50+ Standard Costing MCQ | Cost Accounting MCQs (Free Resource)
Standard Costing MCQ
1. The objective of standard costing is to
(a) Determine profitability of a product
(b) Determine break-even production level
(c) Control costs
(d) Allocate costs with more accuracy
2. A standard cost system may be used in
(a) job order costing, but not process costing
(b) process costing, but not job order costing
(c) either job order costing or process costing
(d) neither job order costing nor process costing
3. An estimate of what cost should be is known as
(a) Actual cost
(b) Ideal cost
(c) Standard cost
(d) Forecast cost
4. A standard cost is
(a) the total amount that appears on the budget for product costs
(b) a pre-determined cost which is calculated from management standards of efficient operation
(c) the total number of units x the cost expected
(d) any amount that appears on a budget
5. Which of the following best describes a basic standard?
(a) A standard set at an ideal level, which makes no allowance for normal losses, waste and machine downtime
(b) A standard that assumes an efficient level of operation, but which includes allowances for factors such as normal loss, waste, and machine downtime
(c) A standard that is kept unchanged over a long period of time
(d) A standard that is based on current price levels
6. A standard which assumes efficient level of operations, but which includes allowance for factors such as waste and machine downtime is known as an
(a) Ideal standard
(b) Normal standard
(c) Attainable standard
(d) Neither (a) nor (b) nor (c)
7. What standard is based on the assumption of most favourable conditions possible ?
(a) Ideal Standard
(b) Normal Standard
(c) Expected Standard
(d) Attainable Standard
8. The standard cost card contains quantities and costs for
(a) direct material only
(b) direct labour only
(c) direct material and direct labour only
(d) direct material, direct labour, and overhead
9. Which one of the following does NOT accurately describe one of the ways in which standards are developed?
(a) Standard material quantities may be determined by engineering studies
(b) Supplier price lists may be used to determine standard prices of materials
(c) Time and motion studies are sometimes used to determine labour efficiency standards
(d) Employee time cards are often used to determine standard labour wage rates
10. What term can be defined as a means of assessing the difference between a predetermined amount and the actual amount?
(a) Variance analysis
(b) Differential costing
(c) Incremental costing
(d) Marginal Costing
| Answers: 1)Determine profitability of a product 2)either job order costing or process costing 3)Ideal cost 4)any amount that appears on a budget 5)A standard that is based on current price levels 6)Attainable standard 7)Ideal Standard 8)direct material, direct labour, and overhead 9)Employee time cards are often used to determine standard labour wage rates 10)Variance analysis |
Q. NO. 5 3RD ANSWER HOGA