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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-6 section-3

Each section contains 100 MCQs on Costing .
51
A process costing system for J Co used an input of 3,500Kg of materials at Rs20 per Kg and labour hours of 2,750 at Rs 25 per hour. Normal loss is 20% and losses can be sold at a scrap value of Rs5 per Kg. Output was 2,950 Kg. What is the value of the output?
Discuss
Answer & Solution
Answer: Option A
No explanation is given for this question. Let's Discuss on Board
52
In process costing, if an abnormal loss arises, the process account is generally.
Discuss
Answer & Solution
Answer: Option D
Solution:
In process costing, if an abnormal loss arises, the process account is generally credited with the full production cost of the abnormal loss units. Abnormal loss (a cost) is credited to the process account and abnormal gain (a benefit) is debited to the process account.
53
"Which of the following statements is/are correct?
1. A materials requisition note is used to record the issue of direct material to a specific job.
2. A typical job cost will contain actual costs for material, labour and production overheads, and non –production overheads are often added as a percentage of total production cost.
3. The job costing method can be applied in costing batches"
Discuss
Answer & Solution
Answer: Option C
Solution:
The following statements that are correct are: A materials requisition note is used to record the issue of direct material to a specific job and The job costing method can be applied in costing batches.
54
A job is budgeted to require 3,300 productive hours after incurring 25% idle time. If the total labour cost budgeted for the job is Rs 36,300. What is the labour cost per hour( to the nearest cent)?
Discuss
Answer & Solution
Answer: Option A
No explanation is given for this question. Let's Discuss on Board
55
A company calculates the prices of jobs by adding overheads to the prime cost and adding 30% to total costs as a profit margin. Job number Y256 was sold for Rs1690 and incurred overheads of Rs 694. What was the prime cost of the job?
Discuss
Answer & Solution
Answer: Option A
No explanation is given for this question. Let's Discuss on Board
56
State which of the following are the characteristics of service costing.
1. High levels of indirect costs as a proportion of total costs
2. Use of composite cost units
3. Use of equivalent units
Discuss
Answer & Solution
Answer: Option B
Solution:
The following that are the characteristics of service costing are High levels of indirect costs as a proportion of total costs and Use of composite cost units.
57
Which of the following organisations should not be advised to use service costing?
Discuss
Answer & Solution
Answer: Option D
Solution:
A light engineering company should not be advised to use service costing. Service costing is a type of operation costing which is used in organizations which provide services instead of producing goods.
58
"Calculate the most appropriate unit cost for a distribution division of a multinational company using the following information.
Miles travelled 636,500
Tonnes carried 2,479
Number of drivers 20
Hours worked by drivers 35,520
Tonnes miles carried 375,200
Cost incurred 562,800"
Discuss
Answer & Solution
Answer: Option B
No explanation is given for this question. Let's Discuss on Board
59
"The following information is available for the W hotel for the latest thirty day period.
Number of rooms available per night 40
Percentage occupancy achieved 65%
Room servicing cost incurred Rs 3900
The room servicing cost per occupied room-night last period, to the nearest Rs, was:"
Discuss
Answer & Solution
Answer: Option B
Solution:
Service occupied = 30 × 40 × 65/100 =780
The room servicing cost per occupied room-night last period, to the nearest Rs, was:
= 3900/780 = Rs. 5.00
60
A company makes a single product and incurs fixed costs of Rs 30,000 per annum. Variable cost per unit is Rs 5 and each unit sells for Rs 15. Annual sales demand is 7,000 units. The breakeven point is:
Discuss
Answer & Solution
Answer: Option B
Solution:
Break-Even Point (Units) = Fixed Costs ÷ (Revenue per Unit – Variable Cost per Unit)
= 30000 ÷ (15 - 5)
= 3000 units.