1) Which of the following is true about management accounting?
A) Management accounting is associated with presentation of accounting data.
B) Management accounting is extremely sensitive to investors needs.
a. Only A
b. Only B
c. Both A and B
d. None of the above
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2) John N. Myer stated that vertical and horizontal analysis forms the back-bone of financial statement analysis technique.
a. True
b. False
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3) Ratio analysis is an important approach of horizontal analysis.
a. True
b. False
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4) Risk of two securities with different expected return can be compared with:
a. Coefficient of variation
b. Standard deviation of securities
c. Variance of Securities
d. None of the above
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5) A portfolio having two risky securities can be turned risk less if
a. The securities are completely positively correlated
b. If the correlation ranges between zero and one
c. The securities are completely negatively correlated
d. None of the above
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Answer
Explanation
Related Ques
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ANSWER: The securities are completely negatively correlated
Explanation:
No explanation is available for this question!
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6) While calculating Gross Profit, if net profit is given,
a. It can be converted into gross profit by adding interest to it
b. It can be converted into Gross profit by adding indirect expenses to it
c. Both a and b
d. None of the above
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Answer
Explanation
Related Ques
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ANSWER: It can be converted into gross profit by adding interest to it
Explanation:
No explanation is available for this question!
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7) Gross profit ratio is calculated by
a. (Gross Profit / Gross sales) * 100
b. (Gross Profit / Net sales) * 100
c. (Net Profit / Gross sales) * 100
d. None of the above
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8) Given Sales is 1,20,000 and Gross Profit is 30,000, the gross profit ratio is
a. 24%
b. 25%
c. 40%
d. 44%
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9) Bond, debentures and term loans fall under:
a. Current assets
b. Non-current assets
c. Non-current liabilities
d. Current liabilities
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10) Funds flow statements are prepared so as to
a. To identify the changes in working capital
b. To identify reasons behind change in working capital
c. To know the item-wise outflow of funds during given period
d. All of the above
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11) _____ has/have accepted cash flow statement is more useful than funds flow statement, particularly from view of analysis of liquidity of a firm.
a. Institute Of Chartered Accountants of India
b. FASB, America
c. SEBI
d. All of the above
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12) Cash Flow Statement is prepared from
a. Profit and loss account
b. Balance Sheet
c. Additional Information
d. All of the above
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13) Which of the following are cash flow from operating activities?
A) Cash Receipts from customers
B) Cash Paid to Supplier and Employees
C) Purchase of fixed assets
D) Sale of fixed assets
a. Both A and B
b. Both A and C
c. Both B and C
d. Both C and D
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14) Marginal cost is computed as
a. Prime cost + All Variable overheads
b. Direct material + Direct labor + Direct Expenses + All variable overheads
c. Total costs – All fixed overheads
d. All of the above
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15) Marginal costing is also known as
a. Direct costing
b. Variable costing
c. Both a and b
d. None of the above
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16) Which of the following statements are true about marginal costing?
A) Marginal costing is not an independent system of costing.
B) In marginal costing all elements of cost are divided into fixed and variable components.
C) In marginal costing fixed costs are treated as product cost.
D) Marginal costing is not a technique of cost analysis.
a. A and B
b. B and C
c. A and D
d. B and D
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17) While making key factor decision, if raw material is key factor then such product should be preferred in which offer:
a. Highest contribution per hour
b. Highest contribution per unit
c. Highest contribution per unit of material
d. None of the above
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18) Change in product mix decision should be merely based on contribution.
a. True
b. False
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19) If direct labor is not affected by the change in the type of material, it will form a part of differential cost.
a. True
b. False
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20) P/V ratio can be calculated on the basis of variable cost ratio as
a. 1 - Variable Cost Ratio
b. 1 + Variable Cost Ratio
c. 1 / Variable Cost Ratio
d. None of the above
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21) Determine P/V ratio if Sales is Rs 80,000 and Variable cost is Rs 60,000.
a. 40%
b. 25%
c. 50%
d. None of the above
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22) Determine P/V ratio if Sales is Rs 1,00,000, Fixed cost is Rs 30,000 and Profit is Rs 20,000.
a. 25%
b. 50%
c. 45%
d. None of the above
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23) Determine P/V ratio if Sales per unit is Rs 10 and Variable cost per unit is Rs 7.
a. 25%
b. 50%
c. 45%
d. 30%
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24) Compute P/V ratio if variable cost ratio is 60%.
a. 40%
b. 50%
c. 45%
d. 30%
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25) In budgetary control_____ is used whereas in standard costing _________ is used.
a. Unit concept, Total concept
b. Total concept, Unit Concept
c. Marginal concept, Gross concept
d. Gross concept, Marginal concept
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26) Which of the following statements are not true?
A) In standard costing standards relies on technical assessment whereas budgetary targets are based on past actual adjusted to future trend.
B) The scope of standard costing is much wider than budgetary control.
C) Budgetary control demands functional coordination whereas it is not the case with standard costing.
D) Standard costing prescribes a monetary limit which cannot be crossed.
a. A and B
b. B and D
c. C and D
d. A and C
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27) The process of standard costing
a. Can be incorporated in accounting routine
b. Helps in reaching variances from the accounting procedure
c. Both a and b
d. None of the above
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28) The process of budgeting helps in the control of
a. Cost of production
b. Liquidity
c. Capital Expenditure
d. All of the above
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29) Budgets are based on plan estimates and therefore budgeting is an effective substitute for management.
a. True
b. False
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30) Budgetary control does not depend on changing business situations like inflation and economic recession.
a. True
b. False
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31) The payment of salary, wages, overheads, cash purchase and payment to creditors are form of
a. Cash payment for capital transaction
b. Cash payment for non-operating expenses
c. Cash payment for business operations
d. None of the above
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32) The payment of income tax, dividend, interest, and donation are examples of
a. Cash payment for capital transaction
b. Cash payment for non-operating expenses
c. Cash payment for business operations
d. None of the above
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33) In order to prepare a flexible budget, items of anticipated expenditures are classified into _______ classes.
a. Five
b. Three
c. Two
d. None of the above
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34) Variable cost is also known as
a. Direct cost
b. Proportionate cost
c. Both a and b
d. None of the above
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35) The sub-variance of material usage variance, known as Material mix variance is measured as
a. Total standard cost - Total actual cost
b. Standard cost of revised standard mix - Standard cost of actual mix
c. (Standard unit price - Actual unit price) * Actual quantity used
d. (Standard quantity - Actual quantity) * Unit standard price
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Answer
Explanation
Related Ques
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ANSWER: Standard cost of revised standard mix - Standard cost of actual mix
Explanation:
No explanation is available for this question!
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36) While calculating material mix variance, if revised standard quantity is greater than actual quantity, the variance is
a. Unfavorable
b. Favorable
c. Neither favorable nor unfavorable
d. None of the above
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37) If the total actual input of units and total standard input of units is equal, there is no need to calculate revised standard quantity.
a. True
b. False
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38) Cost audit is a verification of cost records to estimate the ________ efficiency of a business.
a. External
b. Internal
c. Both internal and external
d. None of the above
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39) The area of focus on responsibility center is
a. Quantum of sales
b. Quantum of production
c. Optimum utilization of resources
d. All of the above
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40) _____________ may deal with actual figures against budgeted ones.
a. Accounting ratios
b. Tabulated Information
c. Formal Financial statements
d. None of the above
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