The 'Cost of Goods Sold' in a manufacturing company includes: MCQ with Answer and Explanation

The 'Cost of Goods Sold' in a manufacturing company includes:
A. Selling expenses
B. Only direct material
C. Prime cost
D. Total manufacturing cost adjusted for WIP
Answer: Option D
Solution (By JKSSB Mock Tests)
COGS for manufacturer = Opening finished goods + Cost of production - Closing finished goods. Cost of production = total manufacturing cost + opening WIP - closing WIP.

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Practice More Accountancy and Book Keeping Questions

Question #1
A compound journal entry is an entry that:
A. Is passed at the end of the year
B. Involves more than one debit or more than one credit account
C. Affects only two accounts
D. Corrects previous errors

Correct Answer: Option B


Explanation:
A compound entry contains multiple debits and/or multiple credits, combining related transactions on the same date.

Question #2
Outstanding expenses in the balance sheet are shown under:
A. Contingent liabilities
B. Fixed liabilities
C. Current liabilities
D. Current assets

Correct Answer: Option C


Explanation:
Outstanding expenses represent amounts payable within a short period, classified as current liabilities.

Question #3
PFMS is an initiative of the Government of India to:
A. Provide loans to farmers
B. Regulate stock exchanges
C. Ensure a robust public financial management system and direct benefit transfers
D. Manage corporate taxes

Correct Answer: Option C


Explanation:
PFMS tracks funds and facilitates DBT for various government schemes.