{"id":15244,"date":"2022-03-10T11:22:08","date_gmt":"2022-03-10T05:52:08","guid":{"rendered":"https:\/\/scholarsclasses.com\/blog\/?p=15244"},"modified":"2026-02-09T20:14:16","modified_gmt":"2026-02-09T14:44:16","slug":"process-costing-mcq-with-answer","status":"publish","type":"post","link":"https:\/\/scholarsclasses.com\/blog\/process-costing-mcq-with-answer\/","title":{"rendered":"40+ Process costing MCQ | Cost Accounting MCQs (Free Resource)"},"content":{"rendered":"\n<h2 class=\"wp-block-heading has-text-align-center\">Process costing MCQ<\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1024\" height=\"576\" data-src=\"https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2022\/03\/Process-costing-MCQ-1024x576.jpg\" alt=\"Process costing MCQ\" class=\"wp-image-15971 lazyload\" title=\"\" data-srcset=\"https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2022\/03\/Process-costing-MCQ-1024x576.jpg 1024w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2022\/03\/Process-costing-MCQ-300x169.jpg 300w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2022\/03\/Process-costing-MCQ-768x432.jpg 768w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2022\/03\/Process-costing-MCQ-1536x864.jpg 1536w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2022\/03\/Process-costing-MCQ-640x360.jpg 640w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2022\/03\/Process-costing-MCQ.jpg 1920w\" data-sizes=\"(max-width: 1024px) 100vw, 1024px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1024px; --smush-placeholder-aspect-ratio: 1024\/576;\" \/><figcaption class=\"wp-element-caption\">Process costing MCQ<\/figcaption><\/figure>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/scholarsclasses.com\/blog\/cost-accounting-mcq\/\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/cost-accounting-mcq\/\" target=\"_blank\" rel=\"noreferrer noopener\">MCQs on other topics of Cost Accounting<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/www.icsi.edu\/media\/webmodules\/modelquestionpaper\/CMA-MCQ%20100.pdf\" data-type=\"URL\" data-id=\"https:\/\/www.icsi.edu\/media\/webmodules\/modelquestionpaper\/CMA-MCQ%20100.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">Cost Accounting MCQs pdf<\/a><\/li>\n<\/ul>\n\n\n\n<p><strong>1.<\/strong> <strong>Process costing is applied when<\/strong><br>(a) small number of different products are manufactured<br>(b) large number of different products are manufactured<br>(c) large number of identical products are manufactured<br>(d) small numbers of customized made-to-order products are manufactured<\/p>\n\n\n\n<p><strong>2. Which of the following does not use process costing?<\/strong><br>(a) Oil refining<br>(b) Distilleries<br>(c) Sugar<br>(d) Air-craft manufacturing<\/p>\n\n\n\n<p><strong>3. Which cost accumulation procedure is most applicable in continuous mass-production manufacturing environments? <\/strong><br>(a) Standard<br>(b) Actual<br>(c) Process<br>(d) Job order<\/p>\n\n\n\n<p><strong>4. Which of the following statements is false?<\/strong><br>(a) In process costing, cost is accumulated according to processes or departments<br>(b) In job costing, the basis of cost accumulation is job order or batch size<br>(c) In process costing, cost is accumulated on time basis<br>(d) In job costing, cost is computed at the end of the cost period<\/p>\n\n\n\n<p><strong>5. Process Cost is based on the concept of<\/strong><br>(a) Average Cost<br>(b) Marginal Cost<br>(c) Standard Cost<br>(d) Differential Cost<\/p>\n\n\n\n<p><strong>6. Normal Loss is equal to<\/strong><br>(a) Normal Output &#8211; Actual Output<br>(b) Actual Output &#8211; Normal Output<br>(c) Input X % of Normal Loss<br>(d) None of the above<\/p>\n\n\n\n<p><strong>7. Normal Output is equal to<\/strong><br>(a) Input &#8211; Abnormal Loss<br>(b) Input &#8211; Normal Loss<br>(c) Input &#8211; Abnormal Gains<br>(d) None of the above<\/p>\n\n\n\n<p><strong>8. Unit Cost is equal to<\/strong><br>(a) Normal Cost \u00f7 Normal Output<br>(b) Total Cost \u00f7 Normal Output<br>(c) Normal Cost \u00f7 Total Output<br>(d) Total Cost \u00f7 Total Output<\/p>\n\n\n\n<p><strong>9. Abnormal Loss is equal to<\/strong><br>(a) Input &#8211; Actual Output<br>(b) Actual Output &#8211; Normal Output<br>(c) Normal Output &#8211; Actual Output<br>(d) Actual Output &#8211; Input<\/p>\n\n\n\n<p><strong>10. Abnormal Gains are equal to<\/strong><br>(a) Actual Output &#8211; Normal Output<br>(b) Normal Output &#8211; Actual Output<br>(c) Actual Output &#8211; Input<br>(d) Input &#8211; Actual Output<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td class=\"has-text-align-center\" data-align=\"center\"><strong>Answers:<\/strong> <span class=\"has-inline-color has-vivid-red-color\">1)large number of identical products are manufactured  2)Air-craft manufacturing  3)Process  4)In job costing, cost is computed at the end of the cost period<\/span>  <span class=\"has-inline-color has-vivid-red-color\">5)Average Cost<\/span> <span class=\"has-inline-color has-vivid-red-color\"> 6)Input X % of Normal Loss  7)Input &#8211; Normal Loss  8)Normal Cost \u00f7 Normal Output  9)Normal Output &#8211; Actual Output  10)Actual Output &#8211; Normal Output<\/span><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/scholarsclasses.com\/blog\/cost-accounting-mcq\/\" target=\"_blank\" rel=\"noreferrer noopener\">MCQs on other topics of Cost Accounting<\/a><\/li>\n<\/ul>\n\n\n\n<p><strong>11. Process cost is very much applicable in<\/strong><br>(a) Construction Industry<br>(b) Pharmaceutical Industry<br>(c) Airline Company<br>(d) None of these<\/p>\n\n\n\n<p><strong>12. In process costing, each producing department is a<\/strong><br>(a) Cost unit<br>(b) Cost center<br>(c) Investment center<br>(d) Sales center<\/p>\n\n\n\n<p><strong>13. Which of the given units can never become part of first department of Cost of Production Report?<\/strong> <br>(a) Units received from preceding department<br>(b) Units transferred to subsequent department<br>(c) Lost units<br>(d) Units still in process<\/p>\n\n\n\n<p><strong>14. When production is below standard specification or quality and cannot be rectified by incurring additional cost, it is called <\/strong><br>(a) Defective<br>(b) Spoilage<br>(c) Waste<br>(d) Scrap<\/p>\n\n\n\n<p><strong>15. What will be the impact of normal loss on the overall per-unit cost?<\/strong><br>(a) Per unit cost will increase <br>(b) Per unit cost will decrease<br>(c) Per unit cost remain unchanged<br>(d) Normal loss has no relation to unit cost<\/p>\n\n\n\n<p><strong>16. 12,000 kg of material were input to a process in a period. The normal loss is 10% of input. There is no opening or closing work-in-progress. Output in the period was 10,920 kg. What was the abnormal gain\/loss in the period? <\/strong> <strong> <\/strong><br>(a) Abnormal gain of 120 kg<br>(b) Abnormal loss of 120 kg<br>(c) Abnormal gain of 1,080 kg<br>(d) Abnormal loss of 1,080 kg<\/p>\n\n\n\n<p><strong>17. Wastage of raw material during a manufacturing process is 20% of input quantity. What input quantity of raw material is required per kg of output? <\/strong><br>(a) 0.8 kg <br>(b) 1.2 kg<br>(c) 1.25 kg<br>(d) 1.33 kg<\/p>\n\n\n\n<p><strong>18. 400 liters of a chemical were manufactured in a period. There is a normal loss of 25% of the material input into the process. An abnormal loss of 5% of material input occurred in the period. How many liters of material (to the nearest liter) were input into the process in the period? <\/strong><br>(a) 500<br>(b) 520<br>(c) 560<br>(d) 571<\/p>\n\n\n\n<p><strong>19. A company uses process costing to value its output. The following was recorded for the period:<\/strong><br>Input materials 2,000 units at Rs 4.50 per unit<br>Conversion costs Rs 13,340<br>Normal loss 5% of input valued at Rs 3 per unit<br>Actual loss of 150 units<br>There were no opening or closing stocks.<br>What was the valuation of one unit of output to one decimal place?<br>(a) Rs 11.8<br>(b) Rs 11.6<br>(c) RS 11.2<br>(d) Rs 11.0<\/p>\n\n\n\n<p><strong>20. A company uses process costing to value its output and all materials are input at the start of the process.<\/strong><br>The following information relates to the process for one month:<br>Input 3,000 units<br>Opening stock 400 units<br>Losses 10% of input is expected to be lost<br>Closing stock 200 units<br>How many good units were output from the process if actual losses were 400 units?<br>(a) 2,800 units <br>(b) 2,900 units<br>(c) 3,000 units<br>(d) 3,200 units<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td class=\"has-text-align-center\" data-align=\"center\"><strong>Answers:<\/strong> <span class=\"has-inline-color has-vivid-red-color\">11)Pharmaceutical Industry  12)Cost center  13)Units received from preceding department  14)Spoilage  15)Per unit cost will increase  16)Abnormal gain of 120 kg  17)1.25 kg  18)571  19)Rs 11.6  <\/span><br><span class=\"has-inline-color has-vivid-red-color\">20)2,800 units<\/span><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/scholarsclasses.com\/blog\/cost-accounting-mcq\/\" target=\"_blank\" rel=\"noreferrer noopener\">MCQs on other topics of Cost Accounting<\/a><\/li>\n<\/ul>\n\n\n\n<p><strong>21. The cost of production of 40 units in Process I consists of materials RS 1,500; Labour Rs 1300 and Overhead Rs 164. The normal waste is 5% of input. <br><\/strong>(a) 40 units are transferred to next process @ RS 70 each<code> <\/code><br>(b) 40 units are transferred to next process @ Rs 74.10 each<br>(c) 38 units are transferred to next process @ Rs 78 each<br>(d) 40 units are transferred to next process @ Rs 78 each<code> <\/code><\/p>\n\n\n\n<p><strong>22. Particulars for Process A.<br><\/strong>Materials (200 Units) Rs 4,000<br>Labour Rs 3,000<br>Indirect Expenses Rs 2,000<br>Normal wastage is 5% of the input. One unit of wastage is sold at Rs 16.50 each.<br>(a) 190 units are transferred to next process at Rs 9,000<br>(b) 200 units are transferred to next process at Rs 9,000<br>(c) 190 units are transferred to next process at Rs 7,000<br>(d) 190 units are transferred to next process at Rs 8,835<\/p>\n\n\n\n<p><strong>23. In process Y, 75 units of a commodity were transferred from process X at a cost of Rs 1,310. The labour and overhead expenses incurred by the process were Rs 190. 20% of the units entered are normally lost and sold @ Rs 4 per unit. The output of the process was 70 units. <\/strong> <strong> <\/strong><br>(a) Process Account Credit Side showed Abnormal Gains of Rs 240<br>(b) Process Account Debit Side showed Abnormal Loss of Rs 240<br>(c) Process Account Credit Side showed Abnormal Loss of Rs 240<br>(d) Process Account Debit Side showed Abnormal Gains of Rs 240<\/p>\n\n\n\n<p><strong>24. Input in a process is 4000 units and normal loss is 20%. When finished output in the process is only 3,240 units, there is an<\/strong><br>(a) Abnormal loss of 40 units<br>(b) Abnormal gain of 40 units<br>(c) Neither abnormal loss nor gain<br>(d) Abnormal loss of 60 units<\/p>\n\n\n\n<p><strong>25. Details of the process for the last period are as follows :<br><\/strong>Put into process &#8211; 5,000 kg<br>Materials &#8211; Rs 2,500 <br>Labour &#8211; Rs 700<br>Production Overheads &#8211; 200% of labour<br>Normal losses are 10% of input in the process. The output for the period was 4,200 kg from the process. There was no opening and closing work-in-process. What were the units of abnormal loss?<br>(a) 500 units<br>(b) 300 units<br>(c) 200 units<br>(d) 100 units<\/p>\n\n\n\n<p><strong>26. You are required to identify how many good units were outputs from the process.<\/strong><br>Units put in process &#8211; 4,000<br>Lost units &#8211; 500<br>Units in process &#8211; 200<br>(a) 3,300 units<br>(b) 4,000 units<br>(c) 4,200 units<br>(d) 4,500 units<\/p>\n\n\n\n<p><strong>27. A chemical process has normal wastage of 10% of input. In a period, 2,500 kg of material were input and there was abnormal loss of 75 kg. What quantity of good production was achieved? <\/strong><br>(a) 2,175 kg <br>(b) 2,250 kg<br>(c) 2,425 kg<br>(d) 2,500 kg<\/p>\n\n\n\n<p><strong>28. Costs incurred prior to the point of separation of the joint or by-products are termed as<\/strong><br>(a) Process cost<br>(b) Joint cost<br>(c) Main cost<br>(d) Separable cost<\/p>\n\n\n\n<p><strong>29. When a single manufacturing process yields two products, one of which has a relatively high sales value compared to the other, the two products are respectively known as<\/strong><br>(a) joint products and byproducts<br>(b) joint products and scrap<br>(c) main products and byproducts<br>(d) main products and joint products<\/p>\n\n\n\n<p><strong>30. A process gives rise, incidentally, to an item of low value, which is called<\/strong><br>(a) a joint product <br>(b) a by-product<br>(c) scrap<br>(d) waste<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td class=\"has-text-align-center\" data-align=\"center\"><strong>Answer:<\/strong><span class=\"has-inline-color has-vivid-red-color\"><strong> <\/strong>21)38 units are transferred to next process @ Rs 78 each  22)190 units are transferred to next process at Rs 8,835  23)Process Account Debit Side showed Abnormal Gains of Rs 240  24)Abnormal gain of 40 units  25)300 units  26)3,300 units  27)2,175 kg  28)Joint cost 29)main products and byproducts 30)a by-product <\/span><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/scholarsclasses.com\/blog\/cost-accounting-mcq\/\" target=\"_blank\" rel=\"noreferrer noopener\">MCQs on other topics of Cost Accounting<\/a><\/li>\n<\/ul>\n\n\n\n<p><strong>31. Byproducts and main products are differentiated by<\/strong><br>(a) number of units per processing period<br>(b) weight or volume of outputs per period<br>(c) the amount of sales value per unit<br>(d) none of the above<\/p>\n\n\n\n<p><strong>32. A Petroleum company assigns certain value based on the calorific value to each petroleum product, and these values become the basis of apportionment of joint cost among petroleum products. This is an example of &#8211; <\/strong> <strong> <\/strong><br>(a) Average Unit Cost Method<br>(b) Physical Unit Method<br>(c) Survey method<br>(d) None of the above<\/p>\n\n\n\n<p><strong>33. Under this method of allocation of joint costs, even high-quality items may have a lower price <\/strong><br>(a) Contribution Margin Method<br>(b) Survey method<br>(c) Average Unit Cost Method<br>(d) None of the above<\/p>\n\n\n\n<p><strong>34. This is also known as &#8216; Weighted Average Cost Method&#8217;. <\/strong><br>(a) Contribution Margin Method<br>(b) Survey method<br>(c) Net Realizable Value Method<br>(d) None of the above<\/p>\n\n\n\n<p><strong>35. Under this method of allocation of joint costs, higher-priced items are charged more costs &#8211;<\/strong><br>(a) Contribution Margin Method<br>(b) Market Value Method<br>(c) Average Unit Cost Method<br>(d) None of the above<\/p>\n\n\n\n<p><strong>36. This method of allocation of joint costs is useful when the products are not saleable at the spilt- off stage without further processing <\/strong><br>(a) Market value at the point of separation<br>(b) Net Realizable Value<br>(c) Market value at finished stage<br>(d) None of the above<\/p>\n\n\n\n<p><strong>37. For the purpose of allocating joint costs to joint products, the sale price at point of sale, reduced by costs to complete after split-off, is assumed to be equal to &#8211; <\/strong><br>(a) Joint Costs<br>(b) Total Costs<br>(c) Net Sales Value at split-off<br>(d) Sale price Less normal profit margin at point of sale<\/p>\n\n\n\n<p><strong>38. Joint Costs are normally allocated on the basis of relative<\/strong><br>(a) Profitability<br>(b) Sales Value<br>(c) Direct Labour Hours<br>(d) Direct Machine Hours<\/p>\n\n\n\n<p><strong>39. Net Realizable Value is defined as<\/strong><br>(a) Sales value at split-off point<br>(b) Sales price minus fixed costs<br>(c) Sales price minus joint costs<br>(d) Sales price minus costs to complete the product<\/p>\n\n\n\n<p><strong>40. Joint Costs are allocated according to sales value of individual products under &#8211;<\/strong><br>(a) Market Value Method<br>(b) Average Unit Cost Method<br>(c) Survey Method<br>(d) Physical Unit Method<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td class=\"has-text-align-center\" data-align=\"center\"><strong>Answer:<\/strong><span class=\"has-inline-color has-vivid-red-color\"><strong> <\/strong>31)the amount of sales value per unit  32)Physical Unit Method  33)Average Unit Cost Method  34)Survey method  35)Market Value Method  36)Market value at finished stage  37)Net Sales Value at split-off  38)Sales Value 39)Sales price minus costs to complete the product 40)Market Value Method<\/span><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><strong>41. Under the Market Value Method, Joint Costs are allocated according to _________ of individual products  <\/strong>(a) Cost Price <br>(b) Market price or cost price whichever is less<br>(c) Sales Value<br>(d) Cost and Demand Price<\/p>\n\n\n\n<p><strong>42. Under the Average Unit Cost Method of apportionment of joint costs, the cost per unit of each product is <\/strong><br>(a) Constant <br>(b) Different<br>(c) Same<br>(d) Semi-Variable<\/p>\n\n\n\n<p><strong>43. All costs incurred beyond the split-off point that are assignable to one or more individual products are called <\/strong><br>(a) byproduct costs<br>(b) joint costs<br>(c) main costs<br>(d) separable costs<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td class=\"has-text-align-center\" data-align=\"center\"><strong>Answer:<\/strong><span class=\"has-inline-color has-vivid-red-color\"><strong> <\/strong>41)Sales Value  42)Same  43)separable costs  <\/span><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><a href=\"https:\/\/youtu.be\/uk71dV27mBA\" data-type=\"link\" data-id=\"https:\/\/youtu.be\/uk71dV27mBA\" target=\"_blank\" rel=\"noopener\">Video<\/a> lectures on Process Costing MCQ&#8217;s.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#46;&#46;&#46;<\/p>\n","protected":false},"author":1,"featured_media":15971,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,7],"tags":[2316],"class_list":["post-15244","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-bcom","category-degree-college","tag-process-costing-mcq"],"_links":{"self":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/15244","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/comments?post=15244"}],"version-history":[{"count":5,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/15244\/revisions"}],"predecessor-version":[{"id":41911,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/15244\/revisions\/41911"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/media\/15971"}],"wp:attachment":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/media?parent=15244"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/categories?post=15244"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/tags?post=15244"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}