Cost concept MCQs
1. What is the basic concept of cost concept?
A) Cost ascertainment.
B) Tax compliance.
C) Financial audit
D) Profit analysis
Answer: A
2. Process costing is appropriate for which firm?
A) Bricklaying firms
B) Transport firms
C) Hospitals
D) Oil refining firms
Answer: D
3. In how many ways cost classification can be done?
A) Three ways
B) Two ways
C) Four ways
D) Many ways
Answer: D
4. Which cost is incurred even if the company is closed?
A) Sunk cost
B) Historical cost
C) Shutdown cost
D) Imputed cost
Answer: C
5. Direct expenses are also known as
A) Overhead expenses
B) Sundry expenses
C) Chargeable expenses
D) Major expenses
Answer: C
6. Warehouse rent is a part of which cost?
A) Production cost
B) Distribution cost
C) Prime cost
D) Factory cost
Answer: B
7. What is tender?
A) Estimation of cost
B) Estimation of profit
C) Estimation of units
D) Estimation of the selling price
Answer: D
8. A total of all the direct costs is known as
A) Cost of production
B) Cost of sales
C) Prime cost
D) Works cost
Answer: C
9. What item is not included in cost accounting?
A) Product costing
B) Profit-sharing
C) Planning
D) Controlling
Answer: B
10. Toy manufacturing companies use what type of costing?
A) Multiple costing
B) Process costing
C) Unit costing
D) Batch costing
Answer: D
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