Costing mcqs

✅ The correct answer is D.
Hybrid costing system, which is applied to batches of similar products, but are not identical is classified as operation costing system. Operation costing, also known as service costing, is a costing method that combines process costing and job costing.

✅ The correct answer is B.
Estimation of cost functions, an ignoring information from all points but considering two observation points can be classified as disadvantage of high low method.

✅ The correct answer is C.
ABC analysis is an inventory control technique in which Inventory is classified into A, B and C Category with A being the lowest quantity, highest value.

✅ The correct answer is A.
Degree of influence that a manager would have on revenues, cost, profit and investment is known as controllability. Controllability is an important property of a control system, and the controllability property plays a crucial role in many control problems, such as stabilization of unstable systems by feedback, or optimal control.

✅ The correct answer is A.
Budget which calculates expected revenues and expected costs, based on actual output quantity is named as flexible budget. A flexible budget, also called a variable budget, is financial plan of estimated revenues and expenses based on the current actual amount of output.

✅ The correct answer is D.
Fifth step in process costing system is to assign total cost to completed units. Total cost is an economic measure that sums all expenses paid to produce a product, purchase an investment, or acquire a piece of equipment including not only the initial cash outlay but also the opportunity cost of their choices.

✅ The correct answer is A.
Time rate system method of wage payment is most suitable where the speed of production is beyond the control of worker. The time rate system is that system of wage payment in which the workers are paid on the basis of time spent by them in the factory.

✅ The correct answer is C.
Support department cost allocation method which makes no difference between variable and fixed costs is classified as single rate cost allocation method. The single-rate cost-allocation method makes no distinction between fixed costs and variable costs in the cost pool.

✅ The correct answer is B.
Costs that are incurred in last department, where product has been processed and will be carried to next department for further processing are called transferred-in costs. Transferred-in costs are costs accumulated during the upstream production processes within a company. Transferred-in costs are the costs accumulated by the product at any given point in production.

✅ The correct answer is A.
Allotment of overhead incurred for a particular cost centre to that specific cost centre is allocation. Allocation and apportionment are accounting methods for attributing cost to certain cost objects for budgeting, planning, and financial reporting.