POSTAL TEST PAPER
INTERMEDIATE SYLLABUS 2022
PAPER - 8
COST ACCOUNTING
Time Allowed: 3 Hours Full Marks: 100
The figures in the margin on the right side indicate full marks.
Answer Question No. 1 and any five from Question No. 2, 3, 4, 5, 6, 7 and 8.
1.(A) Choose the correct answer from the given alternatives (you may write only the Roman
numeral and the alphabet chosen for your answer): [1×12=12]
(i) Ticket counter in a Metro Station is an example of:
a. Profit centre
b. Investment centre
c. Cost centre
d. Revenue centre
(ii) Which of the following is applicable for Cost Control?
a. It is related with the future
b. It is a corrective function
c. It ends when the targets are achieved
d. It challenges the standards set
(iii) Absorption costing is also referred as:
a. Historical costing
b. Traditional costing
c. Full costing
d. All of the above terms
(iv) Prime cost is:
a. all costs incurred in manufacturing a product
b. the total of direct costs
c. the material cost of a product
d. the cost of operating a department
(v) Direct Material is a:
a. Administration Cost
b. Selling and Distribution Cost
c. All of these
d. None of these
(vi) Which of the following methods smoothes out the effect of fluctuations when material
prices fluctuate widely?
a. FIFO
b. Simple Average
c. LIFO
d. Weighted average
(vii) Labour turnover is measured by:
1
Directorate of Studies, The Institute of Cost Accountants of India
, POSTAL TEST PAPER
INTERMEDIATE SYLLABUS 2022
PAPER - 8
COST ACCOUNTING
a. Number of workers replaced / average number of workers
b. Number of workers left / number in the beginning plus number at the end
c. Number of workers joining / number in the beginning of the period
d. All of these
(viii) Under Taylor’s differential piece rate scheme, if a worker fails to complete the task
within the standard time, then he is paid:
a. 83% of the piece work rate
b. 175% of the piece work rate
c. 67% of the piece work rate
d. 125% of the piece work rate
(ix) Normal capacity of a plant refers to the difference between:
a. Maximum capacity and practical capacity
b. Maximum capacity and actual capacity
c. Practical capacity and estimated idle capacity as revealed by long term sales
trend
d. Practical capacity and normal capacity
(x) Selling and Distribution overhead are absorbed on the basis of:
a. Rate per unit
b. Percentage on works cost
c. Percentage on selling price of each unit
d. Any of these
(xi) A company employs three drivers to deliver goods to its customers. The salaries paid
to these drivers are:
a. a part of prime cost
b. a direct production expense
c. a production overhead
d. a selling and distribution overhead
(xii) Which of the following is considered an accounting record?
a. Bin Card
b. Bill of Material
c. Store Ledger
d. None of these
1.(B) State whether the following statements are “True or “False”: [1×7=7]
(i) Material returned note is prepared to keep a record of return of surplus materials to
stores.
(ii) As per the Payment of Bonus Act, 1965 the maximum limit of bonus is 20% of gross
earning
(iii) Departments that assist producing department indirectly are called service
departments.
(iv) Primary packaging cost is included in distribution cost.
(v) Cost ledger control account makes the cost ledger self-balancing.
(vi) Notional interest on owner’s capital appears only in financial profit and loss account.
(vii) Operating costing is applied to ascertain the cost of products.
2
Directorate of Studies, The Institute of Cost Accountants of India
INTERMEDIATE SYLLABUS 2022
PAPER - 8
COST ACCOUNTING
Time Allowed: 3 Hours Full Marks: 100
The figures in the margin on the right side indicate full marks.
Answer Question No. 1 and any five from Question No. 2, 3, 4, 5, 6, 7 and 8.
1.(A) Choose the correct answer from the given alternatives (you may write only the Roman
numeral and the alphabet chosen for your answer): [1×12=12]
(i) Ticket counter in a Metro Station is an example of:
a. Profit centre
b. Investment centre
c. Cost centre
d. Revenue centre
(ii) Which of the following is applicable for Cost Control?
a. It is related with the future
b. It is a corrective function
c. It ends when the targets are achieved
d. It challenges the standards set
(iii) Absorption costing is also referred as:
a. Historical costing
b. Traditional costing
c. Full costing
d. All of the above terms
(iv) Prime cost is:
a. all costs incurred in manufacturing a product
b. the total of direct costs
c. the material cost of a product
d. the cost of operating a department
(v) Direct Material is a:
a. Administration Cost
b. Selling and Distribution Cost
c. All of these
d. None of these
(vi) Which of the following methods smoothes out the effect of fluctuations when material
prices fluctuate widely?
a. FIFO
b. Simple Average
c. LIFO
d. Weighted average
(vii) Labour turnover is measured by:
1
Directorate of Studies, The Institute of Cost Accountants of India
, POSTAL TEST PAPER
INTERMEDIATE SYLLABUS 2022
PAPER - 8
COST ACCOUNTING
a. Number of workers replaced / average number of workers
b. Number of workers left / number in the beginning plus number at the end
c. Number of workers joining / number in the beginning of the period
d. All of these
(viii) Under Taylor’s differential piece rate scheme, if a worker fails to complete the task
within the standard time, then he is paid:
a. 83% of the piece work rate
b. 175% of the piece work rate
c. 67% of the piece work rate
d. 125% of the piece work rate
(ix) Normal capacity of a plant refers to the difference between:
a. Maximum capacity and practical capacity
b. Maximum capacity and actual capacity
c. Practical capacity and estimated idle capacity as revealed by long term sales
trend
d. Practical capacity and normal capacity
(x) Selling and Distribution overhead are absorbed on the basis of:
a. Rate per unit
b. Percentage on works cost
c. Percentage on selling price of each unit
d. Any of these
(xi) A company employs three drivers to deliver goods to its customers. The salaries paid
to these drivers are:
a. a part of prime cost
b. a direct production expense
c. a production overhead
d. a selling and distribution overhead
(xii) Which of the following is considered an accounting record?
a. Bin Card
b. Bill of Material
c. Store Ledger
d. None of these
1.(B) State whether the following statements are “True or “False”: [1×7=7]
(i) Material returned note is prepared to keep a record of return of surplus materials to
stores.
(ii) As per the Payment of Bonus Act, 1965 the maximum limit of bonus is 20% of gross
earning
(iii) Departments that assist producing department indirectly are called service
departments.
(iv) Primary packaging cost is included in distribution cost.
(v) Cost ledger control account makes the cost ledger self-balancing.
(vi) Notional interest on owner’s capital appears only in financial profit and loss account.
(vii) Operating costing is applied to ascertain the cost of products.
2
Directorate of Studies, The Institute of Cost Accountants of India
