MCQOPTIONS
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MCQOPTIONS
This section includes 56 Mcqs, each offering curated multiple-choice questions to sharpen your Cost Accounting knowledge and support exam preparation. Choose a topic below to get started.
| 1. |
The value of sales, consider sales value at split off method is of |
| A. | entire direct material of accounting period |
| B. | entire production of accounting period |
| C. | portion of production of accounting period |
| D. | entire indirect material of accounting period |
| Answer» C. portion of production of accounting period | |
| 2. |
If the sales volume variance is $8500 and the static budget amount is $2000, then the flexible budget amount would be |
| A. | $6,500 |
| B. | $6,600 |
| C. | $6,700 |
| D. | $6,800 |
| Answer» B. $6,600 | |
| 3. |
The division of all the costs related to customers on the basis of different cost allocation bases or cost drivers are called |
| A. | customer cost hierarchy |
| B. | customer profitability hierarchy |
| C. | treasury costing hierarchy |
| D. | partial costing hierarchy |
| Answer» B. customer profitability hierarchy | |
| 4. |
The approaches used to allocate joint costs include |
| A. | sales value at split off method |
| B. | net realizable value method |
| C. | constant gross margin percentage NRV method |
| D. | all of above |
| Answer» E. | |
| 5. |
If the flexible budget amount is $7500 and the sales volume variance is $6500, then the static budget amount would be |
| A. | $7,500 |
| B. | $6,500 |
| C. | $1,000 |
| D. | $10,000 |
| Answer» D. $10,000 | |
| 6. |
In customer cost hierarchy, the costs of all the incurred activities to sell a unit of product are classified as |
| A. | customer sustaining costs |
| B. | customer output unit-level costs |
| C. | customer batch-level costs |
| D. | corporate sustaining costs |
| Answer» C. customer batch-level costs | |
| 7. |
The final sales is subtracted from net realizable value is used to calculate |
| A. | separable costs |
| B. | inseparable costs |
| C. | joint costs |
| D. | floating costs |
| Answer» B. inseparable costs | |
| 8. |
If the percentage of overall gross margin is 15 and the final sales value of whole production is $20000, then the gross margin (in dollars) will be |
| A. | $30,000 |
| B. | $300,000 |
| C. | $40,000 |
| D. | $400,000 |
| Answer» C. $40,000 | |
| 9. |
In corporate costs, the cost incurred to finance construction of new equipment are classified as |
| A. | treasury costs |
| B. | discretionary costs |
| C. | human resource management costs |
| D. | corporate administration costs |
| Answer» B. discretionary costs | |
| 10. |
The net realizable value is added into separate costs to calculate |
| A. | split off costs |
| B. | final cost of direct labor |
| C. | final sales |
| D. | final costs |
| Answer» D. final costs | |
| 11. |
The percentage of overall gross margin is multiplied to final sales value of products total production is used to calculate |
| A. | Gross margin in terms of amount of money |
| B. | Gross margin in terms of separable costs |
| C. | Gross margin in terms of total cost |
| D. | Gross margin in terms of labor cost |
| Answer» B. Gross margin in terms of separable costs | |
| 12. |
An analysis and reporting of revenues earned, and the incurred costs to earn these revenues from customers is classified as |
| A. | partial productivity analysis |
| B. | treasury cost analysis |
| C. | customer profitability analysis |
| D. | customer cost analysis |
| Answer» D. customer cost analysis | |
| 13. |
Which of the following do not include among major categories of corporate costs? |
| A. | human resource management costs |
| B. | corporate administration costs |
| C. | treasury costs |
| D. | discretionary costs |
| Answer» E. | |
| 14. |
An additional cost, incurred for some specific activity to bring processed product on to next production stage is |
| A. | partial cost |
| B. | relevant cost |
| C. | incremental cost |
| D. | irrelevant cost |
| Answer» D. irrelevant cost | |
| 15. |
The difference between static budget amount and the flexible budget amount is named as |
| A. | sales mix variance |
| B. | sales volume variance |
| C. | flexible budget variance |
| D. | static budget variance |
| Answer» C. flexible budget variance | |
| 16. |
In customer cost hierarchy, the costs of individual customer support activities are classified as |
| A. | discretionary channel costs |
| B. | corporate-sustaining costs |
| C. | distribution-channel costs |
| D. | customer-sustaining costs |
| Answer» E. | |
| 17. |
The difference between final sales value and separable costs is equal to |
| A. | net income |
| B. | net realizable value |
| C. | Gross margin |
| D. | Gross realizable value |
| Answer» C. Gross margin | |
| 18. |
A joint cost allocation method is based on relative value of total sales, at the point of split off is classified as |
| A. | sales value at split off method |
| B. | joint costs at split off point method |
| C. | joint products value at split off method |
| D. | main product cost at split off method |
| Answer» B. joint costs at split off point method | |
| 19. |
The difference between budgeted contribution margin for actual sales mix and budgeted sales mix is called |
| A. | sales quantity variance |
| B. | cost mix variance |
| C. | volume mix variance |
| D. | sales mix variance |
| Answer» E. | |
| 20. |
If an actual result is $5500 and corresponding amount of flexible budget on the basis of actual level of output is $3500, then flexible budget variance will be |
| A. | $2,500 |
| B. | $5,500 |
| C. | $3,500 |
| D. | $2,000 |
| Answer» E. | |
| 21. |
The manufacturing, distribution and marketing costs incur after split off point is classified under |
| A. | separable costs |
| B. | joint costs |
| C. | main costs |
| D. | split off costs |
| Answer» B. joint costs | |
| 22. |
The joint cost allocation method, in which individual product from joint products must gain a gross margin percentage is classified as |
| A. | sales value at split off method |
| B. | joint products value at split off method |
| C. | constant gross margin percentage NRV method |
| D. | Gross realizable value method |
| Answer» D. Gross realizable value method | |
| 23. |
In a joint process of production, the product which yields low volume of sales as compared to total sales of other products, specify as |
| A. | Second incremental product |
| B. | First incremental product |
| C. | step down product |
| D. | byproduct |
| Answer» E. | |
| 24. |
The third step in constant gross margin percentage NRV Method to allocate joint cost is to compute |
| A. | Gross margin percentage |
| B. | total production cost of each product |
| C. | allocated joint costs |
| D. | cost of split off point |
| Answer» D. cost of split off point | |
| 25. |
The corporate sustaining costs and distribution channel costs are also classified as |
| A. | indirect costs |
| B. | variable costs |
| C. | fixed costs |
| D. | direct costs |
| Answer» D. direct costs | |
| 26. |
As compared to sale value of main products, the by-products have |
| A. | low sale value |
| B. | high sale value |
| C. | unstable sale value |
| D. | relevant sale value |
| Answer» B. high sale value | |
| 27. |
The customer sustaining costs, customer batch-level costs and customer output-unit level costs are classified as |
| A. | customer level indirect costs |
| B. | customer level direct costs |
| C. | corporate level direct costs |
| D. | corporate level indirect costs |
| Answer» B. customer level direct costs | |
| 28. |
If the final sales are $50000 and the separable costs are $35000, then the net realizable value will be |
| A. | $15,000 |
| B. | $85,000 |
| C. | $35,000 |
| D. | $50,000 |
| Answer» B. $85,000 | |
| 29. |
In customer cost hierarchy, the costs of all activities incurred to sell group of units to end consumers are classified as |
| A. | customer sustaining costs |
| B. | customer output unit-level costs |
| C. | customer batch-level costs |
| D. | corporate sustaining costs |
| Answer» D. corporate sustaining costs | |
| 30. |
If the budgeted contribution margin for budgeted and actual sales mix are $35000 and $27000, then the sales mix variance will be |
| A. | $8,000 |
| B. | $80,000 |
| C. | $62,000 |
| D. | $35,000 |
| Answer» B. $80,000 | |
| 31. |
The first step in constant gross margin percentage, Net realizable value (NRV) method is to allocate joint, to compute |
| A. | Gross margin percentage |
| B. | total production cost of each product |
| C. | allocated joint costs |
| D. | cost of split off point |
| Answer» B. total production cost of each product | |
| 32. |
The executive salaries, rent and other general administration cost in corporate costs are classified under |
| A. | human resource management costs |
| B. | corporate administration costs |
| C. | treasury costs |
| D. | discretionary costs |
| Answer» C. treasury costs | |
| 33. |
In the static budget, the difference between corresponding budgeted amount and actual result is called |
| A. | sales mix variance |
| B. | sales volume variance |
| C. | flexible budget variance |
| D. | static budget variance |
| Answer» E. | |
| 34. |
If the net realizable value is $20000 and the separable costs are $18000, then the final sales will be |
| A. | $20,000 |
| B. | $18,000 |
| C. | $2,000 |
| D. | $38,000 |
| Answer» E. | |
| 35. |
If an actual result in static budget is $2500 and the corresponding budgeted amount is $2200, then the static budget variance will be |
| A. | $3,000 |
| B. | $300 |
| C. | $4,700 |
| D. | $4,500 |
| Answer» C. $4,700 | |
| 36. |
The costs incurred in production process that yield range of products simultaneously are known as |
| A. | separable costs |
| B. | joint costs |
| C. | main costs |
| D. | split off costs |
| Answer» C. main costs | |
| 37. |
In customer cost hierarchy, the costs of those activities that cannot be traced to distribution channels or individual customers are called |
| A. | discretionary channel costs |
| B. | corporate-sustaining costs |
| C. | distribution-channel costs |
| D. | engineered resource costs |
| Answer» C. distribution-channel costs | |
| 38. |
For increasing sales, the decrease in selling price, below the selling price list is known as |
| A. | partial discount |
| B. | corporate discount |
| C. | treasury discount |
| D. | price discount |
| Answer» E. | |
| 39. |
The gross margin percentage in constant gross-margin percentage NRV method is based on |
| A. | total labor costs |
| B. | total production |
| C. | total revenues |
| D. | total costs |
| Answer» C. total revenues | |
| 40. |
An expected future cost which diverges in unconventional course of action is known as |
| A. | partial cost |
| B. | total cost |
| C. | irrelevant cost |
| D. | relevant cost |
| Answer» E. | |
| 41. |
The cost of particular cost object which cannot be traced in economically plausible way is termed as |
| A. | indirect cost |
| B. | partial cost |
| C. | benchmark cost |
| D. | direct cost |
| Answer» B. partial cost | |
| 42. |
If value of final sales is $48000 and the net realizable value is $35000, then the value of sales costs would be |
| A. | $35,000 |
| B. | $13,000 |
| C. | $83,000 |
| D. | $48,000 |
| Answer» C. $83,000 | |
| 43. |
The second step, in constant gross margin percentage Net Realizable Value (NRV) method, to allocate joint cost is to compute |
| A. | allocated joint costs |
| B. | cost of split off point |
| C. | Gross margin percentage |
| D. | total production cost of each product |
| Answer» E. | |
| 44. |
In a joint process of production, a product which yields high volume of sales as compared to total sales volume of other products is known as |
| A. | incremental product |
| B. | sunk product |
| C. | main product |
| D. | split off product |
| Answer» D. split off product | |
| 45. |
An expected future revenue, which diverges in unconventional course of action is classified as |
| A. | partial revenue |
| B. | total revenue |
| C. | relevant revenues |
| D. | irrelevant revenues |
| Answer» D. irrelevant revenues | |
| 46. |
The method which allocates joint costs of joint products, considering physical measures such as volume or relative weight at point of split off is known as |
| A. | direct cost measure method |
| B. | indirect cost measure method |
| C. | physical-measure method |
| D. | relative-measure method |
| Answer» D. relative-measure method | |
| 47. |
The point in joint production process, in which two or more products are separately identifiable is termed as |
| A. | step down point |
| B. | incremental point |
| C. | split off point |
| D. | inseparability point |
| Answer» D. inseparability point | |
| 48. |
The gross margin is subtracted from sales value of all production to yield |
| A. | labor cost incurred on product |
| B. | production cost incurred on product |
| C. | marketing cost incurred on product |
| D. | all of above |
| Answer» C. marketing cost incurred on product | |
| 49. |
In a joint process of production, the two or more products that yield high volume of sales as compared to total sales of other products are classified as |
| A. | split off product |
| B. | joint product |
| C. | sunk product |
| D. | main product |
| Answer» C. sunk product | |
| 50. |
Joint cost allocation method for joint products, which is based on achievable value is known as |
| A. | joint products value at split off method |
| B. | main product cost at split off method |
| C. | Gross realizable value method |
| D. | net realizable value method |
| Answer» E. | |