COST ACCOUNTING (CA) MCQS
S.Y. B.COM
SEMESTER - III
COST ACCOUNTING
(CA)
MCQS - OVERHEAD COST
1) The allotment of whole items of cost centers or cost units is called
a) Cost allocation
b) Cost apportionment
c) Overhead absorption
d) Overhead allotment
2) Packing cost is a
a) Production cost
b) Selling cost
c) Distribution cost
d) It may be any of the above
3) Director's remuneration and expenses form a part of
a) Production overhead
b) Administration overhead
c) Selling overhead
d) Distribution overhead
4) Salary of a foreman should be classified as a
a) Fixed overhead
b) Variable overhead
c) Semi - fixed or semi - variable overhead
5) Charging to a cost center those overheads that result solely from the existence of that cost center is known as
a) Allocation
b) Apportionment
c) Absorption
d) Allotment
6) Absorption means
a) Charging of overhead to cost centers
b) Charging of overheads to cost until
c) Charging of overheads to cost centers or cost units
7) Administration overheads are recovered as a percentage of
a) Direct materials
b) Direct wages
c) Prime cost
d) Works cost
8) Which of the following is a service department?
a) Refining department
b) Machining department
c) Receiving department
d) Finishing department
9) Which of the following is not is selling overhead?
a) Insurance to cover sold goods while in transit
b) Royalty on sales
c) Legal costs for debt realization
d) Distribution of samples
10) Which method of absorption of factory overheads do you suggest in concern which produced only one uniform type of product?
a) Percentage of direct wages basis
b) Direct labor hour rate
c) Machine hour rate
d) A rate per unit of output
e) Any of the above
11) When the amount of under or over absorption is significant, it should be disposed of
a) Transferring to costing profit and loss A/C
b) The use or supplementary rates
c) Carrying over as a deferred charge to the next accounting year
12) Idle capacity of a plant refers to the difference between
a) Maximum capacity and particle capacity
b) Particle capacity and normal capacity
c) Particle capacity and capacity based on sales expectancy
d) Maximum capacity and actual capacity
13) Maximum possible productive capacity of a plant, when no operating time is lost, is
a) Particle capacity
b) Theoretical capacity
c) Normal capacity
d) Capacity based on sales expectancy
14) The capacity which is based on the long term average of the sales expectancy level known as
a) Particle capacity
b) Actual capacity
c) Normal capacity
d) None of these
15) When the amount of overhead absorbed is less than the amount of overhead incurred, it is called
a) Under - absorption of overhead
b) Over - absorption of overhead
c) Proper absorption of overhead
16) Bad debt is an example of
a) Production overhead
b) Administration overhead
c) Selling overhead
d) Distribution overhead
17) Number of workers employed is used as a basis for the apportionment of
a) Time office costs
b) Canteen expenses
c) Personal department expenses
d) Any of these
18) When the factory overhead control account has a closing debit balance, factory overhead was
a) Over - absorbed
b) Under - absorbed
c) Fixed
d) Variable
19) Factory overhead should be absorbed on the basis of
a) Relationship to cost incurred
b) Direct labor hours
c) Direct Labor cost
d) Machine hour
20) In which of the following method of providing depreciation, the amount of depreciation goes on decreasing with the age of the asset?
a) Reducing balance method
b) Sum of digits method
c) Annuity method
d) (a) and (b) above
21) Which of the following is a scientific and accurate method of absorption of factory overheads?
a) Percentage on prime cost
b) Percentage on direct labor cost
c) Machine hour rate
d) All of these
22) What is the basis for distribution of indirect material cost to various departments?
a) Direct allocation
b) Cost of direct overhead
c) Machine hours worked
23) Warehouse expense is an example of
a) Production overhead
b) Selling overhead
c) Distribution overhead
24) Selling and distribution overheads are absorbed on basis of
a) Rate per unit
b) Percentage on works cost
c) Percentage on selling of each unit
d) Any of these
25) The following balances appear as on 31st Dec, 1997 for X ltd.
Over head over-applied | RS.350 |
Cost of goods sold | RS.9,50,000 |
Work in progress inventory | RS.38,000 |
Finished goods inventory | RS.75,000 |
a) To transfer it to costing P & L A/C
b) To prorate it between work in progress inventory and finished goods inventory
c) To prorate between inventory of work in progress and finished goods and cost of goods sold
26) The difference over a period of time, between actual factory overhead and absorbed factory overhead will usually be minimum when the pre-determined overhead rate is based
a) Normal capacity
b) Maximum capacity
c) Direct labor hours
d) Machine hours
e) None of the above
27) Under-absorbed factory overhead costs are
a) Excess variable factory overhead costs
b) Factory overhead cost not allocated to units produced
c) Fixed factory costs not allocated to unit produced
d) Cost that cannot be controlled
e) None of these
28) If a pre-determined factory overhead rate is note employed and the volume of : is reduced from the level planned, the cost per unit would be expected to
a) Remain uncharged for fixed costs and increase for variable costs
b) Increase for fixed cost and remain uncharged for variable costs
c) Increase for fixed costs decrease for variable costs
d) Decrease for fixed costs and decrease foe variable costs
29) The least suitable basis for applying overhead is
a) Materials consumed
b) Direct labor cost
c) Direct labor hours
d) Machine hours
30) Excess plant capacity means
a) Temporary idleness of plant
b) Greater production capacity than a company can use
c) The difference between theoretical capacity and actual capacity
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