Cost and Managerial Accounting

431. A material loss during production or storage due to evaporation or shrinkage is called:

1. Scrap
2. Waste
3. Spoilage
4. Material loss

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432. Objectives of research and development costs include:

1. Maintaining present competitive position
2. Improving enterprise's competitive position
3. Exploring now market/products
4. All of the above

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433. Which of the following definitions describe marginal cost?

1. The variable cost of one unit of product or service
2. A principle whereby variable costs are charged to cost units and the fixed costs attributable to the relevant period are written-off in full against the contribution for that period
3. Costs appropriate to aiding the making of specific management decisions
4. The price at which material identical to that which is used up could be replaced on the date of usage

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434. For computing depreciation of an asset, the factors that are taken into consideration include the following except:

1. Historical cost
2. Expected useful life
3. Insurance premium
4. Estimated residual value

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435. Which of the following is not included in the objectives of maintenance of plant and machinery?

1. Reducing idle time
2. Reducing breakdown
3. Maintaining efficiency
4. Increasing life

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436. Which of the following is not used as a base for apportionment of administration overheads?

1. Direct wages
2. Works cost
3. Conversion cost
4. Sales value

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437. Fringe benefits are those for which efforts of the workers are not necessary and may include the following except:

1. Holiday pay
2. Attendance bonus
3. Production bonus
4. Employer's contribution to P.F.

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438. Which of the following is not a cost implication of labourturnover?

1. Training
2. Recruiting
3. Ageing labour force
4. Damage of machine

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439. Which of the following techniques is not meant for labour cost control?

1. Budgetary control
2. Standard costing
3. ABC analysis
4. Ratio analysis

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440. Which of the following is TRUE regarding Departmental Rates.

1. A departmental absorption rate is a rate of absorption based upon the particular department's overhead cost and activity level
2. A departmental absorption rate is a rate of absorption not based upon the particular department's overhead cost and activity level
3. A single rate of absorption used throughout an organization's production facility and based upon its total production costs and activity
4. None of the given options

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