Monday, 5 December 2011

Cost Accounting Multiple Choice Questions

Greetings to fellow blog readers......


1.    Costing is a technique of :
(a) Income determination                                                 (b) External reporting
(c) Ascertaining cost                                                        (d) Internal reporting

2.    Which of the following function relates to Cost Accounting ?
(a) Internal Reporting                                            (b) External Reporting
(c) Interim Reporting                                             (d) Routine Reporting

3.    …is useful not only to ascertain the cost but also to control the cost :
(a) Management Accounting                                (b) Cost Accounting
(c) Auditing                                                            (d) Income Tax

4.    One of the functions of cost accounting is proper matching of …with revenue
(a) Cost                             (b) Production             (c) Sales                      (d) Stock

5.    Cost Accounting Assists Financial Accounting with regard to the :
(a) Valuation of inventory                                                 (b) Determinations of income
(c) Ascertaining the financial positions                 (d) Determination of cost

6.    Cost Accounting is a tool of :
(a) Financial Accounting                                       (b) Management Accounting
(c) Auditing                                                            (d) Company Accounts

7.    Cost Accounting is based on … figures
(a) Actual                          (b) Estimated              (c) Accrual                  (d) Historical

8.    Incremental Cost is a type of :
(a) Differential Cost                                              (b) Conversions Cost
(c) Job Cost                                                          (d) Historical Cost

9.    …is the cost which fluctuates with volume of production :
(a) Fixed Cost                                                       (b) Variable cost
(c) Semi variable cost                                           (d) controllable cost

10.  …per unit increases when production volume decreases :
(a) Variable cost                                                    (b) Semi Variable cost
(c) Controllable cost                                              (d) Fixed Cost

11.  …is useful for making managerial decisions :
(a) Conversion cost                                              (b) Opportunity cost
(c) Fixed Cost                                                       (d) Incremental cost

12.  …is the sum total of Direct Wages, Direct Expenses and Factory Overheads :
(a) Opportunity Cost                                             (b) Differential Cost
(c) Variable Cost                                                   (d) Conversion Cost

13.  Cost of goods produced include :
(a) Work in progress and total cost                       (b) Cost of production and prime cost
(c) Cost of productions and work in progress      (d) None of the above

14.  Multiple Costing Method is used in :
(a) Knitwear textile industry                                  (b) cement industry
(c) Chemical industry                                           (d) Car manufacturing industry

15.  Factory overheads =
(a) Work Cost                                                       (b) Prime Cost
(c) Total Cost                                                        (d) Cost of goods sold

16.  Direct material + Direct Labour + Direct expenses =
(a) Factory on cost                                               (b) Prime Cost
(c) Cost of goods sold                                           (d) total cost

17.  …costing used in chemical works :
(a) Operating                     (b) Single                     (c) Contract                 (d) Process

18.  The method of costing used in constructional works is :
(a) Job costing                                                      (b) Batch costing
(c) Process costing                                               (d) Operating costing

19.  In a educational institutions, cost unit is :
(a) Office Staff                                                     (b) Students
(c) Children’s                                                         (d) Teachers

20.  In hospitals, cost unit is :
(a) Per tone km                                                     (b) Number
(c) Per Doctor                                                       (d) Per bed per day

21.  Which of following costing methods represent for group of identical products ?
(a) Batch                           (b) Uniform                 (c) Contract                 (d) Standard

22.  Rent, interest and wages of self owned resources are the examples of :
(a) Direct cost                                                       (b) Notional cost
(c) Selling overheads                                            (d) Distribution over heads

23.  A statement that sets out the divisional classification of costs is known as :
(a) Income statement                                           (b) Statement of Cost and Profit
(c) Cost Sheet                                                       (d) Financial Statement

24.  Which of the following is the main aims of Cost Accounting ?
(a) Cost Control                                                    (b) Cost Ascertainment
(c) Price Fixation                                                  (d) All the above

25.  Whereas direct cost is allocable to cost unit or cost centers indirect cost can be :
(a) Allocated                      (b) Collected               (c) Apportioned           (d) None of these

26.  Direct material is an example of :
(a) Fixed cost                                                        (b) Variable cost
(c) Semi-variable cost                                          (d) Office on cost

27.  Which of the following documents is used for issuing materials to the prouction department :
(a) Materials Inspection Note                                (b) Stores Ledger Note
(c) Stores Material Control Record                      (d) Materials Requisition

28.  …is a schedule of materials needed for a job.
(a) Bill of Materials                                                (b) Purchase Requisition
(c) Stock Verification Inventory Sheet                 (d) Materials Transfer Note

29.  Proportional Parts Value Analysis is called as :
(a) Demand and Supply method                          (b) Perpetual Inventory System
(c) ABC Analysis                                                  (d) Break Even analysis


1.c       2.a       3.b       4.a       5.a       6.b       7.b       8.a       9.b       10.d     11.b     12.d
13.c     14.d     15.a     16.b     17.d     18.a     19.b     20.d     21.a     22.b     23.c     24.d
25.c     26.b     27.d     28.a     29.c     

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