Chapter Questions
State whether the following statements are true or false:'Factory overhead' and 'other expenses' are synonymous terms.
Choose the correct answer:Which of the following is a service department?(a) Finishing department(b) Refining department(c) Receiving department(d) Machine department
State whether the following statements are true or false: Departments that assist producing departments indirectly are called service departments.
Choose the correct answer:Packing cost is a(a) Manufacturing overhead(b) Selling overhead(c) Distribution overhead(d) Any of the above
State whether the following statements are true or false: Variable overheads vary with time.
Choose the correct answer: Factory overheads should be absorbed on the basis of(a) Machine hours(b) Direct labour hours(c) Direct labour cost(d) Relationship to cost incurred
State whether the following statements are true or false:Cost of indirect material is apportioned to various departments.
Choose the correct answer: Administration overheads are recorded as a percentage of(a) Works cost(b) Prime cost(c) Direct materials(d) Direct wages
State whether the following statements are true or false:Director's remuneration and expenses form a part of administrative overheads.
Choose the correct answer: A cost seeking to create and stimulate demand and secure orders is(a) Distribution cost(b) Selling cost(c) Administrative cost(d) Research cost
State whether the following statements are true or false:Variable overhead cost is a periodic cost.
Choose the correct answer:Warehouse expenses is an example of(a) Factory overhead(b) Administrative overhead(c) Selling overhead(d) Distribution overhead
State whether the following statements are true or false: Fixed overhead cost is an output cost.
Choose the correct answer:Which of the following is not a selling overhead?(a) Royalty on sales(b) Distribution of samples(c) Legal cost for debt realization(d) Insurance to cover sold goods while in transit
State whether the following statements are true or false: Fixed overhead cost is a committed cost.
Choose the correct answer: Salary to a foreman should be classified as a(a) Variable overhead(b) Fixed overhead(c) Semi-variable or semi-fixed overhead(d) None of the above
State whether the following statements are true or false:Depreciation is a semi-variable expense.
Choose the correct answer:Information regarding depreciation is obtained from(a) Plant register(b) Invoice(c) Cash book(d) Store requisition
State whether the following statements are true or false:Variable overhead cost is a discretionary cost.
Choose the correct answer: Over which of the following costs is the management likely to have least control?(a) Advertising cost(b) Building insurance cost(c) Machine breakdown cost(d) Wage cost