Costing MCQ Questions and Solutions with Explanations

Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7 Section 8 Section 9 Section 10 Section 11 Section 12 Section 13 Section 14

61.
. . . . . . . . costs are partly fixed and partly variable in relation to output.

A. Variable

B. Fixed

C. Semi-variable

D. Both A and B

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62.
Under applied or over applied factory overhead should be:

A. carried forward to next year

B. shown as an extraordinary item

C. apportioned among cost of goods sold and applicable to inventory

D. written off

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63.
The margin of safety may be defined as

A. the point at which break-even point sales are achieved

B. the excess of planned sales over the current actual sales

C. the extent to which sales revenue exceeds fixed costs

D. the difference between planned sales and break-even point sales

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64.
. . . . . . . . is a budget which is updated continuously by adding a further period (a month/quarter) and deducting a corresponding earlier period.

A. Rolling budget

B. Continuous budget

C. Annual budget

D. Both A and B

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65.
Which of the following is not an activity listed in the statement of cash flows?

A. Financing activities

B. Operating activities

C. Funding activities

D. Investing activities

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66.
EOQ is computed by:

A. $$\frac{{2D}}{{Ci}}$$

B. $$\frac{{Ci}}{{100}}$$

C. $$\sqrt {\frac{{2D{C_0}}}{{Ci}}} $$

D. $$\frac{D}{{100}}$$

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67.
Maintenance charges are in the nature of . . . . . . . . expenses.

A. Fixed

B. Variable

C. Semi-variable

D. None of these

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68.
When is the net present value negative,

A. the present value of cash outflows is greater than the future value of cash outflows

B. the future value of cash inflows is greater than the present value of cash outflows

C. the present value of cash outflows is greater than the present value of cash inflows

D. the present value of cash inflows is greater than the present value of cash outflows

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69.
The use of LIFO method is suitable when prices are:

A. Falling

B. Rising

C. Constant

D. In all of the above conditions

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70.
Match the following.

List-I List-II

a. Marginal cost 1. . . . . . . . . = Contribution ÷ Sales

b. P/V ratio 2. Contribution = Selling price - . . . . . . . .

c. Profit 3. . . . . . . . . = Sales (1 - P/V ratio)

d. Variable costs 4. Margin of safety = . . . . . . . . ÷ P/V ratio

A. a-4, b-3, c-2, d-1

B. a-3, b-1, c-4, d-2

C. a-2, b-1, c-4, d-3

D. a-2, b-3, c-4, d-1

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1 2 3 4 5 6 7 8 9 10

List-I	List-II
a. Marginal cost	1. . . . . . . . . = Contribution ÷ Sales
b. P/V ratio	2. Contribution = Selling price - . . . . . . . .
c. Profit	3. . . . . . . . . = Sales (1 - P/V ratio)
d. Variable costs	4. Margin of safety = . . . . . . . . ÷ P/V ratio

Costing MCQ Questions and Solutions with Explanations | Commerce

61. . . . . . . . . costs are partly fixed and partly variable in relation to output.

Answer & Solution

62. Under applied or over applied factory overhead should be:

Answer & Solution

63. The margin of safety may be defined as

Answer & Solution

64. . . . . . . . . is a budget which is updated continuously by adding a further period (a month/quarter) and deducting a corresponding earlier period.

Answer & Solution

65. Which of the following is not an activity listed in the statement of cash flows?

Answer & Solution

66. EOQ is computed by:

Answer & Solution

67. Maintenance charges are in the nature of . . . . . . . . expenses.

Answer & Solution

68. When is the net present value negative,

Answer & Solution

69. The use of LIFO method is suitable when prices are:

Answer & Solution

70. Match the following. List-I List-II a. Marginal cost 1. . . . . . . . . = Contribution ÷ Sales b. P/V ratio 2. Contribution = Selling price - . . . . . . . . c. Profit 3. . . . . . . . . = Sales (1 - P/V ratio) d. Variable costs 4. Margin of safety = . . . . . . . . ÷ P/V ratio

Answer & Solution

Read More Section(Costing)

61.
. . . . . . . . costs are partly fixed and partly variable in relation to output.

62.
Under applied or over applied factory overhead should be:

63.
The margin of safety may be defined as

64.
. . . . . . . . is a budget which is updated continuously by adding a further period (a month/quarter) and deducting a corresponding earlier period.

65.
Which of the following is not an activity listed in the statement of cash flows?

66.
EOQ is computed by:

67.
Maintenance charges are in the nature of . . . . . . . . expenses.

68.
When is the net present value negative,

69.
The use of LIFO method is suitable when prices are:

70.
Match the following.

List-I List-II

a. Marginal cost 1. . . . . . . . . = Contribution ÷ Sales

b. P/V ratio 2. Contribution = Selling price - . . . . . . . .

c. Profit 3. . . . . . . . . = Sales (1 - P/V ratio)

d. Variable costs 4. Margin of safety = . . . . . . . . ÷ P/V ratio