Costing - Study Mode

[#181] Describe the cost unit applicable to the Bicycle industry:
Correct Answer

(B) per bicycle

Explanation

Solution: The cost unit applicable to the Bicycle industry is per bicycle.

[#182] "Calculate the prime cost from the following information: Direct material purchased: Rs. 1,00,000. Direct material consumed: Rs. 90,000. Direct labour: Rs. 60,000. Direct expenses: Rs. 20,000. Manufacturing overheads: Rs. 30,000."
Correct Answer

(C) Rs. 1,70,000

Explanation

Solution: Prime cost = Raw material consumed + Direct labour + Direct expenses = 90000 + 60000 + 20000 = Rs. 170000.

[#183] "Total cost of a product: Rs 10,000. Profit: 25% on Selling Price Profit is:"
Correct Answer

(C) Rs. 3,333

Explanation

Solution: Profit on C.P = 10000 × 25/100 = 2500 Profit on S.P = 2500/(10000-2500) × 10000 = Rs. 3,333.

[#184] Which of these is not a Material control technique:
Correct Answer

(C) Maintaining stores ledger

Explanation

Solution: Maintaining stores ledger is not a Material control technique. A stores ledger is a manual or computer record of the raw materials and production supplies stored in a production facility. It is maintained by the person responsible for these assets, such as the warehouse manager.

[#185] Out of the following, what is not the work of purchase department:
Correct Answer

(D) Accounting for material received

Explanation

Solution: Accounting for material received is not the work of purchase department. Most major companies and even some government organizations have a purchasing or procurement department as part of everyday operations. These departments provide a service that is the backbone of many manufacturing, retail, military and other industrial organizations.