CA Inter P4 · Chapter 6 · Question 9 of 9
Carriage outward incurred on delivering goods to customers is classified as:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Distribution overhead
Explanation
Carriage outward is incurred after production is complete, in delivering goods to customers, so it is a distribution overhead and appears after the cost of goods sold in the cost sheet. Carriage inward, by contrast, forms part of the cost of materials.
More Cost Sheet MCQs
- Q2Prime cost is ₹5,25,000 and factory overheads are ₹1,40,000. Opening work-in-progress is ₹30,000 and closing work-in-progress is ₹45,000…
- Q3Cost of production for the year is ₹7,20,000. Opening stock of finished goods is ₹60,000 and closing stock of finished goods is ₹80,000…
- Q4In a cost sheet, the cost of primary packing (packing without which the product cannot be sold, such as a bottle for a soft drink) is…
- Q5Which of the following items is excluded from the cost sheet?
- Q6Cost of sales of a product is ₹8,40,000. The company wants to earn a profit of 20% on sales. The selling price should be: