Costing mcqs

GRN number refers to________.

by
goods received note number
goods returned note number
goods shortage note number
goods requisition note number
✅ The correct answer is A.
A goods receipt note (GRN) is created to record the delivery of items from your suppliers. A GRN is created against an issued purchase order. When a GRN is created for an item, any pending item quantity for an approved indent request will be automatically issued.

The summarized balance sheet of Rakesh udyog Limited shows the balances of previous and current year of provision for taxation Rs 50,000 and Rs 65,000. If taxed paid during the current year amounted to Rs 70,000 then amount charge from Profit and Loss Account will be:

by
Rs 55,000
Rs 85,000
Rs 45,000
Rs 1,85,000
✅ The correct answer is B.
Amount charged from profit and loss account
= Rs. 70000 + Rs. 65000 – Rs. 50000
= Rs. 85000.

This is a level at which normal issue of material are stopped, but issued under special condition It is ________.

by
maximum stock level
minimum stock level
danger level
average stock level
✅ The correct answer is C.
This is a level at which normal issue of material are stopped, but issued under special condition It is danger level. Danger level is a level of fixed usually below the minimum level. When the stock reaches danger level, an urgent action for purchase is initiated.

Situation in which two or more independent variables are highly correlated is known as

by
price linearity
cost linearity
division linearity
multi-collinearity
✅ The correct answer is D.
Situation in which two or more independent variables are highly correlated is known as multi-collinearity. Multicollinearity is the occurrence of high intercorrelations among independent variables in a multiple regression model.

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

by
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.

Profit forgone by capital investment in inventory rather than investment of capital to somewhere else is classified as

by
relevant purchase order costs
relevant inventory carrying costs
irrelevant inventory carrying costs
relevant opportunity cost of capital
✅ The correct answer is D.
Profit forgone by capital investment in inventory rather than investment of capital to somewhere else is classified as relevant opportunity cost of capital.