(A) Costs may be controlled
(B) Cost units gather overheads as they pass through cost centres
(C) Whole items of cost can be charged to cost centres
(D) Common costs are shared among cost centres
Tag: Financial Accounting Mcqs
A method of dealing with overheads involves spreading common costs over cost centres on the basis of benefit received. This is known as :
(A) Overhead absorption
(B) Overhead apportionment
(C) Overhead identification
(D) Overhead analysis
Which of the following bases would be most appropriate to apportion the cost of electric power to factory departments?
(A) Number of outlet points
(B) Amount metered out
(C) Cubic capacity of premises;
(D) Kilowatt capacity of machines in department
Which of the following costs is not a factory overhead expense?
(A) Depreciation of equipment used in the research department
(B) Salary of quality control inspector
(C) Overtime premium paid to direct labour
(D) Machine maintenance labour cost
Which of the following is not a production department?
(A) Power department
(B) Machining department
(C) Refining department;
(D) Finishing department
Direct Labor is an element of:
(A) Prime cost
(B) Conversion cost
(C) Total production cost
(D) All of the given options
Example of semi-variable items include the following except :
(A) Telephone
(B) Repairs and maintenance
(C) Depreciation of plant and machinery
(D) Insurance of plant and building
Suppose a firm sells its product at a price lower than the opportunity cost of the inputs used to produce it. Which is true?
(A) The firm will earn accounting and economic profits.
(B) The firm will face accounting and economic losses.
(C) The firm will face an accounting loss, but earn economic profits.
(D) The firm may earn accounting profits, but will face economic losses.