Costing

[amp_mcq option1=”If its operations or departments are not directly involved in revenue generating activities, but instead focus on elements of cost control” option2=”If its management is evaluated not only on revenues and expenses, but also on asset investment” option3=”If its management is compensated based on the level of profitability” option4=”If its management is held accountable for both revenues and expenses and has the authority to make decision regarding its products, markets and source of supply” correct=”option4″]

Detailed SolutionWhen is a business unit known to be a profit centre?

[amp_mcq option1=”cost estimation” option2=”price estimation” option3=”unit estimation” option4=”production estimation” correct=”option1″]

Detailed SolutionRelationship based on unrelated level of activity and past data of cost is measured with help of

[amp_mcq option1=”conversion costs” option2=”sunk costs” option3=”inventoriable costs” option4=”non inventoriable costs” correct=”option4″]

Detailed SolutionIn process and job costing system, normal spoilage cost is considered as

[amp_mcq option1=”fixed o/h, variable o/h and semi-variable o/h” option2=”controllable o/h and uncontrollable o/h” option3=”manufacturing o/h, administration o/h and selling & distribution o/h” option4=”past cost and future cost” correct=”option3″]

Detailed SolutionOverhead can be classified according to function-wise as ________.

[amp_mcq option1=”2,000 units” option2=”3,000 units” option3=”4,000 units” option4=”6,000 units” correct=”option2″]

Detailed SolutionA company makes a single product and incurs fixed costs of Rs 30,000 per annum. Variable cost per unit is Rs 5 and each unit sells for Rs 15. Annual sales demand is 7,000 units. The breakeven point is:

[amp_mcq option1=”Ship building” option2=”Aircraft industry” option3=”Self-propelled vehicle industry” option4=”None of these” correct=”option1″]

Detailed SolutionThe contract cost is used in-

[amp_mcq option1=”limiting factor” option2=”materials” option3=”labour” option4=”production” correct=”option1″]

Detailed SolutionThe budget relating to . . . . . . . . must be prepared first and the other budgets should be prepared in the light of that factor.

[amp_mcq option1=”Both (A) and (R) are true and (R) is correct explanation of (A)” option2=”Both (A) and (R) are true but (R) is not the correct explanation of (R)” option3=”(A) is true but (R) is false” option4=”(A) is false but (R) is true” correct=”option3″]

Detailed SolutionGiven below are two statement. one labelled as Assertion (A) and other as Reason (R): Assertion (A): Cost accounting is complementary to financial accounting. Reason (R): The result of cost accounting are not trustworthy. Choose the correct answer

[amp_mcq option1=”Rs. 45,000″ option2=”Rs. 50,000″ option3=”Rs. 54,000″ option4=”Rs. 60,000″ correct=”option3″]

Detailed SolutionDirect material Rs 25,000 and wages Rs 15,000 and direct expenses Rs 5,000 What would be the factory cost if factory overhead rate is 20%.

[amp_mcq option1=”profit and loss a/c” option2=”by-product a/c” option3=”process a/c” option4=”abnormal gain a/c” correct=”option2″]

Detailed SolutionIf any by-product is produced and sold it is credited to ________.