    B. Primary/secondary cost and revenue planning
    D. Overall planning
    E. Unit costing
    Explanation
    Cost planning is an important aspect for orders with a long life cycle as it helps in determining the costs and revenues associated with the order. The three cost planning levels for planning internal orders include primary/secondary cost and revenue planning, overall planning, and unit costing. Primary/secondary cost and revenue planning involves estimating the costs and revenues associated with the order at a detailed level. Overall planning involves considering the overall costs and revenues for the order. Unit costing involves determining the cost per unit for the order. These three levels of cost planning help in effectively managing and controlling the costs associated with the order.

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  • 13. 

     Internal orders serve as interim cost collector and as an aid to plan, monitor and report. When an order is completed, the costs of the internal order must be settled. Which of the following statements are true regarding settling internal orders? (2 correct answers)

    • A.

      Settlement of costs is controlled by the settlement rule defined in the master data of the involved cost element.

    • B.

      The Settlement of costs always is involves a secondary cost element.

    • C.

      The Settlement of costs always is involves a primary cost element.

    • D.

      Internal orders can be settled to other controlling objects only.

    • E.

      A settlement rule establishes the sender and receiver relationships as well as how much each receiver will receive during settlement.

    Correct Answer(s)
    B. The Settlement of costs always is involves a secondary cost element.
    E. A settlement rule establishes the sender and receiver relationships as well as how much each receiver will receive during settlement.
    Explanation
    The settlement of costs for internal orders always involves a secondary cost element, which is a cost element specifically used for settling costs. Additionally, a settlement rule is used to establish the sender and receiver relationships during settlement, determining how much each receiver will receive. This rule plays a crucial role in the process of settling internal orders.

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  • 14. 

     Which of the following statements are true regarding Profit Center Accounting? (2 correct answers)

    • A.

      A profit center is an organizational unit in accounting and reflects a management-oriented structure of the organization for the purpose of external control.

    • B.

      Cost centers can be assigned to profit centers. This assignment is made in the master data of the profit center.

    • C.

      A profit center can belong to only one controlling area.

    • D.

      When Profit Center Accounting is active, controlling objects are assigned to a profit center. This assignment causes the system to generate a statistical posting in EC-PCA to the corresponding profit center for each debit or credit posting.

    • E.

      When Profit Center Accounting is active, controlling objects are assigned to a profit center. This assignment causes the system to generate a real posting in EC-PCA to the corresponding profit center for each debit or credit posting.

    Correct Answer(s)
    C. A profit center can belong to only one controlling area.
    D. When Profit Center Accounting is active, controlling objects are assigned to a profit center. This assignment causes the system to generate a statistical posting in EC-PCA to the corresponding profit center for each debit or credit posting.
    Explanation
    Profit Center Accounting allows for the creation of profit centers, which are organizational units that reflect the management structure of the organization. A profit center can belong to only one controlling area, which helps in maintaining control and accountability. When Profit Center Accounting is active, controlling objects are assigned to a profit center, resulting in the generation of statistical postings in EC-PCA for each debit or credit posting. This helps in analyzing and evaluating the profitability of each profit center. However, real postings are not generated in EC-PCA for each debit or credit posting.

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  • 15. 

    Which of the following statements are true regarding profit centers? (3 correct answers) 

    • A.

      Profit centers can be used as a dimension for financial statements.

    • B.

      Profit centers act as cost collectors similar to cost centers.

    • C.

      Profit centers can allocate costs to other controlling objects.

    • D.

      Profit centers can be assigned to cost centers.

    • E.

      Profit centers cannot be receiver of real postings.

    • F.

      Profit centers cannot only receive statistical postings.

    Correct Answer(s)
    A. Profit centers can be used as a dimension for financial statements.
    D. Profit centers can be assigned to cost centers.
    E. Profit centers cannot be receiver of real postings.
    Explanation
    Profit centers can be used as a dimension for financial statements because they represent a specific area of a business that generates profit or incurs costs. They act as cost collectors similar to cost centers, meaning they track and accumulate costs related to their specific area. Profit centers can allocate costs to other controlling objects, such as cost centers, to accurately reflect the expenses incurred. However, profit centers cannot be receivers of real postings, meaning they cannot directly receive financial transactions. They can only receive statistical postings, which are non-monetary transactions used for analysis and reporting purposes.

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  • 16. 

     Profitability Analysis is an application in Management Accounting and provides two forms of profitability reporting: costing-based and account-based. Which of the following statements are true regarding these two types of reporting? (3 correct answers)

    • A.

      Costing-based Profitability Analysis has reports that display values by value field.

    • B.

      Account-based Profitability Analysis reconciles directly with Financial Accounting at account level.

    • C.

      Costing-based Profitability Analaysis posts revenues when the billing document is created, but updates cost of sales at the point of goods issue.

    • D.

      Account-based Profitability Analysis produces revenues and cost of sales simultaneously when the billing document is calculated.

    • E.

      Account-based Profitability Analysis has reports that display values by cost elements and revenue element.

    Correct Answer(s)
    A. Costing-based Profitability Analysis has reports that display values by value field.
    B. Account-based Profitability Analysis reconciles directly with Financial Accounting at account level.
    E. Account-based Profitability Analysis has reports that display values by cost elements and revenue element.
    Explanation
    Costing-based Profitability Analysis displays values by value field, while Account-based Profitability Analysis displays values by cost elements and revenue element. Account-based Profitability Analysis also reconciles directly with Financial Accounting at the account level.

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  • 17. 

    Profitability segments are the most important structure in Profitability Analysis. Which of the following elements are used within profitability segments? (3 correct answers) 

    • A.

      Characteristic values

    • B.

      Key values

    • C.

      Value fields

    • D.

      Key fields

    • E.

      Characteristics

    Correct Answer(s)
    A. Characteristic values
    C. Value fields
    E. Characteristics
    Explanation
    Profitability segments in Profitability Analysis use characteristic values, value fields, and characteristics. Characteristic values represent the different attributes or dimensions that are used to analyze profitability. Value fields are used to store the actual values of the profitability measures. Characteristics are the attributes or dimensions that are used to define the profitability segments. Key values and key fields are not used within profitability segments.

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  • 18. 

     In Product Cost Controlling you estimate material prices. Which of the following statements are true regarding Product Cost Controlling? (3 correct answers)

    • A.

      Marking a price estimate leads to an update of the current price in the material master.

    • B.

      Releasing a price estimate leads to an update of the future price in the material master.

    • C.

      For marking a price estimate the cost estimate must be free of errors and marking of the price estimate must be allowed for the particular company code, the period and the particular valuation variant.

    • D.

      A standard cost estimate can only be released once a period.

    • E.

      The price estimation procedure uses the routing and the BOM of a material to estimate the costs of production of one unit of the material.

    Correct Answer(s)
    C. For marking a price estimate the cost estimate must be free of errors and marking of the price estimate must be allowed for the particular company code, the period and the particular valuation variant.
    D. A standard cost estimate can only be released once a period.
    E. The price estimation procedure uses the routing and the BOM of a material to estimate the costs of production of one unit of the material.
    Explanation
    Marking a price estimate requires that the cost estimate is error-free and that marking of the price estimate is allowed for the specific company code, period, and valuation variant. A standard cost estimate can only be released once per period. The price estimation procedure utilizes the routing and the BOM of a material to estimate the production costs of one unit of the material.

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  • 19. 

     Which of the following statements are true for operating concern? An operating concern... (2 correct answers)

    • A.

      ... can display information for several costing areas.

    • B.

      ... controls profitability analysis (CO-PA) and represents the structure of the external market segments of a company.

    • C.

      ... is an organizational structure in CO, which supports profit-center-accounting.

    • D.

      ... is an organizational structure in CO, which supports profitability analysis (CO-PA).

    Correct Answer(s)
    B. ... controls profitability analysis (CO-PA) and represents the structure of the external market segments of a company.
    D. ... is an organizational structure in CO, which supports profitability analysis (CO-PA).
    Explanation
    The operating concern controls profitability analysis (CO-PA) and represents the structure of the external market segments of a company. It is an organizational structure in CO that supports profitability analysis (CO-PA). This means that it is responsible for managing and analyzing the company's profitability and market segments. It is not related to costing areas or profit-center-accounting.

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  • 20. 

     Which cost elements are used to allocate costs via cost allocation from sender to receiver? (1 correct answer)

    • A.

      Secondary cost elements

    • B.

      General ledger accounts

    • C.

      Primary cost elements

    • D.

      Accrual cost elements

    Correct Answer
    A. Secondary cost elements
    Explanation
    Secondary cost elements are used to allocate costs via cost allocation from sender to receiver.

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  • 21. 

     Which of the following statements is true for posting logic in FI and CO? (2 correct answers)

    • A.

      Statistical postings are used for information purposes and are usually used in analyses.

    • B.

      Documents in FI and CO have the same document number.

    • C.

      A reposting of primary costs in CO leads to archiving of the original FI-document/post.

    • D.

      A "real" cost object can be displayed in the line item position of the corresponding FI document.

    Correct Answer(s)
    A. Statistical postings are used for information purposes and are usually used in analyses.
    D. A "real" cost object can be displayed in the line item position of the corresponding FI document.
    Explanation
    Statistical postings are used for information purposes and are usually used in analyses. This means that these postings do not have any financial impact but are used to gather data for reporting and analysis purposes. On the other hand, a "real" cost object can be displayed in the line item position of the corresponding FI document. This means that when a cost object is posted in CO, it can be reflected in the corresponding FI document, allowing for better tracking and analysis of costs.

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  • 22. 

    Which of the following master data is defined in cost center accounting? (2 correct answers) 

    • A.

      Standard hierarchy

    • B.

      Activity data

    • C.

      Profit centers

    • D.

      Statistical key figures

    • E.

      Internal orders

    Correct Answer(s)
    A. Standard hierarchy
    D. Statistical key figures
    Explanation
    In cost center accounting, the standard hierarchy is defined to organize and structure the cost centers. It provides a hierarchical view of the cost centers, allowing for easier analysis and reporting. Statistical key figures are also defined in cost center accounting to capture and track non-monetary data, such as headcount or production volumes, which can be used for analysis and allocation purposes.

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  • 23. 

     Which of the following statements are true for Profit Centers? A Profit Center ... (2 correct answers)

    • A.

      ... assigns costs to cost centers and profitability segments.

    • B.

      ... are real cost objects.

    • C.

      ... are used to determine profitability of areas of responsibility in a company.

    • D.

      ... can be stated in the balance sheet and profit & loss statement.

    Correct Answer(s)
    C. ... are used to determine profitability of areas of responsibility in a company.
    D. ... can be stated in the balance sheet and profit & loss statement.
    Explanation
    Profit Centers are used to determine the profitability of areas of responsibility in a company. This means that they are used to analyze and evaluate the financial performance of specific departments or divisions within the organization. Additionally, profit centers can be stated in the balance sheet and profit & loss statement, which means that their financial results are included in these financial statements.

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  • 24. 

    In product cost accounting product cost estimates are carried out. What is determined with a product cost estimate? (1 correct answer) 

    • A.

      General material cost

    • B.

      Estimate lot size for a material.

    • C.

      Actual costs of a material

    Correct Answer
    C. Actual costs of a material
    Explanation
    A product cost estimate determines the actual costs of a material in product cost accounting. It helps in calculating the precise expenses incurred in acquiring the material for production. By determining the actual costs, businesses can accurately assess the cost of producing a product and make informed decisions regarding pricing, profitability, and cost control measures.

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  • 25. 

    What is the main characteristic of secondary cost elements in CO? (1 correct answer) 

    • A.

      They are used in FI to transfer values to CO.

    • B.

      They are defined in FI chart of accounts.

    • C.

      They support assignment of material stock accounts in CO.

    • D.

      They are used in CO for company-internal transfers (e.g. assessments or settlements) between CO-objects.

    Correct Answer
    D. They are used in CO for company-internal transfers (e.g. assessments or settlements) between CO-objects.
    Explanation
    Secondary cost elements in CO are used for company-internal transfers between CO-objects, such as assessments or settlements. They are not used in FI to transfer values to CO, defined in FI chart of accounts, or support assignment of material stock accounts in CO.

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  • 26. 

    Which of the following fields are required to create a cost center in management accounting (CO)? (2 correct answers) 

    • A.

      User responsible

    • B.

      Description

    • C.

      Hierarchy area

    • D.

      Company code

    Correct Answer(s)
    C. Hierarchy area
    D. Company code
    Explanation
    To create a cost center in management accounting (CO), the two required fields are hierarchy area and company code. The hierarchy area is necessary to define the organizational structure and grouping of cost centers, while the company code is needed to assign the cost center to a specific company within the organization. The user responsible and description fields are not mandatory for creating a cost center.

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  • 27. 

    Which of the following management accounting (CO) components requires an operating concern? (1 correct answer) 

    • A.

      Product Cost Accounting

    • B.

      Profit Center Accounting

    • C.

      Overhead Cost Controlling

    • D.

      Profitability Analysis

    Correct Answer
    D. Profitability Analysis
    Explanation
    Profitability Analysis is a management accounting component that requires an operating concern. An operating concern is a key organizational unit in SAP that represents a company's main area of business. It is used to analyze and evaluate profitability based on various dimensions such as product, customer, and market segment. Profitability Analysis provides insights into the profitability of different aspects of the business and helps in making informed decisions regarding pricing, product mix, and resource allocation. Therefore, it is essential to have an operating concern in place for conducting profitability analysis effectively.

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  • Current Version
  • Mar 21, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • Sep 27, 2011
    Quiz Created by
    Dbv_rulez
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