Cost and Managerial Accounting

551. Some overhead charges tend to vary almost directly, some tend to remain constant while some again vary in part with the volume and in part remain constant. This statement describes sequentially the following:

  1. Variable, fixed and semi-variable overheads
  2. Fixed, semi-variable and variable overheads
  3. Semi-variable, variable and fixed overheads
  4. Variable, semi-variable and fixed overheads
Correct answer: (A)
Variable, fixed and semi-variable overheads

552. A method of dealing with overheads involves spreading common costs over cost centres on the basis of benefit received. This is known as

  1. Overhead absorption
  2. Overhead apportionment
  3. Overhead identification
  4. Overhead analysis
Correct answer: (B)
Overhead apportionment

553. Annual requirement is 7800 units; consumption per week is 150 units. Unit price 5, order cost 10 per order. Carrying cost 1 per unit and lead time is 3 week, The Economic order quantity would be.

  1. 395 units
  2. 300 units
  3. 250 units
  4. 150 units
Correct answer: (A)
395 units

554. The short run is a time period in which:

  1. All resources are fixed.
  2. The level of output is fixed.
  3. The size of the production plant is variable.
  4. Some resources are fixed and others are variable
Correct answer: (D)
Some resources are fixed and others are variable

555. Which of the following is / are time based incentive wage plan?

  1. Hasley Premium Plan
  2. Hasley Weir Premium Plan
  3. Rowan Premium Plan
  4. All of the given options
Correct answer: (D)
All of the given options

556. When prices are rising over time, which of the following inventory costing methods will result in the lowest gross margin/profits?

  1. FIFO
  2. LIFO
  3. Weighted Average
  4. Cannot be determined
Correct answer: (B)
LIFO

557. Which of the following is a mechanical device to record the exact time of the workers?

  1. Clock Card
  2. Store Card
  3. Token System
  4. Attendance Register
Correct answer: (A)
Clock Card

558. If, COGS = 50,000 GP Margin = 25% of sales what will be the value of Sales?

  1. 200,000
  2. 66,667
  3. 62,500
  4. None of the given options
Correct answer: (B)
66,667

559. The Economic order quantity can be calculated by

  1. Formula Method
  2. Table Method
  3. Graph Method
  4. All of the given
Correct answer: (D)
All of the given

560. While preparing the Cost of Goods Sold and Income Statement, the over applied FOH is;

  1. Add back, subtracted
  2. Subtracted, add back
  3. Add back, add back
  4. Subtracted, subtracted
Correct answer: (B)
Subtracted, add back
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