1. An example of an inventoriable cost wouldbe: a) Shipping fees b) Advertising
ID: 2457566 • Letter: 1
Question
1. An example of an inventoriable cost wouldbe:
a) Shipping fees
b) Advertising flyers
c) Sales commissions
d) Direct materials
2. Direct materials cost is Rs. 80,000. Direct laborcost is Rs. 60,000. Factory overhead is Rs. 90,000. Beginning goodsin process were Rs. 15,000. The cost of goods manufactured is Rs.245,000. What is the cost assigned to the ending
goods in process?
a) Rs. 45,000
b) Rs. 15,000
c) Rs. 30,000
d) There will be no ending Inventory
3. The FIFO inventory costing method (when using underperpetual inventory system) assumes that the cost of the earliestunits purchased is allocated in which of the followingways?
a) First to be allocated to the ending inventory
b) Last to be allocated to the cost of goods sold
c) Last to be allocated to the ending inventory
d) First to be allocated to the cost of good sold
4. Heavenly Interiors had beginning merchandiseinventory of Rs. 75,000. It made purchases of Rs. 160,000 andrecorded sales of Rs. 220,000 during November. Its estimated grossprofit on sales was 30%. On November 30, the store was destroyed byfire. What was the value of the merchandise inventoryloss?
a) Rs. 154,000
b) Rs. 160,000
c) Rs. 235,000
d) Rs. 81,000
5. Inventory control aims at:
a) Achieving optimization
b) Ensuring against market fluctuations
c) Acceptable customer service at low capital investment
d) Discounts allowed in bulk purchase
6. Which of the following is a factor that should betaken into account for fixing
re-order level?
a) Average consumption
b) Economic Order Quantity
c) Emergency lead time
d) Danger level
7. EOQ is a point where:
a) Ordering cost is equal to carrying cost
b) Ordering cost is higher than carrying cost
c) Ordering cost is lesser than the carrying cost
d) Total cost should be maximum
8. Grumpy & Dopey Ltd estimated that during the year75,000 machine hours would be used and it has been using anoverhead absorption rate of Rs. 6.40 per machine hour in itsmachining department. During the year the overhead expenditureamounted to Rs. 472,560 and 72,600 machine hours wereused.
Which one of the following statements iscorrect?
a) Overhead was under-absorbed by Rs.7,440
b) Overhead was under-absorbed by Rs.7,920
c) Overhead was over-absorbed by Rs.7,440
d) Overhead was over-absorbed by Rs.7,920
9. A business always absorbs its overheads on laborhours. In the 8th period, 18,000 hours were worked, actualoverheads were Rs. 279,000 and there was Rs. 36,000over-absorption. The overhead absorption rate per hourswas:
a) Rs. 15.50
b) Rs. 17.50
c) Rs. 18.00
d) Rs. 13.50
10. The main purpose of cost accounting isto:
a) Maximize profits
b) Help in inventory valuation
c) Provide information to management for decision making
d) Aid in the fixation of selling price
11. In which of the following would there be adifference between financial and managerialaccounting?
a) Users of the information
b) Purpose of the information
c) Flexibility of practices
d) All of the given options
12. Which of the following is a cost that changes inproportion to changes in volume?
a) Fixed cost
b) Sunk cost
c) Opportunity cost
d) None of the given options
13. Cost accounting information can be used for allEXCEPT:
a) Budget control and evaluation
b) Determining standard costs and variances
c) Pricing and inventory valuation decisions
d) Analyzing the data
14. Which of the following is not an element of factoryoverhead?
a) Depreciation on the maintenance equipment
b) Salary of the plant supervisor
c) Property taxes on the plant buildings
d) Salary of a marketing manager
15. The main difference between the profit center andinvestment center is:
a) Decision making
b) Revenue generation
c) Cost incurrence
d) All of the given options
16. Opportunity cost is the best exampleof:
a) Sunk Cost
b) Standard Cost
c) Relevant Cost
d) Irrelevant cost
17- If, Sales = Rs. 800,000, Markup = 25% ofcost, what would be the value of Gross
profit?
a) Rs. 200,000
b) Rs. 160,000
c) Rs. 480,000
d) Rs. 640,000
18- Which of the following is correct?
a) Opening finished goods units + Units produced – Closingfinished goods units =
Units sold
b) Units Sold = Units produced + Closing finished goods units -Opening finished goods
units
c) Sales + Average units of finished goods inventory
d) None of the given options
19- Loss by fire is an example of:
a) Normal Loss
b) Abnormal Loss
c) Both normal loss and abnormal loss
d) Can not be determined
20- In cost Accounting, abnormal loss is chargedto:
a) Factory overhead control account
b) Work in process account
c) Income Statement
d) All of the given options
Explanation / Answer
1.A 2.D 3.D 4.D 5.A 6.B 7.B 8.B 9.D 10.C 11.D 12.D 13.C 14.D 15.A 16.C 17.B 18.D 19.B 20.A
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.