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. Total manufacturing cost adjusted for WIP
C. Prime cost
D. Only direct material
Answer: Option B
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
Agricultural income in India is:
A. Taxable at a flat rate of 10%
B. Exempted under Section 10(1)
C. Taxable only for corporate farmers
D. Fully taxable

Correct Answer: Option B


Explanation:
Section 10(1) of the Income Tax Act exempts agricultural income from Central Income Tax.

Question #2
The 'Proprietary Ratio' establishes relationship between:
A. Proprietors' funds and total assets
B. Current assets and current liabilities
C. Debt and equity
D. Sales and debtors

Correct Answer: Option A


Explanation:
Proprietary ratio = Shareholders' funds / Total assets, indicating the proportion of assets financed by owners.

Question #3
Which of the following is not an objective of budgetary control?
A. Planning
B. Co-ordination
C. Control
D. Profit maximization in the short run

Correct Answer: Option D


Explanation:
Budgetary control aims at planning, coordination, control, and efficiency, not just short-term profit maximization.