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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-5 section-5

Each section contains 100 MCQs on Costing .
41
In multicollinearity, correlation coefficient between two independent variables must be greater than
Discuss
Answer & Solution
Answer: Option A
No explanation is given for this question. Let's Discuss on Board
42
If coefficients are similar for two accounting periods, then single cost relationship is estimated with help of
Discuss
Answer & Solution
Answer: Option C
Solution:
If coefficients are similar for two accounting periods, then single cost relationship is estimated with help of pool of data. Cost pools is an accounting term that refers to groups of accounts serving to express the cost of goods and service allocatable within a business or manufacturing organization.
43
Relationship between independent variable and dependent variable must be
Discuss
Answer & Solution
Answer: Option D
Solution:
Relationship between independent variable and dependent variable must be economically plausible. The cost function shows a positive economically plausible relationship between machine-hours and maintenance costs.
44
In adjustment issues of costing, database must contain reliable measure of
Discuss
Answer & Solution
Answer: Option B
Solution:
In adjustment issues of costing, database must contain reliable measure of cost driver and cost. A cost driver is the unit of an activity that causes the change in activity's cost.
45
If difference in costs is $7000 and difference in machine hours of is $18000, then slope coefficient would be
Discuss
Answer & Solution
Answer: Option B
Solution:
Slope coefficient = Difference in costs ÷ Difference in machine hours
= $7000 ÷ $18000 = 0.39
46
In adjustment issues and data collection, inflation affects the
Discuss
Answer & Solution
Answer: Option A
Solution:
In adjustment issues and data collection, inflation affects the cost driver and cost. A cost driver is the unit of an activity that causes the change in activity's cost.
47
Higher level of production leads to
Discuss
Answer & Solution
Answer: Option A
Solution:
Higher level of production leads to higher repair cost.
48
Method of estimation of cost function, by making opinions and analysis about cost and cost drivers is classified as
Discuss
Answer & Solution
Answer: Option A
Solution:
Method of estimation of cost function, by making opinions and analysis about cost and cost drivers is classified as conference method. The conference method is an approach to cost estimation that pools together data, analyses, and knowledge from expert sources in order to make decisions about costs.
49
Within relevant range, cost function which cost does not change in narrow ranges of activity is called
Discuss
Answer & Solution
Answer: Option C
Solution:
Within relevant range, cost function which cost does not change in narrow ranges of activity is called step variable cost function. A step variable cost is a cost that generally varies with the level of activity, but which tends to be incurred at certain discrete points and to involve large changes in amounts when such a point is reached.
50
In linear cost function which is y=a + bx, objective is to find the
Discuss
Answer & Solution
Answer: Option A
Solution:
In linear cost function which is y=a + bx, objective is to find the values of a and b.