students zone

Chapter 12 - Muliple-choice questions

1. The store where stocks are held can be designated as a:
   1.   ?    cost centre
   2.   ?    cost driver
   3.   ?    cost unit
   4.   ?    production centre
2. An example of a direct cost is:
   1.   ?    insurance of delivery vans
   2.   ?    factory manager’s salary
   3.   ?    electricity to power a cutting machine
   4.   ?    fees paid to an advertising agency
3. An example of a production overhead is:
   1.   ?    subcontract work
   2.   ?    piecework wages
   3.   ?    commission paid to the sale team
   4.   ?    factory cleaning costs
4. An example of a selling and distribution overhead is:
   1.   ?    insurance of delivery vans
   2.   ?    commission paid to the sales team
   3.   ?    fees paid to an advertising agency
   4.   ?    all of these
5. If direct materials are £4.50 per unit, direct wages are £6.50 per unit and indirect costs are apportioned at £4 per unit, the prime cost of 1 unit is:
   1.   ?    £4.50
   2.   ?    £6.50
   3.   ?    £11.00
   4.   ?    £15.00
6. If direct materials are £4.50 per unit, direct wages are £6.50 per unit and indirect costs are apportioned at £4 per unit and the profit mark up is 10% of the production cost, the selling price is:
   1.   ?    £4.95
   2.   ?    £7.15
   3.   ?    £12.10
   4.   ?    £16.50