Quiz 3 CTB Units 1 and 2

Prime cost is

• cost incurred in the production cost centres

• cost incurred in the manufacturing of a product

• total of material cost and direct wages

• direct cost incurred in the manufacturing of a product

Production overheads includes all the following except

• production wages

• factory maintenance expense

• indirect materials

• normal loss in stores

Copyright paid for the use of a particular designed plastic bottle is classified as

• indirect expense

• direct expense

• marketing overhead

• factory overhead

Stamford Tyre Company ordered 5 tons of rubber latex from Malaysia and incurred the following cost.

1. Cost of rubber latex = $200,000

2. Insurance and freight = $3,000

3. Secondary packing materials = $1,000

   Customs duty = $2,000

4. Find total direct material cost

• $200,000

• $203,000

• $204,000

• none of the above

When prices are falling, closing raw material cost will be higher under

• FIFO method

• LIFO method

• Weighted Average method

Identify the secondary packing material.

• cola drink

• cardboard box

• glass bottle

• cap

Non-production cost consist of all the following except

• financial overheads

• marketing overheads

• prime cost

• admin overheads

Production cost include the following

• Direct materials

  Direct wages

  Primary packing cost

• Prime cost

  Production overheads

• Direct materials

  Direct wages

  Direct expenses

• Production overhead

  Admin overheads

  Marketing overheads

  Financial overheads

Abnormal loss of materials and goods is an example of

• Admin overheads

• Marketing overheads

• Material cost

• Production overheads

Choose an example of financial overhead.

• commission paid for bank draft

• bank charges

• legal fees to buy a factory

• bank overdraft interest