MCQ Portal

1. What is the primary objective of cost accounting?

To maximize profit To assist in inventory valuation To aid in determining the selling price To provide management with decision-making information

2. Which of the following is considered a normal loss of material?

Loss due to accident Pilferage Loss due to breaking bulk Loss due to careless handling of material

3. In a reconciliation statement, expenses recorded only in financial accounts are:

Added to financial profit Added to costing profit Ignored Deducted from financial profit

4. Which of the following is classified as a service department?

Refining department Machining department Receiving department Finishing department

5. Which of the following is not considered when preparing a cost sheet?

Purchase returns Carriage inwards Sales commission Interest paid

6. In job costing, which document is used to record the issuance of direct materials to a job?

Purchase order Goods receipt note Material requisition Purchase requisition

7. A process begins with 4,000 units, with a normal loss of 5% of input. The closing work-in-progress is 500 units, 60% complete. If 3,300 units are transferred to the next process, what is the equivalent production for the period?

3,550 units 3,600 units 3,800 units 3,950 units

8. Product A has a contribution-to-sales ratio of 40%. Fixed costs directly attributable to A amount to ₹60,000. What is the sales revenue required to achieve a profit of ₹15,000?

₹2,00,000 ₹1,85,000 ₹1,87,500 ₹2,10,000

9. During a period, 13,600 labor hours were worked at a standard rate of ₹8 per hour. The direct labor efficiency variance was ₹8,800 (Adverse). How many standard hours were produced?

12,000 hours 12,500 hours 13,000 hours 13,500 hours

10. ABC Ltd.'s cash budget indicates a short-term surplus. What would be an appropriate action?

Purchase new fixed assets Repay long-term loans Write off preliminary expenses Pay creditors early to obtain a cash discount

June 2019 Costing Paper

The Number of MCQs are limited as per ICMAI Past Paper in Syllabus 2016