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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-8

Each section contains 100 MCQs on Costing .
41
If beginning work in process inventory units are 2600, units started are 9000, ending work in process units are 2300 and completed good units are 8000 then total spoilage will be
Discuss
Answer & Solution
Answer: Option C
No explanation is given for this question. Let's Discuss on Board
42
Residual material which results from manufacturing products is called
Discuss
Answer & Solution
Answer: Option D
Solution:
Residual material which results from manufacturing products is called scrap. Scrap is residual material that results from manufacturing a product.
43
Costing, which explains how and when scrap affects operating income of company is classified as
Discuss
Answer & Solution
Answer: Option A
Solution:
Costing, which explains how and when scrap affects operating income of company is classified as inventory costing. Inventory is merchandise purchased by merchandisers (retailers, wholesalers, distributors) for the purpose of being sold to customers. The cost of the merchandise purchased but not yet sold is reported in the account Inventory or Merchandise Inventory.
44
An amount of spoilage that is natural in any particular production process is classified as
Discuss
Answer & Solution
Answer: Option B
Solution:
An amount of spoilage that is natural in any particular production process is classified as normal spoilage. Normal spoilage refers to the inherent worsening of products during the production or inventory processes of the sales cycle.
45
Cost of abnormal spoilage is not treated as
Discuss
Answer & Solution
Answer: Option D
Solution:
Cost of abnormal spoilage is not treated as non inventoriable costs. Non-inventoriable cost are costs that are not included in the value of inventory, also known as non-manufacturing overhead. It includes Selling, General and Administrative expenses, and Interest expense.
46
If units of normal spoilage are 150 and total good units manufactured are 1500, then normal spoilage rate would be
Discuss
Answer & Solution
Answer: Option C
Solution:
If units of normal spoilage are 150 and total good units manufactured are 1500, then normal spoilage rate would be 10.00%.
Normal spoilage% = Normal spoilage / Total unit × 100
= 150/1500 × 100 = 10%.
47
Total transferred-out cost plus normal spoilage is divided by number of goods units produced to calculate
Discuss
Answer & Solution
Answer: Option A
Solution:
Total transferred-out cost plus normal spoilage is divided by number of goods units produced to calculate cost per good units transferred out.
48
Type of spoilage, which is considered as controllable and can be avoided is called
Discuss
Answer & Solution
Answer: Option A
Solution:
Type of spoilage, which is considered as controllable and can be avoided is called abnormal spoilage. Abnormal spoilage is the amount of waste or destruction of inventory beyond what is expected in normal business processes.
49
Increase in the amount of creditors result in
Discuss
Answer & Solution
Answer: Option B
No explanation is given for this question. Let's Discuss on Board
50
The expenses which are incurred to increase the demand of the product are known as
Discuss
Answer & Solution
Answer: Option A
No explanation is given for this question. Let's Discuss on Board