MGT 402 cost quiz latest 23 July 2010

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Question # 1 of 15 ( Start time: 06:32:55 PM ) Total Marks: 1

Differential cost has the behavior of ?

Select correct option:

Fixed cost

Step cost

Variable/semi avriable cost

All of the given options



Question # 2 of 15 ( Start time: 06:34:20 PM ) Total Marks: 1

All Indirect cost is charged/record in the head of

Select correct option:

Prime cost

FOH cost

Direct labor cost

None of the given options

Question # 3 of 15 ( Start time: 06:35:17 PM ) Total Marks: 1

Which of the following is / are element / s of production payroll?

Select correct option:

Direct labor force wages

Administrative wages

Selling wages

All of the given options

Question # 4 of 15 ( Start time: 06:36:34 PM ) Total Marks: 1

Which of the following is/are not associated with ordering costs?

Select correct option:

Interest

Insurance

Opportunity costs

All of the given options





Question # 5 of 15 ( Start time: 06:37:55 PM ) Total Marks: 1

A company needed to produce 340 liters of chemical “X”. There is a normal loss of 10 %( 40 units) of the material put in to the process during the month. The company produced 340 liters of good production. Although there was an abnormal loss of 5 % of the material put into the process which was 20 units. Find out the number of liters put in to process in the beginning?

Select correct option:

400 litres

340 litres

300 litres

200 litres





Question # 6 of 15 ( Start time: 06:39:17 PM ) Total Marks: 1

Which of the following costs are treated as period costs under direct costing?

Select correct option:

Only direct costs

Fixed selling and administrative expenses

Fixed manufacturing overhead

Both fixed manufacturing overhead and fixed selling and administrative expenses



Question # 7 of 15 ( Start time: 06:40:36 PM ) Total Marks: 1

Which of the following would be considered to be an investment centre?

Select correct option:

Managers have control over marketing

Management have a sales team

Management have a sales team and are given a credit control function

Managers can purchase capital assets and are given a credit control function





Question # 8 of 15 ( Start time: 06:41:13 PM ) Total Marks: 1

The difference over the period of time between actual and applied FOH will usually be minimal when the predetermined overhead rate is based on:

Select correct option:

Normal capacity

Designed capacity

Direct Labor hours

Machine hours





Question # 9 of 15 ( Start time: 06:42:30 PM ) Total Marks: 1

The Economic order quantity can be calculated by:

Select correct option:

Formula Method

Table Method

Graph Method

All of the given





Question # 10 of 15 ( Start time: 06:42:58 PM ) Total Marks: 1

Cost of Goods Manufactured can be calculated as follow

Select correct option:

Total factory Cost Add Opening Work in process inventory Less Closing Work in process inventory

Total factory Cost Less Opening Work in process inventory Add Closing Work in process inventory

Total factory Cost Less Opening Work in process inventory Less Closing Work in process inventory

Total factory Cost Add Opening Work in process inventory Add Closing Work in process inventory





Question # 11 of 15 ( Start time: 06:44:08 PM ) Total Marks: 1

When closing stock is over valuate, what would its effect be on profit?

Select correct option:

It will Increase the profit

It will decrease the profit

No effect on profit

Cannot be determined





Question # 12 of 15 ( Start time: 06:45:19 PM ) Total Marks: 1

Which of the following items of expense are to be add in FOH cost

Select correct option:

Rent of factory + Head office rent + salaries to factory watchman

Rent of factory + factory lighting bill + Directors salaries

Rent of factory + factory lighting bill + Factory employees salaries

Head office rent + Factory property tax + Factory small tools





Question # 13 of 15 ( Start time: 06:46:05 PM ) Total Marks: 1

Increase in material Inventory means:

Select correct option:

The ending inventory is greater than opening inventory

The ending inventory is less than opening inventory

Both ending and opening inventories are equal

Can not be determined



Question # 14 of 15 ( Start time: 06:47:07 PM ) Total Marks: 1

Which of the following is an example of Statutory deductions:

Select correct option:

Deduction as Income Tax

Deduction as social security

Subscriptions to a trade union

None of the given





Question # 15 of 15 ( Start time: 06:48:07 PM ) Total Marks: 1

Planning for future growth is called:

Select correct option:

Capital budgeting

Working capital management

Financial forecasting

Budgeting





Question # 1 of 15 ( Start time: 12:11:38 PM ) Total Marks: 1
All of the following are terms used to denote Factory Overheads EXCEPT:
Select correct option:


Factory burden
Factory expenses
Manufacturing overhead
Conversion costs

Question # 2 of 15 ( Start time: 12:12:38 PM ) Total Marks: 1
Closing work in process Inventory of last year:
Select correct option:


Is treated as Opening inventory for current year
Is not carried forward to next year
Become expense in the next year
Charge to Profit & Loss account

Question # 3 of 15 ( Start time: 12:13:58 PM ) Total Marks: 1
Under/Over applied FOH cost can be adjusted in which of the following:
Select correct option:


Entire Production
Cost of Good sold
Net Profit
All of given options

Question # 6 of 15 ( Start time: 12:17:34 PM ) Total Marks: 1
Alpha company purchased a machine worth Rs 200,000 in the last year.Now that machine can be use in a new project which company has received this year. Now the cost of that machine is to be called:
Select correct option:


Project cost
Sunk cost
Opportunity cost
Relevant cost

Question # 7 of 15 ( Start time: 12:18:36 PM ) Total Marks: 1
Which of the following is a point of differentiation between blanket rates and department rates?
Select correct option:


Blanket rate is a single overhead rate established for the entire factory
Department rates are separate overhead rates for all departments of factory through which the products pass
Department rate is a single overhead rate established for the entire factory
Blanket rates are separate overhead rates for all departments of factory through which the product passes

Question # 8 of 15 ( Start time: 12:19:12 PM ) Total Marks: 1
A spending variance for factory overhead is the difference between actual factory overhead cost and factory overhead cost that should have been incurred for actual hours worked and results from:
Select correct option:


Price difference of FOH costs
Quantity differences of FOH costs
Price and quantity differences for FOH costs
Difference caused by production volume var

Question # 10 of 15 ( Start time: 12:21:34 PM ) Total Marks: 1
“Taking steps for the fresh purchase of those stocks which have been exhausted and for which requisitions are to be honored in future” is an easy explanation of:
Select correct option


Overstocking
Under stocking
Replenishment of stock
Acquisition of stock

Question # 11 of 15 ( Start time: 12:22:28 PM ) Total Marks: 1
When two products are manufactured during a common process, the factor that determine whether the products are joint product or one main product and one is by product is the:
Select correct option:


Potential marketability for each product
Amount of work expended in the production of each product
Relative total sales value of each product
Management policy

Question # 12 of 15 ( Start time: 12:23:57 PM ) Total Marks: 1
All Indirect cost is charged/record in the head of
Select correct option:


Prime cost
FOH cost
Direct labor cost
None of the given options

Question # 13 of 15 ( Start time: 12:25:23 PM ) Total Marks: 1
The cost of electricity bill of the factory is treated as:
Select correct option:


Fixed cost
Variable cost
Step cost
Semi variable cost

Question # 14 of 15 ( Start time: 12:26:45 PM ) Total Marks: 1
In which of the following center FOH cost NOT incurred
Select correct option:


Production Center
Service Center
General Cost Center
Head Office

Question # 15 of 15 ( Start time: 12:28:14 PM ) Total Marks: 1
If joint products are to be processed further beyond the point of separation, costs should be assigned to the products on the basis of:
Select correct option:


Adjusted sales value
Ultimate sales value
A physical unit of measure
An engineering analysis



Question # 1 of 15 ( Start time: 02:01:15 AM ) Total Marks: 1

Which of the following is to be called product cost

Select correct option:



Material cost

Labor cost

FOH cost

All of the given options



Question # 2 of 15 ( Start time: 02:01:42 AM ) Total Marks: 1

Which of the following costing method provide the added benefit of usefulness for external reporting purpose?

Select correct option:



Absorption costing

Marginal costing

Variable costing

Neither absorption nor marginal costing



Question # 3 of 15 ( Start time: 02:03:04 AM ) Total Marks: 1

A method by which the good used are priced out at average cost is known as:

Select correct option:



BCVO

AVCO

c.FIFO

LIFO



Question # 4 of 15 ( Start time: 02:03:37 AM ) Total Marks: 1

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

Select correct option:



Multiplying the required units with cost per order

Dividing required unit by ordered quantity

Multiplying the required units with ordered quantity

Multiplying the ordered quantity with cost per order



Question # 5 of 15 ( Start time: 02:04:10 AM ) Total Marks: 1

A cost unit is

Select correct option:



The cost per hour of operating a machine

The cost per unit of electricity consumed

A unit of product or services in relation to which costs are ascertained

A measure of work output in a standard hour



Question # 6 of 15 ( Start time: 02:04:54 AM ) Total Marks: 1

Bouch Company has following the data. Units Produced and sold were100,000 @ 100 each. Production Cost per unit Variable cost is Rs.25, Fixed cost is Rs.50,Total cost is Rs.75 What would be the margin of safety ratio?

Select correct option:



25%

33.333%

66.666%

75%



Question # 7 of 15 ( Start time: 02:06:24 AM ) Total Marks: 1

Which of the following is the main objective of direct material budget?

Select correct option:



Determination of minimum and maximum stock level

Developing purchasing requirements

Financial Arrangements

All of the given options



Question # 8 of 15 ( Start time: 02:07:51 AM ) Total Marks: 1

Janet sells a product for Rs.6.25 each. The variable cost is Rs.3.75 per unit. Janet's break-even units are 35,000. What is the amount of fixed costs?

Select correct option:



Rs. 87,500

Rs. 35,000

Rs. 104,750

Rs.131,250



Question # 9 of 15 ( Start time: 02:09:18 AM ) Total Marks: 1

The appropriate journal entry to transfer the cost of completed units from the Work in Process account would involve a credit to Work in Process and a debit to which of the following accounts?

Select correct option:



Income Summary

Raw Materials Inventory

Finished Goods

Manufacturing Summary



Question # 10 of 15 ( Start time: 02:09:49 AM ) Total Marks: 1

While constructing production budget, numbers of units manufactured are calculated by which of the following formula?

Select correct option:



Number of units to be sold + closing units – opening units

Number of units to be sold - closing units + opening units

Number of units to be sold - closing units – opening units

Number of units to be sold + closing units + opening units



Question # 11 of 15 ( Start time: 02:11:06 AM ) Total Marks: 1

The Economic order quantity can be calculated by:

Select correct option:



Formula Method

Table Method

Graph Method

All of the given



Question # 12 of 15 ( Start time: 02:11:30 AM ) Total Marks: 1

Sponsored Links

Net sales = Sales less:

Select correct option:



Sales returns

Sales discounts

Sales returns & allowances

Sales returns & allowances and sales discounts



Question # 13 of 15 ( Start time: 02:11:43 AM ) Total Marks: 1

When closing stock is over valuate, what would its effect be on profit?

Select correct option:



It will Increase the profit

It will decrease the profit

No effect on profit

Cannot be determined



Question # 14 of 15 ( Start time: 02:11:56 AM ) Total Marks: 1

The flux method of labor turnover denotes:

Select correct option:



Workers appointed against the vacancy caused due to discharge or quitting of the organization

Workers appointed in replacement of existing employees

Workers employed under the expansion schemes of the company

The total change in the composition of labor force



Question # 15 of 15 ( Start time: 02:12:23 AM ) Total Marks: 1

Which of the following loss is expected in manufacturing process and represents a necessary cost of processing the marketable units?

Select correct option:



Operating loss

Abnormal loss

Normal loss

Extraordinary loss



Question # 1 of 15 ( Start time: 02:44:08 AM ) Total Marks: 1

Generally, the danger level of stock is fixed ________ the minimum level.

Select correct option:



Below

Above

Equal

Danger level has no relation to minimum level



Question # 2 of 15 ( Start time: 02:45:07 AM ) Total Marks: 1

Loss by fire is an example of:

Select correct option:



Normal Loss

Abnormal Loss

Incremental Loss

Can not be determined



Question # 3 of 15 ( Start time: 02:45:27 AM ) Total Marks: 1

A company produces two chemicals in a joint process. Chemical A can be sold at split off while chemical B currently cost Rs. 2 per gallon for disposal. If chemical B is further processed, it would cost Rs. 5 per gallon. At what sales price would the company be in different between disposing of chemical B at split off and further processing the chemical?

Select correct option:



Rs.3

Rs.5

Rs.4

Rs.7



Question # 4 of 15 ( Start time: 02:46:48 AM ) Total Marks: 1

All of the following are cases of labor turnover EXCEPT:

Select correct option:



Workers appointed against the vacancy caused due to discharge or quitting of the organization

Workers employed under the expansion schemes of the company

The total change in the composition of labor force

Workers retrenched



Question # 5 of 15 ( Start time: 02:47:29 AM ) Total Marks: 1

Which of the following items of expense are to be add in FOH cost

Select correct option:



Rent of factory + Head office rent + salaries to factory watchman

Rent of factory + factory lighting bill + Directors salaries

Rent of factory + factory lighting bill + Factory employees salaries

Head office rent + Factory property tax + Factory small tools



Question # 6 of 15 ( Start time: 02:47:54 AM ) Total Marks: 1

Which of the following is the best characteristic of a by product:

Select correct option:



Is produced from material that would otherwise be of no value

Has a lower selling price than the main product

Is created along with the main product, but its sales value does not cover its production cost

Usually produces a smaller amount of revenue than the main product



Question # 7 of 15 ( Start time: 02:48:49 AM ) Total Marks: 1

Which of the following is considered as basic systems of remunerating labor?

Select correct option:



Time rate system

Piece rate system

Halsey Premium plan

Both time rate and piece rate system





Which of the following element must be taken into account while calculating total earnings of a worker under different incentive wage schemes?

Select correct option:



Rate per unit

Units of production

Extra time taken by employee to complete the production

Number of workers employed



Question # 9 of 15 ( Start time: 02:50:43 AM ) Total Marks: 1

Which of the following costing method provide the added benefit of usefulness for external reporting purpose?

Select correct option:



Absorption costing

Marginal costing

Variable costing

Neither absorption nor marginal costing





Question # 10 of 15 ( Start time: 02:51:01 AM ) Total Marks: 1

Which of the following is the best definition of a by-product?

Select correct option:



A by-product is a product arising from a process where the wastage rate is higher than a defined level



A by-product is a product arising from a process where the sales value is insignificant by comparison with that of the main product or products



A by-product is a product arising from a process where the wastage rate is unpredictable



A by-product is a product arising from a process where the sales value is significant by comparison with that of the main product or products





Question # 11 of 15 ( Start time: 02:51:48 AM ) Total Marks: 1

Which of the following would be considered to be an investment centre?

Select correct option:



Managers have control over marketing

Management have a sales team

Management have a sales team and are given a credit control function

Managers can purchase capital assets and are given a credit control function



Question # 12 of 15 ( Start time: 02:52:39 AM ) Total Marks: 1

Jones, Industries uses process costing system. In October, the finishing department had 30,000 units in beginning work-in-process, 45,000 units in ending inventory and had 95,000 units transferred in from the previous department. Material is added at the end of the process and conversion costs are added uniformly throughout the process. Beginning work-in-process was 20% complete with respect to conversion costs; ending inventory was 40% complete with respect to conversion costs. If Jones uses FIFO, the equivalent units of production for transferred-in costs, direct material, and conversion costs are:

Select correct option:



Material 125,000 units Conversion cost 98,000 units

Material 125,000 units Conversion cost 45,000 units

Material 125,000 units Conversion cost 80,000 units

None of the given options

Reference:

Multiple Choice Quiz

Question#18



Question # 13 of 15 ( Start time: 02:53:58 AM ) Total Marks: 1

Amount of Depreciation on fixed assets will be fixed in nature if calculated under which of the following method?

Select correct option:



Straight line method

Reducing balance method

Some of years digits methods

Double declining method



Question # 14 of 15 ( Start time: 02:55:01 AM ) Total Marks: 1

Taylor's Differential Piece Rate Plan uses-----------piece rates.

Select correct option:



Three

Two

Four

Five



Question # 15 of 15 ( Start time: 02:56:04 AM ) Total Marks: 1

Reduction of labor turnover, accidents, spoilage, waste and absenteeism are the results of which of the following wage plan?

Select correct option:



Piece rate plan

Time rate plan

Differential plan

Group bonus system







Question # 3 of 15 ( Start time: 03:03:42 AM ) Total Marks: 1

Direct material opening inventory add net purchases is called

Select correct option:



Material consumed

Material available for use

Total material purchsed

Material ending inventory



Question # 4 of 15 ( Start time: 03:04:14 AM ) Total Marks: 1

The Process of cost apportionment is carried out so that:

Select correct option:



Cost may be controlled

Cost unit gather overheads as they pass through cost centers

Whole items of cost can be charged to cost centers

Common costs are shared among cost centers



Question # 5 of 15 ( Start time: 03:04:50 AM ) Total Marks: 1

Which of the following is/are reported in production cost report?

Select correct option:



The costs charged to the department

How the costs were assigned to the output?

The equivalent units of production by the department

All of the given options



Question # 6 of 15 ( Start time: 03:05:18 AM ) Total Marks: 1

The journal entry of purchse of stock under periodic inventory system would be?

Select correct option:



Inventory to Cash

Cash to Purchases

Purchses to Inventory

None of the given options



Question # 7 of 15 ( Start time: 03:05:42 AM ) Total Marks: 1

Which of the following is NOT true about job order cost sheets?

Select correct option:



Job cost sheets contain direct material costs

Job cost sheets contain actual amounts of factory overhead

Job cost sheet does not contain conversion cost

Job cost sheets contain direct labor costs





Question # 8 of 15 ( Start time: 03:06:11 AM ) Total Marks: 1

Which of the following costs is part of the prime cost for manufacturing company?

Select correct option:



Cost of transporting raw materials from the suppliers premises

Wages of factory workers engaged in machine maintenance

Depreciation of truck used for deliveries to customers

Cost of indirect production materials



Question # 9 of 15 ( Start time: 03:06:49 AM ) Total Marks: 1

Costs which are constant for a relevant range of activity and rise to new constant level once that range exceeded is called:

Select correct option:



A fixed cost

A variable cost

A mixed cost

A step cost





Question # 10 of 15 ( Start time: 03:07:20 AM ) Total Marks: 1

Factory Over head cost includes

Select correct option:



Factory Rent

Property Tax

Salaries of Factory Clerk

All of the given



Question # 11 of 15 ( Start time: 03:07:49 AM ) Total Marks: 1

A store ledger card is similar to the ________ .

Select correct option:



Stock ledger

Bin card

Material card

Purchase requsition card



Question # 12 of 15 ( Start time: 03:08:04 AM ) Total Marks: 1

Where the applied FOH cost is less than the actual FOH cost it is:

Select correct option:



Unfavorable variance

Favorable variance

Normal variance

Budgeted variance



Question # 13 of 15 ( Start time: 03:08:43 AM ) Total Marks: 1

According to IASB framework, Financial statements exhibit to its users the:

Select correct option:



Financial position

Financial performance

Cash inflow and outflow analysis

All of the given options



Question # 14 of 15 ( Start time: 03:09:04 AM ) Total Marks: 1

Cost of Goods sold budget include(s) all of the following EXCEPT:

Select correct option:



Selling & distribution expenses budget

General & Administrative expenses budget

Production cost budget

Cash budget



Question # 15 of 15 ( Start time: 03:09:50 AM ) Total Marks: 1

Which of the following is/are not associated with ordering costs?

Select correct option:



Interest

Insurance

Opportunity costs

All of the given options

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