Costing

21. In case of rising prices (inflation), LIFO will:

provide lowest value of closing stock and profit
provide highest value of closing stock and profit
provide highest value of closing stock but lowest value of profit
provide highest value of profit but lowest value of closing stock

Detailed SolutionIn case of rising prices (inflation), LIFO will:

22. A company manufactures a single product for which cost and selling price data are as follows: Selling price per unit – Rs 12 Variable cost per unit – Rs 8 Fixed cost for a period – Rs 98,000 Budgeted sales for a period – 30,000 units The margin of safety, expressed as a percentage of budgeted sales,is:

20%
25%
73%
125%

Detailed SolutionA company manufactures a single product for which cost and selling price data are as follows: Selling price per unit – Rs 12 Variable cost per unit – Rs 8 Fixed cost for a period – Rs 98,000 Budgeted sales for a period – 30,000 units The margin of safety, expressed as a percentage of budgeted sales,is:

23. Match the items of List-I with those of List-II and indicate the correct answer List-I List-II a. Acid test ratio 1. Profitability analysis b. Debt service coverage ratio 2. Activity analysis c. Debt equity ratio 3. Liquidity analysis d. Stock turnover ratio 4. Long-term solvency analysis

a-2, b-1, c-3, d-4
a-2, c-3, c-4, d-1
a-3, b-4, c-1, d-2
a-3, b-1, c-4, d-2

Detailed SolutionMatch the items of List-I with those of List-II and indicate the correct answer List-I List-II a. Acid test ratio 1. Profitability analysis b. Debt service coverage ratio 2. Activity analysis c. Debt equity ratio 3. Liquidity analysis d. Stock turnover ratio 4. Long-term solvency analysis

24. Room/day is the cost unit used in . . . . . . . .

hotels
hospitals
schools
None of these

Detailed SolutionRoom/day is the cost unit used in . . . . . . . .

25. An opportunity cost is . . . . . . . .

the advantage foregone
the cost
the income
None of the above

Detailed SolutionAn opportunity cost is . . . . . . . .

26. Period cost, which consists income statement of manufacturing companies belongs to

inventory costs
product costs
non-manufacturing costs
manufacturing costs

Detailed SolutionPeriod cost, which consists income statement of manufacturing companies belongs to

27. In accounting, resources sacrifice for achieving or fulfil specific objective is known as

source cost
sacrifice cost
treated cost
cost

Detailed SolutionIn accounting, resources sacrifice for achieving or fulfil specific objective is known as

28. If units of normal spoilage are 150 and total good units manufactured are 1500, then normal spoilage rate would be

14.00%
15.00%
10.00%
12.00%

Detailed SolutionIf units of normal spoilage are 150 and total good units manufactured are 1500, then normal spoilage rate would be

29. The sum of prime cost and factory overheads is known as which of the following form?

Factory cost
Production cost
Total cost
None of these

Detailed SolutionThe sum of prime cost and factory overheads is known as which of the following form?

30. Audit fess is a part of _______.

works on cost
selling overhead
distribution overhead
administration overhead

Detailed SolutionAudit fess is a part of _______.

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