1. Indirect material used in production is classified as: -
Correct : D. Factory overhead
2. The cost per unit that increases or decreases when the volume of output decreases or increases is known as
Correct : C. variable cost
3. Cost accounting has developed due to the ___________ of financial accounting
Correct : B. Limitations
4. The method of costing most suitable for medicine manufacturing industry is:
Correct : C. Batch Costing
5. Cost accountancy is considered an art because it _____
Correct : B. requires necessary ability and skills
6. The main objective of cost accounting is
Correct : C. Cost control
7. Cost accounting mainly helps the management in
Correct : B. Providing information to management
8. Costs incurred for the maintenance of inventory is called
Correct : A. Carrying cost
9. Absorption costing charges:
Correct : C. Both variable and fixed
10. An important feature of a cost centre is that:
Correct : B. it has a clearly defined boundaries
11. Prime cost may be correctly defined as
Correct : A. the sum of direct materials and direct labour cost with all other costs excluded
12. The term “cost” refers to
Correct : B. the value of the sacrifice made to acquire goods or services
13. Costing is a technique of
Correct : C. ascertaining cost
14. Cost Accounting is a separate
Correct : A. branch of accounting
15. Cost Accounting serves the information needs of
Correct : C. management
16. Costs which remains constant at all level of production is a
Correct : B. fixed cost
17. An opportunity cost is
Correct : A. the advantage forgone
18. Three elements of cost are:
Correct : C. Labour, Material, Other Expense
19. Cost of production is equal to:
Correct : C. Works cost plus Administrative cost
20. Works cost include
Correct : C. Direct Material + Direct Labour + Direct Expenses + Works Expenses
21. Which of the following is not Selling and Distribution Expenses:
Correct : D. Primary packing material
22. Profit is:
Correct : C. Sales minus cost of sales
23. Which of the following is not included in cost?
Correct : B. Dividend
24. Value of material consumed is:
Correct : B. Opening stock of material + Purchases of material – Closing stock of material
25. Specify the expenses excluded from costs:
Correct : B. Expenses of raising capital
26. In this technique of selective control, materials are analysed according to their value so that costly and more valuable materials are given greater attention and care
Correct : B. ABC technique
27. . This is a level at which normal issues of materials are stopped and urgent action is taken for procurement of materials
Correct : D. Danger level
28. The purchasing system where there is a separate purchasing department entrusted with the task of making all purchases is called
Correct : A. Centralised purchasing system
29. A container in which material is kept is known as
Correct : C. Bin card
30. The method of recording stores balances after each receipt and issue to facilitate regular checking is known as
Correct : B. Perpetual Inventory System
31. A material loss during production or storage due to evaporation or shrinkage is called:
Correct : B. Waste
32. The use of FIFO method in material issue control is more suitable when
Correct : D. prices are rising
33. The use of LIFO method in material issue control is more suitable when
Correct : C. prices are falling
34. Annual usage, ₹ 1,20,000.00, cost of placing ₹ 60.00 & annual carrying cost is 10% of the inventory value. The EOQ will be:-
Correct : A. ₹ 12,000.00
35. Purchase requisitions is generally prepared in:
Correct : B. Triplicate
36. A record of both quantities & values maintained by the costing department is called:
Correct : B. Stores ledger
37. Under which method materials received first are issued first?
Correct : B. FIFO
38. If maximum consumption is 300 units per day; minimum consumption is 200 units per day; and re-order period is 8 to 10 days, then what will be the re-order level?
Correct : A. 3,000 units
39. Indirect material scrap is adjusted along with: -
Correct : B. Factory Cost
40. A written request to a supplier for specified goods at an agreed price is called: -
Correct : B. Purchase requisition
41. Direct material is a____________-
Correct : A. Manufacturing Cost
42. A Bill of Materials is ________
Correct : C. A document that shows all the materials required for a job
43. The number of Goods Received Note required to be prepared is:
Correct : B. Five
44. Economic order quantity is a tool for controlling ___________
Correct : A. Inventory
45. The purchase requisition is generally prepared in:
Correct : B. Triplicate
46. Bin card is maintained by ____
Correct : C. Stores department
47. _____ is the time between placement of an order and obtaining delivery.
Correct : B. Lead time
48. _______ technique is a selective control of materials
Correct : A. ABC
49. Which document is prepared to transfer material from one job to the other job?
Correct : A. Material Transfer Note
50. A technique of inventory control where materials are analyzed according to their values so that costly and more valuable materials are given greater attention and care.
Correct : B. ABC technique
51. The level above which stock should not normally be allowed to rise.
Correct : D. Maximum Level
52. Materials which have no demand at present and may be required in future.
Correct : A. Dormant Materials
53. A formal request by the Head of Department or an authorised officer to the purchase manager to the purchase manager to purchase specified materials.
Correct : C. Purchase Requisition
54. Bin card is a record of _________ only.
Correct : D. Quantity
55. Method of pricing materials issued which is based upon the assumption that materials which are purchased first are issued first.
Correct : B. FIFO
56. The practice of purchasing where all purchase functions is done through one department only.
Correct : A. Centralised Purchasing
57. If re-ordering level is 450 units while consumption of materials are 25-27 units and materials are received within 4-6 weeks, the minimum level will be
Correct : B. 200 units
58. A request sent to the purchasing department of a need for materials is called a:
Correct : A. Purchase requisition
59. Which of the following is not direct material?
Correct : C. Consumable stores
60. The original copy of the purchase order is sent to:
Correct : C. The supplier
61. Economic order quantity is:
Correct : C. The most economic order quantity
62. The purchase requisition is generally prepared in:
Correct : C. Quadruplicate
63. In which method of material issues, production is charged at the recent prices?
Correct : A. LIFO
64. Stores Ledger:
Correct : D. makes a record of both quantities and values
65. Bin card is maintained by:
Correct : B. Store-keeper
66. The cost of labour which is directly engaged in production work and can be conveniently identified to a job, process or cost unit is
Correct : B. Direct labour cost
67. The rate of change in the composition of the labour force in an organization is known as
Correct : C. Labour Turnover
68. This is one of the avoidable causes of labour turnover.
Correct : C. Labour Relation
69. Recording time for attendance purpose and for calculation of wages is done through
Correct : B. Time – booking
70. The objectives of time-booking is
Correct : D. All of the above
71. Wages under this system is paid for the time worked irrespective of the volume of
production during that time
Correct : A. Time Rate System
72. Under Piece Rate System wages are paid according to
Correct : B. the quantity of work
73. The following is an example of indirect labour cost
Correct : A. Wages of Peon
74. In the Halsey Premium Plan, bonus is usually set at what % of the time saved?
Correct : A. 50%
75. Under piece rate system of wage payment, payment is made according to the: -
Correct : B. Pieces produced
76. The manual methods of time keeping are:-
Correct : A. Attendance Register Method
77. This sheet is the daily record of the work done by a worker on different jobs: -
Correct : A. Daily time sheets
78. The work done beyond the normal work period is called: -
Correct : B. Overtime
79. The principle of this system is to penalize the slow worker by paying him a low piece rate for low production: -
Correct : C. Taylor’s Differential Piece rate system
80. In which system, output cannot be measured?
Correct : B. Time rate system
81. Monetary benefits include: -
Correct : A. Basic wages
82. A document used for time keeping
Correct : B. Time card
83. Idle Time is
Correct : D. The difference between time paid for and time spent on job
84. Wage sheet is prepared by
Correct : A. Payrolldepartment
85. Labour turnover represents
Correct : B. The change in the labour force
86. In which of the following plans, time wages are not guaranteed?
Correct : C. Taylor
87. Standard time for a job is 8 hours and actual time taken is 6 hours. What is the total wages payable under Halsey plan if wage rate is Rs. 10 per hour?
Correct : B. `80
88. According to Merrick’s multiple piece rate system, the piece rate applicable to a worker
with an efficiency of 100 % or above is _____ of normal piece rate
Correct : C. 120%
89. Which of the following methods of wage payment does not guarantee wages on time basis?
Correct : A. Piece rate system
90. Labour which takes an active and direct part in the production of a product is known as
Correct : D. All of the above
91. Indirect labour costs do not include
Correct : B. assigned workman’s wages
92. ________ is concerned with the recording of time of workers for the purpose of attendance and wage calculations.
Correct : C. Timekeeping
93. The methods of time booking do not include
Correct : A. Attendance Records
94. When there are frequent changes in the labour force, labour turnover is said to be
Correct : B. high
95. Replacement cost of labour includes cost of
Correct : D. training new workers
96. When remuneration is paid based on units produced, the system is called
Correct : D. piece rate system
97. Idle time does not include
Correct : C. overtime
98. Which of the following is not direct labour:
Correct : D. Time-keeper
99. Labour flux rate denotes the:
Correct : D. Total change in composition of labour force due to additions and separations of workers.
100. Which of the following document is not used for time booking?