Deck 2: Inventory Management and Costing Techniques

Question 1

A bill of material is prepared in case of a................................. job

A)standard job
B)non-standardized job
C)both a & b
D)none of these

Answer 1

non-standardized job

Question 2

The quantity of material to be ordered at one time is known as…………

A)ordering quantity
B)commercial order quantity
C)economic order quantity
D)none of these

Answer 2

ordering quantity

Question 3

……….represents that quantity of material which is normally ordered when a particular material reaches reordering level.

A)maximum level
B)re-order level
C)minimum level
D)re-order quantity

Answer 3

re-order quantity

Question 4

The principle types of inventories are raw materials and ,…............and finished goods

A)processed materials
B)goods-in-progress
C)stored goods
D)goods for dispatch

Question 5

Inventory turnover in days = Days during the period ÷………………..

A)inventory turnover ratio
B)material consumed during the period
C)cost of average stock during the period
D)none of these

Question 6

Inventory turnover ratio = Cost of …………………..during the period ÷ Cost of average inventory held during the period.

A)inventory consumed
B)minimum inventory
C)maximum inventory
D)none of these

Question 7

Re-ordering level = ........................................X Maximum re-order period

A)average re-order period
B)maximum usage
C)maximum consumption
D)normal usage

Question 8

………………forms part of cost of production.

A)abnormal waste
B)normal waste
C)both a & b
D)none of these

Question 9

Material losses due to abnormal reasons should be transferred to…………………

A)profit and loss account
B)costing profit and loss account
C)trading account
D)none of these

Question 10

Marginal costing is a …………… of costing

A)system
B)method
C)technique
D)all of these