Under Activity Based Costing (ABC), the number of purchase orders processed is an example of a: MCQ with Answer and Explanation

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Under Activity Based Costing (ABC), the number of purchase orders processed is an example of a:

A. Cost Driver

B. Cost Object

C. Cost Pool

D. Direct Cost

Answer: Option A

Solution (By JKSSB Mock Tests)

A cost driver is the factor that creates or influences a cost. The number of orders 'drives' the purchasing department's costs.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Question #1

Under 'Ind AS 37', a provision is recognised for:

A. All future operating losses

B. Repairs and maintenance

C. Self-insurance

D. A present obligation from a past event, where outflow of resources is probable and can be reliably estimated

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Correct Answer: Option D

Explanation:
Provision recognition criteria: present obligation, probable outflow, reliable estimate.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2

The 'GST on Virtual Digital Assets' is:

A. Exempt

B. 5%

C. 18%

D. 28%

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Correct Answer: Option C

Explanation:
GST on services related to VDA is generally 18%.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #3

S1: A triple column cash book records cash, bank, and discount transactions. S2: A contra entry in a cash book involves both cash and bank columns. Which statement(s) is/are correct?

A. S1 only

B. Neither S1 nor S2

C. S2 only

D. Both S1 and S2

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Correct Answer: Option D

Explanation:
A triple column cash book has columns for cash, bank, and discount on both sides. A contra entry occurs when transactions involve both cash and bank (e.g., cash deposited into bank), affecting both columns.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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