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.

513. Hierarchy which is based on different types of cost allocation and drivers, is to categorize cost pool activity is classified as

cost hierarchy
price hierarchy
activity hierarchy
purpose hierarchy
✅ The correct answer is A.
Hierarchy which is based on different types of cost allocation and drivers, is to categorize cost pool activity is classified as cost hierarchy. The cost hierarchy is a classification system used in activity-based costing that designates activities based on how easily they can be traced to a product.

514. Calculate the labour turnover rate according to replacement method from the following: No of workers on the payroll: – At the beginning of the month: 500 – At the end of the month: 600 During the month, 5 workers left, 20 workers were discharged and 75 workers were recruited Ofthese, 10 workers were recruited in the vacancies of those leaving and while the rest were engaged for an expansion scheme

4.55%
1.82%
6%
3%
✅ The correct answer is B.
Replacement method = No of worker replaced during the period/Average no of workers at same period × 100

No of worker replaced during the period = 10

Average no of workers = (500+600)/2= 550

∴10/ 550 × 100

=1.82%

518. Method which allocates joint costs of joint products, considering physical measures such as volume or relative weight at point of split off is known as

direct cost measure method
indirect cost measure method
physical-measure method
relative-measure method
✅ The correct answer is C.
Method which allocates joint costs of joint products, considering physical measures such as volume or relative weight at point of split off is known as physical-measure method. The physical measure method allocates cost by the weight, volume, or some other measurement of the product that’s produced.