The 'Cost of Inventory' does not include: MCQ with Answer and Explanation

The 'Cost of Inventory' does not include:
A. Storage costs necessary in production process
B. Selling and distribution costs
C. Freight inwards
D. Customs duty
Answer: Option B
Solution (By JKExamLibrary)
Selling costs are excluded from inventory cost as per AS 2.

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Practice More Accountancy and Book Keeping Questions

Question #1 Report Error
The minimum subscription in a public issue should be at least:
A. 100%
B. 75% of issued capital
C. 90% of issued capital
D. 50% of issued capital

Correct Answer: Option C


Explanation:
As per SEBI, minimum subscription is 90% of the issue size for public offers.

Question #2 Report Error
The 'Target Costing' approach begins with:
A. Calculating actual cost
B. Setting a desired selling price and then deducting desired profit margin to arrive at target cost
C. Budgeting
D. Determining cost of production

Correct Answer: Option B


Explanation:
Target costing is a market-driven approach: Target cost = Target selling price - Desired profit.

Question #3 Report Error
TDS (Tax Deducted at Source) must be deposited to the credit of the Central Government by the deductor usually within:
A. 7th day of the next month
B. 30 days of deduction
C. Same day of deduction
D. End of the financial year

Correct Answer: Option A


Explanation:
Generally, TDS deducted in a month must be deposited to the government by the 7th of the following month.