MCQs on various steps in Accounting of Overheads -Collection ,Classifictaion,Allocation ,Apportionment and Re-apportionment of Overheads.

1. MULTIPLE CHOICE QUESTIONS
Subject: Cost & Works Accounting-II
Topic: Accounting of Overheads – Part I
PRESENTED BY
DR.SHRADHA PRASAD
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

2. Production Overheads represent all ____________ costs.
A . Direct B . Indirect
C . Prime D . Actual
B . Indirect
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

3. ___________costs are charged directly to the cost centre or cost
units without any difficulty.
A . Direct B . Indirect
C . Fixed D . Variable
A . Direct
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

4. ____________ are meant for collection of indirect material costs.
A . Purchase Day Book B . Invoice
C . Stores Requisition D . All of the above
D . All of the above
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

5. ___________ is the systematic process of grouping of overheads
on the basis of common characteristics.
A . Collection B . Classification
C . Codification D . Allocation
B . Classification
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

6. ___________ is the allotment of whole items of cost to certain
cost units or cost centres.
A . Apportionment B . Re-apportionment
C . Allocation D . Absorption
C . Allocation
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

7. ______________ is the allotment of proportion of items of cost to
cost centres or cost units.
A . Allocation B . Absorption
C . Re-apportionment D . Apportionment
D . Apportionment
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

8. ______________ is a system under which a distinct number is
allocated to each item of cost for the purpose of identification.
A . Standing Order System B . Sitting Order System
C . Sleeping Order System D . Seating Order System
A . Standing Order System
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

9. _______________ of Overheads is always direct.
A . Absorption B . Apportionment
C . Allocation D . Re-apportionment
C . Allocation
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

10. According to which principle, common overheads are
apportioned on the basis of actual benefit received .
A . Potential Benefit B . Actual Benefit
C . Survey Method D . Service or Use
B . Actual Benefit
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

11. ______________ method is considered inequitable because it
penalizes the efficient and the profitable units of the business
to the advantages of inefficient ones.
A . Ability to Pay Method B . Potential Benefit
C . Actual Benefit D . Survey Method
A . Ability to Pay Method
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

12. Provident Fund Contribution is apportioned on the basis of
______
A . Direct Wages B . Indirect Wages
C . Direct Materials D. Direct Expenses
A . Direct Wages
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

13. Insurance of stock is apportioned on the basis of _____________
A . Value of Plant B . Value of Stock
C . Prime Cost wages D . Indirect Material
B . Value of Stock
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

14. Fire Insurance is apportioned on the basis of _____________
A . Value of direct material B . Value of Asset
C . Machine Hours D . Labour Hours
B . Value of Asset
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

15. Machine Shop Expenses is apportioned on the basis of _____
A . Machine Hours B . Labour Hours
C . Machine Hours or Labour Hours D .Capital cost of Machinery
C . Machine Hours or Labour Hours
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

16. If overhead cannot be allocated , it is apportioned.
A . True B . False
A . True
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

17. Allocation of Overheads is known as Primary Distribution of
Overheads.
A . True B . False
A . True
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

18. Service Department works on things .
A . True B . False
B . False
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

19. Production Department works on things.
A . True B . False
A . True
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

20. Departmentalization of Overheads ensures greater accuracy in
cost ascertainment.
A . True B . False
A . True
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

21. Secondary Distribution of overheads means the
re- apportionment of overheads.
A . True B . False
A . True
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD

22. THANK YOU
COST & WORKS ACCOUNTING - II
BY DR. SHRADHA PRASAD