Costing – Set 3 January 30, 2025 by aasi Home › Commerce › Costing Costing Costing – Set 3 📝 Model Practice Set ⚡ Instant Answers & Explanation 🎯 Exam Oriented 0% Report a question What’s wrong with this question? You cannot submit an empty report. Please add some details. 1234567891011121314151617181920212223242526272829303132333435363738394041424344454647484950 Costing – Set 3 Dear ! This is Costing – Set 3 Quiz and it contains 50 questions. Keep Learning! 1 / 50 1) According to incremental method, party which receives highest ranking in allocation of common cost is classified as second incremental party Third incremental party primary party First incremental party 2 / 50 2) Department which provides assisting services to internal departments is classified as supply department support department allocation base department production department 3 / 50 3) Method which determines weights of cost allocation by considering cost of each user as separate entity is known as stand-alone cost allocation method bundled products allocation method variable cost allocation method incremental cost allocation method 4 / 50 4) First ranked product, in incremental revenue allocation method, is classified as First incremental product primary product Second incremental product Third incremental product 5 / 50 5) If an overhead cost of operating a machine is $500000 for 1000 hours, then cost allocation rate will be $250 per machine hour $500 per machine hour $1000 per machine hour $1500 per machine hour 6 / 50 6) Cost of operating activity, facility or any cost object which usually shares by two or more than two users is classified as common cost stand-alone cost bundled cost incremental cost 7 / 50 7) cost object user, who is ranked first in incremental cost allocation method is known as First incremental user secondary user primary user second incremental user 8 / 50 8) An approach which yields benefits of normal costing and actual manufacturing overhead is classified as unadjusted budget rate approach adjusted budget rate approach adjusted allocation rate approach unadjusted allocation rate approach 9 / 50 9) Considering dual rate method, if employees work for 8500 budgeted hours at $120 per hour and work for 9500 actual hours at $110 per hour, then total cost would be $3,078,000 $3,065,000 $2,078,000 $2,065,000 10 / 50 10) Approaches to allocate costs of support department do not include sales mix allocation method dual-rate cost-allocation method both b and c single rate cost allocation method 11 / 50 11) Term which describes assigning of indirect cost to any cost abject is classified as cost allocation sales allocation cost tracing sales tracing 12 / 50 12) Third ranked product in incremental revenue-allocation method is known as Second incremental product primary product Third incremental product First incremental product 13 / 50 13) A document which consists information about labour time usage, for specific job in a specific department, is known as buying time record direct time record selling time record labour time record 14 / 50 14) In normal costing, situation in which allocated amount of indirect cost is greater than incurred cost, is considered as incurred indirect cost applied direct cost over allocated indirect cost applied indirect cost 15 / 50 15) Package which consists of two or more products to be sold for single price, but components of products in package have separate stand-alone price is called dual mix product bundled product step down product reciprocal product 16 / 50 16) Process of assigning direct or indirect cost to any cost object is known as event assignment probability assignment cost assignment cost expectation 17 / 50 17) Method of revenue allocation, which ranks products included in bundle according to predetermined criteria of management is known as step down allocation method revenue mix allocation method incremental revenue allocation method stand-alone revenue allocation method 18 / 50 18) Methods used to allocate costs of reciprocal support departments include step down reciprocal method direct method all of these 19 / 50 19) If budgeted annual indirect cost is $60000, budgeted annual quantity of cost allocation base is $3600, then budgeted indirect cost rate will be 16.67 per piece 14.67 per piece 13.67 per piece 15.67 per piece 20 / 50 20) If budgeted direct labour hours are 4550 and direct labour cost rate is $600 per labour hour then, total direct labour cost would be $3,730,000 $1,730,000 $4,730,000 $2,730,000 21 / 50 21) Department which directly adds value to product or service is known as both a and b operating department production department allocation base department 22 / 50 22) A document which contains information about materials of specific product, in specific department comes under selling method material acquisition method costing method none of these 23 / 50 23) Method which divides support department cost into two dimensions such as fixed and variable cost pool is classified as single rate cost allocation method sales mix allocation method dual-rate cost-allocation method quantity variance allocation method 24 / 50 24) Total indirect cost in pool by an actual quantity of cost allocation base is used to calculate direct rate manufacturing overhead costs actual manufacturing overhead rate overhead rate 25 / 50 25) Method which ranks cost object incurred by individual users, in ranking order of more responsible users is classified as stand-alone cost allocation method incremental cost allocation method variable cost allocation method bundled products allocation method 26 / 50 26) Single or multiple units of distinct services or products are classified as price job post cost 27 / 50 27) If budget sales units are 8000, ending inventory is 2000 units and beginning inventory is 3000, then budget production would be 13000 units 7000 units 10000 units 11000 units 28 / 50 28) Process in which earned revenue is related to specific revenue object, which can cannot trace it in cost effective way is known as reciprocal revenue revenue increment revenue allocation revenue object 29 / 50 29) Method, which allocates cost of support department to operating and support departments is known as step down method direct method indirect method reciprocal method 30 / 50 30) A group of individual indirect cost item is defined as indirect pool direct pool item pool cost pool 31 / 50 31) Budgeted direct labour hours are multiplied to direct labour cost rate to calculate expected total direct labour cost budgeted total indirect labour cost budgeted total direct labour cost expected labour hours 32 / 50 32) An under allocated indirect cost is also called under applied indirect cost absorbed indirect cost both a and b under absorbed indirect cost 33 / 50 33) Support department cost allocation method which makes no difference between variable and fixed costs is classified as sales mix allocation method single rate cost allocation method dual-rate cost-allocation method quantity variance allocation method 34 / 50 34) An average unit cost, applicable to each similar produced units is classified as per post cost per price cost per unit cost application cost 35 / 50 35) Budgeted total direct labour cost is divided with budgeted total direct labour to calculate budgeted direct labour cost rate budgeted indirect labour cost rate expected indirect labour cost rate expected direct labour cost rate 36 / 50 36) In incremental cost allocation method, cost object user who is ranked third in ranking order is classified as secondary user second incremental user primary user First incremental user 37 / 50 37) If employees of division A work for 8000 hours for $90 per hour, then rate must be paid in division B in accordance of single rate method will be less than $90 per hour none of these greater than $90 per hour $90 per hour 38 / 50 38) Method which allocates cost of support department to only operating departments is called indirect method reciprocal method direct method step down method 39 / 50 39) If budgeted total direct labour hours are 5500 and budgeted direct labour cost is $755000, then budgeted direct labour cost rate is $137.27 per hour $142 per labour hour $140 per labour hour $138 per labour hour 40 / 50 40) In incremental cost allocation method, cost object user who is ranked second in ranking order is known as secondary user second incremental user First incremental user primary user 41 / 50 41) A particular term for which specific revenue measurement is required is known as revenue object revenue allocation revenue increment reciprocal revenue 42 / 50 42) In stand-alone revenue-allocation method, type of weights available for this method is unit costs as weights physical units as weights all of these selling prices as weight 43 / 50 43) Second ranked product in incremental revenue allocation method is termed as Third incremental product Second incremental product First incremental product primary product 44 / 50 44) Products, divisions and customers are examples of reciprocal revenue revenue increment revenue object revenue allocation 45 / 50 45) Costs, which consist of interdepartmental cost allocations plus cost of support department are classified as complete reciprocal costs artificial costs flexible operating costs operating costs 46 / 50 46) Method, which uses specific information on products as weights to allocate bundled revenues for each product in bundle is classified as revenue mix allocation method step down allocation method incremental revenue allocation method stand-alone revenue allocation method 47 / 50 47) Centers such as revenue, cost, investment and profit all are known as responsibility center marketing center planning center financial center 48 / 50 48) If budgeted total direct labour hours are 3800 and budgeted direct labour cost is $480000, then budgeted direct labour cost rate will be $128.32 per labour hour $132 per labour hour $126.32 per labour hour $130 per labour hour 49 / 50 49) Method, which allocates cost of support department for operating departments by recognizing all mutual services provided is classified as direct method reciprocal method indirect method step down method 50 / 50 50) Cash sales, accounts receivables and rental receipts all are known as total goods sold cash receipts budget receipts goods manufactured Your score isThe average score is 0%🎉 Challenge alert! 💡 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