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B Com Exam  >  B Com Test  >  Cost Accounting  >  Test: Cost Accounting Techniques- 2 - B Com MCQ

Cost Accounting Techniques- 2 - Free MCQ Practice Test with solutions,


MCQ Practice Test & Solutions: Test: Cost Accounting Techniques- 2 (10 Questions)

You can prepare effectively for B Com Cost Accounting with this dedicated MCQ Practice Test (available with solutions) on the important topic of "Test: Cost Accounting Techniques- 2". These 10 questions have been designed by the experts with the latest curriculum of B Com 2026, to help you master the concept.

Test Highlights:

  • - Format: Multiple Choice Questions (MCQ)
  • - Duration: 10 minutes
  • - Number of Questions: 10

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Test: Cost Accounting Techniques- 2 - Question 1
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Which of the following statements is true about a non-integrated accounting system?

Detailed Solution: Question 1

In a non-integrated accounting system, separate ledgers are maintained for cost and financial accounts. This means that cost accounts only record transactions related to the product or service being provided, while financial accounts include a broader range of expenses and balance sheet items. Notional expenses like rent or interest on capital tied up in the stock are also dealt with in the cost accounts. This system allows for better tracking and analysis of costs related to production or sales.

Test: Cost Accounting Techniques- 2 - Question 2
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What is a special feature of the non-integrated accounting system?

Detailed Solution: Question 2

One special feature of the non-integrated accounting system is its ability to deal with notional expenses like rent or interest on capital tied up in the stock. By recognizing the interest on capital tied up in stock, the system helps stores and works managers be aware of the money being blocked because of holding stock. This feature allows for better financial management and decision-making within the organization.

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Test: Cost Accounting Techniques- 2 - Question 3
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What is the main difference between a non-integrated accounting system and an integrated accounting system?

Detailed Solution: Question 3

The main difference between a non-integrated accounting system and an integrated accounting system is the number of accounts maintained. In a non-integrated system, separate ledgers are maintained for cost and financial accounts, resulting in fewer accounts overall. On the other hand, an integrated system maintains a single set of accounts for cost and financial records, eliminating the need for separate profit and loss accounts. This integration allows for easier maintenance of accounts and avoids unnecessary complications.

Test: Cost Accounting Techniques- 2 - Question 4
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What is the benefit of an integrated accounting system?

Detailed Solution: Question 4

One of the benefits of an integrated accounting system is that there is no need for reconciliation. Since a single set of accounting records is maintained for both cost and financial accounts, there is no possibility of different profit figures being reported. This eliminates the need for reconciling different sets of books and ensures accurate and consistent financial reporting. It also saves time by avoiding the maintenance of separate books for cost and financial records.

Test: Cost Accounting Techniques- 2 - Question 5
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Which of the following is a prerequisite for an integral accounting system?

Detailed Solution: Question 5

One of the prerequisites for an integral accounting system is perfect coordination between the staff responsible for the financial and cost aspects. In order to ensure an efficient processing of accounting documents, there needs to be seamless collaboration between the finance department and the cost department. This coordination allows for the integration of cost and financial accounts, resulting in a single set of accounts that provides necessary information for both costing and finance purposes.

Test: Cost Accounting Techniques- 2 - Question 6
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What is a fixed cost in accounting?

Detailed Solution: Question 6

In accounting, a fixed cost is a cost that is independent of the level of sales. It is related to the passage of time rather than the volume of sales. Examples of fixed costs include rent, salaries, insurance, and other costs that remain constant regardless of the level of sales. Fixed costs are important to consider in break-even analysis or cost-volume-profit analysis, as they do not vary with changes in sales volume and can have a significant impact on overall profitability.

Test: Cost Accounting Techniques- 2 - Question 7
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What is break-even analysis also known as?

Detailed Solution: Question 7

Break-even analysis is also known as cost-volume-profit analysis or CVP analysis. It is a method used to study the effects of changes in fixed costs, variable costs, sales price, quantity, and mix on future profits. It helps in determining the break-even point, which is the level of sales or production at which total costs are equal to total revenue. By analyzing the cost-volume-profit relationship, organizations can make informed decisions about pricing, production levels, and overall profitability.

Test: Cost Accounting Techniques- 2 - Question 8
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What is a variable cost in accounting?

Detailed Solution: Question 8

In accounting, a variable cost is a cost that is directly related to the level of sales. It varies in proportion to the volume or level of activity. Examples of variable costs include the cost of goods sold and commissions, which increase or decrease as sales volume changes. Variable costs are important to consider in break-even analysis or cost-volume-profit analysis, as they directly impact the profitability of each unit or product sold.

Test: Cost Accounting Techniques- 2 - Question 9
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What is the break-even point in a business?

Detailed Solution: Question 9

The break-even point in a business is the level of sales or production at which total costs and total revenue are equal. It is the point at which there is neither a profit nor a loss under varying levels of activity. The break-even point is important for managers as it indicates the minimum level of output or activity required to cover all expenses and start making a profit. It reflects the relationship between costs, volume, and profits and helps in decision-making regarding pricing, production levels, and overall financial performance.

Test: Cost Accounting Techniques- 2 - Question 10
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What is the relationship between fixed costs and variable costs in break-even analysis?

Detailed Solution: Question 10

In break-even analysis, there is a relationship between fixed costs and variable costs. Fixed costs, such as rent and salaries, remain constant regardless of sales volume. They do not change with the level of activity. On the other hand, variable costs, such as the cost of goods sold and commissions, vary in direct proportion to sales volume. As sales increase, variable costs also increase, and vice versa. Understanding this relationship is crucial for determining the break-even point and analyzing the impact of changes in sales volume on costs and profits.

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About this B Com Practice Test

This test contains 10 MCQs on Cost Accounting Techniques- 2 with detailed solutions for each question. It is part of the Cost Accounting course on EduRev, designed to align with the current B Com syllabus. Each solution explains not just the correct answer but also gives you an understanding of the topic — not just to attempt the question but also help you prepare for the exam with practice.

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