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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-1 section-6

Each section contains 100 MCQs on Costing .
1
If actual result is $26000, flexible budget amount is $13000, then flexible budget amount will be
Discuss
Answer & Solution
Answer: Option C
Solution:
Flexible budget = Actual result - Flexible budget amount
= $26000 - $13000 = $13,000
2
If static budget amount is $9000, flexible budget amount is $20000, then sales volume variance will be
Discuss
Answer & Solution
Answer: Option B
Solution:
Sales volume variance = Flexible budget - Static budget
= $20000 - $9000 = $11,000
3
If static budget is $208000 and flexible budget amount is $305000, then sales budget variance will be
Discuss
Answer & Solution
Answer: Option B
Solution:
Sales budget variance = Flexible budget - Static budget
= $305000 - $208000 = $97,000
4
Subtracted flexible budget amount can form an actual result to calculate
Discuss
Answer & Solution
Answer: Option B
Solution:
Subtracted flexible budget amount can form an actual result to calculate flexible budget variance. A flexible budget variance is any difference between the results generated by a flexible budget model and actual results. If actual revenues are inserted into a flexible budget model, this means that any variance will arise between budgeted and actual expenses, not revenues.
5
If sales budget variance for operating income is $68000 and static budget amount is $19000, then flexible budget amount will be
Discuss
Answer & Solution
Answer: Option C
Solution:
Flexible budget amount = Operating income + static budget
= $68000 + $19000 = $87,000
6
Sales budget variance is subtracted from flexible budget amount to calculate
Discuss
Answer & Solution
Answer: Option A
Solution:
Sales budget variance is subtracted from flexible budget amount to calculate static budget amount. A static budget is a type of budget that incorporates anticipated values about inputs and outputs that are conceived before the period in question begins.
7
If flexible budget amount is $62000 and an actual result is $35000, then flexible budget amount would be
Discuss
Answer & Solution
Answer: Option A
Solution:
Flexible budget = Flexible budget amount - Actual result
= $62000 - $35000 = $27,000
8
Flexible budget amount is added to flexible budget variance to calculate
Discuss
Answer & Solution
Answer: Option B
Solution:
Flexible budget amount is added to flexible budget variance to calculate actual result. A flexible budget, also called a variable budget, is financial plan of estimated revenues and expenses based on the current actual amount of output.
9
Flexible budget amount is $57000 and flexible budget variance is $14000, then actual result amount will be
Discuss
Answer & Solution
Answer: Option B
Solution:
Actual result = Flexible budget amount + Flexible budget variance
= $57000 + $14000 = $71,000
10
Static budget amount is subtracted from flexible budget amount to calculate the
Discuss
Answer & Solution
Answer: Option A
Solution:
Static budget amount is subtracted from flexible budget amount to calculate the sales budget variance. A sales budget is management's estimate of sales for a future financial period. A business uses sales budgets to set department goals, estimate earnings and forecast production requirements.