Cost Accounting Quizes

Cost Accounting Multiple Choice Questions ( MCQS) Page-4. The following Cost Accounting Questions from different Past Papers etc, PPSC Past Papers, Fpsc Pass Papers, NTS and also from MCQS Bank. These Questions are helpful for the preparation of Written test for the Posts of Accountant, Cost Accountant, Auditor and any for any Accounts Related Jobs Tests.

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Multiple Choice Questions on Cost Accounting

61. Which of the following statement is TRUE about the relevant cost?

a. It is a sunk cost

b. It is an opportunity cost

c. It do not affect the decision making process

d. All costs are relevant

62. In decision making all costs already incurred in past should always be:

a. Ignored

b. Considered

c. Partially ignored

d. Partially considered

63. Which of the following statement is TRUE about historical cost?

a. It is always relevant to decision making

b. It is always irrelevant to decision making

c. It is always an opportunity cost

d. It is always realizable value

64. In cost accounting, unavoidable loss is charged to which of the following? 

a. Factory over head control account

b. Work in process control account

c. Marketing overhead control account

d. Administration overhead control account

65. Merrick Differential Piece Rate Plan based on _____________piece rates is fixed.

a. Two

b. Three

c. Four

d. Five

66. Which of the given is (are) the method(s) of measurement of Labor Turnover?

a. Separation method

b. Flux method

c. Replacement method

d. All of the given options

67. What will be the impact of normal loss on the overall per unit cost ?

a. Per unit cost will increase

b. Per unit cost will decrease

c. Per unit cost remain unchanged

d. Normal loss has no relation to unit cost

68. Which of the given units can never become part of first department of Cost of Production Report? 

a. Units received from preceding department

b. Units transferred to subsequent department

c. Lost units

d. Units still in process

69. Details of the process for the last period are as follows:

Put into process 5,000 kg

Materials ` 2,500 

Labor `700

Production overheads 200% of labor

Normal losses are 10% of input in the process. The output for the period was 4,200 Kg from the 

process. There was no opening and closing Work- in- process. What were the units of abnormal 

loss?

a. 500 units

b. 300 units

c. 200 units

d. 100 units

70. ABC Company makes a single product which it sells for ` 20 per unit. Fixed costs are ` 75,000 per 

month and product has a profit/volume ratio of 40%. In that period actual sales were ` 225,000. 

Required: Calculate ABC Company Break Even point in `

a. 187, 500

b. 562, 500

c.  1,500,000

d. None of the given options

71. All of the following are the features of fixed costs EXCEPT:

a. Although fixed within a relevant range of activity level but are relevant to a decision making

when it is avoidable.

b. Although fixed within a relevant range of activity level but are relevant to a decision making

when it is incremental.

c. Generally it is irrelevant

d. It is relevant to decision making under any circumstances

72. A typical factory overhead cost is:

a. Distribution

b. Internal audit

c. Compensation of plant manager

d. Design

73. An average cost is also known as: 

a. Variable cost

b. Unit cost

c. Total cost

d. Fixed cost

74. Period costs are:

a. Expensed when the product is sold

b. Included in the cost of goods sold

c. Related to specific period

d. Not expensed

75. While calculating the EOQ, number of orders is calculated by:

a. Dividing required unit by ordered quantity

b. Multiplying the required units with ordered quantity

c. Multiplying the ordered quantity with cost per order

d. Multiplying the required units with cost per order

76. Which of the following best describe piece rate system?

a. The increased volume of production results in decreased cost of production

b. The increased volume of production in minimum time

c. Establishment of fair standard rates

d. Higher output is a result of efficient management

77. The term Cost apportionment is referred to:

a. The costs that can not be identified with specific cost centers.

b. The total cost of factory overhead needs to be distributed among specific cost centers but

must be divided among the concerned department/cost centers.

c. The total cost of factory overhead needs to be distributed among specific cost centers.

d. None of the given options

78. Which of the following loss is not included as part of the cost of transferred or finished goods, but rather treated as a period cost?

a. Operating loss

b. Abnormal loss

c. Normal loss

d. Non-operating loss

79. Hyde Park Company produces sprockets that are used in wheels. Each sprocket sells for ` 50 and 

the company sells approximately 400,000 sprockets each year. Unit cost data for the year follows: 

Direct material ` 15

Direct labor ` 10

Other cost:

Manufacturing

Distribution

Fixed 

` 5

` 4

Variable

` 7

` 3

Required: Identify the unit cost of sprockets under direct costing

a.  44

b.  37

c.  32

d.  35

80. When production is equal to sales, which of the following is TRUE? 

a. No change occurs to inventories for either use absorption costing or variable costing methods

b. The use of absorption costing produces a higher net income than the use of variable costing

c. The use of absorption costing produces a lower net income than the use of variable costing

d. The use of absorption costing causes inventory value to increase more than they would though

the use of variable costing

Answers

61 b 62 a 63 b

64 a 65 b 66 d 67 a 68 a 69 b 70 d

71 d 72 c 73 b 74 c 75 a 76 b 77 c

78 b 79 d 80 a