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Sem VI - Cost Accounting - TY. Bcom

This document contains 50 multiple choice questions related to cost accounting concepts and principles. The questions cover topics such as cost variance analysis, break-even analysis, absorption costing, joint cost allocation, and standard costing.

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mahesh patil
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523 views

Sem VI - Cost Accounting - TY. Bcom

This document contains 50 multiple choice questions related to cost accounting concepts and principles. The questions cover topics such as cost variance analysis, break-even analysis, absorption costing, joint cost allocation, and standard costing.

Uploaded by

mahesh patil
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Sample questions

TY. Bcom
Cost Accounting - Semester - VI
1. The selling price per unit less the variable cost per unit is the
a. Fixed cost per unit.
b. Gross profit per unit.
c. Operating profit per unit.
d. Contribution per unit

2. A contract is a separate
a. Unit of cost.
b. Cost centre.
c. Account.
d. None of the above.

3. Idle time variance is always


a. favourable
b. unfavourable
c. controllable
d. None of the above

4. WDV of plant destroyed by accident is credited to


a. Machinery A/c
b. Contract A/c
c. Contractee A/c
d. Contractors A/c

5. At the break-even point, which equation will be true.


a. Variable cost - fixed cost = Contribution
b. Sales = Variable cost + Fixed cost
c. Sales - Fixed cost = Contribution
d. Sales - Contribution = Variable cost

6. Labour Cost Variance = Labour Rate Variance + Labour _______Variance


a. Yield
b. Rate
c. Efficiency
d. Mix

7. Abnormal loss is not allowed to


a. Affect cost of output
b. Affect market value
c. Affect input
d. None of the above
8. Favorable labour efficiency variance indicates
a. Improvement in labour efficiency
b. Cost reduction
c. Improvement in quality
d. None of the above

9. Input is 950 units normal loss is 10% output is 840 units abnormal loss is
a. 20 units
b. 25 units
c. 15 units
d. 30 units

10. Margin of safety is expressed as


a. Profit / P/V ratio
b. (Actual sales - sales at BEP)/ Actual sales
c. Actual sales - sales at BEP
d. All of the above

11. A Ltd. used 4,538 kgs of material at a standard cost of Rs 2.50 per kg. The material usage
variance was Rs 280 (Favourable). The standard usage of material for the period is
a. 4,700 kgs
b. 4,650 kgs
c. 4,600 kgs
d. 4,588 kgs

12. Cost of output is calculated at each process


a. Everyday
b. Periodically
c. Weekly
d. Monthly

13. Difference between standard and actual cost is called


a. Variance
b. Profit
c. Loss
d. Wastage

14. The product which has equal economic importance is a


a. Joint Product
b. By - Product
c. Economic product
d. Consumer product

15. If contribution, margin increase by Rs 2 per units, then operating profits will
a. also increase by Rs 2 per unit
b. Increase by less than Rs 2 per unit
c. decrease by Rs 2 per unit
d. cannot say
16. Cost driver for personnel are
a. Recruitment activity
b. Industrial relations
c. Training requirement
d. All of the Above

17. The journal entry needed to record the completion of a job includes a
a. debit to cost of goods sold
b. debit to work in process
c. debit to finished goods inventory
d. debit to raw materials inventory

18. The total cost of manufacturing 4,000 units of a product is Rs 4,50,000 which includes
fixed costs of Rs 2,50,000. If the company desires to produce 5,000 units, then the total
cost will be-
a. Rs 5,27,778
b. Rs 5,20,000
c. Rs 5,00,000
d. Rs 4,95,000

19. Under which of the following situations is raw materials inventory credited and work in
process inventory debited?
a. We ship goods to the customer
b. Material is transferred to the factory
c. We transfer goods to the storeroom
d. We purchase goods on account

20. The standard and the actual requirements of material of a company are as under: Standard
– 2,400 units at the rate of Rs 20 per unit Actual – 2,600 units at the rate of Rs 19 per unit
the material cost variance is
a. Rs 2,600 (Adverse)
b. Rs 1,400 (Favourable)
c. Rs 2,400 (Adverse)
d. Rs 1,400 (Adverse)

21. Excess of standard cost over actual cost is a-


a. Favourable variance
b. Abnormal gain
c. Unfavourable variance
d. None of the above
22. The Manufacturing Overhead Control account
a. is increased by allocated manufacturing overhead
b. is credited with amounts transferred to Work-in-Process
c. is decreased by allocated manufacturing overhead
d. is debited with actual overhead costs
23. Sales Rs 3,00,000, Variable cost is Rs 1,70,000 profit is 20% on sale. Fixed cost will be
a. Rs 60,000
b. Rs 70,000
c. Rs 80,000
d. Rs 95,000

24. Bench marking involves


a. Meaning
b. Analysis
c. Integration
d. All of the above

25. Activity based costing is a


a. Method of costing
b. Method of allocation
c. Techniques of costing
d. All of the above

26. This is essential to make the cost ledger 'self-balancing'.


a. General Ledger Adjustment Account
b. Stores Ledger Control Account
c. Work-in-Progress Ledger
d. Finished Goods Control Account

27. The balance of the Work in Process account is equal to


a. The total costs of the jobs completed
b. The total costs of the jobs completed and sold
c. The total manufacturing costs incurred during the period
d. The total costs of the incomplete jobs

28. This represents the total value of finished goods in stock


a. General ledger Adjustment Account
b. Stores Ledger control Account
c. Work-in-progress Ledger
d. Finished goods Control Account

29. What is an interlocking bookkeeping system?


a. A single, combined system containing both cost accounting and financial accounting
records
b. A system combining cost accounting and management accounting
c. A system with high secured access
d. A system where separate accounts are kept for cost accounting and for financial
accounting.
30. _______ is the person for whom the Contract job is undertaken
a. Contractor
b. Contractee
c. Sub-contractor
d. Job-worker
31. In contract costing Work-in-progress at year end is equal to
a. only closing stock of materials
b. only work certified
c. only work uncertified
d. the total of all the above

32. Work certified is between 25% and 50% of the contract price. The transfer to P&L A/c
will be
a. 1/3rd of Notional profits, reduced in the ratio of cash received to work certified
b. NIL
c. 2/3rd of Notional profits, reduced in the ratio of cash received to work certified
d. 100% of Notional profits

33. Selling Overhead recovered is credited to _____


a. Cost of Sales
b. Finished Goods Control
c. Manufacturing overhead A/c
d. Work in progress A/c

34. Realizable value of abnormal loss is credited to _______


a. Process A/c
b. Abnormal Loss A/c
c. Abnormal gain A/c
d. Process stock A/c

35. Contract costing is a variant of _______Costing


a. Budgetary
b. Process
c. Operating
d. Job

36. Process cost is very much applicable in


a. Construction Industry
b. Pharmaceutical Industry
c. Airline Company
d. Transport company

37. Joint Cost are allocated according to sales value of individual products under -
a. Market Value Method
b. Average Unit Cost Method
c. Survey Method
d. Physical Unit Method

38. Value of Work Certified Rs 2,50,000; Cost of Work Uncertified Rs 20,000; Total Cost
incurred till date Rs 1,20,000. Notional Profit is Rs _______.
a. 1,30,000
b. 1,00,000
c. 1,50,000
d. 2,70,000
39. To obtain break even point in rupee, total fixed cost is divided by
a. variable cost per unit
b. contribution per unit
c. fixed cost per unit
d. P /V Ratio

40. A process gives rise, incidentally, to an item of low value, which is called
a. a joint product
b. a by-product
c. scrap
d. waste

41. Profit is Rs 3,000 contribution per Unit Rs 6, Margin of safety will be


a. Rs 400
b. Rs 1,400
c. Rs 1,600
d. Rs 500

42. Profit volume ratio is improved by reducing


a. Variable cost
b. Fixed cost
c. Both of them
d. None of the above

43. If standard cost is lower than the actual cost, the difference is known as
a. Favourable
b. Adverse
c. Positive
d. Negative

44. When variable cost decreases, the break-even point


a. Increases
b. Decreases
c. No effect
d. Can’t say

45. Costs that are common to many different activities within an organization are known as
costs.
a. Product-level
b. Facility-level
c. Batch-level
d. Unit-level

46. The labour rate variance is computed as :


a. (Actual labour hours worked - Standard labour hours allowed) x Actual labour rate
b. (Actual labour hours worked - Standard labour hours allowed) x Standard labour rate
c. (Actual labour rate - Standard labour rate) x Standard hours allowed
d. (Actual labour rate - Standard labour rate) x Actual hours worked

47. What is the purpose of ABC?


a. To identify what product costs are incurred by a company
b. To allocate and assign all product costs incurred to the appropriate products or
services
c. To determine a cost object for which cost information is needed
d. To allocate and assign indirect costs

48. The standard which can be attained under the most favourable conditions possible
a. Ideal Standard
b. Expected Standard
c. Current Standard
d. Normal Standard

49. Which one of the following is a collection of overhead costs related to a cost object?
a. Cost pool
b. Cost driver
c. Cost object
d. Cost allocation

50. Sale of By - product is


a. Debited to process A/c
b. Credited to profit and loss A/c
c. Credited to process A/c
d. Debited to normal A/c

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