Costing

31. Last step in developing operating budget is

implementing income
implementing decision
efficient implementation
effective implementation

Detailed SolutionLast step in developing operating budget is

32. Bin card is maintained by ________.

costing department
stores department
finance department
accounting department

Detailed SolutionBin card is maintained by ________.

33. “S produces and sells one product, P, for which the data are as follows: Selling price Rs 28 Variable cost Rs 16 Fixed cost Rs 4 The fixed costs are based on a budgeted production and sales level of 25,000 units for the next period. Due to market changes both the selling price and the variable cost are expected to increase above the budgeted level in the next period. If the selling price and variable cost per unit increase by 10% and 8% respectively, by how much must sales volume change, compared with the original budgeted level, in order to achieve the original budgeted profit for the period?”

10.1% decrease
11.2% decrease
13.3% decrease
16.0% decrease

Detailed Solution“S produces and sells one product, P, for which the data are as follows: Selling price Rs 28 Variable cost Rs 16 Fixed cost Rs 4 The fixed costs are based on a budgeted production and sales level of 25,000 units for the next period. Due to market changes both the selling price and the variable cost are expected to increase above the budgeted level in the next period. If the selling price and variable cost per unit increase by 10% and 8% respectively, by how much must sales volume change, compared with the original budgeted level, in order to achieve the original budgeted profit for the period?”

34. Product which requires low amount of resources, but incur high per unit cost is classified as

expected under cost
expected over cost
product under costing
product over costing

Detailed SolutionProduct which requires low amount of resources, but incur high per unit cost is classified as

35. The process of redistribution of service department costs to production departments is ________.

departmentalization
primary distribution
secondary distribution
classification

Detailed SolutionThe process of redistribution of service department costs to production departments is ________.

36. . . . . . . . . is the most suitable method in a transport industry.

Operation costing
Service costing
Process costing
Job costing

Detailed Solution. . . . . . . . is the most suitable method in a transport industry.

37. Formula of 1 – unexplained variation / total variation is used to calculate

coefficient of determination
coefficient of index
coefficient of residual
coefficient of prediction

Detailed SolutionFormula of 1 – unexplained variation / total variation is used to calculate

38. Material or anything for which cost is to be measured is known as

measurement object
cost object
accounting object
budget object

Detailed SolutionMaterial or anything for which cost is to be measured is known as

39. AT Co makes a single product and is preparing its material usage budget for next year Each unit of product requires 2kg of material, and 5,000 units of product are to be produced next year Opening inventory of material is budgeted to be 800 kg and AT co budgets to increase material inventory at the end of next year by 20%. The material usage budget for next year is

8,000 Kg
9,840 kg
10,000 Kg
10,160 Kg

Detailed SolutionAT Co makes a single product and is preparing its material usage budget for next year Each unit of product requires 2kg of material, and 5,000 units of product are to be produced next year Opening inventory of material is budgeted to be 800 kg and AT co budgets to increase material inventory at the end of next year by 20%. The material usage budget for next year is

40. In quantitative analysis of estimating cost function, last and foremost step is to

evaluate variable driver
evaluate cost driver
evaluate price driver
evaluate demand driver

Detailed SolutionIn quantitative analysis of estimating cost function, last and foremost step is to

Page 1Page 2Page 3Page 4Page 5
Test 1Test 2Test 3Test 4Test 5Test 6Test 7Test 8Test 9Test 10Test 11Test 12Test 13Test 14Test 15Test 16Test 17Test 18Test 19Test 20Test 21Test 22Test 23Test 24