1. Economic Batch Quantity depends on ……………….and ……………..costs.

 (A) Material, labour
(B) set-up costs, carrying
(C) transportation, carrying
(D) warehousing, labour



2. The ……………costing is applied when a quantity of similar and identical products are manufactured together as one Job.

(A) Job
(B) Batch
(C) operation
(D) output



3. The loss incurred on an incomplete contract is transferred to …………….account.

(A) Costing profit and loss account
(B) profit and loss account
(C) trading account
(D) deferred to next year.



4. When the completion stage of the contract is more than half, the profit to be credited to Profit and Loss account will be equal to…………..

(A) 1/3rd of Notional Profit x cash received Work certified
(B) ½ of Notional Profit x cash received Work certified
(C) 2/3rd of Notional profit x cash received Work certified
(D) full Notional Profit.



5. When the completion stage of a contract is less than ¼, the total expenditure on the contract is transferred to ………………..account.

(A) Work-in-Progress
(B) Profit and loss account
(C) miscellaneous account
(D) none of these



6. If the amount of work certified is less than………of the contract price,then no profit should be taken to Profit & Loss Account.

(A) 20%
(B) 25%
(C) 33 1/3%
(D) 40%



7. Contract costing is not used in one of the following industries.

(A) Ship building
(B) Civil Construction
(C) Automobiles
(D) Construction of Bridges



8. The sum of value of work certified and uncertified appearing in the Contract Account is called ……………..

(A) Work done.
(B) Work in Process
(C) Work Completed
(D) Work in Progress 



9. ……………………is the most suitable method in a transport industry.

(A) Operation costing
(B) Service costing
(C) Process costing
(D) Job costing



10. Room/day is the cost unit used in…………………

(A) Hotels
(B) hospital
(C) schools
(D) none of these




More MCQs on Cost Accounting