MCQ On Costing
MCQ On Costing
1. Part C of the Annexure to the Cost Audit Report in CRA 3 deals with ________ .
(A) Manufacturing Sector
(B) Service Sector
(C) Regulated Sector
(D) Unregulated Sector
3. Under the Generally Accepted Cost Accounting Principles, the cost of cane supplied
from own farm to the sugar mill is treated as ___________.
(A) Direct Materials Cost
(B) Indirect Materials Cost
(C) Production Overhead
(D) Administrative Overhead
6. As per the Central Excise Valuation Rules 2000, the assessable value of goods used
for captive consumption is __________.
(A) at actual cost of production of such goods
(B) at marginal cost of production of such goods
(C) at 110% of cost of production of such goods
(D) at market price of such goods
7. A shoe manufacturing company has a plant capacity of producing 700 shoes per
shift. During the year of 300 working days, 3 shifts of 8 hours with half-hour recess per
shift, it produces 35.91 lakh shoes. The Normal Capacity Utilization percentage is ____.
(A) 82%
(B) 76%
(C) 74%
(D) 78%
8. Propriety Audit in the context of Government Audit seeks to ensure that _______.
(A) public money are not spent for the benefit of a particular person
(B) public officer should exercise same vigilance as in respect of expenditure of
his/her own money
(C) no authority should pass an order which will be directly or indirectly to its own
advantage
(D) All the above
10. Overall Objectives of the independent Cost Auditor and conduct of an Audit in
accordance with Cost Auditing Standard is dealt in _____________.
(A) Cost Auditing Standard 101
(B) Cost Auditing Standard 102
(C) Cost Auditing Standard 103
(D) Cost Auditing Standard 104
12. A manufacturing unit showed, during the Financial Year 2016-17, the following
financial data (in ₹lakh): Net Sales 1,250, Export Incentives 85, Other income 106, Adj.
of Finished Stock (+) 95, Materials 634, Salaries 425, Overheads 101.8, and Tax 52.6.
The Value Added as per Rules is (in ₹lakh) _____________.
(A) 946
(B) 796
(C) 755
(D) 688
13. Royalty paid on production ₹35,000, Job Charges ₹20,000, Special Design Charges ₹
20,000, Software Development Charges related to Production ₹27,000, and Travelling
abroad for Training ₹25,000 The Direct Expenses as per CAS 10 is ₹ _____________.
(A) 92,000
(B) 1,00,000
(C) 1,02,000
(D) 1,27,000
14. Operational Audit can lead to better management with the focus on_____________.
(A) Transaction-based analysis for Fraud Prevention
(B) Compliance of Rules
(C) Risk Identification, Process Improvement
(D) Budget Monitoring
18. Which one of the following is not a professional misconduct in relation to Cost
Accountants in Practice as per the Second Schedule of The CWA Act, 1959?
(A) He/she fails to invite attention to any material departure from the generally
accepted procedure of costing and pricing applicable to the circumstances
(B) He/she does not exercise due diligence or is grossly negligent in the conduct of
his/her professional duties
(C) He/she fails to report a material misstatement known to him/her to appear in a
cost or pricing statement with which he/she is concerned in a professional
capacity
(D) In the opinion of the Council, he/she brings disrepute to the Profession or the
Institute as a result of his/her action whether or not related to his/her professional
work
19. In which CRA Form, is the Cost Audit Report of a company filed with the Central
Government?
(A) CRA-4
(B) CRA-3
(C) CRA-1
(D) CRA-2
21. As per the Cost Auditing Standard 101, the risk of Material Misstatements has two
components, viz., ……………………………..
(A) Inherent Risk and Control Risk
(B) Detection Risk and Audit Risk
(C) Material Risk and Implicit Risk
(D) Financial Risk and Explicit Risk
22. As per Part D, Para 4 of the Companies (Cost Records and Audit) Rules, 2014, Value
Addition and Distribution of Earnings are to be computed based on
(A) Audited Financial Data
(B) Cost Record Data
(C) Unaudited Financial Data
(D) Both (A) and (B)
24. Which of the following is not a Professional Misconduct as per the First Schedule of The
CWA Act, 1959, in relation to the Cost Accountants in Practice?
(A) Pays or allows or agrees to pay or allow, directly or indirectly, any share,
commission or brokerage in the fees or profits of his/her professional work, to any
person other than a member of the Institute or a partner or a retired partner or the
legal representative of a deceased partner
(B) Enters into a partnership, in or outside India, with any person other than a Cost
Accountant in Practice or such other person who is a member of any other
professional body having such qualifications as may be prescribed
(C) Advertises his/her professional attainments or services or uses any designation or
expression other than Cost Accountant on professional documents, visiting cards,
letter heads or sign boards, unless it is a degree of a University established by law
in India or recognised by the Central Government or a title indicating
membership of The ICAI or any other institution that has been recognised by the
Central Government or may be recognised by the Council
(D) Expresses his/her opinion on cost or pricing statements of any business or
enterprise in which, he/she, his/her firm or a partner in his/her firm has substantial
interest
26. As per the CAS 23, the activity of Overburden Removal that benefits the identified
component of an ore to be mined by the entity is called as ......
(A) Mining Activity
(B) Overburden Removal
(C) Stripping Activity
(D) Advance Stripping
27. Cost Information _____________ the organization to structure the cost, understand it
and use it for communicating with the stakeholders.
(A) Enables
(B) Disables
(C) Useful
(D) None of these
29. Costing includes product, process, and resource-related information covering the
_____________ of the organization and its value chain.
(A) Performance
(B) Ability
(C) Consistency
(D) Functions
31. Cost Audit represents true and faire view of the ____________ of any product.
(A) Cost of sale
(B) Cost of raw material consumption
(C) Cost of production
(D) None of these
33. The Cost Auditor appointed has to render the cost audit report to the board of
directors of the Company, as per the specified time limit, in Form ____________.
(A) CRA-3
(B) CRA – 1
(C) XBRL
(D) CRA – 2
35. ‘Sugar and Industrial Alcohol’ belong to __________________ sector for the purpose of
Application of Cost Records.
(A) Regulated
(B) Non-Regulated
(C) Both depending on circumstances
(D) None of above
37. The Central Govt. released the CCRA – Rules, 2014 in pursuance to the powers vested
with it U/s ---------- of the Companies Act, 2013
(A) Section 469
(B) Section 148
(C) Section 465
(D) Section 469 and 148
39. The provisions related to maintenance of cost records were introduced in the year ---
------ by amendment to the companies act, 1956.
(A) 1960
(B) 1965
(C) 1966
(D) 1970
41. The cost audit report under CCRA – Rules, 2014 is to be submitted in ---------------
(A) Form – 3
(B) Form – 4
(C) Form – 1
(D) Form – 2
42. The cost audit report under CCRA – Rules, 2014 is to be filed as an attachment to ------
-----
(A) Form – 3
(B) Form – 4
(C) Form – 2
(D) None of the above
45. The cost auditor to be appointed within --------- days of the beginning of the financial
year.
(A) 90 days
(B) 180 days
(C) 6 months
(D) 270 days
46. CCRA – Rules, 2014 is applicable from the financial year commencing on or after
(A) 01.01.2014
(B) 01.04.2014
(C) 01.07.2014
(D) 01.04.2015
47. Which Para in covered in Part D to the Annexures to Cost audit report.
(A) Profit Reconciliation
(B) Value addition and distribution of profit
(C) Reconciliation of Indirect taxes
50. The foreign exchange component of imported material is converted at the rate on –
(A) Date of Payment
(B) Date of Delivery
(C) Date of Transaction
(D) Date of Use
51. Variances due to abnormal reasons ------------ form part of cost as per GACAP.
(A) Will Not
(B) Is
(C) Are
(D) Will
55. The procedures followed by the cost auditor to reduce the audit risk to an acceptable
level will not detect a misstatement that exists and that could be material is
_____________.
(A) Inherent risk
(B) Detection risk
(C) Control risk
(D). None of these
58. Cost auditing standards preface to the standards on auditing, quality control review
and related services rendered by the cost accountant has been issued by _________.
(A) ICAI
(B) ICMAI
(C) CAASB
(D) ICWAI
59. CAS _____________ ensures the achievement of audit objectives with available
resources and securing coordination with the auditee on audit work.
(A) CAS – 102
(B) CAS –104
(C) CAS – 103
(D) CAS- 101
62. The cost auditing standards deal with the __________ of the cost auditor.
(A) Efficiency
(B) Effectiveness
(C) Qualifications
(D) Responsibility
63. The cost auditor is __________ for forming and expressing an opinion on the cost
statements.
(A) Responsible
(B) Reasonable
(C) Irresponsible
(D) Assessing
64. Which one of the following KPI is used to measure productivity & efficiency a
machinery
(A) % of Idle time to total available time
(B) Machine downtime ratio
(C) Cost per of Break-Down Hour
(D) Contribution per unit of material used
66. Which one of the following is covered under performance analysis report
(A) Cost per unit of material used
(B) Cost of utilities
(C) Impact of IFRS on the Cost Structure
(D) Impact of CAS and GACAP
67. The basic objective to prepare report on performance analysis is/are as under
(A) to improve profits and profitability
(B) to optimize resource allocation
(C) to optimize the product and services portfolio
(D) All of the above
69. Kaizen Costing & Lean Manufacturing (Management Accounting Tool) are used as
_______
(A) Cost Reduction Tool
(B) Cost Computation Tool
(C) Performance Measure Tool
(D) Control Tool
70. Management audit is the unique process of _____ the performance of directors,
managers or the performance of Management.
(A) Appraising
(B) Calculating
(C) Auditing
(D) Planning
(A) T. G. Rose
(B) T. G. Tailors
(C) M. C. Sukla
(D) None of them
85. Who can be appointed as Internal Auditor as per the Companies Act, 2013
(A) A Chartered Accountant
(B) A Cost Accountant
(C) Such other professional
(D) All of the above
90. The management auditor shall consider in the evaluation of capacity utilization –
(A) Method of measuring base machine capacity
(B) Capacity measurement is based on “capital output ratio” or sundry other factors
(C) Technical terminology like licensed capacity, installed capacity, rated capacity
etc should be properly defined
(D) All of the above
93. Aspects may be taken into consideration for proper inventory control
(A) Maximum, minimum and reorder level fixation
(B) Fixed order quantity system and different replenishment systems
(C) Fast moving, slow moving and non-moving analysis etc
(D) All of the above
95. There is no requirement of Audit Working Papers while conducting audit and they only
result in loss of time.
(A) The Statement is Correct
(B) The Statement is Incorrect
(C) The Statement is Incomplete
(D) None
96. Co-operative Auditor has to conduct an examination of the overdue debts, if any,
and a valuation of the assets and liabilities of the society while conducting internal
audit as per
(A) Section 17(3) of the Cooperative Societies Act, 1912
(B) Section 17(2) of the Cooperative Societies Act, 1912
(C) Section 17(5) of the Cooperative Societies Act, 1912
(D) Section 37(2) of the Cooperative Societies Act, 1912
97. Field Balance Sheet Approach to audit can be applied in case of audit of the
(A) Co-Operative societies
(B) Local Body Corporate
(C) Self-Help Group
(D) Club
98. Under ‘propriety audit’, the auditors try to bring out what type of expenditure:
(A) Improper
(B) Avoidable
(C) In fructuous
(D) All of the above
102. C&AG has right to direct the manner in which the company’s accounts shall be
audited by the auditor and to give such auditor instructions in regard to any matter
relating to the performance of his functions as per section_______________
(A) 44AB of income Tax
(B) 143 of the Companies Act, 2013
(C) 173 of the Companies Act, 2013
(D) 134 of the Companies Act, 2013
105. The government also engages in commercial activities and for the purpose it may
incorporate _________ type of entities.
(A) Five
(B) Three
(C) Many
(D) Various
110. Which one of the following costs appeared only in Cost Accounts?
(A) Interest on mortgage and loans
(B) Notional Interest on Capital
(C) Dividend equalization fund, sinking, fund etc
(D) Loss due to scrapping of plan and machinery
111. Royalty paid on sales ₹30,000; Royalty paid on units produced ₹20,000, Hire Charges
of equipment used for production ₹2,000, Design charges ₹15,000, Software
development charges related to production ₹22,000. The Direct Expenses amount is:
(A) ₹88000
(B) ₹89000
(C) ₹99000
(D) ₹98000
112. The Balance Sheet of X Ltd As on 31st March 2017 showed the following information:
Capital - ₹1500 lacs, Reserves - ₹696 lacs, Loans - ₹600 lacs, Sundry Creditors ₹774
lacs, Total assets -₹3570 lacs. For the year 16-17, PBT - ₹900 lacs, Provision for tax is ₹
360 lacs and proposed dividend is ₹300 lacs.Return on Networth is:
(A) 30.41 %
(B) 29.41 %
(C) 28.41 %
(D) 27.41%
113. Royalty paid on units produced ₹20,000, Hire Charges of equipment used for
production ₹2,000, Design charges ₹15,000, Software development charges related to
production ₹22,000. The Direct Expenses is:
(A) ₹57000
(B) ₹59000
(C) ₹37000
(D) ₹44000
114. A cotton textile mill had cumulative waste percentage of 8% in Blow Room, 6% in
Carding, 4% in Drawing, 4% in Simplex and 9% in Ring Frame. For an input of 1000 kg.
of cotton in Blow Room, the output at Ring Frame is _________.
(A) 735.27 Kg
(B) 725.27 Kg
(C) 745.27 Kg
(D) 755.27 Kg
115. Gross Sales ₹16500 lacs, Excise Duty ₹1240 lacs, Increase in stock ₹42 lacs,Cost of raw
materials ₹6250 lacs, Power ₹2220 lacs, other overheads ₹215 lacs, Value Added is:
(A) ₹15260 Lac
(B) ₹6617 Lac
(C) ₹6533 Lac
(D) ₹15302 lac
116. Rule 4 of the Companies (Cost Records and Audit) Rules, 2014 deals with:
(A) Application of Cost Records
(B) Application of Cost Audit
(C)Appointment of Cost Auditor
(D) Cost Audit Report
123. Rule 6 of the Companies (Cost Records and Audit) Rules, 2014 deals with:
(A) Application of Cost Records
(B) Application of Cost Audit
(C) Appointment of Cost Auditor
(D) Cost Audit Report
124. Product and Profitability Statement (For audited products/services) is shown under
______________ of Annexure to Cost Audit Report.
(A) Part A
(B) Part B
(C) Part C
(D) Part D
125. Any casual vacancy in the office of a cost auditor, shall be filled by the Board of
Directors within _______________ days of occurrence of such vacancy.
(A) 180
(B) 90
(C) 30
(D) 60
126. The Companies are required to maintain Cost Records if turnover exceeds
____________ crores or more during immediately preceding Financial Year in respect
of the products and services specified
(A) ₹25
(B) ₹30
(C) ₹35
(D) ₹10
127. Which one of the following is not a professional misconduct in relation to Cost
Accountants in Practice as per the First Schedule of The CWA Act, 1959?
(A) discloses information acquired in the course of his professional engagement to
any person other than his client so engaging him, without the consent of his
client, or otherwise than as required by any law for the time being in force
(B) allows any person to practice in his name as a cost accountant unless such
person is also a cost accountant in practice and is in partnership with or
employed by himself
(C) accepts or agrees to accept any part of the profits of the professional work of a
person who is not a member of the Institute
(D) secures, either through the services of a person who is not an employee of such
cost accountant or who is not his partner or by means which are not open to a
cost accountant, any professional business
130. Exemptions from application of the Rules are provided to Companies whose revenue
from exports, in foreign exchange, exceeds ________________ of total revenue and
companies operating from Special Economic Zones.
(A) 45%
(B) 50%
(C) 75%
(D) 80%
131. In XBRL Format process of determining the elements that correspond to lines and
columns in a financial statement and which elements must be created by extension
is:
(A) Mapping
(B) Label
(C) Hierarchy
(D) Scaling
132. Before submission to the Auditor for Report, the Form CRA 3 should be signed by
__________.
(A) The Secretary and the Chief Finance Officer of the company
(B) The Secretary and the Cost Accounts Officer of the company
(C) The Secretary and one Director of the company
(D) The Chief Finance Officer and the Managing Director of the company
133. Cost of self-generation utilities for own consumption shall comprise ___________.
(A) Administrative overheads
134. The useful life of an intangible asset, like amount paid on technical knowhow, shall
not exceed _________ from the date it is available for use.
(A) 5 years
(B) 8 years
(C) 10 years
(D) 12 years
136. A member of The ICAI shall be deemed to be guilty of other misconduct, if he/she is
held guilty by any civil or criminal court of an offence which is punishable with
imprisonment ___________.
(A) For a term exceeding 3 years
(B) For a term exceeding 3 months
(C) For a term exceeding 6 months
(D) For a term exceeding 2 years
138. Which of the following ratios appears as Profitability Ratio in Part D of Annexure to the
Cost Audit Report ?
(A) Net Profit to Net Sale
(B) Value added to Net Sales
(C) Profit before Tax to Value Added
(D) Net Profit to Share Capital
140. ORS Ltd is a multi-product company having annual turnover of ₹103 crore, Table A
items under CARO being ₹26 crore, Table B items ₹8 crore and the rest are not
covered in either of the Tables. Cost Audit will be ___________ .
(A) not applicable to the company
(B) applicable for Table A products only
(C) applicable for all products
(D) applicable for Table A and Table B products only
141. The wages of employees of contractor engaged in the organization for the past
period is ___________ Employee Cost.
(A) included in
(B) excluded from
142. The figures below are available for Reliable Ltd Budgeted production - 800 units,
Standard hours per unit 25, Actual production 576 units and actual working— 12000
hours. What is the Efficiency Ratio?
(A) 110%
(B) 120%
(C) 100%
(D) 125%
143. Machinery used in defense, space and atomic energy sector and fulfilling turnover
criteria is under
(A) regulated sector
(B) unregulated sector
(C) exempted by different statute
(D) not applicable category
145. The abridged cost statement (CRA 3) need not be separate for
(A) each product with separate (CTA) CETA heading
(B) each product having separate industry specific expenses
(C) each product having different unit of measure
(D) self/captive consumption of each product
146. The Management Auditor should evaluate MIS of an organization after ___________ .
(A) studying content, quality and source of information
(B) studying flow of information
(C) studying correlation of information in decision areas
(D) studying all the above
148. SHYAN LTd has a machine of productive capacity of 1500 unit per hour. It runs 3 shifts
with 1 weekly off and 12 holidays per year, each shift has one hour stoppage due to
lunch, change shift etc Maintenance is done in running time. The Normal Capacity of
the plant as per CAS-2 will be
(A) 131.40 lakh units
(B) 94.815 lakh units
(C) 108.36 lakh units
(D) None of the above
149. BORS & Co., a firm of Cost Accountants was appointed as Cost Auditor of PANTEX LTD
on 31.07.2018 for auditing the cost records for the FY 2018-19. The Auditor appointed
as such shall continue in such capacity upto
150. Which one of the following KPI (Key Performance Indicator) is used to measure
efficiency of manufacturing performance?
(A) Production per Machine Hour
(B) Operating Cycle of Materials turnover
(C) Material as % of Total Cost
(D) % of idle time to total available time
153. Once the instance document is successfully validated from the tool, the next step is to
(A) download XBRL validation tool
(B) pre-scrutinize the validated instance document
(C) convert to human readable format and verify correctness of the instance
document
(D) attach instance document to the Form CRA-4
155. The knowledge of Entity’s Internal Control is to be understood by the Cost Auditor as
required by
(A) Cost Auditing Standard 101
(B) Cost Auditing Standard 102
(C) Cost Auditing Standard 103
(D) Cost Auditing Standard 104
Answer:
A Management Auditor has to rely more on his experience and acumen to identify
areas of review. There are no fixed items of evidence to be checked by
Management Auditor
(80) (B) Three separate parties
The parties are a public accountant in practice, a responsible party and intended
users
(81) (B) Peter (A) Phyrrh
Zero base budget (ZBB) System was modeled by Peter (A) Phyrrh
(82) (D) SWOT analysis
A SWOT - strengths, weaknesses, opportunities and threats analysis can help identify
and understand key issues affecting the business
(83) (A) T. G. Rose
T. G. Rose developed the concept of Management Audit as a logical system of
evaluating the quality of Management
(84) (D) All of the above
Internal control system can be classified in three types Preventive Control, Detective
Control and Corrective Control
(85) (D) All of the above
AS per Section 138 of the Companies Act , 2013 an internal auditor, shall either be a
chartered accountant or a cost accountant, or such other professional as may be
decided by the Board to conduct internal audit of the functions and activities of the
company.
(86) (A) Section 138
Section 138 of the Companies Act 2013 deals with provisions of Internal Audit
(87) (C) Government Expenditure
Audit of Government Expenditure is one of the major components of government
audit conducted by the office of C & AG
(88) (D) Both (A) and (B)
Internal audit is a management tool performed by employees of the organization or
external agencies specially assigned for this purpose
(89) (D) All of the above
Non-Governmental Organizations (NGO) are generally incorporated as societies
under the Societies Registration, Act, 1860 or as a trust under the India Trust Act, 1882,
or under any other law corresponding to these Acts enforced in any part of Indi(A)
NGO’s can also be incorporated as a company under section 8 of the Companies
Act, 2013
(90) (D) All of the above
Yes, the management auditor shall consider the following points in the evaluation
and measurement of capacity utilization
(91) (D) All of the above
According to ‘Technical Guide on Internal Auditing’ by The Institute of Cost
Accountants of India, Internal Auditor should have following three traits:
• Technical Expertise
• Right Attitude
• Communication and other soft skills.
An Internal Audit team has to have representation from diverse professional fields in
order to understand the organization better.
(92) (D) All of the above
An audit of or for a government agency is composed of three elements are as under
1. Financial compliance,
2. Economy and efficiency, and
3. Program results.
The typical definition of a financial audit would not include elements 2 and 3. These
are operational auditing techniques.
(93) (D) All of the above
The following aspects may be taken into consideration for proper inventory control –
This standard deals with the principles and methods of classification, measurement
and assignment of pollution control costs, for determination of Cost of product or
service, and the presentation and disclosure in cost statements
(121) (C) Interest
Operating expenses typically exclude interest expense, nonrecurring items (such as
accounting adjustments, legal judgments, or one-time transactions), and other
income statement items not directly related to a company's core business operations
(122) (B) Cost of Sale
This is as per CAS 5
(123) (C) Appointment of Cost Auditor
According to Rule 6(1) , the category of companies specified in Rule 3 and the
thresholds limits laid down in Rule 4, shall within one hundred and eighty days of the
commencement of every financial year, appoint a cost auditor.
Provided that before such appointment is made, the written consent of the cost
auditor to such appointment, and a certificate from him or it, as provided in sub-rule
(1A), shall be obtained
(124) (D) Part D
Pursuant to Rule 6(4) of the Companies (Cost Records and Audit ) Rules, 2014
(125) (C) 30
Pursuant to Rule 6(3A) of the Companies (Cost Records and Audit) Rules, 2014
(126) (C) ₹35
Pursuant to Rule 3 of the Companies (Cost Records and Audit) Rules, 2014
(127) (A) discloses information acquired in the course of his professional engagement to
any person other than his client so engaging him, without the consent of his client, or
otherwise than as required by any law for the time being in force
It is a misconduct as per the Second Schedule, Part I of the CWA Act, 1959
(128) (C) Packing Material Cost
This standard deals with the principles and methods of determining the Packing
Material Cost
(129) (B) Micro
The objective of operational audit is to appraise the effectiveness and efficiency of a
division, activity, or operation of the entity in meeting organizational goals
(130) (C) 75%
The requirement of Cost Audit under these rules shall not apply to companies whose
revenue from exports in foreign exchange exceed 75% of total revenue and
companies operating in special economic zone
(131) (A) Mapping
This is as per XBRL glossary. Several technical terms are used, that have specific
meanings, in the context of using XBRL
(132) (C) The Secretary and one Director of the company
Annexure to the Cost Audit Report in CRA 3 shall be approved by the Board of
Directors and by signed by the Company Secretary and a Director authorized by the
Board before submission to the Auditor for Report
(133) (C) Factory overheads
As per CAS 8, the cost of self-generated utilities for own consumption shall comprise
direct material cost, direct employee cost, direct expenses and factory overheads
(134) (C) 10 years
CAS 16 on depreciation and amortization states that useful life of an intangible asset
shall not exceed 10 years from the date it is available for use
(135) (B) Cost Auditing Standard 102
CAS 102 deals with Cost Audit Documentation
(136) (C) For a term exceeding 6 months
Part III of the Second Schedule to the Cost & Works Accountants of India Act, 1959
finds a member guilty of other misconduct if he/she is held guilty by a court for
offences punishable with imprisonment for a term exceeding 6 months
(137) (A) Dictionary
Cost Taxonomy is a Dictionary of all cost elements required in the Cost Audit Report
and Compliance Report
(138) (C) Profit before Tax to Value Added
This is one of the four ratios identified as Profitability Rations in Part D of Annexure to
the Cost Audit Report
(139) (D) Treatment of Revenue in Cost Statements
Effective from 1st April, 2017, CAS 24 on Treatment of Revenue in Cost Statements has
become applicable
(140) (B) applicable for Table A products only
Rule 4 to Companies (Cost Audit & Records) Rules, 2014 states that if the overall
turnover of the company is more than ₹100 crore, only products of Table A will be
covered if the sum total of all the products of the company covered under Table A
and Table B is more than ₹25 crore but less than ₹35 crore
(141) (B) excluded from
CAS 7 on Cost Accounting Standard on Employee Cost excludes benefits paid or
payable for the services rendered by employees of any contractor engaged in the
organization
(142) (B) 120%
Efficiency Ratio = Actual output (576 units)/ Standard output (12000 hours/25 hours =
480 units); therefore, Efficiency ratio = 576/480 = 1.20 or 120%
(143) (B) unregulated sector
Machinery used in defense, space and atomic energy sector and fulfilling turnover
criteria is under Unregulated sector
(144) (D) documentation of audit of cost statements, records etc
The purpose of the Cost Auditing Standard 102 is to provide guidance to the
members in the preparation of audit documentation in the context of the audit of
cost statements, records and other related documents
(145) (D) self/captive consumption of each product
The abridged cost statement need not be separate for Self/Captive Consumption of
each product
(146) (D) studying all the above
The Management Auditor should evaluate MIS of an organization after studying
content, quality and source of information, studying Flow of information, studying
correlation of information in decision areas
(147) (D) To examine the Trust Deed or Regulations
The Trust Deed or Regulation is the basic document on which the composition of the
educational institution is framed
(148) (B) 94.815 lakh units
As per CAS 2, normal capacity is maximum productive capacity reduced by time lost
on preventive maintenance, holidays, Set up delays. Here, Normal capacity = (365-
52-12) x (8-1) x 3 x 1500 = 94.815 lakh unit
(149) (B) 30.09.2019, on expiry of six months from close of accounts
As per Rules, 2014, the Cost Auditor, unless removed or resigned from office, shall
continue till expiry of 180 days from closure of financial year or till he submits the cost
audit report. Here his submission of the report did not go beyond six months from
closure of financial year
(150) (B) Operating Cycle of Materials turnover
Key Performance indicator of manufacturing is the Operating cycle of Materia!, WIP,
Finished Goods Turnover
(151) (C) An appraise management of business enterprise of responsibility towards
consumers
The audit is based on the philosophy that the role of business should be conducive to
raising the quality of life through its contribution in terms of better product-quality and
services by making available the products and services of the right qualities at the
right time, in right quantity, at the right place and right price
(152) (D) Either or all of the above