Cost Accounting -Material Cost

Material Control

Answer All Questions

Direct Material can be classified as ----------

• Fixed cost

• Variable cost

• Semi-variable Cost

• Prime Cost

Continuous stock taking is a part of ------

• Annual Stock Taking

• Perpetual inventory

• ABC Analysis

• Bin card

Under the FSN system of inventory control, inventory is classified on the basis of -----

• Volume of material consumption

• Frequency of usage of items of inventory

• Criticality of the item of inventory for production

• Value of items of inventory

Materials are issued from Store to production unit on the basis of -----

• Material Transfer Note

• Material Requisition Note

• Bills of Materials

• Purchase Requisition Note

X Ltd buys its annual requirement of 36000 units in 6 installments .Each units costs Rs.1 & the ordering cost is Rs.25. The inventory carrying cost is estimated at 20% of unit value.Find the total annual cost of the existing inventory policy .How much money can be saved by EOQ?

State whether true or false:-

High Material turnover Ratio reduces the investment funds in inventory.