Management Accounting - 1

Select The Blank
Question
Furniture account will always have a ________ balance.
Correct Answer
Debit
Your Answer
Nil

Multiple Choice Multiple Answer
Question
Accounting is the art where transactions are …
Correct Answer
Summarized , Classified , Recorded
Your Answer
Summarized , Classified , Recorded

True/False
Question
The phrase 'By Balance c/d.' written on the credit side of the rent account, indicates credit balance for this account.
Correct Answer
False
Your Answer
False

Select The Blank
Question
The ________ variance is the difference between the actual variable overhead incurred and the standard variable overhead charged to production.
Correct Answer
Total variable overhead
Your Answer
Total variable overhead

True/False
Question
Accounting refers to the process of analyzing & interpreting the information already recorded in the books of accounts.
Correct Answer
True
Your Answer
True

Select The Blank
Question
The selection of ________ may depend upon the various factors like characteristics of the business organisation, tax considerations, statutory requirements etc.
Correct Answer
Accounting period
Your Answer
Accounting period

True/False
Question
Standard costs are used for external reporting.
Correct Answer
False
Your Answer
False

True/False
Question
It is said that the income statement represents wealth increase /decrease for the organisation.
Correct Answer
True
Your Answer
False

Multiple Choice Single Answer
Question
Mr. Oak, materials manager, spends 40% time in the factory and the remaining in office. If his annual salary is Rs.500,000/-, what amount should be charged as office overheads ?
Correct Answer
Rs.300,000/-
Your Answer
Rs.200,000/-

Multiple Choice Multiple Answer
Question
The factors to be considered while preparing the direct materials budget are :
Correct Answer
Adequacy of material storing space , Availability of funds , Material in stores but reserved for specific purposes
Your Answer
Adequacy of material storing space , Availability of funds , Material in stores but reserved for specific purposes

Multiple Choice Multiple Answer
Question
In which of the following situations, the flexible budget should be preferred?
Correct Answer
Sales are too difficult to predict , Supply level of input cannot be predicted , Varying levels of production activity
Your Answer
Sales are too difficult to predict , Supply level of input cannot be predicted , Varying levels of production activity

Multiple Choice Multiple Answer
Question
Techniques of management accounting include:
Correct Answer
Marginal costing , Budgetary control , Standard costing
Your Answer
Marginal costing , Cost control , Budgetary control , Standard costing

Match The Following
Question
Correct Answer
Your Answer
Profit and loss account
Commission received
Dividend paid
Manufacturing account
Work in Progress
Land & Building
Balance Sheet
Land & Building
Closing stock of finished goods
Trading account
Closing stock of finished goods
Work in Progress

True/False
Question
While preparing the labour cost budget, factors such as overtime working or night shift working may be ignored.
Correct Answer
False
Your Answer
False

Multiple Choice Multiple Answer
Question
If the sales forecast is less than the past sales but the top management insists upon a certain amount of additional profits, then following steps can be taken to achieve the target profit
Correct Answer
Increase the selling price , Reduce cost of sales , Increase the selling efforts
Your Answer
Increase the selling price , Increase the sales volume , Increase the selling efforts

Multiple Choice Multiple Answer
Question
From the following, select intangible assets:
Correct Answer
Goodwill , Patents , Trade Marks
Your Answer
Patents , Trade Marks , Investments

True/False
Question
Bank reconciliation statement must be prepared before the preparation of profit and loss account and balance sheet.
Correct Answer
True
Your Answer
False

Multiple Choice Single Answer
Question
Find the budget which is inadequate as a cost control technique :
Correct Answer
Fixed budget
Your Answer
Fixed budget

True/False
Question
Predetermined rate of absorption of overheads helps in quick preparation of cost estimates and quoting prices.
Correct Answer
True
Your Answer
True

Multiple Choice Single Answer
Question
Net sales Rs,7,50,000/-, opening stock Rs.1,14,375/-, purchases Rs.483,375/- and closing stock Rs.1,47,750/-. Calculate the Gross Profit.
Correct Answer
Rs.3,00,000/-
Your Answer
Rs.3,00,000/-

Select The Blank
Question
________ is an example of intangible asset.
Correct Answer
Goodwill
Your Answer
Land

True/False
Question
Accounting is an art of recording, classifying & summarizing in a significant manner.
Correct Answer
True
Your Answer
True

True/False
Question
Goods sent to the customers on approval basis should be treated as sales.
Correct Answer
False
Your Answer
False

Multiple Choice Multiple Answer
Question
Features of Sunk cost are . . .
Correct Answer
Indicates historical cost , Not relevant in decision making process , Incurred in past
Your Answer
Indicates historical cost , Incurred in past , Relevant in decision making process

True/False
Question
Profitability statement indicates the amount of assets & liabilities.
Correct Answer
False
Your Answer
True

True/False
Question
A business is an activity carried out with the intention of earning the profit.
Correct Answer
True
Your Answer
True

Multiple Choice Multiple Answer
Question
Identify the steps involved in selecting the optimum product mix, when the limiting factor is number of labour hours and sales demand.
Correct Answer
For each product find the contribution per unit and per labour hour , Award ranks to each of the products based on contribution per limiting factor , Priority is given to fulfill the market demand of the product which gives maximum contribution per labour hour.
Your Answer
For each product find the contribution per unit and per labour hour , Award ranks to each of the products based on contribution per limiting factor , Priority is given to fulfill the market demand of the product which gives maximum contribution per labour hour.

Multiple Choice Multiple Answer
Question
Techniques of management accounting include:
Correct Answer
Marginal costing , Budgetary control , Standard costing
Your Answer
Marginal costing , Cost control , Budgetary control

True/False
Question
The ideal budget period for a company engaged in generation and distribution of electricity is one year.
Correct Answer
False
Your Answer
False

Select The Blank
Question
The ________ adjustment is necessary to relfect the cost for the use of fixed asset during the year.
Correct Answer
Depreciation
Your Answer
Depreciation

True/False
Question
According to Reducing Balance Method, the depreciation is provided at a predetermined percentage on the balance of cost of asset after deduction of the depreciation previously charged.
Correct Answer
True
Your Answer
True

Select The Blank
Question
Crane expenses should be apportioned on the basis of ________.
Correct Answer
Number of hours crane worked in the department
Your Answer
Number of hours crane worked in the department

Multiple Choice Multiple Answer
Question
Essentials for effective implementation of budgetary control system are
Correct Answer
Commitment of top management , Clearly defined objectives , Continous budget education
Your Answer
Commitment of top management , Clearly defined objectives , Continous budget education

Multiple Choice Single Answer
Question
Commission payable to General Manager is 10 % of the net profits. If the net profit before charging commission is Rs.29,200/-, then what will be the amount of his net profit after commission?
Correct Answer
Rs.26,545.45
Your Answer
Rs.29,200/-

Select The Blank
Question
A forecast is mere estimate of what is likely to happen, but ________ is the action plan to be followed.
Correct Answer
Budget
Your Answer
Budget

True/False
Question
A very wide scope of Management Accounting is the limitation by itself.
Correct Answer
True
Your Answer
True

Select The Blank
Question
The combination in which different products are sold by a company is known as ________.
Correct Answer
Sales mix
Your Answer
Sales mix

Multiple Choice Single Answer
Question
The reporting method used in the costing system should be based on the principle of
Correct Answer
Management by exception
Your Answer
Management by objectives

True/False
Question
Balance sheet indicates the financial status of the business at given period.
Correct Answer
True
Your Answer
True

Multiple Choice Single Answer
Question
The wages paid to maintenance department workers who do repair work principally for production departments but also on the vehicles in the distribuiton department shoud be charged as:
Correct Answer
Service costs
Your Answer
Service costs

Multiple Choice Single Answer
Question
M/s Vivek Enterprises has paid rent relating to the residence of Mr. Vivek, proprietor of Vivek Enterprises. This payment should be treated as
Correct Answer
Drawings
Your Answer
Capital

Select The Blank
Question
Measurement of ________ gives an idea of the degree of mobility of labour.
Correct Answer
Labour turnover
Your Answer
Labour turnover

Multiple Choice Single Answer
Question
Net profit for the year before charging commission to the manager, is Rs.111,775/-. The manager of the company is entitled to commission @ 8% on net profits after charging commission. Find the amount of commission due to the manager.
Correct Answer
Rs.8,279.63
Your Answer
Rs.8,942/-

Match The Following
Question
Correct Answer
Your Answer
Total cost
Cost of finished goods
Cost of finished goods
Non operating income
Profit on sale of investment
Profit on sale of investment
Selling and distribution overheads
Advertisement expenses
Advertisement expenses
Factory overheads
Repair for factory building
Repair for factory building

True/False
Question
Control on purchase of material is exercised by the storekeeper.
Correct Answer
False
Your Answer
True

Multiple Choice Single Answer
Question
A company wishes to earn a 15% profit margin on selling price when quoting for a job. Which of the following is the profit margin of cost which will achieve the required profit margin ?
Correct Answer
0.1765
Your Answer
0.15

Select The Blank
Question
Economical use of labour, materials and facilities can achieved with the help of ________.
Correct Answer
Budgetary control
Your Answer
Cost control