1. Which of the following are characteristics of job costing?

i. customer-driven production

ii. complete production possible within a single accounting period

iii homogenous products

A. i only

B. i and ii only

C. i and iii only

D. ii and iii only

2. A company operates a job costing system. Job 406 requires $120 of direct materials, $80

of direct labour and $40 of direct expenses. Direct labour is $8 per hour. Production

overheads are absorbed at a rate of $16 per hour and non-production overheads are absorbed at a rate of 60% of prime cost. What is the total cost of Job 406?

A. $480

B. $520

C. $544

D. $640

3. All of the following statements are correct EXCEPT:

A. in process costing but not job costing, the cost normal loss will be incorporated into

normal product costs

B. in process costing, information is needed about work passing through a process and

work remaining in each process

C. job costs are collected separately, whereas process costs are averages

D. in job costing the progress of a job can be determined from the materials requisition

notes and time sheet

4 A company uses process costing to value output. During the last month the following information was recorded:

Output: 1,400 kg valued at $7.50/kg

Normal Loss: 150 kg which has a scrap value of $3/kg

Abnormal gain: 50 kg

What was the value of the input?

A. $10,325

B. $10,950

C. $10,800

D. $10,575

5. WXY manufacturers product A in a single process. Normal loss (scrap) in the process is

10% of output and scrapped units can be sold off for $4/unit. In period 4, process costs of direct material, direct labour and production overheads totalled $92,400. Input to the process was 6600 units. What was the cost/unit produced?

A. $15.40

B. $15.15

C. $15.00

D. $12.00

6. What is the term for unavoidable losses in production?

A. Actual losses

B. Abnormal losses

C. Normal losses

D. Abnormal losses

7. 5400 kg of material was input to a process. Expected output was 90% of input. If actual output was 4000kg then there was an abnormal:

A. loss of 1400 kg

B. gain of 1400 kg

C. loss of 860 kg

D. gain of 860 kg

8. A company orders a particular raw material in order quantities of 250 units. No safety stock is held, the stockholding cost is $3 per unit per annum and the annual demand is 2,500 units.

What is the total annual stockholding cost of the raw material?

A. $375

B. $750

C. $3,750

D. $7,500

Questions 9 11 refer to the following information below:

A company had the following transactions for the month of March.

Purchases Sales

March 1 100 @ $2

March 2 20 @ $5

March 12 40 @ $2.50

March 15 100 @ $3

9. What is the value of closing stock using the LIFO method?

A. $ 100

B. $52.50

C. $40

D. $43

10. What is the value of closing stock using FIFO?

A. $50

B. $100

C. $52

D. $40

11. What is the value of the closing stock using the AVCO method

A. $100

B. $43.40

C. $40

D. $35.50

12. Classification of costs by element would include:

A. material, labour and expenses

B. material, labour and administration

C. fixed, variable and direct expenses

D. labour, production, semi-variable

13. Which of the following BEST describes a fixed cost? It:

A. represents a fixed proportion of total costs

B. remains constant per unit of output

C. has a direct relationship with output

D. remains at the same level when output increases

14. A businesss telephone bill should normally be classified into which of the following categories?

A. Fixed Cost

B. Stepped fixed cost

C. Semi-variable cost

D. Variable cost

15. All of the following costs would be classified as semi-variable costs EXCEPT:

A. rates of business premises

B. car hire with fixed rental and charge per mile

C. telephone bill with fixed rental and charge per call

D. straight line depreciation

16. Normal rate per hour paid to a staff of TCI Solutions Ltd is $2,000 and the standard time allowed is 20 units per hour. Assuming Wilson completes 80 units and Germuis 50 units in 7 hours. Calculate the earnings of each employee.

A. $8 000 and $5 000 respectively

B. $10 000 and $20 000

C. $20 000 and $25 000

D. $25 000 and $30 000

17. All of the following are advantages to the piece rate form of remuneration EXCEPT:

A. Effort is rewarded and in consequence, the employee is given the incentive to produce

more.

B. Because employees are self-motivated, less supervision is required.

C. The employees benefits from a reduction in the overhead cost per unit of production.

D. There is a danger that quality will be sacrificed and in such a situation the employer

would spend more on inspection and quality control.

18. Assume the rate per hour is $15 and the cost per unit is $16,000 while the units

produced is 8,000 units. Calculate the piece rate with guaranteed day rate of remuneration

assuming that 8,800 hours were used to produce the entire unit.

A. $100 000

B. $120 000

C. $140 000

D. $180 000

19. All of types of the following are premium bonus schemes EXCEPT:

A. Halsey Bonus Scheme

B. Halsey Weir Bonus Scheme

C. Rowan Weir Bonus Scheme

D. Rowan Bonus Scheme

20. The stock control functions and activities of the stores include:

A. identifying and defining need for items of stores and supplies

B. identifying and evaluating available suppliers of these items

C. negotiating with selected suppliers

D. planning the replenishment and recording of stock

21. Which of the following types of costing system compares actual with predetermined performance?

A. Standard costing

B. Process costing

C. Job costing

D. Batch costing

22. All of the following are objectives of standard costing EXCEPT:

A. To control costs by establishing standards and analysis of variance

B. To enable the principle of management by exception to be practiced at the detailed

operational level

C. To assist in control of each departments processes of production

D. To provide a formal basis for assessing performance and efficiency

23. The cost accounting system is used by management to do all of the following ECXEPT?

Planning

Control

Only used by the cost accountant to make future projections

Decision making