Cost accounting

Any contract work which is only in the process or advancing to completion is known as work in progress.

• TRUE

• FALSE

What all are taken for the calculation of prime cost?

• direct materials

• factory overheads

• direct expenses

• productive wages

That form of specific order costing which applies where work is undertaken to customer's special requirements is called batch costing.

• True

• False

Formula for material cost variance

• (ST*SR)-(AT*AR)

• (SP-AP)*AQ

• (SQ*SP)-(AQ*AP)

• (SQ-AQ)*SP

______ is a statement prepared in advance showing estimate cash receipt and cash disbursements during a specific future period of time.

• capital expenditure budget

• budget

• production budget

• cash budget

The entire process of preparing budget or the act of building budget is called budgeting

• true

• false

Under which method, cost are apportioned on the basis of weight or quantity of each product and fixed cost are shared on the basis of contribution of each of the product?

• average unit cost method

• survey method

• Contribution margin method

• physical unit method

_____ is an unavoidable loss which occurs due to the inherent nature of the materials and production process under normal conditions.

• normal loss

• abnormal loss

Formula for Economic Batch Quantity (EBQ)

Identify the type of contract in which the contract price is fixed in advance which is paid in different installments on the basis of progress of work or the full payment is made on completion on the contract as agreed upon.

• fixed prices contracts with escalation clause

• fixed price contract

• cost plus contract

• fixed price with de-escalation clause