Costing MCQs

Question 1

Packing cost is ________.

Accepted Answer

distribution cost

Answer

production cost

Answer

selling cost

Answer

administration cost

Question 2

Directors remuneration and expenses form part of ________.

Accepted Answer

administrative overhead

Answer

production overhead

Answer

selling overhead

Answer

distribution overhead

Question 3

Absorption means ________.

Accepted Answer

charging of overheads to cost units

Answer

charging overheads to cost centres

Answer

charging of overheads to cost centres or cost units

Answer

allotment of overheads to different departments

Question 4

Which of the following is a service department?

Accepted Answer

Receiving department

Answer

Refining department

Answer

Machining department

Answer

Finishing department

Question 5

Bad debt is an example of ________.

Accepted Answer

selling overhead

Answer

production overhead

Answer

administrative overhead

Answer

distribution overhead

Question 6

Variable cost per unit ________.

Accepted Answer

remains constant

Answer

varies when output varies

Answer

increase when output increases

Answer

decreases when output decreases

Question 7

Increase in total variable cost is due to ________.

Accepted Answer

increase in production

Answer

increase in fixed cost

Answer

increase in sales

Answer

increase in efficiency

Question 8

An example of fixed cost ________.

Accepted Answer

rent for building

Answer

property tax

Answer

direct material cost

Answer

direct wages

Question 9

The process of allocating and apportioning the costs on suitable basis to all the departments is _______.

Accepted Answer

primary distribution

Answer

departmentalization

Answer

secondary distribution

Answer

classification