Costing

1. An estimated coefficient, which indicates degree by which estimated values are affected by random factors is known as

standard error of estimated coefficient
weighted error of estimated coefficient
average of estimated coefficient
variance of estimated coefficient

Detailed SolutionAn estimated coefficient, which indicates degree by which estimated values are affected by random factors is known as

2. Inflated price method of valuing material issues is suitable when . . . . . . . .

materials are subject to natural wastage
prices rise
prices fall
None of these

Detailed SolutionInflated price method of valuing material issues is suitable when . . . . . . . .

3. Product A requires 10 kg of material at the rate of Rs. 5 per kg. The actual consumption of material for the manufacturing of product A comes to 12 kg of material at the rate of Rs. 6 per kg. Direct material cost variance is

Rs. 22 (favourable)
Rs. 22 (unfavourable)
Rs. 12 (favourable)
Rs. 12 (unfavourable)

Detailed SolutionProduct A requires 10 kg of material at the rate of Rs. 5 per kg. The actual consumption of material for the manufacturing of product A comes to 12 kg of material at the rate of Rs. 6 per kg. Direct material cost variance is

4. “Calculate EOQ (approx) from the following details: Annual Consumption: 24000 units Ordering cost: Rs 10 per order Purchase price: Rs 100 per unit Carrying cost: 5%”

310
400
290
300

Detailed Solution“Calculate EOQ (approx) from the following details: Annual Consumption: 24000 units Ordering cost: Rs 10 per order Purchase price: Rs 100 per unit Carrying cost: 5%”

5. What are the current assets if the current ratio is 2.5, liquid ratio is 1.5, and the working capital is Rs. 60,000?

Rs. 60,000
Rs. 80,000
Rs. 1,00,000
Rs. 1,20,000

Detailed SolutionWhat are the current assets if the current ratio is 2.5, liquid ratio is 1.5, and the working capital is Rs. 60,000?

6. “For the financial year ended as on March 31, 20XX the figures extracted from the balance sheet of Xerox Limited as under: Opening Stock Rs 29,000; Purchases Rs 2,42,000; Sales Rs 3,20,000; Gross Profit 25% of Sales. Stock Turnover Ratio will be” :-

8 times
6 times
9 times
10 times

Detailed Solution“For the financial year ended as on March 31, 20XX the figures extracted from the balance sheet of Xerox Limited as under: Opening Stock Rs 29,000; Purchases Rs 2,42,000; Sales Rs 3,20,000; Gross Profit 25% of Sales. Stock Turnover Ratio will be” :-

7. In step cost functions, cost is increased by

discrete amounts
same amounts
linear amounts
nonlinear amounts

Detailed SolutionIn step cost functions, cost is increased by

8. Which inventory costing method is based on the assumption that costs should be charged against revenue in the order, in which they were incurred?

Perpetual inventory
LIFO
FIFO
Average cost

Detailed SolutionWhich inventory costing method is based on the assumption that costs should be charged against revenue in the order, in which they were incurred?

9. When partially completed units are converted to a comparable number of completed units, they are referred to as

split-off units
equivalent units
converted units
equitable units

Detailed SolutionWhen partially completed units are converted to a comparable number of completed units, they are referred to as

10. Work uncertified is ________.

debited to contract a/c
credited to contract a/c
debited to contractor a/c
debited to profit and loss a/c

Detailed SolutionWork uncertified is ________.

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