Which formula correctly represents 'Cost of Production'? MCQ with Answer and Explanation

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Which formula correctly represents 'Cost of Production'?

A. Prime Cost + Factory Overheads

B. Factory Cost + Administrative Overheads

C. Prime Cost + Selling Overheads

D. Cost of Production + Selling Overheads

Answer: Option B

Solution (By JKSSB Mock Tests)

In a cost sheet, Factory Cost added to Office and Administrative Overheads yields the Cost of Production.

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Question #1

In a partnership firm, a partner's current account is maintained to record:

A. Only profits

B. Drawings, interest on capital, salary, share of profit, etc.

C. Only loans to partners

D. Only capital contributions

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Correct Answer: Option B

Explanation:
Fixed capital method keeps capital account for initial capital and current account for all other adjustments.

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Question #2

The 'Non-Controlling Interest' (NCI) at acquisition date can be measured at:

A. Book value

B. Either fair value or proportionate share of net assets

C. Only fair value

D. Only proportionate share of net assets

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Correct Answer: Option B

Explanation:
Ind AS 103 allows a choice.

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Question #3

The petty cash book is balanced:

A. Daily

B. At the end of the month

C. At the end of the year

D. When it is replenished

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Correct Answer: Option D

Explanation:
Under imprest system, petty cash book is closed when cash is replenished, not periodically.

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

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