Costing - Study Mode

[#931] If any by-product is produced and sold it is credited to ________.
Correct Answer

(C) process a/c

Explanation

Solution: If any by-product is produced and sold it is credited to process a/c.

[#932] Balance of abnormal gain a/c is transferred to ________.
Correct Answer

(D) costing profit and loss a/c

Explanation

Solution: Balance of abnormal gain a/c is transferred to costing profit and loss a/c. Abnormal loss is transferred to the costing P&L.

[#933] Inter process profits are ________.
Correct Answer

(B) debited to respective process a/c

Explanation

Solution: Inter process profits are debited to respective process a/c. Inter process profit represents the value added to the output over its cost, while being transferred from one process to another. Since the value addition is without incurring any cost, it would amount to or result in an amount of profit equal to the value addition.

[#934] In proper capital budgeting analysis, we evaluate incremental
Correct Answer

(A) cash flow

[#935] . . . . . . . . is the amount by which the absorbed overheads fall short of the actual amount of overheads incurred.
Correct Answer

(B) Under absorption of overheads