Activity Based Costing
M.Com Sem -2 (HNGU)
Q. 1 Activity Based costing is the method of _________
(A) Overheads Distribution
(B) Cost Accounting
(C) Decision Making
(D) Material Classification
Q.2 In Which of the following method cost driver is use for allocation of overheads.
(A) Machine Hour Rate
(B) Activity Based Costing
(C) Always Better Control
(D) Percentage of Direct Labour
Q.3 In which of the following method single rate is use for absorption (Recovery of overheads?
(A) Activity Based Costing
(B) Traditional Method
(C) In both
(D) None of above
Q. 4 In Which of the following condition ABC can be used?
(A) When Production is Manual
(B) When proportion of Overhead is high
(C)When setting time is low
(D) When Different cost drivers are not available
Q.5 Which of the following is a limitation of activity-based costing?
A) Costs are accumulated by each major activity
B) A variety of activity measures are used
C) All costs in an activity cost pool pertain to a single activity
D) Activity-based costing relies on the assumption that the cost in each cost pool is strictly proportional to its cost measure
Q.6 X Company uses activity-based costing for Product B and Product D. The total estimated overhead cost for the parts administration activity pool was Rs 5,50,000 and the expected activity was 2000 part types. If Product D requires 1200 part types, the amount of overhead allocated to product D for parts administration would be:
A) Rs.275,000
B) Rs.300,000
C) Rs.330,000
D) Rs.345,000
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