Cost of Goods Sold MCQs

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MCQs 1-10

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1. Net sales = Sales less?

(a) Sales returns

(b) Sales discounts

(d) Sales returns & allowances and sales discounts

Correct! Wrong!

2. If the Gross profit is Rs. 5,000 and the net profit is 25% of the Gross profit. The expenses?

(a) Rs. 3,750

(b) Rs. 1,250

(d) Rs. 6,250

Correct! Wrong!

3. Cost of Goods sold is classified as which type of account?

(a) Asset

(b) Liability

(d) Expense

Correct! Wrong!

4. Conversion cost = Direct labor +___________?

(a) Labor

(b) F.O.H

(d) None of these

Correct! Wrong!

5. Which one of the following assets could be described as a current asset?

(a) Stock of goods for resale

(b) Machinery to manufacture goods for resale

(d) Land on which the buildings stand

Correct! Wrong!

6. The largest expense of most manufacturing firms is?

(a) Salaries Expense

(b) Amortization Expense

(d) Cost of goods sold

Correct! Wrong!

7. The specific cost of the workforce used to produce a product such cost is called?

(a) Direct labor cost

(b) Direct material cost

(d) None

Correct! Wrong!

8. Which of the following product costs is both a prime cost and conversion cost?

(a) Direct labor

(b) Manufacturing overhead

(d) All of the above

Correct! Wrong!

9. Which of the following is NOT included under the head of FOH cost?

(a) Indirect Material

(b) Indirect Labor

(d) Direct labor

Correct! Wrong!

10. A firm had beginning finished goods inventory of Rs. 15,000, ending finished goods inventory of Rs. 20,000 and cost of goods sold of Rs. 80,000. What was the cost of goods manufactured?

(a) Rs. 80,000

(b) Rs. 85,000

(d) Rs. 65,000

Correct! Wrong!

>> Practice Cost of Goods Sold Problems and Solutions

MCQs 11-20

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11. Direct Labor is an element of?

(a) Prime cost

(b) Conversion cost

(d) All of the given options

Correct! Wrong!

12. Total Manufacturing costs are also known as product costs. Which of the following best describes those costs which are considered to be manufacturing costs?

(a) Direct materials, direct labor, and factory overhead

(b) Direct materials and direct labor only

(d) Direct labor and factory overhead

Correct! Wrong!

13. On a multiple-step income statement, the excess of net sales over the cost of merchandise sold is called?

(a) Cost of Goods Sold

(b) Operating income

(d) Gross profit

Correct! Wrong!

14. Which of the following cost is used in the calculation of cost per unit?

(a) Total production cost

(b) Cost of goods available for sales

(d) Cost of goods Sold

Correct! Wrong!

15. Direct expenses are such expenses?

(a) Which are directly paid to the employee

(b) Which are directly associated with the purchase

(d) All of above

Correct! Wrong!

16. Factory overhead includes all manufacturing costs except direct material and direct labor. Which of the following items would not be considered to be a factory overhead cost?

(a) Repainting the corporate office building

(b) Indirect labor

(d) Small expenditures pertaining to items like rags, screws, etc., used in the production process

Correct! Wrong!

17. Which of the following is correct?

(a) Units sold= Opening finished goods units + Units produced – Closing finished goods units

(b) Units Sold = Units produced + Closing finished goods units - Opening finished goods units

(d) Units sold = Sales - Average units of finished goods inventory

Correct! Wrong!

18. Direct expenses are such expenses?

(a) Which are directly paid to employee

(b) Which are directly associated with sale

(d) None of above

Correct! Wrong!

19. Wages paid to laborers working in the manufacturing department is treated as an expense of?

(a) Cost of goods sold

(b) Administrative expenses

(d) Marketing expenses

Correct! Wrong!

20. Which of the following expressions is incorrect?

(a) Gross profit – operating expenses = operating income

(b) Sales – cost of goods sold – operating expenses = operating income

(d) Operating expenses – cost of goods sold = gross profit

Correct! Wrong!

>> Theoretical concept Cost of Goods Sold Statement (CGS)

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Back To Cost Accounting MCQs

Next To Inventory Valuation MCQs

More Interest

Costing

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References

Cost Accounting For Dummies – By Kenneth W. Boyd

Fundamentals Of Cost Accounting – By William Lanen, Shannon Anderson Et.Al

Cost Accounting Fundamentals – By Steven M. Bragg

Cost Accounting Made Simple – By Mike Piper

Principles Of Cost Accounting – By Maria R. Mitchell

Fundamentals Of Cost Accounting 5^th Edition – By William Lanen, Shannon Anderson, And Michael Maher

7 Comments

sunny ge on November 12, 2022 at 8:35 am

good option for learning
Reply
Syed sajjad ali abidi on November 11, 2022 at 2:47 pm

Submitted
Reply
amjad ali on November 11, 2022 at 2:41 pm

all attempt mcqs
Reply
Nehal Hashmi on November 11, 2022 at 1:19 pm

All my responses are corrected & my score is 20.
Reply
hira fazal on November 11, 2022 at 11:55 am

it was nice practice intiative
Reply
Mohammad Kashif Kashif on November 11, 2022 at 11:15 am

Excellent exercise
Reply
Misbah Noreen on November 11, 2022 at 10:47 am

20 score
Reply

Cost of Goods Sold MCQs

MCQs 1-10

Click The Option and See Result

1. Net sales = Sales less?

2. If the Gross profit is Rs. 5,000 and the net profit is 25% of the Gross profit. The expenses?

3. Cost of Goods sold is classified as which type of account?

4. Conversion cost = Direct labor +___________?

5. Which one of the following assets could be described as a current asset?

6. The largest expense of most manufacturing firms is?

7. The specific cost of the workforce used to produce a product such cost is called?

8. Which of the following product costs is both a prime cost and conversion cost?

9. Which of the following is NOT included under the head of FOH cost?

10. A firm had beginning finished goods inventory of Rs. 15,000, ending finished goods inventory of Rs. 20,000 and cost of goods sold of Rs. 80,000. What was the cost of goods manufactured?

MCQs 11-20

Click The Option and See Result

11. Direct Labor is an element of?

12. Total Manufacturing costs are also known as product costs. Which of the following best describes those costs which are considered to be manufacturing costs?

13. On a multiple-step income statement, the excess of net sales over the cost of merchandise sold is called?

14. Which of the following cost is used in the calculation of cost per unit?

15. Direct expenses are such expenses?

16. Factory overhead includes all manufacturing costs except direct material and direct labor. Which of the following items would not be considered to be a factory overhead cost?

17. Which of the following is correct?

18. Direct expenses are such expenses?

19. Wages paid to laborers working in the manufacturing department is treated as an expense of?

20. Which of the following expressions is incorrect?

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