Costing mcqs

✅ The correct answer is A.
In regression equation, an evaluation criteria considers significance of independent variable. An independent variable is the variable that is changed or controlled in a scientific experiment to test the effects on the dependent variable.

✅ The correct answer is A.
Fifth step in quantitative analysis of estimating cost function is to estimate cost function. A cost estimate is the approximation of the cost of a program, project, or operation. The cost estimate is the product of the cost estimating process.

✅ The correct answer is D.
Re-order level = Safety stock + Total consumption
= 1000 + (500 × 12) = 1000 + 6000 = 7000 units.

✅ The correct answer is D.
In plotting cost functions, number of machine hours and batches are represented on y-axis.

✅ The correct answer is D.
Machine break downs is an abnormal cause of Idle time. Abnormal idle time may arise in case of all types of workers.

✅ The correct answer is A.
Process of assigning direct or indirect cost to any cost object is known as cost assignment. Cost assignment is the allocation of costs to the activities or objects that triggered the incurrence of the costs.

✅ The correct answer is D.
Terms used in manufacturing cost systems are prime costs and conversion costs. Manufacturing cost is the sum of costs of all resources consumed in the process of making a product.

✅ The correct answer is A.
Inventory of final goods that are not yet sold is called finished goods inventory. Finished goods inventory refers to the number of manufactured products in stock that are available for customers to purchase.

✅ The correct answer is B.
Economic order quantity is that quantity at which cost of holding and carrying inventory is minimum and equal. Economic order quantity (EOQ) is the ideal order quantity a company should purchase for its inventory given a set cost of production, a certain demand rate, and other variables. This is done to minimize inventory holding costs and order-related costs.

✅ The correct answer is C.