Costing Methods MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Costing Methods, 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 Costing Methods 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 Costing Methods mcq questions that explore various aspects of Costing Methods problems. Each MCQ is crafted to challenge your understanding of Costing Methods 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 Costing Methods 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 Costing Methods. 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 Costing Methods knowledge to the test? Let's get started with our carefully curated MCQs!

Costing Methods MCQs | Page 13 of 17

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Q121.
If an allocated indirect cost is $1500 and the actual incurred indirect cost is $1200, then this is classified as

a.

applied indirect cost

b.

applied direct cost

c.

incurred indirect cost

d.

over allocated indirect cost

Discuss
Answer: (d).over allocated indirect cost
Q122.
If the budgeted direct labor hours are 3550 and direct labor cost rate is $500 per labor hour, then total direct labor cost would be

a.

$1,775,000

b.

$1,675,000

c.

$1,875,000

d.

$1,975,000

Discuss
Answer: (a).$1,775,000
Q123.
The cost of previous department is a part of

a.

transferred-in costs

b.

transferred-out costs

c.

FIFO costs

d.

LIFO costs

Discuss
Answer: (a).transferred-in costs
Q124.
The total costs incur in a production process, is divided by total number of output units, to calculate the

a.

cost of indirect labor

b.

cost of direct labor

c.

cost of direct material

d.

unit costs

Discuss
Answer: (d).unit costs
Q125.
If the beginning work in process equivalent units are 2500 units, work done in current period equivalent units are 3800 units and ending work in process equivalent units are 5000, then complete equivalent units in current period are

a.

1800 units

b.

1500 units

c.

1300 units

d.

1500 units

Discuss
Answer: (c).1300 units
Q126.
A unit cost calculated in costing system, by assigning total costs incurred to many similar units is categorized as

a.

accounting period costing system

b.

process costing system

c.

job costing system

d.

none of above

Discuss
Answer: (b).process costing system
Q127.
If the beginning work in process equivalent units are 2500 units, work done in current period equivalent units are 3800 units and units completed in current period are 4000, then ending work in process equivalent units will be

a.

1800 units

b.

2300 units

c.

10300 units

d.

1500 units

Discuss
Answer: (b).2300 units
Q128.
The first step in process costing system is to

a.

summarize flow of output

b.

compute output in units

c.

summarize total costs

d.

compute cost for each equivalent unit

Discuss
Answer: (a).summarize flow of output
Q129.
The costs that are incurred in last department, where the product has been processed and will be carried to next department for further processing are called

a.

partial work costs

b.

transferred-in costs

c.

transferred-out costs

d.

weighted average costs

Discuss
Answer: (b).transferred-in costs
Q130.
In process costing method, when the work done in current accounting period, and beginning inventory before current accounting period, is classified as

a.

partial inventory costing method

b.

current period inventory method

c.

Last-in, first-out method

d.

First-in, first-out method

Discuss
Answer: (d).First-in, first-out method
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