Accounting For Material Quiz: Test!

17 Questions | Attempts: 2848

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Accounting For Material Quiz: Test! - Quiz

Accounting, as we all know, is a broad subject. Today, with this 'Accounting for Materials quiz,' we will test your knowledge about it by asking you questions based on simple accounting concepts- material accounting. Just like every other accounting topic, materials accounting also covers a wide range of financial documents and costs. Let's see how much you know about this subject. Try to hit a score above 70% in order to pass this test.


Questions and Answers
  • 1. 
    Direct material is a _______. 
    • A. 

      Fixed cost

    • B. 

      Variable cost

    • C. 

      Semi variable cost

    • D. 

      Fixed income

  • 2. 
    Direct material is a _________. 
    • A. 

      Manufacturing cost.

    • B. 

      Administration cost

    • C. 

      Selling and distribution cost

    • D. 

      None of the above

  • 3. 
    In most industries, what is the most important element of cost? 
    • A. 

      Material

    • B. 

      Labour

    • C. 

      Overheads.

    • D. 

      None of them

  • 4. 
    Which of the following options can be categorized as an accounting record?
    • A. 

      Bill of Materials

    • B. 

      Bin card

    • C. 

      Stores ledger

    • D. 

      All of these

  • 5. 
    Name the document that is used for issuing materials to production departments.
    • A. 

      Purchase Requisition Note

    • B. 

      Stores requisition Note

    • C. 

      Goods Received Note

    • D. 

      Stores Credit Note

  • 6. 
    The ________ type of loss is considered to be the normal loss of materials.
    • A. 

      Loss due to accidents

    • B. 

      Pilferage

    • C. 

      Loss due to breaking the bulk

    • D. 

      Loss due to careless handling of materials

  • 7. 
    Select the pricing method in which costs log behind the current economic values.
    • A. 

      Last-in-first-out price

    • B. 

      First-in-first-out price

    • C. 

      Replacement price

    • D. 

      Weighted average price

  • 8. 
    Name the stock control method that aims at concentrating efforts on selected items of materials. 
    • A. 

      Perpetual inventory system

    • B. 

      Materials turnover

    • C. 

      Maximum, minimum and re-order level setting

    • D. 

      ABC analysis

  • 9. 
    In base stock method of pricing the material issues, what does the term ‘base stock’ represent?
    • A. 

      Quantity of stock being issued

    • B. 

      Stock in balance

    • C. 

      Minimum stock

    • D. 

      Maximum stock

  • 10. 
    Which of the following cost items should NOT be treated as direct material ?
    • A. 

      Electricity representing 90% of the total cost.

    • B. 

      Sand paper used in production

    • C. 

      Thread used in attaching garments

    • D. 

      All of the above

  • 11. 
    Continuous stock-taking is a part of _________. 
    • A. 

       Annual stock-taking

    • B. 

      Perpetual inventory

    • C. 

      ABC analysis.

    • D. 

      All of them

  • 12. 
    In which of the following methods, materials are issued at the price prevailing at the time of issue ?
    • A. 

      Inflated price method

    • B. 

      Standard price method

    • C. 

      Replacement price method

    • D. 

      Specific price method.

  • 13. 
    The storekeeper should initiate a purchase requisition when stock reaches.
    • A. 

       Minimum level

    • B. 

      Maximum level

    • C. 

      Re-order level

    • D. 

      Average level.

  • 14. 
    Which of these material losses should be transferred to Costing Profit and Loss Account?
    • A. 

      Loss by evaporation

    • B. 

      Loss due to improper storage of materials

    • C. 

      Loss due to breaking the bulk

    • D. 

      All of these.

  • 15. 
    When material prices fluctuate widely, the method of pricing that gives absurd results is called _________. 
    • A. 

      Simple average price

    • B. 

      Weighted average price

    • C. 

      Moving average price

    • D. 

      Inflated price.

  • 16. 
    When price fluctuates widely, which method smooth out the effect of fluctuations?
    • A. 

      Simple average

    • B. 

      Weight average

    • C. 

      FIFO

    • D. 

      LIFO

  • 17. 
    Pick the method in which the charge to production is not at actual cost. 
    • A. 

      Weighted average price

    • B. 

      Standard price

    • C. 

      Replacement price

    • D. 

      All of these

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