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Costing MCQ Questions and Solutions with Explanations | Commerce

Costing MCQ Questions and answers with easy and logical explanations. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Costing MCQ is important for exams like B.COM, M.COM, BBA, BBM, CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other commerce department exam. Page-2 section-8

Each section contains 100 MCQs on Costing .
11
An expected future revenue, which diverges in unconventional course of action is classified as
Discuss
Answer & Solution
Answer: Option C
Solution:
An expected future revenue, which diverges in unconventional course of action is classified as relevant revenues. Relevant means that you consider future revenue and expenses.
12
Gross margin is subtracted from sales value of all production to yield
Discuss
Answer & Solution
Answer: Option B
Solution:
Gross margin is subtracted from sales value of all production to yield production cost incurred on product. The gross profit margin is calculated by taking total revenue minus the cost of goods sold (COGS) and dividing the difference by total revenue.
13
In a joint process of production, two or more products that yield high volume of sales as compared to total sales of other products are classified as
Discuss
Answer & Solution
Answer: Option B
Solution:
In a joint process of production, two or more products that yield high volume of sales as compared to total sales of other products are classified as joint product. A joint product is a product that results jointly with other products from processing a common input. A joint product can be the output of a process with fixed or variable proportions.
14
Joint cost allocation method for joint products, which is based on achievable value is known as
Discuss
Answer & Solution
Answer: Option D
Solution:
Joint cost allocation method for joint products, which is based on achievable value is known as net realizable value method. The net realizable value method allocates joint costs on the basis of the final sales value less separable costs.
15
Any output that has total positive sales is a
Discuss
Answer & Solution
Answer: Option D
Solution:
Any output that has total positive sales is a joint product, main product and product.
16
Point in joint production process, in which two or more products are separately identifiable is termed as
Discuss
Answer & Solution
Answer: Option C
Solution:
Point in joint production process, in which two or more products are separately identifiable is termed as split off point. A split-off point is the location in a production process where jointly manufactured products are henceforth manufactured separately; thus, their costs can be identified individually after the split-off point.
17
Costs incurred in production process that yield range of products simultaneously are known as
Discuss
Answer & Solution
Answer: Option B
Solution:
Costs incurred in production process that yield range of products simultaneously are known as joint costs. Joint cost is the manufacturing cost incurred on a joint production process which takes common inputs but simultaneously produces multiple products called joint-products.
18
Percentage of overall gross margin is multiplied to final sales value of products total production is used to calculate
Discuss
Answer & Solution
Answer: Option A
Solution:
Percentage of overall gross margin is multiplied to final sales value of products total production is used to calculate Gross margin in terms of amount of money.
19
Final sales is subtracted from net realizable value is used to calculate
Discuss
Answer & Solution
Answer: Option A
Solution:
Final sales is subtracted from net realizable value is used to calculate separable costs. The net realizable value method allocates joint costs on the basis of the final sales value less separable costs.
20
If percentage of overall gross margin is 15 and final sales value of whole production is $20000, then gross margin (in dollars) will be
Discuss
Answer & Solution
Answer: Option B
Solution:
If percentage of overall gross margin is 15 and final sales value of whole production is $20000, then gross margin (in dollars) will be $300,000.
Gross Margin = Sale value × Gross margin percentage
$20000 × 15 = $300000.