Indirect Costs Allocation Multiple Choice Questions with Answers – PDF Download

MCQ 1: An under allocated indirect cost is also called:

1. under applied indirect cost
2. under absorbed indirect cost
3. absorbed indirect cost
4. both a and b

MCQ 2: In a normal accounting period, an allocated amount of indirect cost is $700 and an actual amount is $800, then this can be classified as:

1. under allocated indirect cost
2. over allocated direct cost
3. over allocated budget
4. under allocated budget

MCQ 3: If an actual indirect cost incur is $35000 and the indirect cost allocated is $43000, then the under allocated indirect cost will be:

1. $78,000
2. −$78000
3. −$8000
4. $8,000

MCQ 4: If an actual indirect cost incurred is $25000 and the indirect cost allocated is $23000, then the over allocated indirect cost would be:

1. $48,000
2. −$2000
3. $2,000
4. −$48000

MCQ 5: If an allocated indirect cost is $1500 and the actual incurred indirect cost is $1200, then this is classified as:

1. applied indirect cost
2. applied direct cost
3. incurred indirect cost
4. over allocated indirect cost