931. Absorption costing is also known as
A. Historical costing
B. Total costing
C. Both a and b
D. None of the above
932. Given production is 1,00,000 units, fixed costs is Rs 2,00,000 Selling price is Rs 10 per unit and variable cost is Rs 6 per unit. Determine profit using technique of marginal costing.
A. Rs 2,00,000
B. Rs 8,00,000
C. Rs 6,00,000
D. None of the above
933. Which of the following statements are true?
A. In absorption costing, cost is divided into three major parts while in marginal costing cost is divided into two main parts.
B. IN absorption costing period is important and in marginal costing product is important.
C. Both a and b
D. None of the above
934. In context of net operating profit, which of the following statements are true?
A. If all costs are variable, the amount of profit obtained in marginal costing and absorption costing will be same.
B. If the volume of sales and output is equal in a period, profit will be same in absorption costing and marginal costing.
C. Both a and b
D. None of the above
935. Under absorption costing, managerial decisions are based on
A. Profit
B. Contribution
C. Profit volume ratio
D. None of the above
936. If sales is less than production and there is no opening stock, it suggests there is closing stock. In such a scenario, profit under marginal costing will be less than the one shown by absorption costing.
A. True
B. False
937. Which of the following are advantages of marginal costing?
A. Makes the process of cost accounting more simple
B. Helps in proper valuation of closing stock
C. Useful for standard and budgetary control
D. All of the above
938. Managers utilizes marginal costing for
A. Make or buy decision
B. Utilization of additional capacity
C. Determination of dumping price
D. All of the above
939. The problems associated with marginal costing are
A. Difficulties in divisions of costs
B. Problem of valuation of stocks
C. Ignores time elements
D. All of the above
940. ___________ is not suitable where selling price is determined on the basis of cost-plus method.
A. Absorption costing
B. Marginal costing
C. Both a and b
D. None of the above