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- Management Accounting Test Questions - Set 16
MCQs 1: Listed Enterprises need to prepare Cash Flow Statement only under indirect method.
MCQs 2: In the case of financial enterprises, the cash flow resulting from interest and dividend received and interest paid should be classified as cash flow from
MCQs 3: Which of the following are advantages of marginal costing?
Makes the process of cost accounting more simple
Helps in proper valuation of closing stock
Useful for standard and budgetary control
All of the above
MCQs 4: Managers utilizes marginal costing for
Make or buy decision
Utilization of additional capacity
Determination of dumping price
All of the above
MCQs 5: The problems associated with marginal costing are
Difficulties in divisions of costs
Problem of valuation of stocks
Ignores time elements
All of the above
MCQs 6: Under some special circumstances, price may be fixed at below cost too.
MCQs 7: During trade recession, the goods are sold at
MCQs 8: In certain decision areas like plant closure and change in capacity, ________is more useful.
MCQs 9: The profit at the level of existing sales is computed as
Sales - (Fixed cost + Variable cost)
Sales + (Fixed cost + Variable cost)
Sales - Variable cost
Sales - Fixed cost
MCQs 10: Profit at any level of sales in amount is measured as
Sales * P/V ratio – Variable cost
Sales * P/V ratio + Fixed cost
Sales * P/V ratio – Fixed cost
Sales * P/V ratio + Variable cost
MCQs 11: Profit at any level of sales in units is measured as
Sales (units) * Cost per unit - Fixed cost
Sales (units) * Cost per unit + Fixed cost
Sales (units) * Cost per unit
None of the above
MCQs 12: What will be the amount of profit if Fixed cost is Rs 20,000 Sales is Rs 1,60,000 and P/V ratio is 25%?
MCQs 13: Determine amount of profit if Variable costs is Rs 1,20,000 Fixed costs is Rs 40,000 and sales is Rs 2,00,000.
MCQs 14: The labour engaged in the making of a product is known as _______
MCQs 15: Which of the following statements are true about standard labour time?
Standard labour time indicates the time in hours needed for a specified process
It is standardized on the basis of past experience with no adjustments made for time and motion study
In fixing standard time due allowance should not be given to fatigue and tool setting
The Production manager does not provide any input in setting the labour time standards
MCQs 16: If labour time is based on the maximum efficiency, the unit cost will be
MCQs 17: A budgeting process which demands each manager to justify his entire budget in detail from beginning is
MCQs 18: The scare factors is also known as
MCQs 19: Capacity ratio * Efficiency ratio = Activity ratio.
MCQs 20: A budgeted balance sheet is prepared in Projected Balance sheet method and an estimate is made of the values of all assets including bank overdraft, cash balance and bank.
MCQs 21: Which of the following statements are not true about Projected Balance Sheet Method?
It is good for long-term
It is appropriate for annual cash forecast
It is of extreme use for planning and control
None of the above
MCQs 22: XYZ factory working for 50 hours per week employs hundred workers on a job work. The standard output is 200 units per gang hour and standard rate is Rs 1 per hour. During a week in June, five employees were paid @ Rs 1.20 per hour and ten employees were paid @ 80 paise per hour. Rest of the employees were paid @ standard hour rate. The actual number of units produced was 10,200. Determine labour cost variance
MCQs 23: Given standard cost specifications time 5 hours per unit and cost Rs 5 per labour. Actual performance in cost period is production hours 10,400 and idle time 400 hours. Payment done is average per hour Rs 5.20 for 10,800 hours. Determine labour rate variance and labour efficiency variance, respectively.
Rs 2,160 and Rs 2,000 both unfavorable
Rs 2,160 and Rs 2,000 both favorable
Rs 2,000 and Rs 2,160 both unfavorable
Rs 2,000 and Rs 2,160 both favorable
MCQs 24: Which variance is also known as Gang composition variance?
MCQs 25: Which of the following statements are true about responsibility accounting?
Responsibility accounting results in inter-departmental conflicts
In responsibility center more focus is paid on products, processes or jobs
No focus is paid on controlling costs
None of the above
MCQs 26: Control reports come in the category of routine reports.
MCQs 27: The coverage of control reports is wider than that of information reports.
MCQs 28: Management accounting highlights staff relationship with top management as well as other personnel.
MCQs 29: Which of the following statements are true?
A) Financial statements are only interim report.
B) Financial statements are also known as annual records.
C) Financial statements are historic.
MCQs 30: Certain assumptions are essential to prepare financial statements.
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