Target Cost is calculated as: MCQ with Answer and Explanation

Question
Target Cost is calculated as:
A. Current Cost - Desired Profit
B. Prime Cost + Factory Overheads
C. Variable Cost + Fixed Cost
D. Expected Selling Price - Desired Profit Margin
Answer: Option D
Solution (By JKSSB Mock Tests)
Target costing starts with market price, subtracts the required profit, to find the maximum allowable cost (Target Cost).
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Request complete Subject PDF

Discuss this Question (0)

No comments yet. Be the first to start the discussion!

Practice More Accountancy and Book Keeping Questions

Question #1
Under the Income Tax Act, the 'TDS' on payment of interest on securities (other than 8% taxable government securities) is governed by which section?
A. Section 194
B. Section 194C
C. Section 194A
D. Section 194J
Discuss
Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option A

Explanation:
Section 194 of the Income Tax Act mandates TDS on income by way of interest on securities (like debentures, corporate bonds) at the prescribed rates.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #2
The 'Net Profit Margin' is:
A. Operating profit / Net sales
B. Gross profit / Net sales
C. EBIT / Net sales
D. Net profit / Net sales
Discuss
Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option D

Explanation:
Net profit margin reflects overall profitability after all expenses.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #3
What is an 'amended cash book' in the context of BRS?
A. A cash book used only for petty expenses
B. A cash book updated with missing transactions and rectifications before preparing BRS
C. A cash book updated for bank errors
D. A cash book prepared by the bank
Discuss
Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option B

Explanation:
An amended cash book adjusts for items like direct deposits, bank charges, and clerical errors in the cash book before reconciling timing differences.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Explore All Accountancy and Book Keeping MCQs
Today's Top Topics
Accountancy and Book Keeping 1861 Statistics 1318
Explore Subjects
Accountancy and Statistics 3179 Economy GK 2220 English 15164 Computer 5279 Current Affairs 575
Practice Mix
Which of the following is an indirect tax in India?
The valve between the left atrium and left ventricle is the:
A person faces north. He turns 45° left, then 90° right, then 45° left. Which direction is he facing?
Under the Income Tax Act, the 'TDS' on the sale of an immovable property (other than agricultural land) by a resident is governed by which section, and what is the rate?
In 'Piecemeal Distribution' during dissolution, the first priority for payment of outside liabilities is: