Costing

41. If sales revenue at 60% capacity is Rs. 4,50,000, sales revenue at 70% capacity on a fall in selling price by 5% would be?

Rs. 4,98,750
Rs. 7,50,000
Rs. 5,25,000
Rs. 7,12,500

Detailed SolutionIf sales revenue at 60% capacity is Rs. 4,50,000, sales revenue at 70% capacity on a fall in selling price by 5% would be?

42. The total of all direct expenses is known as . . . . . . . . cost.

prime
works
production
Both A and B

Detailed SolutionThe total of all direct expenses is known as . . . . . . . . cost.

43. Assertion (A) Break-even point can be determined both mathematically as well as graphically. Reason (R) When it is determined on a graph paper, the graph drawn is named as ‘break-even chart’.

(A) is true, but (R) is false
(A) is false, but (R) is true
Both (A) and (R) are true and (R) is the correct explanation of (A)
Both (A) and (R) are true, but (R) is not the correct explanation of (A)

Detailed SolutionAssertion (A) Break-even point can be determined both mathematically as well as graphically. Reason (R) When it is determined on a graph paper, the graph drawn is named as ‘break-even chart’.

44. Cost accounting provides data for managerial . . . . . . . .

decision making
recruitment
retrenchment
None of the above

Detailed SolutionCost accounting provides data for managerial . . . . . . . .

45. When actual loss is . . . . . . . . than the estimated loss, the difference between the two is considered to be abnormal loss.

more
less
Both A and B
None of these

Detailed SolutionWhen actual loss is . . . . . . . . than the estimated loss, the difference between the two is considered to be abnormal loss.

46. Expenditure over and above prime cost is known as ________.

overhead
factory cost
cost of sales
cost of production

Detailed SolutionExpenditure over and above prime cost is known as ________.

47. Compelling strategic plan, promoting coordination and providing framework of performance are

advantages of budget
disadvantages of budget
advantages of costing method
disadvantages of costing method

Detailed SolutionCompelling strategic plan, promoting coordination and providing framework of performance are

48. Partial or completed units of manufactured goods, that do not meet customer specifications and get sold at reduced price or simply discarded, are called

spoilage
rework
scrap
equivalence

Detailed SolutionPartial or completed units of manufactured goods, that do not meet customer specifications and get sold at reduced price or simply discarded, are called

49. Added value is the change in . . . . . . . .

market value
cost
income
None of the above

Detailed SolutionAdded value is the change in . . . . . . . .

50. Statement (A): It is necessary to tally current costs with current income in order to find out the correct profit. Reason (R): LIFO ensures matching of current costs with current income.

Both A and R are correct and R is the correct explanation of A
Both A and R are correct but R is not the correct explanation of A
A is correct but R is incorrect
A is incorrect but R is correct

Detailed SolutionStatement (A): It is necessary to tally current costs with current income in order to find out the correct profit. Reason (R): LIFO ensures matching of current costs with current income.

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