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Q.49. Most suitable basis for apportioning insurance of machine would be: (a) Floor Area (b) Value of Machines (c) No. of Workers (d) No. of Machines Q. 50. Blanket overhead rate is: (a) One single overhead absorption rate for the whole factory (b) Rate which is blank or nil rate (c) rate in which multiple overhead rates are calculated for each production department, service department etc. (d) Always a machine hour rate Q.51. AT Co makes a single product and is preparing its material usage budget for next year. Each unit of product requires 2kg of material, and 5,000 units of product are to be produced next year. Opening inventory of material is budgeted to be 800 kg and AT co budgets to increase material inventory at the end of next year by 20% The material usage budget for next year is (a) 8,000 Kg ((b) 9,840 kg ((c) 10,000 Kg = (d) 10,160 Kg Q.52. During a period 17, 500 labour hours were worked at a standard cost of Rs 6.50 per hour. The labour efficiency variance was Rs 7,800 favourable. How many standard hours were produced? (a) 1,200 (b) 16,300 (c) 17,500 (d) 18,700 Q.53. Which of the following is not a reason for an idle time variance? (a) Wage rate increase (b) Machine breakdown (c) Illness or injury to worker (d) Non- availability of material Q.54. During September, 300 labour hours were worked for a total cost of Rs 4800. The variable overhead expenditure variance was Rs 600 (A). Overheads are assumed to be related to direct labour hours of active working. What was the standard cost per labour hour? (a) Rs 14 (b) Rs 16.50 (c) Rs 17.50 (d) Rs 18Q.55. Which of the following would explain an adverse variable production overhead efficiency variance? 1. Employees were of a lower skill level than specified in the standard 2. Unexpected idle time resulted from a series of machine breakdown 3. Poor Quality material was difficult to process (a) (1), (2) and (3) (b) (1) and (2) (c) (2) and (3) (d) (1) and (3) Q.56. Budgeted sales of X for March are 18000 units. At the end of the production process for X, 10% of production units are scrapped as defective. Opening inventories of X for March are budgeted to be 15000 units and closing inventories will be 11,400 units. All inventories of finished goods must have successfully passed the quality control check. The production budget for X for March, in units is: (a) 12,960 (b) 14,400 (c) 15,840 (d) 16,000 Q.57. CG Co manufactures a single product T. Budgeted production output of product T during June is 200 units. Each unit of product T requires 6 labour hours for completion and CG Co anticipates 20 per cent idle time. Labour is paid at a rate of Rs7 per hour. The direct labour cost budget for March is (a) Rs 6,720 (b) 8,400 (c) 10,080 (d) 10,500 Q.58. A Local Authority is preparing cash Budget for its refuse disposal department. Which of the = following items would not be included in the cash budget? (a) Capital cost of a new collection vehicle (b) Depreciation of the machinery (c) Operatives wages (d) Fuel for the collection Vehicles Q.59. BDL Lid. is currently preparing its cash budget for the year to 31 March 2014. An extract from its sales budget for the same year shows the following sales values. Rs March 60,000 April 70,000 May 55,000 June 65,000 40% of its sales are expected to be for cash. Of its credit sales, 70% are expected to pay in month after sale and take a 2% discount. 27% are expected to pay in the second month after the sale, and the remaining 3% are expected to be bad debts. The value of sales budget to be shown in the cash budget for May 2013 is (a) Rs 60,532 (b) Rs 61,120 (c) Rs 66,532 (d) Rs 86,620Q.68. Which of the following statements is/are correct? 1. A materials requisition note is used to record the issue of direct material to a specific job. 2. A typical job cost will contain actual costs for material, labour and production overheads, and non -production overheads are often added as a percentage of total production cost 3. The job costing method can be applied in costing batches (a) (1) only (b) (1) and (2) only (c) (1) and (3) only (d) (2) and (3) only Q.69. A job is budgeted to require 3,300 productive hours after incurring 25% idle time. If the total labour cost budgeted for the job is Rs36,300. What is the labour cost per hour( to the nearest cent)? (a) Rs 8.25 (b) Rs 8.80 (c) Rs 11.00 (d) Rs 14.67 Q.70. A company calculates the prices of jobs by adding overheads to the prime cost and adding 30% to total costs as a profit margin. Job number Y256 was sold for Rs1690 and incurred overheads of Rs 694. What was the prime cost of the job? (a) Rs 489 (b) Rs 606 (c) Rs 996 (d) Rs 1300 Q.71. State which of the following are the characteristics of service costing. 1. High levels of indirect costs as a proportion of total costs 2. Use of composite cost units 3. Use of equivalent units (a) (1) only (b) (1) and (2) only (c) (2) only (d) (2) and (3) only Q.72. Which of the following organisations should not be advised to use service costing? (a) Distribution service (b) Hospital = (c) Maintenance division of a manufacturing company (d) A light engineering companyQ.93. If credit sales for the year is Rs. 5,40,000 and Debtors at the end of year is Rs. 90,000 the Average Collection Period will be (a) 30 days (b) 61 days (c) 90 days (d) 120 days Q.94. The summarized balance sheet of Rakesh udyog Limited shows the balances of previous and current year of provision for taxation Rs. 50,000 and Rs. 65,000. If taxed paid during the current year amounted to Rs. 70,000 then amount charge from Profit and Loss Account will be: (a) Rs. 55,000 (b) Rs. 85,000 (c) Rs. 45,000 (d) Rs. 1,85,000 Q.95. The summarized balance sheet of Autolight Limited shows the balances of previous and current year of retained earnings Rs. 25,000 and Rs. 35,000. If dividend paid during the current year amounted to Rs. 5,000 then profit earned during the year will be: (a) Rs. 5,000 (b) Rs. 55,000 (c) Rs. 15,000 (d) Rs. 65,000 Q.96. Following information is available of XYZ Limited for quarter ended June, 2013 Fixed cost Rs. 5,00,000 Variable cost Rs. 10 per unit Selling price Rs. 15 per unit Output level 1,50,000 units What will be amount of profit earned during the quarter using the marginal costing technique? (a) Rs. 2,50,000 (b) Rs. 10,00,000 (c) Rs. 5,00,000 (d) Rs. 17,50,000 Q.97. The P/v ratio of a company is 50% and margin of safety is 40%. If present sales is Rs. 30,00,000 then Break Even Point in Rs. will be (a) Rs. 9,00,000 (b) Rs. 18,00,000 (c) Rs. 5,00,000 (d) None of the above Q.98. Following information is available of PQR for year ended March, 2013: 4,000 units in process, 3,800 units output, 10% of input is normal wastage, Rs. 2.50 per unit is scrap value and Rs. 46,000 incurred towards total process cost then amount on account of abnormal gain to be transferred to Costing P&L will be: (a) Rs. 2,500 (b) Rs. 2,000 (c) Rs. 4,000 (d) Rs. 3,500Q.86. In 'make or buy' decision, it is profitable to buy from outside only when the supplier's price is below the firm's own (a) Fixed Cost (b) Variable Cost (c) Total Cost (d) Prime Cost Q.87. A budget which is prepared in a manner so as to give the budgeted cost for any level of activity is known as: (a) Master budget (b) Zero base budget ((c) Functional budget (d) Flexible budget Q.88. is also known as working capital ratio. (a) Current ratio (b) Quick ratio ((c) Liquid ratio (d) Debt-equity ratio Q.89. is a summary of all functional budgets in a capsule form. (a) Functional Budget (b) Master Budget (c) Long Period Budget (d) Flexible Budget Q.90. is a detailed budget of cash receipts and cash expenditure incorporating both revenue and capital items. (a) Cash Budget (b) Capital Expenditure Budget (c) Sales Budget (d) Overhead Budget Q.91. Statutory cost audit are applicable only to: (a) Firm (b) Company (c) Individual (d) Society Q.92. For the financial year ended as on March 31, 2013 the figures extracted from the balance sheet of Xerox Limited as under: Opening Stock Rs. 29,000; Purchases Rs. 2,42,000; Sales Rs. 3,20,000; Gross Profit 25% of Sales. Stock Turnover Ratio will be :- (a) 8 times (b) 6 times (c) 9 times (d) 10 timesQ.96. Following information is available of XYZ Limited for quarter ended June, 2013 Fixed cost Rs. 5,00,000 Variable cost Rs. 10 per unit Selling price Rs. 15 per unit Output level 1,50,000 units What will be amount of profit earned during the quarter using the marginal costing technique? (a) Rs. 2,50,000 (b) Rs. 10,00,000 (c) Rs. 5,00,000 (d) Rs. 17,50,000 Q.97. The P/v ratio of a company is 50% and margin of safety is 40%. If present sales is Rs. 30,00,000 then Break Even Point in Rs. will be (a) Rs. 9,00,000 (b) Rs. 18,00,000 (c) Rs. 5,00,000 (d) None of the above Q.98. Following information is available of PQR for year ended March, 2013: 4,000 units in process, 3,800 units output, 10% of input is normal wastage, Rs. 2.50 per unit is scrap value and Rs. 46,000 incurred towards total process cost then amount on account of abnormal gain to be transferred to Costing P&L will be:- (a) Rs. 2,500 (b) Rs. 2,000 (c) Rs. 4,000 (d) Rs. 3,500 Q.99. In element-wise classification of overheads, which one of the following is not included - (a) Fixed overheads (b) Indirect labour (c) Indirect materials (d) Indirect expenditure. Q.100. When the sales increase from Rs. 40,000 to Rs. 60,000 and profit increases by Rs. 5,000, the P/V ratio is - (a) 20% (b) 30% (c) 25% (d) 40%.Q.60. The actual output of 162,500 units and actual fixed costs of Rs. 87000 were exactly as budgeted. However, the actual expenditure of Rs 300,000 was Rs. 18,000 over budget. What was the budget variable cost per unit? (a) Rs 1.20 (b) Rs 1.31 (c) Rs1.42 (d) Rs 1.50 Q.61. CA Co manufactures a single product and has drawn up the following flexed budget for the year. 60% 70% 80% Rs Rs Rs Direct materials 120,000 140,000 160,000 Direct labour 90,000 105,000 120,000 Production overheads 54,000 58,000 62,000 Other overheads 40,000 40,000 40,000 Total Cost 304,000 343,000 382,000 What would be the total cost in a budget that is prepared at the 77% level of activity? (a) Rs 330,300 (b) Rs 370,300 (c) Rs 373,300 (d) Rs 377,300 Q.62. A Itd is a manufacturing company that has no production resource limitations for the foreseeable future. The Managing Director has asked the company mangers to coordinate the preparation of their budgets for the next financial year. In what order should the following budgets be prepared? (1) Sales budget (2) Cash budget (3) Production budget (4) Purchase budget (5) Finished goods inventory budget (a) (2), (3), (4). (5). (1) (b) (1). (5), (3). (4). (2) (c) (1), (4), (5). (3). (2) (d) (4), (5), (3). (1), (2) Q.63. S produces and sells one product, P, for which the data are as follows: Selling price Rs 28 Variable cost Rs 16 Fixed cost Rs 4Q.30. Calculate the value of closing stock from the following according to LIFO method: 1st January, 2014: Opening balance: 50 units @ Rs. 4 Receipts: 5th January, 2014: 100 units @ Rs. 5 12th January, 2014: 200 units @ Rs. 4.50 Issues: 2nd January, 2014: 30 units 18th January, 2014: 150 units (a) Rs. 765 (b) Rs. 805 (c) Rs. 786 (d) Rs. 700 Q.31. Calculate the value of closing stock from the following according to Weighted Average method: 1st January, 2014: Opening balance: 50 units @ Rs. 4 Receipts: 5th January, 2014: 100 units @ Rs. 5 12th January, 2014: 200 units @ Rs. 4.50 Issues: 2nd January, 2014: 30 units 18th January, 2014: 150 units (a) Rs. 765 (b) Rs. 805 (c) Rs. 786 (d) Rs. 700 Q.32. Cost of abnormal wastage is: (a) Charged to the product cost (b) Charged to the profit & loss account (c) charged partly to the product and partly profit & loss account (d) not charged at all. Q.33. Calculate re-order level from the following: Safety stock: 1000 units Consumption per week: 500 units It takes 12 weeks to reach material from the date of ordering. (a) 1000 units (b) 6000 units (c) 3000 units (d) 7000 unitsQ.10. Sunk costs are: (a) relevant for decision making (b) Not relevant for decision making (c) cost to be incurred in future (d) future costs Q.11. Describe the method of costing to be applied in case of Nursing Home: = (a) Operating Costing (b) Process Costing (c) Contract Costing (d) Job Costing Q.12. Describe the cost unit applicable to the Bicycle industry: (a) per part of bicycle (b) per bicycle (c) per tonne (d) per day Q.13. Calculate the prime cost from the following information: Direct material purchased: Rs. 1,00,000 Direct material consumed: Rs. 90,000 Direct labour: Rs. 60,000 Direct expenses: Rs. 20,000 Manufacturing overheads: Rs. 30,000 (a) Rs. 1,80,000 (b) Rs. 2,00,000 (c) Rs. 1,70,000 (d) Rs. 2,10,000 Q. 14. Total cost of a product: Rs. 10,000 Profit: 25% on Selling Price Profit is: (a) Rs. 2,500 (b) Rs. 3,000 (c) Rs. 3,333 (d) Rs. 2,000 Q.15. Calculate cost of sales from the following: Net Works cost: Rs. 2,00,000 Office & Administration Overheads: Rs. 1,00,000 Opening stock of WIP: Rs. 10,000 Closing Stock of WIP: Rs. 20,000 Closing stock of finished goods: Rs. 30,000 There was no opening stock of finished goods. Selling overheads: Rs. 10,000 (a) Rs. 2,70,000 (b) Rs. 2,80,000 (c) Rs. 3,00,000 (d) Rs. 3,20,000