Costing mcqs

✅ The correct answer is A.
Final sales is subtracted from net realizable value is used to calculate separable costs. The net realizable value method allocates joint costs on the basis of the final sales value less separable costs.

✅ The correct answer is B.
Directors remuneration and expenses form part of administrative overhead. Administrative overhead includes the expenses related to the administration and general operations of the business.

✅ The correct answer is D.
Manufacturing overhead cost allocated to individual jobs is classified as manufacturing overhead allocated and manufacturing overhead applied.

✅ The correct answer is C.

✅ The correct answer is A.
Direct labour means labour which can be conveniently associated with aparticular cost unit. Direct Labour cost consists of wages paid to workers directly engaged in manufacturing or handling a product, job or process.

✅ The correct answer is B.
Sales budget variance = Flexible budget – Static budget
= $305000 – $208000 = $97,000

✅ The correct answer is A.
Spread of over allocated overhead and under allocated overhead among work in process, finished goods and goods sold cost is classified as proration approach.

✅ The correct answer is C.
Bad debt is an example of selling overhead. The expenses incurred by an organization in carrying out its selling activities.

✅ The correct answer is B.
cost object user, who is ranked first in incremental cost allocation method is known as primary user. The term primary user describes someone who interacts with a system. The primary user is in direct contact with the system interface and thus is usually most affected by it.

✅ The correct answer is A.
In plotting of cost functions, level of activities according to which charged cost is represented on x-axis.