Test 354 Welcome to your International Navodaya Chamber of Commerce (INCOC) Platform ! Subject: Cost Accounting Total Number of Question: 40 Time: 41 Minutes Please check your email after completion of test for result. All the best... Name Phone No Email State 1. Which of the following statements is true regarding direct expenses? They are always variable costs They cannot be traced to a cost unit They are part of prime cost They are always fixed costs None 2. Which of the following is a feature of marginal costing? It includes fixed costs in product cost Fixed costs are treated as period costs It is used for external reporting It does not consider contribution None 3. The term 'cost centre' refers to: A unit where costs are incurred A unit responsible for revenue generation A profit-making division A unit that produces no expenses None 4. Which of the following is the formula for contribution per unit? Selling Price - Fixed Cost Selling Price - Variable Cost Fixed Cost - Variable Cost Total Cost - Selling Price None 5. The allocation of costs that are not directly attributable to cost centres is called: Apportionment Absorption Allocation Distribution None 6. Which of the following industries would most likely use batch costing? Oil refining Printing Electricity generation Steel production None 7. A cost that has already been incurred and cannot be recovered is known as: Fixed cost Sunk cost Variable cost Opportunity cost None 8. The predetermined overhead rate is calculated as: Actual Overheads / Actual Activity Leve Estimated Overheads / Estimated Activity Level Fixed Costs / Contribution Margin Total Sales / Total Costs None 9. A semi-variable cost is also known as a: Fixed cost Stepped cost Mixed cost Direct cost None 10. Which costing technique is used to minimize waste in production? Marginal costing Absorption costing Standard costing Activity-based costing None 11. Which of the following does not affect the break-even point? Selling price per unit Variable cost per unit Fixed costs Production volume None 12. A budgetary control system aims to: Calculate profitability Compare actual performance with budgeted figures Increase fixed costs Allocate indirect costs None 13. Which of the following best describes the purpose of cost accounting? To prepare financial statements To ascertain and control costs To comply with legal requirements To determine tax liability None 14. Fixed costs that can be reduced with managerial intervention are called: Avoidable costs Discretionary fixed costs aCommitted fixed costs Variable costs None 15. Which method of costing is used in mass production industries? Process costing Job costing Batch costing Contract costing None 16. Which of the following statements is true regarding indirect costs? They are easily traced to a product They do not include labour costs They are shared among cost centres They are always variable None 17. The method of costing used by hospitals is typically: Job costing Process costing Operating costing Batch costing None 18. The fixed overhead volume variance occurs due to: Change in sales price Difference between actual and budgeted production Changes in direct material cost Over-absorption of overheads None 19. The main purpose of standard costing is to: Calculate profit Control costs Allocate overheads Increase sales revenue None 20. Which of the following is used to calculate the profit-volume ratio? (Contribution / Sales) x 100 (Fixed Cost / Sales) x 100 (Variable Cost / Sales) x 100 (Net Profit / Sales) x 100 None 21. An example of direct cost in a furniture factory is: Rent of factory Supervisor's salary Timber used for production Depreciation of equipment None 22. Variable costs in total: Remain constant at all activity levels Increase as the level of activity increases Decrease with increasing production Are always fixed None 23. Which cost is used as a benchmark to evaluate actual performance? Historical cost Standard cost Fixed cost Sunk cost None 24. The term 'absorption rate' refers to: The rate of sales growth The rate of variable cost allocation The rate of allocating overhead costs to production units The rate of profit calculation None 25. In marginal costing, which cost is ignored while calculating product cost? Direct material Direct labour Variable overheads Fixed overheads None 26. Which of the following is not a characteristic of job costing? Customized production Costs are accumulated by individual jobs Suitable for repetitive production Costs are assigned to each job separately None 27. When total sales are equal to total costs, the business is at: A loss Break-even Profit Marginal return None 28. Cost plus pricing is used when: The demand is elastic The cost of the product is difficult to estimate Profit margin is added to the cost Competition is very high None 29. Over-absorption of overhead occurs when: Actual overheads are greater than absorbed overheads Absorbed overheads are greater than actual overheads Actual overheads are equal to absorbed overheads Variable costs are more than fixed costs None 30. In absorption costing, closing inventory is valued using: Only variable costs Only fixed costs Total production cost Contribution margin None 31. Labour turnover measures: The efficiency of labour The number of employees leaving the organization The rate of wage increase The amount of overtime worked None 32. Which of the following is true regarding batch costing? Each item is costed individually ated for each product separately It is used for products that are identical It is not used in manufacturing industries Costs are accumulated for each product separately None 33. An overhead absorption rate is used to: Allocate direct costs to production Estimate the profit margin Absorb indirect costs into product costs Calculate selling price None 34. Marginal costing is also known as: Direct costing Absorption costing Total costing Standard costing None 35. Break-even analysis is based on which assumption? Total cost is linear with respect to output Variable cost changes with production volume Fixed cost changes with production volume Selling price per unit changes with volume None 36. Which costing method is used in a chemical industry? Job costing Contract costing Process costing Operating costing None 37. The cost incurred for a specific purpose and that can be eliminated if that purpose is not pursued is called: Committed cost Relevant cost Sunk cost Opportunity cost None 38. The fixed cost per unit will: Increase as production increases Remain constant irrespective of production volume Decrease as production increases Be greater than the variable cost None 39. In the cost sheet, selling and distribution expenses are considered as: Part of prime cost Factory overheads Administration costs Period costs None 40. The material price variance is calculated as: (Actual Quantity × Standard Price) - (Actual Quantity × Actual Price) (Standard Quantity × Standard Price) - (Actual Quantity × Standard Price) (Actual Price - Standard Price) × Actual Quantity (Standard Price - Actual Price) × Standard Quantity None 1 out of 4 Great job on taking the INCOC Test! We appreciate your interest in test. Look out for results and future opportunities. Stay Connected !! Your quiz time is about to finish. Few seconds left. 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