. Cost apportionment involves:

The sharing out of costs to products

The sharing out of overheads to service departments

The sharing out of common costs to departments

The allocation of direct costs to departments

The sharing out of costs to products

Which definition best describes indirect costs?

Indirect costs are those costs which are not controlled directly by a manager.

Indirect costs are those costs which cannot be directly associated with a product or service.

In a costing system, a job account is similar to a work in progress account, except that it is for one job only. In a company that specialises in jobbing work, the work in progress account is the total of all the individual job accounts.

The above statement is incorrect

A predetermined overhead absorption rate is also known as:

The fixed overhead recovery rate

A situation may arise where both service departments do work for the other service department, as well as the production departments. The secondary apportionment is more complex. The process is called reciprocal apportionment

The above statement is incorrect

Which of the following is/are the basic object/s of job analysis?

Ascertain the relative worth of each job

Breaking up job into its basic elements

An equivalent unit of material or conversion cost is equal to

A unit of work-in-process inventory.

The amount of material conversion cost necessary to complete one unit of production.

A unit of work-in-process inventory.

The amount of material or conversion cost necessary to start a unit of production into work in process inventory.

Fifty percent of material or conversion cost of a unit to finished goods inventory

“Hedging” technique is used

When there is an organized commodity market

Where large quantities of a particular commodity are bought and sold

…………………is the total of prime cost and factory overheads.

Selling and Distributional Expenses

…………………stores organization is adopted to store all the goods at centrally located at onplace.

Central stores with sub-stores.

Which is not a consideration in a make or buy decision?

Existence of sufficient administrative / technical personnel

Political and social factors with the organization

2081 + Mcqs in Accounting Page 7 McqOptions

301.	. Cost apportionment involves:
A.	The sharing out of overheads to service departments
B.	The sharing out of common costs to departments
C.	The allocation of direct costs to departments
D.	The sharing out of costs to products
Answer» D. The sharing out of costs to products

Discussion

302.	The cost of abnormal loss is built into inventory.
A.	False
B.	True
C.	none
D.	none
Answer» B. True

Discussion

303.	Which definition best describes indirect costs?
A.	Indirect costs are those costs which are not controlled directly by a manager.
B.	Indirect costs are those costs which cannot be directly associated with a product or service.
C.	Indirect costs are always fix
Answer» C. Indirect costs are always fix

Discussion

304.	In a costing system, a job account is similar to a work in progress account, except that it is for one job only. In a company that specialises in jobbing work, the work in progress account is the total of all the individual job accounts.
A.	The above statement is correct
B.	The above statement is incorrect
C.	none
D.	none
Answer» B. The above statement is incorrect

Discussion

305.	A contract is generally of ………………..duration.
A.	Long
B.	Small
C.	Average
D.	Very Small
Answer» B. Small

Discussion

306.	A predetermined overhead absorption rate is also known as:
A.	Fixed overhead absorption rate
B.	The fixed overhead recovery rate
C.	The fixed overhead applied
D.	All of the above
Answer» D. All of the above

Discussion

307.	A situation may arise where both service departments do work for the other service department, as well as the production departments. The secondary apportionment is more complex. The process is called reciprocal apportionment
A.	The above statement is correct
B.	The above statement is incorrect
C.	none
D.	none
Answer» B. The above statement is incorrect

Discussion

308.	The disposal cost of abnormal loss is included in the abnormal loss account and therefore in the transfer of the cost of abnormal loss to the statement of profit or loss.
A.	True
B.	False
C.	none
D.	none
Answer» B. False

Discussion

309.	Which of the following is/are the basic object/s of job analysis?
A.	Determination of wage rates
B.	Ascertain the relative worth of each job
C.	Breaking up job into its basic elements
D.	All of the given options
Answer» B. Ascertain the relative worth of each job

Discussion

310.	Costs for each job are collected on a:
A.	Job cost sheet
B.	Job card
C.	Either A or B
D.	None
Answer» D. None

Discussion

311.	An example of a production overhead would be:
A.	Material.
B.	Rent
C.	Labour cost.
D.	Supervisory cost
Answer» E.

Discussion

312.	An equivalent unit of material or conversion cost is equal to
A.	The amount of material conversion cost necessary to complete one unit of production.
B.	A unit of work-in-process inventory.
C.	The amount of material or conversion cost necessary to start a unit of production into work in process inventory.
D.	Fifty percent of material or conversion cost of a unit to finished goods inventory
Answer» B. A unit of work-in-process inventory.

Discussion

313.	Which one of the following is not included in the 5 R in purchasing?
A.	Quality
B.	Quantity
C.	Price
D.	None of these
Answer» E.

Discussion

314.	The purchasing view of the material master is relevant at what organizational level?
A.	Company code
B.	Client
C.	Storage location
D.	Plant
Answer» E.

Discussion

315.	The weighted average method divides the cost of goods available for sale by the number of units:
A.	Available for sale
B.	Sold
C.	Purchased during the period
D.	none
Answer» B. Sold

Discussion

316.	The term…………………. is comprehensively used to include various aspects such ascosting, cost accounting, cost control, cost audit and budgetary control.
A.	Cost Accountancy
B.	Costing
C.	Cost Accounting
D.	Inventory control
Answer» B. Costing

Discussion

317.	The expenses which cannot be directly identified with a particular unit or cost centre isknown as …………………...
A.	Indirect Labour
B.	Indirect material
C.	Indirect expenses
D.	Direct expenses
Answer» D. Direct expenses

Discussion

318.	“Hedging” technique is used
A.	When there is an organized commodity market
B.	Where large quantities of a particular commodity are bought and sold
C.	Both (a) and (b)
D.	None of these
Answer» D. None of these

Discussion

319.	Effective purchase control prevents wastage and losses of material right from the purchasefrom their ……………….
A.	Consumption
B.	Wastage
C.	Storage
D.	none
Answer» B. Wastage

Discussion

320.	A unit of quantity of product, service or time, in relation to which cost may be ascertainedor expressed is known as .
A.	Cost Centre
B.	Cost Sheet
C.	Cost Unit
D.	none
Answer» D. none

Discussion

321.	The receipt of…………….is the first step in purchase procedure.
A.	Invoice
B.	Material requisition
C.	Purchase requisition
D.	none
Answer» D. none

Discussion

322.	In………………costing the cost of a group of products is ascertained.
A.	Process
B.	Job
C.	Batch
D.	Service
Answer» D. Service

Discussion

323.	If WIP opening stock is 10,000 units, work done in the period is 13,000 and WIP closingstock is 5,000 units. The equivalent completed unit during the period is:
A.	19,000n
B.	18,000
C.	17,000
D.	none
Answer» C. 17,000

Discussion

324.	The unused materials are returned to stores with a material …………..note.
A.	Acceptance
B.	Transfer
C.	Return
D.	none
Answer» D. none

Discussion

325.	The term …………….may be defined as the systematic control over the procurement ofmaterials.
A.	Material control
B.	Purchase control
C.	Sales control
D.	none
Answer» C. Sales control

Discussion

326.	Direct Labour Cost is also known as…………
A.	Indirect Labour
B.	Indirect Wages
C.	Direct Wages
D.	Debtors
Answer» D. Debtors

Discussion

327.	The term……………..is defined as a system that ensures the provision of the required quantityof material of the required quality at the required time with the minimum amount of capital.
A.	Material Control
B.	Labour Control
C.	Marketing Control
D.	none
Answer» B. Labour Control

Discussion

328.	…………………is the total of prime cost and factory overheads.
A.	Cost of production
B.	Works cost
C.	Cost of material consumed
D.	Selling and Distributional Expenses
Answer» C. Cost of material consumed

Discussion

329.	The evolution of cost accounting took place because of…………………….of financialaccounting.
A.	Advantages
B.	Limitations
C.	Merits
D.	Management control
Answer» C. Merits

Discussion

330.	The document prepared on receipt of materials in store is known as
A.	MRN
B.	GRN
C.	Challan
D.	Bill of materials.
Answer» C. Challan

Discussion

331.	…………………stores organization is adopted to store all the goods at centrally located at onplace.
A.	Centralized
B.	Central stores with sub-stores.
C.	Independent
D.	none
Answer» B. Central stores with sub-stores.

Discussion

332.	The purchase order form is designed by
A.	Materials Manager
B.	Purchase Manager
C.	Marketing Manager
D.	None of them
Answer» C. Marketing Manager

Discussion

333.	Direct expense are also called ……………………. Expenses.
A.	Variable
B.	Chargeable
C.	Fixed
D.	none
Answer» C. Fixed

Discussion

334.	The average stock level is………….. units if the maximum stock level is 2475 units and theminimum stock level is 855 units.
A.	1565
B.	1665
C.	1465
D.	none
Answer» C. 1465

Discussion

335.	The __________ specification describes, defines or specifies the goods / services to besupplied. Performance
A.	Functional
B.	Technical
C.	Bid
D.	General Requirements
Answer» D. General Requirements

Discussion

336.	The Technique and ………….of ascertaining the cost is known as Costing.
A.	Batch
B.	Method
C.	Process
D.	Batch costing
Answer» D. Batch costing

Discussion

337.	Purchase of material a substantial of the company’s finance is committed which affects………position of the company.
A.	Cash flow
B.	Fund Flow
C.	Balance – Sheet
D.	none
Answer» B. Fund Flow

Discussion

338.	The stock level at which the storekeeper initiates purchase requisitions is known as………….
A.	Re-order level
B.	Danger level
C.	Maximum stock level
D.	none
Answer» B. Danger level

Discussion

339.	Direct expense are also called ……………… expenses
A.	Semi-variable
B.	Chargeable
C.	Fixed
D.	none
Answer» C. Fixed

Discussion

340.	Economic Order Quantity is he tool for controlling……………….
A.	Inventory
B.	Labour
C.	Expenses
D.	none
Answer» B. Labour

Discussion

341.	……………..cost is the cost of commodities supplied to an undertaking.
A.	Material
B.	Labour
C.	Expenses
D.	Cost
Answer» C. Expenses

Discussion

342.	Weighted average method is a generally accepted accounting principle?
A.	True
B.	False
C.	none
D.	none
Answer» B. False

Discussion

343.	Continuous costing is also called
A.	Operation costing
B.	Process costing
C.	Batch costing
D.	Contract costing
Answer» C. Batch costing

Discussion

344.	costing is suitable for mines, quarries, cement works etc.
A.	Process
B.	Contract
C.	Batch
D.	Operation
Answer» E.

Discussion

345.	When job is very big and spread over long periods of time the method of costing adoptedis……
A.	Process
B.	Job
C.	Contract
D.	Operation
Answer» D. Operation

Discussion

346.	_________ is a narrative description of the work to be accomplished or resource to besupplied.
A.	Purchase order
B.	Level of effort work
C.	Scope of work
D.	Contract stipulation
Answer» D. Contract stipulation

Discussion

347.	Preparation of…………………..is one of most important function of purchase Department.
A.	Purchase Budget
B.	Purchase Receipt
C.	Purchase Price
D.	Purchase Cost
Answer» B. Purchase Receipt

Discussion

348.	Which is not a consideration in a make or buy decision?
A.	Cost factors
B.	Sales volume
C.	Existence of sufficient administrative / technical personnel
D.	Political and social factors with the organization
Answer» C. Existence of sufficient administrative / technical personnel

Discussion

349.	Weighted average method for inventory is permissible in:
A.	IFRS only
B.	US GAAP only
C.	IFRS & US GAAP Both
D.	none
Answer» C. IFRS & US GAAP Both

Discussion

350.	The following classes of costs are usually involved in inventory decisions except
A.	Cost of ordering
B.	Carrying cost
C.	Cost of shortages
D.	Machining cost
Answer» E.

Discussion

Explore topic-wise MCQs in Finance & Accounting.

. Cost apportionment involves:

The cost of abnormal loss is built into inventory.

Which definition best describes indirect costs?

In a costing system, a job account is similar to a work in progress account, except that it is for one job only. In a company that specialises in jobbing work, the work in progress account is the total of all the individual job accounts.

A contract is generally of ………………..duration.

A predetermined overhead absorption rate is also known as:

A situation may arise where both service departments do work for the other service department, as well as the production departments. The secondary apportionment is more complex. The process is called reciprocal apportionment

The disposal cost of abnormal loss is included in the abnormal loss account and therefore in the transfer of the cost of abnormal loss to the statement of profit or loss.

Which of the following is/are the basic object/s of job analysis?

Costs for each job are collected on a:

An example of a production overhead would be:

An equivalent unit of material or conversion cost is equal to

Which one of the following is not included in the 5 R in purchasing?

The purchasing view of the material master is relevant at what organizational level?

The weighted average method divides the cost of goods available for sale by the number of units:

The term…………………. is comprehensively used to include various aspects such ascosting, cost accounting, cost control, cost audit and budgetary control.

The expenses which cannot be directly identified with a particular unit or cost centre isknown as …………………...

“Hedging” technique is used

Effective purchase control prevents wastage and losses of material right from the purchasefrom their ……………….

A unit of quantity of product, service or time, in relation to which cost may be ascertainedor expressed is known as .

The receipt of…………….is the first step in purchase procedure.

In………………costing the cost of a group of products is ascertained.

If WIP opening stock is 10,000 units, work done in the period is 13,000 and WIP closingstock is 5,000 units. The equivalent completed unit during the period is:

The unused materials are returned to stores with a material …………..note.

The term …………….may be defined as the systematic control over the procurement ofmaterials.

Direct Labour Cost is also known as…………

The term……………..is defined as a system that ensures the provision of the required quantityof material of the required quality at the required time with the minimum amount of capital.

…………………is the total of prime cost and factory overheads.

The evolution of cost accounting took place because of…………………….of financialaccounting.

The document prepared on receipt of materials in store is known as

…………………stores organization is adopted to store all the goods at centrally located at onplace.

The purchase order form is designed by

Direct expense are also called ……………………. Expenses.

The average stock level is………….. units if the maximum stock level is 2475 units and theminimum stock level is 855 units.

The __________ specification describes, defines or specifies the goods / services to besupplied. Performance

The Technique and ………….of ascertaining the cost is known as Costing.

Purchase of material a substantial of the company’s finance is committed which affects………position of the company.

The stock level at which the storekeeper initiates purchase requisitions is known as………….

Direct expense are also called ……………… expenses

Economic Order Quantity is he tool for controlling……………….

……………..cost is the cost of commodities supplied to an undertaking.

Weighted average method is a generally accepted accounting principle?

Continuous costing is also called

costing is suitable for mines, quarries, cement works etc.

When job is very big and spread over long periods of time the method of costing adoptedis……

_________ is a narrative description of the work to be accomplished or resource to besupplied.

Preparation of…………………..is one of most important function of purchase Department.

Which is not a consideration in a make or buy decision?

Weighted average method for inventory is permissible in:

The following classes of costs are usually involved in inventory decisions except