Costing Archives - MCQ and Quiz for Exams

1. An implementation of activity based costing would be possible only if accountants find

goodness of each activity

handling of each activity

cost driver for each activity

cost object for each activity

Detailed SolutionAn implementation of activity based costing would be possible only if accountants find

2. Stock verification sheets are maintained to record the results of . . . . . . . .

physical verification

financial control

financial verification

quality verification

Detailed SolutionStock verification sheets are maintained to record the results of . . . . . . . .

3. Material price variance = Actual usage (. . . . . . . .)

Standard price

Standard unit price - actual unit price

Actual price

Standard usage

Detailed SolutionMaterial price variance = Actual usage (. . . . . . . .)

4. If percentage of overall gross margin is 15 and final sales value of whole production is $20000, then gross margin (in dollars) will be

$30,000

$300,000

$40,000

$400,000

Detailed SolutionIf percentage of overall gross margin is 15 and final sales value of whole production is $20000, then gross margin (in dollars) will be

5. Perpetual inventory system involves __________

bincard and stores ledger

bill of material and material requisition

purchase requisition and purchase order

inward and outward invoices

Detailed SolutionPerpetual inventory system involves __________

6. Costing, which explains how and when scrap affects operating income of company is classified as

inventory costing

conversion costing

normal scrap costing

abnormal scrap costing

Detailed SolutionCosting, which explains how and when scrap affects operating income of company is classified as

7. Allotment of whole item of cost to a cost centre or cost unit is known as:

Cost Apportionment

Cost Allocation

Cost Absorption

Machine hour rate

Detailed SolutionAllotment of whole item of cost to a cost centre or cost unit is known as:

8. When prices are rising, the stock should be valued under:

FIFO method

LIFO method

General average method

Weighted average method

Detailed SolutionWhen prices are rising, the stock should be valued under:

9. If budgeted total direct labour hours are 3800 and budgeted direct labour cost is $480000, then budgeted direct labour cost rate will be

$126.32 per labour hour

$128.32 per labour hour

$130 per labour hour

$132 per labour hour

Detailed SolutionIf budgeted total direct labour hours are 3800 and budgeted direct labour cost is $480000, then budgeted direct labour cost rate will be

10. If the current ratio is 2 : 1 and working capital is Rs. 60,000. What is the value of the current assets?

Rs. 60,000

Rs. 1,00,000

Rs. 1,20,000

Rs. 1,80,000

Detailed SolutionIf the current ratio is 2 : 1 and working capital is Rs. 60,000. What is the value of the current assets?

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