Costing

Costing MCQs with Answers and Explanations | Cost Accounting Objective Questions

Sharpen your understanding of Costing and Cost Accounting with our collection of MCQs with answers and detailed explanations. Covering key topics such as marginal costing, standard costing, process costing, job order costing, variance analysis, budgeting, cost control, and managerial decision-making, these objective questions are highly useful for students, teachers, and candidates preparing for professional and competitive exams (CA, ACCA, ICMA, MBA, CSS, PMS, NTS, FPSC, PPSC, UPSC, etc.). Each question includes a clear solution and explanation to strengthen concepts, improve problem-solving skills, and enhance exam preparation. Perfect for practice, self-assessment, and revision in the field of Cost Accounting.

111. Costs that are incurred in last department, where product has been processed and will be carried to next department for further processing are called

by
partial work costs
transferred-in costs
transferred-out costs
weighted average costs
✅ The correct answer is B.
Costs that are incurred in last department, where product has been processed and will be carried to next department for further processing are called transferred-in costs. Transferred-in costs are costs accumulated during the upstream production processes within a company. Transferred-in costs are the costs accumulated by the product at any given point in production.

112. Allotment of overhead incurred for a particular cost centre to that specific cost centre is ________.

by
allocation
allotment
primary distribution
secondary distribution
✅ The correct answer is A.
Allotment of overhead incurred for a particular cost centre to that specific cost centre is allocation. Allocation and apportionment are accounting methods for attributing cost to certain cost objects for budgeting, planning, and financial reporting.

118. Hybrid costing system, which is applied to batches of similar products, but are not identical is classified as

by
incremental costing system
split off costing system
inventoriable costing system
operation costing system
✅ The correct answer is D.
Hybrid costing system, which is applied to batches of similar products, but are not identical is classified as operation costing system. Operation costing, also known as service costing, is a costing method that combines process costing and job costing.

119. Estimation of cost functions, an ignoring information from all points but considering two observation points can be classified as

by
disadvantage of low high method
disadvantage of high low method
advantage of high low method
advantage of low high method
✅ The correct answer is B.
Estimation of cost functions, an ignoring information from all points but considering two observation points can be classified as disadvantage of high low method.

120. 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

by
(1) only
(1) and (2) only
(2) only
(2) and (3) only
✅ The correct answer is B.
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.