{"id":6256,"date":"2021-09-22T11:48:47","date_gmt":"2021-09-22T06:18:47","guid":{"rendered":"https:\/\/scholarsclasses.com\/blog\/?p=6256"},"modified":"2025-12-24T17:40:18","modified_gmt":"2025-12-24T12:10:18","slug":"contract-costing-mcq","status":"publish","type":"post","link":"https:\/\/scholarsclasses.com\/blog\/contract-costing-mcq\/","title":{"rendered":"Contract Costing MCQ | Cost Accounting MCQs (Free Resource)"},"content":{"rendered":"\n<h2 class=\"wp-block-heading has-text-align-center\"><strong>Contract Costing MCQ<\/strong><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large is-resized\"><img decoding=\"async\" width=\"1024\" height=\"576\" data-src=\"https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/09\/Contract-Costing-MCQ-1024x576.jpg\" alt=\"Contract Costing MCQ\" class=\"wp-image-6617 lazyload\" title=\"\" data-srcset=\"https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/09\/Contract-Costing-MCQ-1024x576.jpg 1024w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/09\/Contract-Costing-MCQ-300x169.jpg 300w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/09\/Contract-Costing-MCQ-768x432.jpg 768w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/09\/Contract-Costing-MCQ-1536x864.jpg 1536w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/09\/Contract-Costing-MCQ-640x360.jpg 640w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/09\/Contract-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\">Contract 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. Contract costing is a basic method of<br><\/strong>(a) Historical costing <br>(b) Specific order costing<br>(c) Process costing <br>(d) Standard costing<\/p>\n\n\n\n<p><strong>2. Contract costing is a variant of _________ Costing.<br><\/strong>(a) Job <br>(b) Process<br>(c) Unit <br>(d) Batch<\/p>\n\n\n\n<p><strong>3. Contract costing is usually applicable in<br><\/strong>(a) Construction Works <br>(b) Textile Mills<br>(c) Cement Industries <br>(d) Chemical Industries<\/p>\n\n\n\n<p><strong>4. __________ is the person for whom the Contract job is undertaken.<br><\/strong>(a) Contractor <br>(b) Contractee<br>(c) Sub-contractor <br>(d) Job-worker<\/p>\n\n\n\n<p><strong>5. Which one of the following is not a contract cost?<br><\/strong>(a) Direct wages <br>(b) Depreciation of plant<br>(c) Sub-contractors\u2019 fees <br>(d) Architects\u2019 certificates<\/p>\n\n\n\n<p><strong>6. The degree of completion of work is determined by comparing the work certified with<br><\/strong>(a) Contract price <br>(b) Work in progress<br>(c) Cash received on contract <br>(d) Retention money<\/p>\n\n\n\n<p><strong>7. In contract costing credit is taken only for a part of the profit on<br><\/strong>(a) Completed contract <br>(b) Incomplete contract<br>(c) Work uncertified <br>(d) Work Certified<\/p>\n\n\n\n<p><strong>8. In contract costing payment of cash to the contractor is made on the basis of<br><\/strong>(a) Uncertified work <br>(b) Certified work<br>(c) Work in progress <br>(d) Retention Money<\/p>\n\n\n\n<p><strong>9. The cost of any sub-contracted work is<br><\/strong>(a) A direct expense of a contract and is debited to the contract account<br>(b) An indirect expense of a contract and is debited to the contract account<br>(c) A direct expense of a contract and is debited to the client account<br>(d) An indirect expense of a contract and is debited to the client account<\/p>\n\n\n\n<p><strong>10. Progress payments received by the contractor from the client are<br><\/strong>(a) Debited to the contract account <br>(b) Credited to the contract account<br>(c) Debited to the client account <br>(d) Credited to the client account<\/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)Specific order costing  2)Job  3)Constructional Works  4)Contractee  5)Architects\u2019 certificates  6)Contract price  7)Incomplete contract  8)Certified work  9)A direct expense of a contract and is debited to the contract account  10)Credited to the client account<\/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. Retention Money is equal to<br><\/strong>(a) Work certified Less Work uncertified<br>(b) Contract price Less Work certified<br>(c) Work certified Less Payment received by contractor<br>(d) None of the above<\/p>\n\n\n\n<p><strong>12. Material supplied by the Contractee<br><\/strong>(a) is debited to the Contract Account <br>(b) is ignored in the Contract Account<br>(c) is credited to the Contract Account <br>(d) is debited to the Contractee\u2019s Account<\/p>\n\n\n\n<p><strong>13. Cost of material lost or destroyed<br><\/strong>(a) is credited to the Contract Account<br>(b) is debited to the Contract Account<br>(c) is debited to the Costing Profit and Loss Account<br>(d) is credited to the Costing Profit and Loss Account<\/p>\n\n\n\n<p><strong>14. Work Certified is valued at<br><\/strong>(a) Cost price <br>(b) Market price<br>(c) Cost or market price whichever is less <br>(d) Estimated price<\/p>\n\n\n\n<p><strong>15. Value of Work Certified Less Profit =<br><\/strong>(a) Work-in-progress <br>(b) Cost of Work Certified<br>(c) Retention Money <br>(d) Cost of uncertified work<\/p>\n\n\n\n<p><strong>16. The Total Value of Work Completed during an accounting year is equal to<br><\/strong>(a) Work Certified + Progress Payment Received<br>(b) Work Certified + Work Uncertified<br>(c) Work Certified + Retention Money<br>(d) None of the above<\/p>\n\n\n\n<p><strong>17. Notional Profit is equal to<br><\/strong>(a) Work certified Less Cost of work certified<br>(b) Work certified Less Cost of work completed<br>(c) Payment received Less Work certified<br>(d) None of the above<\/p>\n\n\n\n<p><strong>18. Work-in-progress at year end is equal to<br><\/strong>(a) only closing stock of materials <br>(b) only work certified<br>(c) only work uncertified <br>(d) the total of all the above<\/p>\n\n\n\n<p><strong>19. Work certified is less than 25% of the contract price. The transfer to P &amp; L A\/c will be<br><\/strong>(a) 1\/3 rd of Notional profits <br>(b) NIL<br>(c) 2\/3 rd of Notional profits <br>(d) 100% of Notional profits<\/p>\n\n\n\n<p><strong>20. Work certified is between 25% and 50% of the contract price. The transfer to P &amp; L A\/c will be<br><\/strong>(a) 1\/3 rd of Notional profits, reduced in the ratio of cash received to work certified<br>(b) NIL<br>(c) 2\/3 rd of Notional profits, reduced in the ratio of cash received to work certified<br>(d) 100% of Notional profits<\/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)Work certified Less Payment received by contractor  12)is ignored in the Contract Account  13)is credited to the Contract Account  14)Cost price  15)Cost of Work Certified  16)Work Certified + Work Uncertified  17)Work certified Less Cost of work certified  18)the total of all the above  19)NIL  <\/span><br><span class=\"has-inline-color has-vivid-red-color\">20)1\/3 rd of Notional profits, reduced in the ratio of cash received to work certified<\/span><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><strong>21. Work certified is between 50% and 90% of the contract price. The transfer to P &amp; L A\/c will be<br><\/strong>(a) 1\/3 rd of Notional profits, reduced in the ratio of cash received to work certified<br>(b) NIL<br>(c) 2\/3 rd of Notional profits, reduced in the ratio of cash received to work certified<br>(d) 100% of Notional profits<\/p>\n\n\n\n<p><strong>22. The entire contract is complete. The transfer to P &amp; L A\/c will be<br><\/strong>(a) 1\/3 rd of Notional profits <br>(b) NIL<br>(c) 2\/3 rd of Notional profits <br>(d) Entire profit<\/p>\n\n\n\n<p><strong>23. If a contract is 40% complete, credit taken to the profit and loss account is<br><\/strong>(a) 40% of the notional profit<br>(b) 1\/3 rd of Notional profits, reduced in the ratio of cash received to work certified<br>(c) NIL<br>(d) 2\/3 rd of Notional profits, reduced in the ratio of cash received to work certified<\/p>\n\n\n\n<p><strong>24. Value of work certified &#8211; Rs 5,00,000<br>Cost of work to date &#8211; Rs 4,00,000<br>Cost of work not yet certified &#8211; Rs 1,00,000 <br>Notional Profit is<\/strong><br>(a) Rs 1,00,000 <br>(b) Nil<br>(c) Loss Rs 1,00,000<code> <\/code><br>(d) Rs 2,00,000<\/p>\n\n\n\n<p><strong>25. The total profit on a contract for Rs 3,00,000 is Rs 60,000 and the contract is 60% complete and has been certified accordingly. The retention money is 20% of the certified value, then the amount of profit that can be prudently credited to Profit and Loss Account<\/strong><br>(a) Rs 60,000<code> <\/code><br>(b) Rs 36,000<br>(c) Rs 28,800<code> <\/code><br>(d) Rs 48,000<\/p>\n\n\n\n<p><strong>26. Contract cost &#8211; Rs 2,80,000  <br>Contract value &#8211; Rs 5,00,000<br>Cash received &#8211; Rs 2,70,000<br>Uncertified work &#8211; Rs 30,000<br>Deduction from bills by way of retention money is 10%.<br>How much profit, if any, you would take to the profit and loss account?<\/strong><br>(a) Rs 50,000<br>(b) Rs 33,333<br>(c) Rs 30,000 <br>(d) Nil<\/p>\n\n\n\n<p><strong>27.Total cost of contract to date &#8211; Rs 3,83,000<br>Cost of contract not yet to certified &#8211; Rs 23,000<br>Value of work certified &#8211; Rs 4,20,000<br>Cash received to date &#8211; Rs 3,78,000<br>Value of work-in-progress is<\/strong><br>(a) Rs 65,000 <br>(b) Rs 41,000<br>(c) Rs 23,000<br>(d) Rs 14,000<\/p>\n\n\n\n<p><strong>28. <strong>Total cost of contract to date &#8211; Rs 3,83,000<br>Cost of contract not yet to certified &#8211; Rs 23,000<br>Value of work certified &#8211; Rs 4,20,000<br>Cash received to date &#8211; Rs 3,78,000<br><\/strong>Reserve for contingencies is<\/strong><br>(a) Rs 60,000<code> <\/code><br>(b) Rs 24,000<br>(c) Rs 36,000<code> <\/code><br>(d) Rs 1,000<\/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)1\/3 rd of Notional profits, reduced in the ratio of cash received to work certified  22)Entire profit  23)1\/3 rd of Notional profits, reduced in the ratio of cash received to work certified  24)Rs 2,00,000  25)Rs 28,800  26)Rs 30,000  27)Rs 41,000  28)Rs 24,000<\/span><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><strong>Learn the chapters on TYBCOM from our <a href=\"https:\/\/studio.youtube.com\/channel\/UCExY0hxogv75WdPK1MFS3fw\" data-type=\"link\" data-id=\"https:\/\/studio.youtube.com\/channel\/UCExY0hxogv75WdPK1MFS3fw\" target=\"_blank\" rel=\"noopener\">YouTube channel<\/a>.<\/strong><\/p>\n\n\n\n<h3 class=\"wp-block-heading has-text-align-center has-contrast-color has-text-color\">Online lectures of BCOM &amp; BAF<\/h3>\n\n\n\n<p>\ud83d\udd17 Share our videos and channel with your friends, and help us grow this channel.<br>Learn many Chapters from our playlist.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlydBJkFOG9X7cqtVesnyQdiY\" data-type=\"link\" data-id=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlydBJkFOG9X7cqtVesnyQdiY\" target=\"_blank\" rel=\"noopener\">Standard Costing <\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlydgIIWTK-MAhenQShV9aCK-\" data-type=\"link\" data-id=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlydgIIWTK-MAhenQShV9aCK-\" target=\"_blank\" rel=\"noopener\">Marginal Costing<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlyfAB3BFBOpzxOcTccRd9Sd9\" data-type=\"link\" data-id=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlyfAB3BFBOpzxOcTccRd9Sd9\" target=\"_blank\" rel=\"noopener\">Process Costing<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlycvOpisB7z6ChFU_M12WaHF\" data-type=\"link\" data-id=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlycvOpisB7z6ChFU_M12WaHF\" target=\"_blank\" rel=\"noopener\">Contract Costing<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlycztlxZO8_dFK3MBUpDmspT\" data-type=\"link\" data-id=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlycztlxZO8_dFK3MBUpDmspT\" target=\"_blank\" rel=\"noopener\">Material Cost<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlydix7pL2yOZvNwjTC2NE4Hs\" data-type=\"link\" data-id=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlydix7pL2yOZvNwjTC2NE4Hs\" target=\"_blank\" rel=\"noopener\">Labour Cost<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlyfya-qJBFNCGDo694oYD3HM\" data-type=\"link\" data-id=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlyfya-qJBFNCGDo694oYD3HM\" target=\"_blank\" rel=\"noopener\">Overheads<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/youtu.be\/OTqK6hkkWao\" data-type=\"link\" data-id=\"https:\/\/youtu.be\/OTqK6hkkWao\" target=\"_blank\" rel=\"noopener\">Cost Sheet<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlycqh9Q_KNwtQu9Btq0HX90Q\" data-type=\"link\" data-id=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlycqh9Q_KNwtQu9Btq0HX90Q\" target=\"_blank\" rel=\"noopener\">Foreign Exchange Currency<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlyf2XUidmrcmeoKRO_lhgVEN\" data-type=\"link\" data-id=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlyf2XUidmrcmeoKRO_lhgVEN\" target=\"_blank\" rel=\"noopener\">Investment Accounting<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlyf19LYQpS269Jv96hKVR8sN\" data-type=\"link\" data-id=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlyf19LYQpS269Jv96hKVR8sN\" target=\"_blank\" rel=\"noopener\">Buy Back of Shares<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlyeLvm_Yt0P33iAlqoZpALna\" data-type=\"link\" data-id=\"https:\/\/www.youtube.com\/playlist?list=PLJ_81_DlRlyeLvm_Yt0P33iAlqoZpALna\" target=\"_blank\" rel=\"noopener\">Liquidation of Companies<\/a><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>&#46;&#46;&#46;<\/p>\n","protected":false},"author":1,"featured_media":6617,"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":[2315],"class_list":["post-6256","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-bcom","category-degree-college","tag-contract-costing-mcq"],"_links":{"self":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/6256","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=6256"}],"version-history":[{"count":13,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/6256\/revisions"}],"predecessor-version":[{"id":41520,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/6256\/revisions\/41520"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/media\/6617"}],"wp:attachment":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/media?parent=6256"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/categories?post=6256"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/tags?post=6256"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}