Costing mcqs

✅ The correct answer is A.
Higher and accurate budgeted profit forecast of managers lead to high incentive bonus. At the start of each fiscal period, the business owner prepares a budget based on projected revenue and the expenditure needed to realize that revenue.

✅ The correct answer is D.
Assisting Shareholders in decision making is not an objective of Cost Accounting. Objectives of cost accounting are ascertainment of cost, fixation of selling price, proper recording and presentation of cost data to management for measuring efficiency and for cost control and cost reduction, ascertaining the profit of each activity, assisting management in decision making and determination of break-even point.

✅ The correct answer is A.
Budget plan in many companies is also referred as profit plan. Profit planning is the set of actions taken to achieve a targeted profit level. These actions involve the development of an interlocking set of budgets that roll up into a master budget.

✅ The correct answer is B.
Manufacturing budget = Indirect manufacturing labour + Power cost + Maintenance and supplies
= $20000 + $5000 + $10000 = $35,000

✅ The correct answer is A.
Stores Ledger is a quantitative as well as value wise records of material received, issued and balance. A stores ledger is a manual or computer record of the raw materials and production supplies stored in a production facility. It is maintained by the person responsible for these assets, such as the warehouse manager.

✅ The correct answer is A.
Labour cost is the second element of cost. Labour cost is a second major element of cost. Under the present political conditions with a restive labour in organised industry, it is very difficult to reduce labour cost.

✅ The correct answer is A.
Slope coefficient of linear cost function is zero.

✅ The correct answer is C.
A manager, who is responsible for both cost and revenues belongs to department of profit center. A profit center is a branch or division of a company that directly adds to the corporation’s bottom-line profitability.

✅ The correct answer is B.
Bin Card is a quantitative record of material received, issued and balance. A BIN Card is a table that records the status of a good held in stock.

✅ The correct answer is C.
Profit earned during the year
= 5000 + 35000 – 25000
= Rs. 15000.