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.

261. Purchase order lead time is multiplied to number of units is sold per unit of time to calculate

by
carrying costs
relevant total costs
economic order quantity
reorder point
✅ The correct answer is D.
Purchase order lead time is multiplied to number of units is sold per unit of time to calculate reorder point. The reorder point (ROP) is the level of inventory which triggers an action to replenish that particular inventory stock.

262. “For the financial year ended as on March 31, 20XX the figures extracted from the balance sheet of Xerox Limited as under: Opening Stock Rs 29,000; Purchases Rs 2,42,000; Sales Rs 3,20,000; Gross Profit 25% of Sales. Stock Turnover Ratio will be” :-

by
8 times
6 times
9 times
10 times
✅ The correct answer is A.
Inventory turnover ratio = cost of goods sold / average inventory at cost

cost of goods sold is 25% of sales i.e
320000 * 25 % = 8000

average inventory at cost = 31000 – 29000 = 1000.

Stock turnover ratio = 8000/1000 = 8 times.

267. Cost pattern, when production inputs are to be used in discrete functions, but quantities are fractional, will be categorized as

by
continuously variable cost function
fixed cost function
mixed cost function
semi variable cost function
✅ The correct answer is A.
Cost pattern, when production inputs are to be used in discrete functions, but quantities are fractional, will be categorized as continuously variable cost function. A variable cost is a corporate expense that changes in proportion to production output.

269. Costing technique, in which actual direct rates are multiplied to quantity of direct cost inputs is classified as

by
priced costing
actual costing
direct costing
indirect costing
✅ The correct answer is B.
Costing technique, in which actual direct rates are multiplied to quantity of direct cost inputs is classified as actual costing. Actual costing is the recording of product costs based on the following factors: Actual cost of materials.