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WorksheetsCOST ACCOUNTING -B.COM 6TH SEMESTER
Total questions: 50
Worksheet time: 3hrs 30mins
1. According to ICMA London, costing is “that form of specific order costing, which applies where work is undertaken to customers’ special requirements.”
Job
Batch
Process
Standard
A method of costing applied where costs are collected and accumulated for each work order
.
Process costing
Contract costing
Operating costing
Job costing
3. Which of the following statements is not true about job costing?
Production always against customers’ orders
Cost of each job ascertained separately
Job is of equal or longer duration compared to contracts
Job work is labour intensive
Which is a method of specific order costing?
Job costing
Process costing
Output costing
Service costing
The method of costing applied in special ship building is
Batch costing
Job costing
Process costing
None of the above
Which of the following considers an ‘economic quantity’ for the purpose of cost reduction?
Job costing
Process costing
Batch costing
Contract costing
The method of costing applied in cycle part manufacturing is
Batch costing
Job costing
Process costing
None of the above
Production order with respect to a job is issued by department.
Production
Production Planning
Purchase
Sales
Scope of specific order costing is very wide and includes
Job, Batch and contract costing
Process , Contract and unit costing
Batch , Job and process costing
Unit , service and transport costing
Economic batch quantity is used in batch costing to
Meet specific customer requirements
Produce at the least possible cost
In order to ensure stock in anticipation of demand
None of these
For identification, each job or work order received from a customer is allotted a
Production order
Batch number
Job number
Code number
In job costing, the basic document to accumulate and ascertain the cost of each order is
Purchase order
Requisition sheet
Invoice
Job cost sheet
Job costing is used in
Chemical manufacturing
Printing press
Brick making
Cement production
In job costing, each job is the _____
Cost centre
Cost unit
Profit centre
None of these
………… is an important point to be determined in industries where batch costing is employed.
EBQ
EOQ
Re – order quantity
Batch
______ cost is fixed per batch.
Setting up
Manufacturing cost
Storage cost
Ordering cost
Interest on capital invested is an example of ___
Setting up cost
Carrying cost
Ordering cost
Manufacturing cost
Calculate EBQ if annual demand is 24000 units, Set up cost per batch is Rs. 120 and carrying cost per unit is Rs. 0.36.
2000 units
4000 units
1200 units
3600 units
_____ is a group of identical products.
Job
Batch
Process
Contract
The method of costing used to ascertain the cost of a batch is called
Contract costing
Process costing
Batch costing
Process costing
Manufacturers of components of television adopt
Job costing
Batch costing
Contract costing
Process costing
Which of the following statements is NOT true about contract costing?
Number of contracts undertaken at a time is limited
Work is done at the site of the customer
Requires long period for completion
Indirect costs are higher as compared to job costing
Please select the correct treatment of depreciation on plant and machinery in contract account.
Credited with amount of depreciation
Debited with cost of plant purchased
Credited with cost of plant purchased and debited with depreciated value of plant
Debited with amount of depreciation
Contract price is fixed in advance in case of
Cost plus contract
Target costing
Fixed price contract
None of these
Contract price is the cost of work done plus a percentage in case of
Cost plus contract
Target costing
Fixed price contract
Fluctuating contract
______ refers to the part payment made by the contractee to the contractor on the basis of certificate issued by the architect to the contractee.
Work certified
Work in progress
Notional profit
Progress payment
The amount expended by the contractor on a contract not completed at the end of the accounting period is called _____
Work certified
Work uncertified
Work in progress
Progress payment
Work done on contract and approved by architect or engineer of the contractee is called
Work in progress
Work uncertified
Work certified
None of these
Depending on the terms of contract, the contractee may pay only 80% to 90% of work certified to the contractor. This is referred to as____
Retention money
Cash ratio
Work in progress
Notional profit
Notional profit is computed as _____
Work certified + Work uncertified
Work in progress – Work uncertified
Contract price – estimated total cost
Work in progress – cost of work to date
The portion of notional/ estimated profit transferred to P & L Account when work certified is 1/4 or less of contract price is ____
No profit transferred
Notional Profit x 13 x 𝐶𝑎𝑠ℎ 𝑟𝑒𝑐𝑒𝑖𝑣𝑒𝑑𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑
Notional Profit x 23 x 𝐶𝑎𝑠ℎ 𝑟𝑒𝑐𝑒𝑖𝑣𝑒𝑑𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑
Estimated profit x 𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑𝐶𝑜𝑛𝑡𝑟𝑎𝑐𝑡 𝑝𝑟𝑖𝑐𝑒
The portion of notional/ estimated profit transferred to P & L Account when work certified is more than 1/4 or less than 1/2 of contract price is ____
a.
b.
c.
d.
No profit transferred
Notional Profit x 1/3 x 𝐶𝑎𝑠ℎ 𝑟𝑒𝑐𝑒𝑖𝑣𝑒𝑑𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑
Notional Profit x 2/3 x 𝐶𝑎𝑠ℎ 𝑟𝑒𝑐𝑒𝑖𝑣𝑒𝑑𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑
Estimated profit x 𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑𝐶𝑜𝑛𝑡𝑟𝑎𝑐𝑡 𝑝𝑟𝑖𝑐𝑒
The portion of notional/ estimated profit transferred to P & L Account when work certified is more than 1/2 or less than 9/10 of contract price is ____
a.
b.
c.
d.
No profit transferred
Notional Profit x 1/3 x 𝐶𝑎𝑠ℎ 𝑟𝑒𝑐𝑒𝑖𝑣𝑒𝑑𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑
Notional Profit x 2/3 x 𝐶𝑎𝑠ℎ 𝑟𝑒𝑐𝑒𝑖𝑣𝑒𝑑𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑
Estimated profit x 𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑𝐶𝑜𝑛𝑡𝑟𝑎𝑐𝑡 𝑝𝑟𝑖𝑐𝑒
The portion of notional/ estimated profit transferred to P & L Account when the contract is near completion is _______
.
No profit transferred
Notional Profit x 1/3 x 𝐶𝑎𝑠ℎ 𝑟𝑒𝑐𝑒𝑖𝑣𝑒𝑑𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑
Notional Profit x 2/3 x 𝐶𝑎𝑠ℎ 𝑟𝑒𝑐𝑒𝑖𝑣𝑒𝑑𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑
Estimated profit x 𝑊𝑜𝑟𝑘 𝑐𝑒𝑟𝑡𝑖𝑓𝑖𝑒𝑑𝐶𝑜𝑛𝑡𝑟𝑎𝑐𝑡 𝑝𝑟𝑖𝑐𝑒
Sub contract cost is charged to ________
Contract account
Work in progress
Profit and loss account
Contractor’s account
Work certified is valued at _____ price.
Cost
Market
Contract
Standard
Loss on incomplete contract is transferred to ______ account.
Work in progress
Contract
Profit and loss
Contractee’s
______ is provided in contracts to cover any likely changes in price or utilization of materials and labour.
Escalation clause
Rule
Extra price
DeEscalation clause
Work in progress in contract means
Work certified
Work certified and uncertified
Work uncertified
None of these
Which is true about process costing?
Production takes long duration
Each output is customer specific
Production is done in lots/ batches
Production is continuous
Loss which is unavoidable on account of the nature of the material is called _____
Uncontrolled
Normal
Abnormal
None of these
The value of abnormal loss is debited on the basis of
Normal cost of normal output
Scrap value
Cost of production
None of these
Which statement is true about the treatment of abnormal loss?
Value is credited to process loss a/c
Scrap value is credited to process loss a/c
Balance in abnormal loss a/c is transferred to costing profit & loss a/c
None of these
Cost of 75 units introduced–Rs. 1308, Additional expenses incurred–Rs. 202, Normal loss– 15 units, Actual output-70 units and scrap value–Rs.4/ unit. Calculate value of abnormal gain.
Rs. 1510
Rs. 1450
Rs. 241.67
Rs. 251.67
When the actual loss is more than the estimated loss, the difference between the two is considered to be _________
Abnormal gain
Abnormal loss
Normal loss
Normal gain
_________ process loss should be transferred to costing profit and loss account.
Normal
Abnormal
Actual
None of these
______ is the method of costing used to ascertain the cost of a product at each stage of manufacture.
Job costing
Contract costing
Process costing
Batch costing
In process costing, costs are accumulated by ______
Process
Job
Batch
Production order
Abnormal gain in a process is written to be _______
Debit side of process account
Credit side of process account
Debit side of costing P&L a/c
None of these
Loss arising due to evaporation is considered as _______ in process accounts.
Abnormal loss
Seasonal loss
Normal loss
None of these
