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1 If a manufacturing entity follows a standard marginal costing system, fixed production cost variances are not expected. Identify whether this statement is true or false
True
False
2 While transporting raw material to the factory, it's expected that a small quantity of raw material will get damaged. What type of loss is that?
Normal loss
Abnormal loss
Recoverable loss
Irrecoverable loss
3 Which of the following is the treatment of abnormal loss in a production process?
Charged to FOH or factory overhead control a/c
Charged to a specific job or work in process a/c
Ignored in cost accounting
Divided by the total units manufactured
4 Total days in a year divided by the Inventory Turn over Ratio is equals to:
Stocking period
Stock replacement period
Stock holding period
Inventory turnover days
5 Which of the following is the correct formula for Halsey Premium Plan
Gross Wages = (Time worked x wage rate) + 0.5 (Time saved x wage rate)
Gross Wages = (Time worked x wage rate) + 0.5 (Time worked x wage rate)
Gross Wages = (Time worked x wage rate) + 2 (Time saved x wage rate)
Gross Wages = (Time worked x wage rate) + 2 (Time worked x wage rate)
6 This is the information of ABC manufacturing company: Budgeted factory overheads = $100, normal activity level of machine = 20 hours and labor = 50 hours. ABC Company’s manufacturing processes are highly labor oriented and labor is the significant cost driver. ABC Company calculates overhead absorption rate by using an appropriate base. What is the ABC Company’s Factory overhead absorption rate?
$5
$1.42
$2.2
$2
7 When will Absorption Costing and marginal costing give the same level of net profit?
Produced units > Units sold
Produced units = Units sold
Produced units < Units sold
8 All of the following are methods of the join product’s cost allocation at the split-off point Except:
Market value Method
Physical Quantity Ratio method
Hypothetical Market Value method
Quantity of material method
9 In the context of joint product cost allocation, which one of the following methods uses ‘Price minus further processing cost’ in allocating joint cost at the split-off point?
Hypothetical Market Value Ratio
Selling Price Ratio or Market value method
Physical Quantity Ratio
None of them
10 XYZ Company has contribution to sales ratio 20% and profit to sales ratio 5%. What is the margin of safety ratio?
20%
25%
4%
5%


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