McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Commerce (B Com) .
Chapters
| 51. |
In order to calculate a cost for each joint product, the common costs must be ________ between the joint products. |
| A. | Identified |
| B. | Allocated |
| C. | Apportioned |
| D. | None |
| Answer» C. Apportioned | |
| 52. |
Which of the methods of apportionment is normally used for apportioning common costs between joint products? |
| A. | Units basis |
| B. | Sales value at the split-off point basis |
| C. | Net realizable value |
| D. | Either of the above |
| Answer» D. Either of the above | |
| 53. |
In Units basis, Common costs are apportioned between joint products on the basis of the total number of units produced. The cost per unit is the same for all the joint products. (This is also described as the physical quantities basis). |
| A. | Correct |
| B. | Incorrect |
| C. | none |
| D. | none |
| Answer» A. Correct | |
| 54. |
The units basis has the following limitations. |
| A. | Where the products separate during the processes into different states, for example where one product is a gas and another is a liquid, this method is unsuitable. |
| B. | This method does not take into account the relative income-earning potentials of the individual products, with the result that one product might appear very profitable and another appears to be incurring losses. |
| C. | Both A&B |
| D. | None |
| Answer» C. Both A&B | |
| 55. |
The relative sales value method is the most widely used method of apportioning joint costs because (ignoring the effect of further processing costs) it assumes that all products achieve the same profit margin. |
| A. | True |
| B. | False |
| C. | none |
| D. | none |
| Answer» A. True | |
| 56. |
By products are outputs from a joint process that are relatively minor in quantity and/or value. |
| A. | False |
| B. | True |
| C. | none |
| D. | none |
| Answer» B. True | |
| 57. |
Since a by-product does not have any substantial value, there is no sense in charging it with a share of the common processing costs. |
| A. | False |
| B. | True |
| C. | none |
| D. | none |
| Answer» B. True | |
| 58. |
Which of the following statement is correct? |
| A. | A joint product is regarded as an important sale-able item, and so it should be separately costed. The profitability of each joint product should be assessed in the cost accounts. |
| B. | A by-product is not important as a sale-able item, and whatever revenue it earns is a ‘bonus’ for the organisation. Because of their relative insignificance, by-products are not separately costed. |
| C. | Both A&B are correct |
| D. | None |
| Answer» C. Both A&B are correct | |
| 59. |
The point at which joint products and by-products become separately identifiable is known as: |
| A. | The split off point |
| B. | Separation point |
| C. | Either A or B |
| D. | None |
| Answer» C. Either A or B | |
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