Top 50+ Solved Service Costing MCQ Questions Answer
Q. What would be the effect of inaccurate estimation of overhead absorption rates on aJob?
a. If the jobs are over-priced, customers will go elsewhere
b. If the jobs are under-priced, sales revenue will fail to cover costs and/or provide an adequate return
c. Both A&B
d. None
Q. Batch costing is similar to job costing in that each batch of similar articles isseparately identifiable.
a. False
b. True
c. none
d. none
Q. The cost per unit manufactured in a batch is the total batch cost divided by thenumber of units in the batch.
a. Correct
b. Incorrect
c. none
d. none
Q. The job costing method can therefore be applied in costing batches. The only difference is that a number of items are being costed together as a single unit, instead of a single item or service.
a. The above statement is correct
b. The above statement is incorrect
c. none
d. none
Q. Identify the characteristics of services:I. Intangibility: They do not have a physical substance unlike goods. They cannot be held or seen. II. Inseparability: Consumption and creation of a service cannot be separated. Services are consumed as they are created. III. Variability: Services face the problem of maintaining consistency in the standard of output. IV. Perishability: Services cannot be stored. V. Lack of ownership: Services do not result in the transfer of property in anything.
a. All of the above
b. (I) (II) and (V) only
c. (I) and (V) only
d. None