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.

201. As compared to cumulative average-time learning model, learning model which predicts more cumulative total time to produce more units is known as

by
incremental unit time learning model
incremental price learning model
incremental unit average model
incremental cost learning model
✅ The correct answer is A.
As compared to cumulative average-time learning model, learning model which predicts more cumulative total time to produce more units is known as incremental unit time learning model.

204. Third step in developing operating budget is

by
analysis of batches
analysis of batches
analysis of products
making predictions about future
✅ The correct answer is D.
Third step in developing operating budget is making predictions about future. An operating budget is the annual budget of an activity stated in terms of Budget Classification Code, functional/subfunctional categories and cost accounts.

206. Activities related to coordinating, controlling and planning flow of inventory are classified as

by
decisional management
throughput management
inventory management
manufacturing management
✅ The correct answer is C.
Activities related to coordinating, controlling and planning flow of inventory are classified as inventory management. Inventory management refers to the process of ordering, storing, and using a company’s inventory. These include the management of raw materials, components, and finished products, as well as warehousing and processing such items.

208. Method which divides support department cost into two dimensions such as fixed and variable cost pool is classified as

by
sales mix allocation method
dual-rate cost-allocation method
single rate cost allocation method
quantity variance allocation method
✅ The correct answer is B.
Method which divides support department cost into two dimensions such as fixed and variable cost pool is classified as dual-rate cost-allocation method. Allocations are performed in order to create financial statements that are in compliance with the applicable accounting framework.

209. Balance sheet, in which all costs of product that must be considered as its assets, is said to be

by
factory overhead costs
manufacturing overhead costs
Inventoriable costs
finished costs
✅ The correct answer is C.
Balance sheet, in which all costs of product that must be considered as its assets, is said to be Inventoriable costs. Inventoriable costs, also known as product costs, refer to the direct costs associated with the manufacturing of products for revenue generation.

210. In costing of project, wages paid to workers for unproductive work at time of material shortage is termed as

by
indirect wages
health wages
idle time wages
shortage time wages
✅ The correct answer is C.
In costing of project, wages paid to workers for unproductive work at time of material shortage is termed as idle time wages. The labour cost of normal idle time may be treated as an item of factory expenses and recovered as an indirect charge in case of indirect workers.