Monday, 5 December 2011

Cost Accounting Multiple Choice Questions

Greetings to fellow blog readers......

COST ACCOUNTING PAPER FOR INTERVIEW PREPARATION

1. Costing is a technique of :

(a) Income determination (b) External reporting

2. Which of the following function relates to Cost Accounting ?

(a) Internal Reporting (b) External Reporting

3. …is useful not only to ascertain the cost but also to control the cost :

(a) Management Accounting (b) Cost Accounting

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

6. Cost Accounting is a tool of :

(a) Financial Accounting (b) Management Accounting

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

9. …is the cost which fluctuates with volume of production :

(a) Fixed Cost (b) Variable cost

10. …per unit increases when production volume decreases :

(a) Variable cost (b) Semi Variable cost

11. …is useful for making managerial decisions :

(a) Conversion cost (b) Opportunity cost

12. …is the sum total of Direct Wages, Direct Expenses and Factory Overheads :

(a) Opportunity Cost (b) Differential Cost

13. Cost of goods produced include :

(a) Work in progress and total cost (b) Cost of production and prime cost

14. Multiple Costing Method is used in :

(a) Knitwear textile industry (b) cement industry

15. Factory overheads =

(a) Work Cost (b) Prime Cost

16. Direct material + Direct Labour + Direct expenses =

(a) Factory on cost (b) Prime 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

19. In a educational institutions, cost unit is :

(a) Office Staff (b) Students

20. In hospitals, cost unit is :

(a) Per tone km (b) Number

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

23. A statement that sets out the divisional classification of costs is known as :

(a) Income statement (b) Statement of Cost and Profit

24. Which of the following is the main aims of Cost Accounting ?

(a) Cost Control (b) Cost Ascertainment

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

27. Which of the following documents is used for issuing materials to the prouction department :

(a) Materials Inspection Note (b) Stores Ledger Note

28. …is a schedule of materials needed for a job.

(a) Bill of Materials (b) Purchase Requisition

29. Proportional Parts Value Analysis is called as :

(a) Demand and Supply method (b) Perpetual Inventory System

ANSWERS

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

Wednesday, 30 November 2011

Financial Accounting multiple choice questions-4

Greetings to fellow blog readers......

77. Which of the following accounts have only credit balance ?

1. Accounts payable account 2. Salaries outstanding

3. Reserve fund a/c 4. All of the above

78. Which of the following accounts may be a debit balance ?

1. Discount received a/c 2. Sales a/c

3. Trade expenses a/c 4. Loan account

79. Cash book records :

1. All receipts and payments of cash 2. All cash and credit sales of goods

3. All cash and credit sales of goods 4. None of these

80. Subsidiary books can be divided into how many types ?

1. 2 2. 8 3. 4 4. 7

81. Cash discount is provided on :

1. Sales 2. Prompt payments

3. Purchase 4. None of these

82. Cash book is a ?

1. Ledger a/c 2. Subsidiary Journal and ledger a/c

3. Subsidiary Journal only 4. None of these

83. Which of the following books should be used to record purchase if furniture on credit ?

1. Journal book 2. Journal proper

3. Cash book 4. Purchase book

84. Which of the following accounts is increased by debit entries ?

1. Machinery accounts 2. Purchase return accounts

3. Discount received accounts 4. None of these

85. The debit balance in the banks account is :

1. An asset 2. A Liability

3. An expenses 4. None of these

86. Return outwards book makes a record of :

1. Goods returned to the suppliers 2. Goods returned by the customers

3. Goods returned by the proprietors 4. None of these

87. A purchases book is kept to record :

1. All purchases of goods 2. All cash purchases

3. All credit purchases 4. All credit purchases of goods

88. A Return outward book is kept to record :

1. Return of goods purchased 2. Returns of anything purchased

3. Returns of goods sold 4. Returns of anything sold

89. The total of the sales book is posted periodically to the :

1. Credit of sales account 2. Debit of purchases account

3. credit of capital account 4. None of these

90. Sales book is kept to record :

1. All sales of goods for cash 2. All credit sales

3. All credit sales of goods 4. Returns of goods

91. Sales returns book is kept to record :

1. Returns of goods sold

2. Returns of goods purchased by the proprietor for his personal use

3. Returns of machinery purchased

4. None of these

92. A business has assets of Rs.20,000 and the owner’s equity is Rs.8,000. What is the amount of liabilities ?

1. Rs.12,000 2. Rs.28,000 3. Rs.14,000 4. None of these

93. Cash sales are recorded in :

1. Sales book 2. Journal 3. Bank a/c 4. Cash book

94. If stock worth Rs.10,000 (That has not been insured) is destroyed by fire. Accounting entry is

1. Profit & Loss a/c – Dr 10,000 2. Stock a/c – Dr. 10,000

To Trading a/c – 10,000 To Trading a/c – 10,000

3. Trading a/c – Dr 10,000 4. None of these

To Stock a/c – 10,000

95. Preparation of trial balance helps in locating errors of ?

1. Omission 2. A clerical nature

3. Commission 4. All types

96. In which of the following would an adjusting entry for depreciation be made ?

1. Cash book 2. Journal

3. Sales book 4. Purchases book

97. What is the accounting entry required for issuing a purchase order of Rs.10,000 to S. Sahay ?

1. Purchases a/c – Dr. 10,000 2. Purchases order a/c – Dr. 10,000

To Cash a/c – 10,000 To S. Sahay a/c – 10,000

3. Purchases order a/c – Dr. 10,000 4. None of these

To S. Sahay a/c – 10,000

98. Which of the following accounts has only credit entries ?

1. Accounts payable 2. Capital a/c

3. Reserve fund a/c 4. All the above

99. Receipt of Rs.2,500 from Kamal, a debtor has not been recorded in the books. The profit would shows ?

1. an increase of Rs.2,500 2. A decrease of Rs.2,500

3. Neither increase nor decrease 4. None of the above

100. A chronological record of transactions may be found in :

1. Balance Sheet 2. Trial balance

3. Ledger 4. Journal

ANSWERS

77.4 78.4 79.1 80.2 81.2 82.2 83.2 84.1

85.2 86.1 87.4 88.3 89.1 90.3 91.1 92.1 93.4 94.1 95.2 96.4

97.4 98.4 99.3 100.4

Finance and Accounting terminology

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