Costing mcqs

✅ The correct answer is A.
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.

✅ The correct answer is D.
Under Gantts task and bonus plan no bonus is payable to a worker if his efficiency is less than 100%. If a worker takes more time than the standard time to complete the task (i.e., his efficiency is below 100%), he is given wages for the time taken by him and if a worker takes the standard time to perform the task (i.e., efficiency is 100%), he is given wages for the standard time and a bonus of 20% on the wages earned.

✅ The correct answer is C.
Insurance is an example of purchasing costs. It is important when you decide to buy a home that you have a full understanding of the costs associated with your purchase.

✅ The correct answer is B.
ABC analysis is a way of categorizing the material on the basis of the quantity of consumption and their relative values. Some material might be consumed in lower quantities but their period may be very high. Such materials are kept in group “A”. Similarly, some material may be consumed in large quantities but their values may be lower. Such materials are kept in group ‘C’. In between these two, some materials may be consumption in moderate quantity with the moderated price. Such materials are kept in group ‘B’ under ABC analysis very close control is exercised over the material in group ‘A’ whereas a very little control is exercise is exercised over the material in group ‘C’.

✅ The correct answer is A.

✅ The correct answer is B.
The cost unit applicable to the Bicycle industry is per bicycle.

✅ The correct answer is B.
Costs incurred in production process that yield range of products simultaneously are known as joint costs. Joint cost is the manufacturing cost incurred on a joint production process which takes common inputs but simultaneously produces multiple products called joint-products.

✅ The correct answer is B.
Most suitable basis for apportioning insurance of machine would be Value of Machines.

✅ The correct answer is D.
Under Time wage rate method of wage payment, wages are influenced by idle time. Under time wage system, wages are paid on the basis of time spent on the job irrespective of the amount of work done.

✅ The correct answer is A.
Units of normal spoilage are divided to total completed units, rather than total actual produced units to calculate normal spoilage rates. The normal spoilage will be calculated as the total number of spoiled units, divided by the total units produced, and multiplied by 100.