Costing Archives - MCQ and Quiz for Exams

1. Under absorption of overhead expenses in cost accounting results in _________.

decrease in costing profit

decrease in financial accounts profit

increase in costing profit

increase in financial accounts profit

Detailed SolutionUnder absorption of overhead expenses in cost accounting results in _________.

2. Which is the best measurement by the centre’s for the contribution of a profit centre to the overall profitability of the business in the long-run?

Taxable income

Contribution margin

Performance margin

Responsibility margin

Detailed SolutionWhich is the best measurement by the centre’s for the contribution of a profit centre to the overall profitability of the business in the long-run?

3. . . . . . . . . costs are partly fixed and partly variable in relation to output:

Indirect

Prime

Works

Advertisement E. Semi-variable

Detailed Solution. . . . . . . . costs are partly fixed and partly variable in relation to output:

4. Overhead refers to:

Direct or Prime Cost

All Indirect costs

only Factory indirect costs

Only indirect expenses

Detailed SolutionOverhead refers to:

5. Labour cost variance is the difference between standard cost of labour and . . . . . . . .

Budgeted cost of labour

Estimated cost of labour

Actual cost of labour

None of these

Detailed SolutionLabour cost variance is the difference between standard cost of labour and . . . . . . . .

6. Purchase order lead time is multiplied to number of units is sold per unit of time to calculate

carrying costs

relevant total costs

economic order quantity

reorder point

Detailed SolutionPurchase order lead time is multiplied to number of units is sold per unit of time to calculate

7. An expected future revenue, which diverges in unconventional course of action is classified as

partial revenue

total revenue

relevant revenues

irrelevant revenues

Detailed SolutionAn expected future revenue, which diverges in unconventional course of action is classified as

8. Material usage variance is computed by:

SQ - AQ

AQ/SQ

(SQ - AQ) Ã SP

SP Ã AQ

Detailed SolutionMaterial usage variance is computed by:

9. Model which refers possibility for management to conduct sensitivity analysis can be categorized under

investment planning models

financial planning models

cost planning models

revenues forecast models

Detailed SolutionModel which refers possibility for management to conduct sensitivity analysis can be categorized under

10. Material losses due to abnormal reasons should be transferred to . . . . . . . . . .

Profit and loss account

Costing Profit and Loss Account

Trading Account

None of these

Detailed SolutionMaterial losses due to abnormal reasons should be transferred to . . . . . . . . . .

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