Costing MCQs

Question 1

Material usage variance = Material mix variance + . . . . . . . .

Accepted Answer

Material yield variance

Answer

Material cost variance

Answer

Material price variance

Answer

Material quantity variance

Question 2

Which of the following is usually NOT a right enjoyed by a Principal in the contract of Agency?

Accepted Answer

Right to charge abnormal fee for the agency

Answer

Right to revoke the agency

Answer

Right to repudiate the agency

Answer

Right to recover the secret profits from the agent

Question 3

Cost of goods sold is calculated:

Accepted Answer

Cost of production + opening stock of finished goods - closing stock of finished goods

Answer

Prime cost + factory overhead cost + work in progress at the beginning - works in progress closing

Answer

Opening stock of raw materials + purchase of raw materials - closing stock of raw materials

Answer

Cost of production + administrative expenses + work in progress closing - work in progress beginning

Question 4

The quantity of material to be ordered at one time is known as . . . . . . . . .

Accepted Answer

ordering quantity

Answer

commercial order quantity

Answer

economic order quantity

Answer

None of these

Question 5

The Gantt bonus scheme is a composite form of-

Accepted Answer

Halsey and Taylor scheme

Answer

Rown and Taylor's plan

Answer

Halsey and rown scheme

Answer

Emerson and Bedox scheme

Question 6

The test of objectivity and verifiability is satisfied by valuing inventory at:

Accepted Answer

Net realisable value

Answer

Historical cost

Answer

Current replacement value

Answer

Inflated value

Question 7

Which of the following is a technique of financial statement analysis?

Accepted Answer

All of the above

Answer

Common-size statement

Answer

Comparative statement

Answer

Trend analysis

Question 8

Which of the following statements relating to incentive payments is correct?

Accepted Answer

In Rowan incentive plan, bonus paid to the employee is equal to the proportion of the time saved to the standard time

Answer

In Halsey incentive plan, bonus paid to a worker is equal to 50% of the time saved, divided by the rate per hour

Answer

In Taylor's differential piece rate system, a worker whose output exceeds standard output is paid 100% of piece rate, and a worker whose output falls short of the standard is paid only 50% of piece rate

Answer

The Rowan incentive plan is the base of all other incentive payment plans

Question 9

A firm consumes 90,000 units of a certain item of raw material in its production process annually. It costs Rs. 3 per unit, the cost per purchase order is Rs. 300 and the inventory carrying cost is 20% per year. What is the EOQ?

Accepted Answer

9487 units

Answer

9470 units

Answer

9480 units

Answer

9840 units