Costing Archives - Page 3 of 116 - MCQ and Quiz for Exams

21. Chances of cost to be considered as variable are more, if the

time horizons are long

time horizons are short

time horizons are irrelevant

time horizons are relevant

Detailed SolutionChances of cost to be considered as variable are more, if the

22. The stores keeper should initiate a purchase requisition when stock reaches ________.

Average stock level

Minimum stock level

Maximum stock level

Re-order level

Detailed SolutionThe stores keeper should initiate a purchase requisition when stock reaches ________.

23. Relevant incremental costs are added into relevant opportunity cost of capital to calculate

purchase order costs

relevant inventory carrying costs

irrelevant inventory carrying costs

relevant ordering costs

Detailed SolutionRelevant incremental costs are added into relevant opportunity cost of capital to calculate

24. Consider the following statements. 1. Marginal costing and absorption costing are the same. 2. For decision-making, absorption costing is more suitable than marginal costing. 3. Marginal costing is based on the distinction between fixed and variable costs. Which of the statement(s) given above is/are correct?

Both 1 and 2

Both 2 and 3

Both 1 and 3

None of these

Detailed SolutionConsider the following statements. 1. Marginal costing and absorption costing are the same. 2. For decision-making, absorption costing is more suitable than marginal costing. 3. Marginal costing is based on the distinction between fixed and variable costs. Which of the statement(s) given above is/are correct?

25. The statement prepared under process costing is called

cost of goods sold statement

income statement

cost of production report

variance statement

Detailed SolutionThe statement prepared under process costing is called

26. Cost accounting was developed because of the _________.

limitations of the financial accounting

limitations of the management accounting

limitations of the human resource accounting

limitations of the double entry accounting

Detailed SolutionCost accounting was developed because of the _________.

27. A document which provides for the detailed cost centre and cost unit is _______.

tender

cost sheet

invoice

profit statement

Detailed SolutionA document which provides for the detailed cost centre and cost unit is _______.

28. Why is cash budget prepared?

It helps in cash management

It helps in preparing balance sheet

It is legally compulsory

Both A and C

Detailed SolutionWhy is cash budget prepared?

29. The process of setting standards and comparing actual performance with standards with a view to control the cost is ________.

cost reduction

cost control

cost allocation

cost ascertainment

Detailed SolutionThe process of setting standards and comparing actual performance with standards with a view to control the cost is ________.

30. Volume Variance =

Standard rate (Actual output - budgeted output)

Actual output Ã standard rate - budgeted fixed overheads

Standard rate per hour (Standard hours produced - actual hours)

All of the above

Detailed SolutionVolume Variance =

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