MCQOPTIONS
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MCQOPTIONS
This section includes 1375 Mcqs, each offering curated multiple-choice questions to sharpen your Commerce knowledge and support exam preparation. Choose a topic below to get started.
| 301. |
State which of the following are the characteristics of service costing.1. High levels of indirect costs as a proportion of total costs2. Use of composite cost units3. Use of equivalent units |
| A. | only |
| B. | and (2) only |
| C. | only |
| D. | and (3) only |
| Answer» C. only | |
| 302. |
A company calculates the prices of jobs by adding overheads to the prime cost and adding 30% to total costs as a profit margin. Job number Y256 was sold for Rs1690 and incurred overheads of Rs 694. What was the prime cost of the job? |
| A. | s 489 |
| B. | s 606 |
| C. | s 996 |
| D. | s 1300 |
| Answer» B. s 606 | |
| 303. |
A job is budgeted to require 3,300 productive hours after incurring 25% idle time. If the total labour cost budgeted for the job is Rs 36,300. What is the labour cost per hour( to the nearest cent)? |
| A. | s 8.25 |
| B. | s 8.80 |
| C. | s 11.00 |
| D. | s 14.67 |
| Answer» B. s 8.80 | |
| 304. |
"Which of the following statements is/are correct?1. A materials requisition note is used to record the issue of direct material to a specific job.2. A typical job cost will contain actual costs for material, labour and production overheads, and non –production overheads are often added as a percentage of total production cost.3. The job costing method can be applied in costing batches" |
| A. | only |
| B. | and (2) only |
| C. | and (3) only |
| D. | and (3) only |
| Answer» D. and (3) only | |
| 305. |
A process costing system for J Co used an input of 3,500Kg of materials at Rs20 per Kg and labour hours of 2,750 at Rs 25 per hour. Normal loss is 20% and losses can be sold at a scrap value of Rs5 per Kg. Output was 2,950 Kg. What is the value of the output? |
| A. | s 142,485 |
| B. | s 146,183 |
| C. | s 149,746 |
| D. | s 152,986 |
| Answer» B. s 146,183 | |
| 306. |
"Process B had no opening inventory. 13,500 units of raw material were transferred in at Rs 4.50 per unit. Additional material at Rs1.25per unit was added in process. Labour and overheads were Rs 6.25 per completed unit and Rs 2.50 per unit incomplete.If 11,750completed units were transferred out, what was the closing inventory in Process B?" |
| A. | s 6562.50 |
| B. | s 12,250.00 |
| C. | s 14,437.50 |
| D. | s 25,375.00 |
| Answer» D. s 25,375.00 | |
| 307. |
In process costing, a joint product is: |
| A. | product which is later divided into many parts |
| B. | product which is produced simultaneously with other products and is of similar value to at least one of the other products. |
| C. | product which is produced simultaneously with other products but which is of a greater value than any of the other products. |
| D. | product produced jointly with another organization |
| Answer» C. product which is produced simultaneously with other products but which is of a greater value than any of the other products. | |
| 308. |
"Which of the following would explain an adverse variable production overhead efficiency variance?1 Employees were of a lower skill level than specified in the standard2 Unexpected idle time resulted from a series of machine breakdown3 Poor Quality material was difficult to process" |
| A. | 1), (2) and (3) |
| B. | and (2) |
| C. | and (3) |
| D. | and (3) |
| Answer» E. | |
| 309. |
"During September, 300 labour hours were worked for a total cost of Rs. 4800 The variable overhead expenditure variance was Rs. 600 (A) Overheads are assumed to be related to direct labour hours of active working.What was the standard cost per labour hour?" |
| A. | s. 14 |
| B. | s. 1650 |
| C. | s. 1750 |
| D. | s. 18 |
| Answer» B. s. 1650 | |
| 310. |
AT Co makes a single product and is preparing its material usage budget for next year Each unit of product requires 2kg of material, and 5,000 units of product are to be produced next year Opening inventory of material is budgeted to be 800 kg and AT co budgets to increase material inventory at the end of next year by 20%.The material usage budget for next year is |
| A. | ,000 Kg |
| B. | ,840 kg |
| C. | 0,000 Kg |
| D. | 0,160 Kg |
| Answer» D. 0,160 Kg | |
| 311. |
Service departments costs should be allocated to: |
| A. | nly Service departments |
| B. | nly Production departments |
| C. | oth Production and service departments |
| D. | one of the production and service departments |
| Answer» D. one of the production and service departments | |
| 312. |
Which of the following is not a method of cost absorption? |
| A. | ercentage of direct material cost |
| B. | achine hour rate |
| C. | abour hour rate |
| D. | epeated distribution method |
| Answer» E. | |
| 313. |
Allotment of whole item of cost to a cost centre or cost unit is known as: |
| A. | ost Apportionment |
| B. | ost Allocation |
| C. | ost Absorption |
| D. | achine hour rate |
| Answer» C. ost Absorption | |
| 314. |
The actual output of 162,500 units and actual fixed costs of Rs 87000 were exactly as budgeted. However, the actual expenditure of Rs 300,000 was Rs 18,000 over budget. What was the budget variable cost per unit? |
| A. | s 1.20 |
| B. | s 1.31 |
| C. | s1.42 |
| D. | s 1.50 |
| Answer» B. s 1.31 | |
| 315. |
"BDL Ltd. is currently preparing its cash budget for the year to 31 March 20XX. An extract from its sales budget for the same year shows the following sales values.RsMarch 60,000April 70,000May 55,000June 65,00040% of its sales are expected to be for cash. Of its credit sales, 70% are expected to pay in month after sale and take a 2% discount. 27% are expected to pay in the second month after the sale, and the remaining 3% are expected to be bad debts. The value of sales budget to be shown in the cash budget for May 20XX is" |
| A. | s. 60,532 |
| B. | s. 61,120 |
| C. | s. 66,532 |
| D. | s. 86,620 |
| Answer» B. s. 61,120 | |
| 316. |
A Local Authority is preparing cash Budget for its refuse disposal department. Which of the following items would not be included in the cash budget? |
| A. | apital cost of a new collection vehicle |
| B. | epreciation of the machinery |
| C. | peratives wages |
| D. | uel for the collection Vehicles |
| Answer» C. peratives wages | |
| 317. |
Calculate the labour turnover rate according to Separation method from the following:No of workers on the payroll:- At the beginning of the month: 500- At the end of the month: 600During the month, 5 workers left, 20 workers were discharged and 75 workers were recruited Of these, 10 workers were recruited in the vacancies of those leaving and while the rest were engaged for an expansion scheme |
| A. | .55% |
| B. | .82% |
| C. | % |
| D. | % |
| Answer» B. .82% | |
| 318. |
Calculate the labour turnover rate according to replacement method from the following:No of workers on the payroll:- At the beginning of the month: 500- At the end of the month: 600During the month, 5 workers left, 20 workers were discharged and 75 workers were recruited Ofthese, 10 workers were recruited in the vacancies of those leaving and while the rest were engaged for an expansion scheme |
| A. | .55% |
| B. | .82% |
| C. | % |
| D. | % |
| Answer» C. % | |
| 319. |
"Calculate workers recruited and joined from the following:Labour turnover rates are 20%, 10% and 6% respectively under Flux method, Replacement method andSeparation method No of workers replaced during the quarter is 80" |
| A. | 12 |
| B. | 0 |
| C. | 8 |
| D. | 4 |
| Answer» B. 0 | |
| 320. |
Which of the following is not an avoidable cause of labour turnover: |
| A. | issatisfaction with Job |
| B. | ack of training facilities |
| C. | ow wages and allowances |
| D. | isability, making a worker unfit for work |
| Answer» E. | |
| 321. |
Labour turnover means: |
| A. | urnover generated by labour |
| B. | ate of change in composition of labour force during a specified period |
| C. | ither of the above |
| D. | oth of the above |
| Answer» C. ither of the above | |
| 322. |
If overtime is resorted to at the desire of the customer, then the overtime premium: |
| A. | hould be charged to costing profit and loss account; |
| B. | hould not be charged at all |
| C. | hould be charged to the job directly |
| D. | hould be charged to the highest profit making department |
| Answer» D. hould be charged to the highest profit making department | |
| 323. |
"Calculate re-order level from the following:Safety stock: 1000 unitsConsumption per week: 500 unitsIt takes 12 weeks to reach material from the date of ordering" |
| A. | 000 units |
| B. | 000 units |
| C. | 000 units |
| D. | 000 units |
| Answer» E. | |
| 324. |
Cost of abnormal wastage is: |
| A. | harged to the product cost |
| B. | harged to the profit & loss account |
| C. | harged partly to the product and partly profit & loss account |
| D. | ot charged at all |
| Answer» C. harged partly to the product and partly profit & loss account | |
| 325. |
"Calculate the value of closing stock from the following according to Weighted Average method:1st January, 20XX: Opening balance: 50 units @ Rs 4Receipts:5th January, 20XX: 100 units @ Rs 512th January, 20XX: 200 units @ Rs 450Issues:2nd January, 20XX: 30 units18th January, 20XX: 150 units" |
| A. | s. 765 |
| B. | s. 805 |
| C. | s. 786 |
| D. | s. 700 |
| Answer» D. s. 700 | |
| 326. |
"Calculate the value of closing stock from the following according to LIFO method:1st January, 20XX: Opening balance: 50 units @ Rs 4Receipts:5th January, 20XX: 100 units @ Rs 512th January, 20XX: 200 units @ Rs 4.50Issues:2nd January, 20XX: 30 units18th January, 20XX: 150 units" |
| A. | s. 765 |
| B. | s. 805 |
| C. | s. 786 |
| D. | s. 700 |
| Answer» C. s. 786 | |
| 327. |
"Calculate the value of closing stock from the following according to FIFO method:1st January, 20XX: Opening balance: 50 units @ Rs 4Receipts:5th January, 20XX: 100 units @ Rs 512th January, 20XX: 200 units @ Rs 4.50Issues:2nd January, 20XX: 30 units18th January, 20XX: 150 units" |
| A. | s. 765 |
| B. | s. 805 |
| C. | s. 786 |
| D. | s. 700 |
| Answer» B. s. 805 | |
| 328. |
"Following information is available of XYZ Limited for quarter ended June, 20XXFixed cost Rs 5,00,000Variable cost Rs 10 per unitSelling price Rs 15 per unitOutput level 1,50,000 unitsWhat will be amount of profit earned during the quarter using the marginal costing technique?" |
| A. | s 2,50,000 |
| B. | s 10,00,000 |
| C. | s 5,00,000 |
| D. | s 17,50,000 |
| Answer» B. s 10,00,000 | |
| 329. |
The summarized balance sheet of Autolight Limited shows the balances of previous and current year of retained earnings Rs 25,000 and Rs 35,000. If dividend paid during the current year amounted to Rs 5,000 then profit earned during the year will be: |
| A. | s 5,000 |
| B. | s 55,000 |
| C. | s 15,000 |
| D. | s 65,000 |
| Answer» D. s 65,000 | |
| 330. |
The summarized balance sheet of Rakesh udyog Limited shows the balances of previous and current year of provision for taxation Rs 50,000 and Rs 65,000. If taxed paid during the current year amounted to Rs 70,000 then amount charge from Profit and Loss Account will be: |
| A. | s 55,000 |
| B. | s 85,000 |
| C. | s 45,000 |
| D. | s 1,85,000 |
| Answer» C. s 45,000 | |
| 331. |
If credit sales for the year is Rs 5,40,000 and Debtors at the end of year is Rs 90,000 the Average Collection Period will be |
| A. | 0 days |
| B. | 1 days |
| C. | 0 days |
| D. | 20 days |
| Answer» C. 0 days | |
| 332. |
Statutory cost audit are applicable only to: |
| A. | irm |
| B. | ompany |
| C. | ndividual |
| D. | ociety |
| Answer» C. ndividual | |
| 333. |
_____________ is a detailed budget of cash receipts and cash expenditure incorporating both revenue and capital items. |
| A. | ash Budget |
| B. | apital Expenditure Budget |
| C. | ales Budget |
| D. | verhead Budget |
| Answer» B. apital Expenditure Budget | |
| 334. |
___________ is a summary of all functional budgets in a capsule form. |
| A. | unctional Budget |
| B. | aster Budget |
| C. | ong Period Budget |
| D. | lexible Budget |
| Answer» C. ong Period Budget | |
| 335. |
_________ is also known as working capital ratio. |
| A. | urrent ratio |
| B. | uick ratio |
| C. | iquid ratio |
| D. | ebt-equity ratio |
| Answer» B. uick ratio | |
| 336. |
In ‘make or buy’ decision, it is profitable to buy from outside only when the supplier’s price is below the firm’s own ______________. |
| A. | ixed Cost |
| B. | ariable Cost |
| C. | otal Cost |
| D. | rime Cost |
| Answer» C. otal Cost | |
| 337. |
The cost per unit of a product manufactured in a factory amounts to Rs 160 (75% variable) when the production is 10,000 units. When production increases by 25%, the cost of production will be Rs per unit. |
| A. | s 145 |
| B. | s 150 |
| C. | s 152 |
| D. | s 140 |
| Answer» D. s 140 | |
| 338. |
A transport company is running five buses between two towns, which are 50 kms apart. Seating capacity of each bus is 50 passengeRs Actually passengers carried by each bus were 75% of seating capacity. All buses ran on all days of the month. Each bus made one round trip per day. Passenger kms are: |
| A. | 81250 |
| B. | 87500 |
| C. | 62500 |
| D. | one of the above |
| Answer» D. one of the above | |
| 339. |
In case of joint products, the main objective of accounting of the cost is to apportion the joint costs incurred up to the split off point. For cost apportionment one company has chosen Physical Quantity Method. Three joint products ‘A’, ‘B’ and ‘C’ are produced in the same process. Up to the point of split off the total production of A, B and C is 60,000 kg, out of which ‘A’ produces 30,000 kg and joint costs are Rs 3,60,000. Joint costs allocated to product A is. |
| A. | s 1,20,000 |
| B. | s 60,000 |
| C. | s 1,80,000 |
| D. | one of the these |
| Answer» D. one of the these | |
| 340. |
"After inviting tenders for supply of raw materials, two quotations are received as follows—Supplier P Rs 2.20 per unit, Supplier Q Rs 2.10 per unit plus Rs 2,000 fixed charges irrespective of the units ordered. The order quantity for which the purchase price per unit will be the same—" |
| A. | 2,000 units |
| B. | 0,000 units |
| C. | 1,000 units |
| D. | one of the above. |
| Answer» C. 1,000 units | |
| 341. |
Capital gearing ratio is ___________. |
| A. | arket test ratio |
| B. | ong-term solvency ratio |
| C. | iquid ratio |
| D. | urnover ratio |
| Answer» C. iquid ratio | |
| 342. |
A company's break even point is 6,000 units per annum. The selling price is Rs 90 per unit and the variable cost is Rs 40 per unit. What are the company's annual fixed costs? |
| A. | s 120 |
| B. | s 2,40,000 |
| C. | s 3,00,000 |
| D. | s 5,40,000 |
| Answer» D. s 5,40,000 | |
| 343. |
"It is now expected that the variable production cost per unit and the selling price per unit will each increase by 10%, and fixed production cost will rise by 25%. What will be the new break even point?Selling price - Rs 6 per unitVariable production cost - Rs 1.20 per unitVariable selling cost - Rs 0.40 per unitFixed production cost - Rs 4 per unitFixed selling cost - Rs 0.80 per unitBudgeted production and sales for the year are 10,000 units." |
| A. | ,788 units |
| B. | 1,600 units |
| C. | 1,885 units |
| D. | 2,397 units |
| Answer» D. 2,397 units | |
| 344. |
"How many units must be sold if company wants to achieve a profit of Rs 11,000 for the year?Selling price - Rs 6 per unitVariable production cost - Rs 1.20 per unitVariable selling cost - Rs 0.40 per unitFixed production cost - Rs 4 per unitFixed selling cost - Rs 0.80 per unitBudgeted production and sales for the year are 10,000 units." |
| A. | ,500 units |
| B. | ,833 units |
| C. | 0,625 units |
| D. | 3,409 units |
| Answer» E. | |
| 345. |
A company manufactures a single product for which cost and selling price data are as follows:Selling price per unit - Rs 12Variable cost per unit - Rs 8Fixed cost for a period - Rs 98,000Budgeted sales for a period - 30,000 unitsThe margin of safety, expressed as a percentage of budgeted sales,is: |
| A. | 0% |
| B. | 5% |
| C. | 3% |
| D. | 25% |
| Answer» B. 5% | |
| 346. |
A company makes a single product and incurs fixed costs of Rs 30,000 per annum. Variable cost per unit is Rs 5 and each unit sells for Rs 15. Annual sales demand is 7,000 units. The breakeven point is: |
| A. | ,000 units |
| B. | ,000 units |
| C. | ,000 units |
| D. | ,000 units |
| Answer» C. ,000 units | |
| 347. |
"The following information is available for the W hotel for the latest thirty day period.Number of rooms available per night 40Percentage occupancy achieved 65%Room servicing cost incurred Rs 3900The room servicing cost per occupied room-night last period, to the nearest Rs, was:" |
| A. | s 3.25 |
| B. | s 5.00 |
| C. | s 97.50 |
| D. | s 150.00 |
| Answer» C. s 97.50 | |
| 348. |
"Calculate the most appropriate unit cost for a distribution division of a multinational company using the following information.Miles travelled 636,500Tonnes carried 2,479Number of drivers 20Hours worked by drivers 35,520Tonnes miles carried 375,200Cost incurred 562,800" |
| A. | s .88 |
| B. | s 1.50 |
| C. | s 15.84 |
| D. | s28, 140 |
| Answer» C. s 15.84 | |
| 349. |
Under absorption of overhead expenses in cost accounting results in _________. |
| A. | ecrease in costing profit |
| B. | ecrease in financial accounts profit |
| C. | ncrease in costing profit |
| D. | ncrease in financial accounts profit |
| Answer» D. ncrease in financial accounts profit | |
| 350. |
Overvaluation of opening stock in financial accounting results ________. |
| A. | ecreases costing profit |
| B. | ecreases financial accounts profit |
| C. | ncreases costing profit |
| D. | ncreases financial accounts profit |
| Answer» C. ncreases costing profit | |