1. At the economic ordering quantity level, the following is true:
a :
The ordering cost is minimum
b :
The carrying cost is minimum
c :
The ordering cost is equal to the carrying cost
d :
The purchase price is minimum
Correct Answer: c [The ordering cost is equal to the carrying cost]
2. Batch Costing is applied effectively in the following situation:
a :
paper manufacturing
b :
drug manufacturing
c :
designer clothes manufacturing
d :
oil refining
Correct Answer: b [drug manufacturing]
3. A certain process needed standard labour of 24 skilled labour hours and 30 unskilled labour hours at Rs. 60 and Rs. 40 respectively as the standard labour rates. Actually, 20 and 25 labour hours were used at Rs. 50 and Rs. 50 respectively. Then, the labour mix variance will be
a :
Adverse
b :
Favourable
c :
Zero
d :
Favourable for skilled and unfavourable for unskilled
Correct Answer: c [Zero]
4. Cost Unit of Hospital Industry is
a :
Tonne
b :
Student per year
c :
Kilowatt Hour
d :
Patient Day
Correct Answer: d [Patient Day]
5. Which of the following items is not included in preparation of cost sheet?
a :
Carriage inward
b :
Purchase returns
c :
Sales Commission
d :
Interest paid
Correct Answer: d [Interest paid]
6. Operating costing is applicable to:
a :
Hospitals
b :
Cinemas
c :
Transport undertaking
d :
All of the above
Correct Answer: d [All of the above]
7. Difference between standard cost and actual cost is called as
a :
Wastage
b :
Loss
c :
Variance
d :
Profit
Correct Answer: c [Variance]
8. Sales Budget is a-
a :
Expenditure budget
b :
Functional budget
c :
Master budget
d :
None of the above
Correct Answer: b [Functional budget]
9. Depreciation is a example of-
a :
Fixed Cost
b :
Variable Cost
c :
Semi Variable Cost
d :
None
Correct Answer: a [Fixed Cost]
10. The allotment of whole items of cost centres or cost unit is called
a :
Cost allocation
b :
Cost apportionment
c :
Overhead absorption
d :
None of the above
Correct Answer: a [Cost allocation]
11. Job costing is used in
a :
Furniture making
b :
Repair shops
c :
Printing press
d :
All of the above
Correct Answer: d [All of the above]
12. In a process 800 units are introduced during 2016-17. 5% of input is normal loss. Closing work-in-progress 60% complete is 100 units. 660 completed units are transferred to next process. Equivalent production for the period is
a :
744 units
b :
540 units
c :
720 units
d :
760 units
Correct Answer: c [720 units]
13. _____ deals with the principles and methods of determining the production or operation overheads.
a :
CAS-3
b :
CAS-5
c :
CAS-9
d :
CAS-16
Correct Answer: a [CAS-3]
14. Joint Cost is suitable for-
a :
Infrastructure Industry
b :
Ornament Industry.
c :
Oil Industry
d :
Fertilizer Industry
Correct Answer: c [Oil Industry]
15. Direct Expenses that does not meet the test of materiality can be ———— part of overhead.
a :
Treated
b :
Not treated
c :
All of the these
d :
None of these
Correct Answer: a [Treated]
16. Charging to a cost center those overheads that result solely for the existence of that cost Center is known as
a :
Allocation
b :
Apportionment
c :
Absorption
d :
Allotment
Correct Answer: a [Allocation]
17. Standards deals with determination of averages/equalized transportation cost –
a :
CAS 22
b :
CAS 9
c :
CAS 5
d :
CAS 6
Correct Answer: c [CAS 5]
18. Equivalent production of 1,000 units, 60% complete in all respects, is:
a :
1000 units
b :
1600 units
c :
600 units
d :
1060 units
Correct Answer: c [600 units]
19. Batch Costing is suitable for
a :
Sugar Industry
b :
Chemical Industry
c :
Pharma Industry
d :
Oil Industry
Correct Answer: c [Pharma Industry]
20. Cost units of Hospital Industry is
a :
Tonne
b :
Student per year
c :
Kilowatt Hour
d :
Patient Day
Correct Answer: d [Patient Day]
21. The most important element of cost is
a :
Material
b :
Labour
c :
Overheads
d :
All of these
Correct Answer: a [Material]
22. Which of the following is considered as accounting record?
a :
Bin Card
b :
Bill of material
c :
Store Ledger
d :
None of these
Correct Answer: c [Store Ledger]
23. Under the high wage plan, a worker is paid
a :
At a time rate higher than the usual rate
b :
According to his efficiency
c :
At a double rate for overtime
d :
Normal wages plus bonus
Correct Answer: a [At a time rate higher than the usual rate]
24. When overtime is required for meeting urgent orders, overtime premium should be
