Capacity Analysis and Inventory Costing MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Capacity Analysis and Inventory Costing, a fundamental topic in the field of Cost Accounting. Whether you're preparing for competitive exams, honing your problem-solving skills, or simply looking to enhance your abilities in this field, our Capacity Analysis and Inventory Costing MCQs are designed to help you grasp the core concepts and excel in solving problems.

In this section, you'll find a wide range of Capacity Analysis and Inventory Costing mcq questions that explore various aspects of Capacity Analysis and Inventory Costing problems. Each MCQ is crafted to challenge your understanding of Capacity Analysis and Inventory Costing principles, enabling you to refine your problem-solving techniques. Whether you're a student aiming to ace Cost Accounting tests, a job seeker preparing for interviews, or someone simply interested in sharpening their skills, our Capacity Analysis and Inventory Costing MCQs are your pathway to success in mastering this essential Cost Accounting topic.

Note: Each of the following question comes with multiple answer choices. Select the most appropriate option and test your understanding of Capacity Analysis and Inventory Costing. You can click on an option to test your knowledge before viewing the solution for a MCQ. Happy learning!

So, are you ready to put your Capacity Analysis and Inventory Costing knowledge to the test? Let's get started with our carefully curated MCQs!

Capacity Analysis and Inventory Costing MCQs | Page 8 of 11

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Q71.
In Variable Costing Method, the fixed manufacturing cost in the calculation period is treated as

a.

variable quantity

b.

fixed quantity

c.

price

d.

expense

Discuss
Answer: (d).expense
Q72.
If the per unit budgeted per unit cost is $165 and budgeted production units are 400 then fixed budgeted manufacturing costs will be

a.

$36,000

b.

$66,000

c.

$56,000

d.

$46,000

Discuss
Answer: (b).$66,000
Q73.
In manufacturing companies, the variable costing method is also classified as

a.

direct costing

b.

indirect costing

c.

total costing

d.

One factor costing

Discuss
Answer: (a).direct costing
Q74.
If the revenues are $85000 and throughput contribution is $63700, then direct material cost of goods sold will be

a.

$21,300

b.

$148,700

c.

$138,700

d.

$118,700

Discuss
Answer: (a).$21,300
Q75.
The capacity level of operations which is less than theoretical capacity is considered as

a.

practical capacity

b.

theoretical costing

c.

standard capacity

d.

actual capacity

Discuss
Answer: (a).practical capacity
Q76.
The variance which is included in absorption costing, but not in variable costing is classified as

a.

production volume variance

b.

cost volume variance

c.

profit volume variance

d.

fixed cost variance

Discuss
Answer: (a).production volume variance
Q77.
If the fixed budgeted manufacturing cost is $35000 and the budgeted production units are 7000, then budgeted fixed manufacturing cost per unit will be

a.

$20

b.

$5

c.

$10

d.

$15

Discuss
Answer: (b).$5
Q78.
Which is considered as most stable measure of the capacity utilization?

a.

spiral capacity

b.

supply capacity

c.

demand capacity

d.

practical capacity

Discuss
Answer: (d).practical capacity
Q79.
The standard quantity of input used for achieved output, which is multiplied to standard prices, to calculate variable direct manufacturing cost in

a.

output costing

b.

standard costing

c.

achieved costing

d.

input costing

Discuss
Answer: (b).standard costing
Q80.
If the target operating income is $84000 and contribution margin per unit is $600, then number of units must be sold to earn targeted operating income, will be

a.

100 units

b.

110 units

c.

120 units

d.

140 units

Discuss
Answer: (d).140 units
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