Inventory Costing Methods Multiple Choice Questions with Answers – PDF Download

MCQ 1: An approach used for choosing capacity level, having no beginning inventory, is classified as:

1. write off variance approach
2. write in variance approach
3. adjusted variance approach
4. unadjusted variance approach

MCQ 2: If the budgeted fixed cost is $26000, per unit budgeted denominator level is 1300 units, then budgeted fixed cost will be:

1. $50
2. $30
3. $20
4. $40

MCQ 3: If target operating income is $38000, contribution margin per unit is $400, then the number of units must be sold to earn targeted operating income will be:

1. 65 units
2. 75 units
3. 95 units
4. 85 units

MCQ 4: The managers using capacity planning do not make:

1. pricing decisions
2. marketing decisions
3. financial decisions
4. cost budgeting decisions

MCQ 5: The budgeted fixed manufacturing cost is divided by budgeted fixed manufacturing cost per unit to calculate:

1. fixed material price
2. variable materials price
3. fixed production units
4. budgeted production units