Management accounting final- scdl

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Multiple Choice Multiple Answer

Question Essentials for effective implementation of budgetary control sys tem are

Correct Answer Commitment of top management , Clearly defined objective s , Continous budget education

Your Answer Commitment of top management , Clearly defined objectives , Cont inous budget education

Multiple Choice Multiple Answer

Question Features of convention of consistency are . . .

Correct Answer The accounting policies and procedures should be followe d consistently , Facilitates the comparison of financial statements , It facilit ates comparison of financial statements on period-to-period basis

Your Answer The accounting policies and procedures should be followed consis tently , It facilitates comparison of financial statements on period-to-period b asis

True/False

Question The bin card and stores ledger, being independent records, compa rison of these two records should be avoided.

Correct Answer False Your Answer False

Match The Following

Question Correct Answer Your Answer

Dividend paid Profit and loss appropriation account Profit and loss account Freight inwards Manufacturing account Manufacturing account

Sales Trading account Capital account

Freight outwards Profit and loss account Trading account

Select The Blank

Question Large angle of incidence indicates ________ amount of profits. Correct Answer higher

Your Answer same

True/False

Question Error of commission refer to a situation where a transaction is not recorded in the books of account.

Correct Answer False Your Answer True

Multiple Choice Single Answer

Question Relevant costs in decision making are :

Correct Answer Those costs which will arise as a result of the proposed action

Your Answer Those costs which will arise as a result of the proposed action

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Question ________is the summary of all the balances in all the accounts l isted in ledger account of an organization at any given point of time.

Correct Answer Trial Balance Your Answer Trial Balance

Multiple Choice Multiple Answer

Question Overhead capacity variance is the outcome of:

Correct Answer Shortage of labour , Enforced idle time, e.g.power break downs , Customer demand being more or less than anticipated

Your Answer Shortage of labour , Enforced idle time, e.g.power breakdowns , Customer demand being more or less than anticipated

True/False

Question Factory overheads consist of all overhead costs incurred from th e stage of procurement of material till the production of finished goods.

Correct Answer True Your Answer True

True/False

Question Bank reconciliation statement must be prepared before the prepar ation of profit and loss account and balance sheet.

Correct Answer True Your Answer True

Multiple Choice Single Answer

Question Included in the trial balance is the sales promotion suspense ac count with a debit balance of Rs.6,300/-. It is given that this balance should b e written off. Calculate its impact on profit of the company.

Correct Answer The net profit will decrease by Your Answer The gross profit will increase by

Select The Blank

Question In calculation of total sales margin variance, the ________cost of sales is deducted from the actual sales revenue.

Correct Answer Standard Your Answer Actual

Match The Following

Question Correct Answer Your Answer

Increase in contribution will lead to Increase in profits Increase in prof it volume ratio

Increase in fixed cost will lead to Increase in break even point Decrease in contribution

Decrease in variable cost will lead to Increase in profit volume ratio Increase in profits

Decrease in selling price will lead to Decrease in contribution Increase in break even point

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Multiple Choice Multiple Answer

Question Marginal costing technique is useful in taking decisions relatin g to which of the following courses of action?

Correct Answer Decision to drop a product line , Decision to accept a s pecial offer at price lower than the normal selling price , Decision regarding t emporary shut-downs

Your Answer Decision to drop a product line , Decision to accept a special o ffer at price lower than the normal selling price , Decision to accept a special offer at price higher than the normal selling price , Decision regarding tempor ary shut-downs

Multiple Choice Single Answer

Question Basic objective of Uniform Costing is . . . Correct Answer comparison

Your Answer To control cost

Select The Blank

Question Re-order level should be higher than ________ but lesser than ma ximum stock level.

Correct Answer Minimum level Your Answer Minimum level

True/False

Question The variable costs are controllable at the lower lever. Correct Answer True

Your Answer False

Select The Blank

Question Economical use of labour, materials and facilities can achieved with the help of ________.

Correct Answer Budgetary control Your Answer Budgetary control

Select The Blank

Question Goods returned by Pawan worth Rs.1,000/- is debited to Pawan's A ccount. In order to rectify the mistake, which account should be debited ? _____ ___

Correct Answer Suspense account Your Answer Personal account

True/False

Question The purchase account should be debited when an order is placed w ith the supplier of material.

Correct Answer False Your Answer False

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

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Select The Blank

Question Interest receivable is a________ for the organisation. Correct Answer Current sset

Your Answer Long term asset

Multiple Choice Single Answer

Question Purchases returns of Rs.18,000/- were wrongly transferred to the sales returns account. Calculate its impact on net profit.

Correct Answer The net profit will not be affected Your Answer The net profit will decrease by

Multiple Choice Single Answer

Question Amit sold Goods to Atul for Rs. 50,000/- on cash & Rs. 50,000/- on credit basis. Amit allowed 10% discount for on the spot transaction. What is the amount that should be debited to the cash account?

Correct Answer Your Answer

Multiple Choice Single Answer

Question Interest on bank loan, was paid till the quarter ending 30th Sep tember, 2003, Rs.36,000/-. Find the amount to be debited to the profit and loss account for the year ending on 31st March, 2004, assuming the loan is not yet re paid as on this date.

Correct Answer Your Answer

Multiple Choice Single Answer

Question The features of the Halsey Plan are:

Correct Answer The benefit of time saved is divided equally between the employer and employee

Your Answer The benefit of time saved is divided equally between the employe r and employee

True/False

Question The sum of indirect material cost, indirect labour cost and indi rect expenses is termed as factory cost.

Correct Answer False Your Answer True

Multiple Choice Single Answer

Question Determine re-order level from the following : Maximum daily cons umption - 200 units; maximum delivery period - 12 days; average daily consumptio n - 150 units and average delivery period - 8 days.

Correct Answer 2,400 units Your Answer 2,400 units

Select The Blank

Question An error of partial omission can be rectified by either debiting or crediting the ________ account, as the case maybe.

Correct Answer suspense

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Multiple Choice Multiple Answer

Question Select the examples of functional budgets:

Correct Answer Sales budget , Production budget , Research and developm ent budget

Your Answer Sales budget , Production budget , Research and development budg et

Multiple Choice Single Answer

Question With the help of the given information, find actual fixed overhe ads for actual output. Fixed overheads volume variance -Rs.75,000/- (Favourable) ; fixed overheads efficiency variance -Rs.95,000/- (Favourable); fixed overheads calendar variance Rs.20,000/- (Adverse); fixed voerheads expenditure variance R s.100,000/- (Adverse) and standard fixed overheads for actual output -Rs.575,000 /-.

Correct Answer Your Answer

Select The Blank

Question Furniture account will always have a ________ balance. Correct Answer Debit

Your Answer Credit

Select The Blank

Question If the ordering cost ________s, then the economic order quantity will Increase.

Correct Answer Increase Your Answer Increase

Multiple Choice Multiple Answer

Question Which of the following information is included in the goods rece ived note?

Correct Answer Date of receipt of material , Quantity received , Descri ption of goods

Your Answer Date of receipt of material , Quantity received , Price of goods , Description of goods

Multiple Choice Multiple Answer

Question Select the non-monetary incentives

Correct Answer Health and safety services , Canteen facility , Loans at reduced rate of interest

Your Answer Health and safety services , Canteen facility

True/False

Question A business is an activity carried out with the intention of earn ing the profit.

Correct Answer True Your Answer True

True/False

Question Linking overhead to a cost unit is known as overhead absorption. Correct Answer True

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Multiple Choice Multiple Answer

Question The operating profit as per cost statement may differ from the p rofit as per Profit and Loss Account due to existence of

Correct Answer Depreciation on plant and machinery , Interest on loans taken from other , Interest on loans granted to others

Your Answer Depreciation on plant and machinery , Interest on loans taken fr om other

Multiple Choice Multiple Answer

Question The main advantages of profit sharing are :

Correct Answer Employees try to increase productivity , Incentives are shared by all the employees , Augments emplyees' efficiency

Your Answer Employees try to increase productivity , Incentives are shared b y all the employees

Multiple Choice Multiple Answer

Question Labour efficiency variance Rs.1,000/- (favourable); labour mix v ariance Rs.260/- (adverse) and labour rate variance Rs.300/- (adverse). Compute labour cost variance and labour yield variance.

Correct Answer Labour cost variance -Rs.700/- (Favourable) , Labour yie ld variance -Rs.1,260/- , Labour yield variance is favourable

Your Answer Labour cost variance -Rs.700/- (Favourable) , Labour yield varia nce -Rs.1,260/-

True/False

Question The best way to reduce labour cost is to recruit cheap labour. Correct Answer False

Your Answer False

True/False

Question Balance sheet indicates the financial status of the business at given period.

Correct Answer True Your Answer True

Multiple Choice Multiple Answer

Question Select the items which may be classified as selling and distribu tion overheads.

Correct Answer Delivery van expenses , Rent of finished goods warehouse , Sales research expenses

Your Answer Delivery van expenses , Rent of finished goods warehouse , Sales research expenses

Select The Blank

Question In India the gas industry and electricity industry, and ________ industry are examples of industries using the uniform costing system.

Correct Answer fertilizer Your Answer fertilizer

Multiple Choice Single Answer

Question The process of recording the costs in a formal and systematic ma nner with the intention of preparing statistical data there from a ascertain the

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cost, is known as . . .

Correct Answer Cost accounting Your Answer Cost accounting

Multiple Choice Single Answer

Question Fixed deposit bearing interest @ 5.50%, for Rs.10,000/- was kept with Bank of India on 1st June, 2003, for a period of one year. The type of the fixed deposit is cumulative, i.e. interest shall be received only on maturity. What treatment should be given in the books of accounts on 31st March, 2004, the year ending date?

Correct Answer An entry for Rs.458.34, debiting interest accrued but no t due account should be passed

Your Answer An entry for Rs.458.34, crediting interest accrued but not due a ccount should be passed

True/False

Question A business is an activity carried out with the intention of earn ing the profit.

Correct Answer True Your Answer True

True/False

Question Balance sheet indicates the financial status of the business at given period.

Correct Answer True Your Answer True

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 False

True/False

Question Accounting is an art of recording, classifying & summarizing in a significant manner.

Correct Answer True Your Answer True

True/False

Question Financial accounting may deal with the ascertainment of cost & c alculation of profitability of the individual product.

Correct Answer False Your Answer False

True/False

Question The reports generated by financial accounting are meant for the use by management for effective decisions.

Correct Answer True Your Answer True

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LIST OF ATTEMPTED QUESTIONS AND ANSWERS

Multiple Choice Multiple Answer

Question The objects of cost accountancy are

Correct Answer To ascertain cost and profitability , Cost Control , Pre sentation of Information

Your Answer To ascertain cost and profitability , Cost Control , Presentatio n of Information

Multiple Choice Multiple Answer

Question Management accounting is concerned with the following activities

Correct Answer Decision making , Safeguarding assets , Planning and con trolling activities

Your Answer Decision making , Planning and controlling activities

Multiple Choice Multiple Answer

Question Features of material usage variance are

Correct Answer Measures the difference between the quantity of material s actually used and that should have been used. , Considers standard price X act ual quantity , Considers standard price X standard quantity

Your Answer Measures the difference between the quantity of materials actual ly used and that should have been used. , Considers standard price X actual quan tity , Considers standard price X standard quantity

True/False

Question Under the accelerating premium system incentive increases at a f ast rate with the decrease in output.

Correct Answer False Your Answer False

True/False

Question If the physical stock is less than the stock as per the stores l edger, such shortage should be treated as an issue of material.

Correct Answer True Your Answer False

Multiple Choice Single Answer

Question An analysis of the time card of a worker on a machine shows that of the total 48 hours, he worked 45 hours (including 4 hours overtime) on produ ction and that 3 hours was idle due to machine break-down. The rate of the worke r is rupees ten per hour : but overtime is paid at 50 per cent extra. You are re quired to calculate the earnings of the worker.

Correct Answer Your Answer

True/False

Question Predetermined rate of absorption of overheads helps in quick pre paration of cost estimates and quoting prices.

Correct Answer True Your Answer True

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Select The Blank

Question If overhead absorbed i.e. overheads charged to units during the period is more than the overhead incurred, it is said that the overheads are ___ _____.

Correct Answer Over-absorbed Your Answer Under-absorbed

Select The Blank

Question A worker is paid a monthly salary of Rs.500/- along with a bonus of 50 paise per unit completed, this type of labour cost may be classified as _ _______ cost.

Correct Answer Semi-variable Your Answer Semi-variable

Select The Blank

Question Goods purchased from A for Rs.2,020/- were passed through the sa les book. The rectification of this error will result in ________.

Correct Answer Decrease in gross profit by Your Answer Increase in gross profit by

True/False

Question High time wages means necessarily high cost of production. Correct Answer False

Your Answer False

Multiple Choice Multiple Answer

Question The management of Dick Ltd. is deciding whether to buy component Y from the supplier, since the purchase cost is less than the manufacturing cos t. State the non-financial aspects that must be considered before arriving at a decision

Correct Answer Reliability regarding quality of the material supplied b y the supplier , Alternative use of labour of engaged in manufacturing component Y , Regularity of material supplies from the supplier

Your Answer Reliability regarding quality of the material supplied by the su pplier , Alternative use of labour of engaged in manufacturing component Y , Reg ularity of material supplies from the supplier

Select The Blank

Question Loans which are borrowed from financial institutions are to be p aid off in 8 years, should be disclosed as ________ in the balance sheet.

Correct Answer Long term liabilities Your Answer Long term liabilities

Select The Blank

Question Interest receivable is a________ for the organization. Correct Answer Current asset

Your Answer Current asset

True/False

Question Period cost is the cost assigned to the products. Correct Answer False

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Multiple Choice Single Answer

Question A new computer worth Rs.35,000 was purchased on 18th June, 2003. The company has 10 such computers costing Rs.20,000/- each. The depreciation is charged @ 18% p.a. Find the depreciation on computers to be charged for the yea r.

Correct Answer Rs.40,953.70 Your Answer Rs.40,953.70

Multiple Choice Single Answer

Question The direct material usage budget and direct material purchase bu dget differ because of which of the following?

Correct Answer A planned change in the level of material stock Your Answer The level of efficiency of men or machines

True/False

Question New companies can adopt Uniform costing system as a ready-made s ystem.

Correct Answer True Your Answer True

Multiple Choice Multiple Answer

Question Pre-requisites of Uniform Costing are

Correct Answer Spirit of mutual trust , Free Exchange of ideas , No riv alry

Your Answer Free Exchange of ideas , No rivalry , Spirit of mutual trust

Multiple Choice Multiple Answer

Question The principal functions of the cost accounting department are Correct Answer Classifying labour cost according to jobs, processes, et c. , Preparation of different reports based on direct, indirect labour cost, etc . , To focus on areas where labour cost may be reduced.

Your Answer Classifying labour cost according to jobs, processes, etc. , Pre paration of different reports based on direct, indirect labour cost, etc. , To f ocus on areas where labour cost may be reduced.

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 inp ut cannot be predicted , Varying levels of production activity

Your Answer Sales are too difficult to predict , Supply level of input canno t be predicted , Varying levels of production activity

Multiple Choice Single Answer

Question Select the information to be considered before installing a cost ing system

Correct Answer Labour intensity of the product Your Answer Number of workers required

Multiple Choice Single Answer

Question Tom company has sales of Rs.200,000/- with variable expenses of Rs.150,000/-, fixed expenses of Rs.60,000/-, and an operating loss of Rs.10,000/

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-. By how much would Tom have to increase its sales in order to achieve an opera ting income of 10% of sales?

Correct Answer Your Answer

Multiple Choice Single Answer

Question As on 31st March, 2004, it was decided to write off Rs.800/- of debtors as bad debts. Also, provision for bad and doubtful debts is to be made @ 5% and for discount on debtors @ 4%. Find the net amount of debtors to be discl osed in the balance sheet, if the total debtors before the aforesaid adjustments is Rs.98,623/-.

Correct Answer Rs.89,214.58 Your Answer Rs.88,285.26

Select The Blank

Question Payment by ________ method lowers the cost of production through their impact on fixed costs.

Correct Answer Results Your Answer Time

Multiple Choice Multiple Answer

Question Which of the following aspects are mainly responsible for diffic ulty in application of Uniform costing system?

Correct Answer Capital investment , Plant size , Location Your Answer Capital investment , Plant size , Location

Select The Blank

Question The most appropriate method for apportionment of overheads of th e purchasing and stores department is percentage on ________.

Correct Answer Direct Material Your Answer Direct Material

Multiple Choice Single Answer

Question Judge the given statement according to the given criteria :- 'Pr ovision for doubtful debts account' and 'provision for discount on debtors accou nt' mean same account can be maintained under two account-heads, since both are related to debtors and indicate a loss to the organization.

Correct Answer The statement is incorrect but the reason is correct Your Answer The statement and the reason both are incorrect

Multiple Choice Multiple Answer

Question Following errors affect the trial balance

Correct Answer Wrong totaling of subsidiary books , Posting on the wron g side of an account , Omission of posting an account in the ledger

Your Answer Wrong totaling of subsidiary books , Posting on the wrong side o f an account , Omission of posting an account in the ledger

Select The Blank

Question If the owner brings in personal calculator for office use, _____ ___ account should be credited.

Correct Answer Capital Your Answer Cash

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Multiple Choice Multiple Answer

Question From the following select the examples of errors of commission :

Correct Answer Sales recorded in the sales register as Rs.2,020/- inste ad of Rs.2,200/- , Received cash from Sham, credited to Ram's account , Paid tra nsport charges, credited to transport charges account

Your Answer Sales recorded in the sales register as Rs.2,020/- instead of Rs .2,200/- , Received cash from Sham, credited to Ram's account , Paid transport c harges, credited to transport charges account

Select The Blank

Question A ________ can be defined as a part of the organization for whic h separate budget can be prepared and implemented.

Correct Answer Budget centre Your Answer Budget centre

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 Your Answer

True/False

Question Profitability statement is a period statement & provides informa tion about the results of operations.

Correct Answer True Your Answer True

Select The Blank

Question The method of overhead apportionment which considers both the ma terial cost as well as the labour cost, is known as ________ method.

Correct Answer Prime cost percentage rate Your Answer Prime cost percentage rate

Multiple Choice Single Answer

Question Net profit for the year before charging commission to the manage r, 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

Multiple Choice Single Answer

Question A manufacturer is producing alloy for which standard mix is 25% copper and 75% iron. Standard price for copper is Rs.80/- per kg. and for iron R s.20/- per kg. 20% of input is standard loss. Actual output is 8,000 kg. of allo y using 2,000 kg of copper at Rs.90/- per kg. and 9,000 kg of iron at Rs.15/- pe r kg. Calculate the standard cost of copper.

Correct Answer Your Answer

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Question Cheque received from a client on 28th September, 2004 must be en tered in the bank book only after it is credited in the pass book.

Correct Answer False Your Answer False

Multiple Choice Multiple Answer

Question The various areas in which uniform costing can be adopted are Correct Answer Valuation of inventories , Charging of depreciation , Ap portionment of overheads

Your Answer Valuation of inventories , Charging of depreciation , Apportionm ent of overheads

Multiple Choice Single Answer

Question The gross profit for the year 2004 is Rs.184,326/-. The deprecia tion on furniture for the year is Rs.24,561/-; dividend received amounted to Rs. 12,000/- and the director's remuneration worked out to be Rs.95,784/-. Find the net profit for the year 2004.

Correct Answer Your Answer

True/False

Question The purpose of the profit and loss account is to bring together information which relates to gross profit and the expenses for running the busin ess.

Correct Answer True Your Answer True

Match The Following

Question Correct Answer Your Answer

Ledger Maintain all types of accounts Maintain all types of accounts

Audit Reviewing internal control system Reviewing internal control syste m

Accounting Process of analyzing & interpretation Process of analyzing & i nterpretation

Journal Book of original entry Book of original entry

Match The Following

Question Correct Answer Your Answer

Daily Time sheets Time spent by worker on job is recorded Time spent by wo rker on job is recorded

Time Keeping Department Recording of workers time Recording of workers tim e

Time booking department Jobwise booking of time. Jobwise booking of time. Time Recording Clock Method Ticket number & clock card allotted to worker Ticket number & clock card allotted to worker

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Multiple Choice Multiple Answer

Question Items credited to Profit & Loss Account are

Correct Answer Gross profit , Commission received , Interested received Your Answer Gross profit , Commission received , Interested received

True/False

Question For a manufacturing company, dividend received is a non-operatin g income.

Correct Answer True Your Answer False

Select The Blank

Question A standard that is never altered, after being established, is kn own as ________ standard.

Correct Answer Ideal Your Answer Basic

Multiple Choice Single Answer

Question Rs.2,650/- were paid to ABC Ltd. for maintenance of machine; whi ch account should be debited for this transaction?

Correct Answer Maintenance of machine account Your Answer ABC Ltd.'s Account

LIST OF ATTEMPTED QUESTIONS AND ANSWERS Multiple Choice Multiple Answer

Question The management of Horngreen Ltd. is deciding whether to continue workin g at loss or to temporarily shut down the factory. State the qualitative aspects that must be considered before arriving at a decision.

Correct Answer Loss of trained personnel , Loss of regular customers , Expenditu re required to restart the factory

Your Answer Expenditure required to restart the factory Multiple Choice Single Answer

Question The purchase budget for October is Rs.12,500/- and November is Rs.15,00 0/-. If the materials are purchased for cash the supplier is offering a rebate o f 5%. If the materials are purchased on credit of 30 days, no rebate is offered. The company purchase

Correct Answer October- NIL, November- Rs.26,750/- Your Answer October- Rs.14,250/-, November- Rs.11,875/- True/False

Question Maintenance Department is a service cost centre. Correct Answer True

Your Answer True

Multiple Choice Multiple Answer

Question Ram and Laxman are partners of Kush & Bros. As on 1st April, 2003 Ram's capital is Rs.50,000/- and Laxman's capital is Rs.80,000/-. If interest on capi tal is to be provided @ 10% p.a., what will be amount of capital of each of the partners as on 31st March, 2004, assuming there were no additions during this pe riod? Also, state the treatment of this item in the Profit and loss account. Correct Answer Ram's capital Rs.55,000/- , Laxman's capital Rs.88,000/- , Intere st on capital should be debited to the Profit and loss account

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Your Answer Laxman's capital Rs.88,000/- , Interest on capital should be debited to the Profit and loss account

Multiple Choice Single Answer

Question Rs.2,650/- were paid to ABC Ltd. for maintenance of machine; which acco unt should be debited for this transaction?

Correct Answer Maintenance of machine account Your Answer ABC Ltd.'s Account

Match The Following

Question Correct Answer Your Answer

Advantageously applicable in similar industries Scope of uniform costing Fields covered by uniform costing

Spirit of mutual trust Requisite for uniform costing Disadvantage of uniform cos ting

Avoids cut throat competition Advantage of uniform costing Requisite for uniform costing

Treatment given to research and development costs Fields covered by uniform cost ing Advantage of uniform costing

Select The Blank

Question Under the AB________ analysis, nuts and bolts used as material will be classified as category C.

Correct Answer C Your Answer C Select The Blank

Question If overhead absorbed i.e. overheads charged to units during the period is more than the overhead incurred, it is said that the overheads are ________. Correct Answer Over-absorbed

Your Answer True and fair

Multiple Choice Multiple Answer

Question Identify the causes due to which the cost of labour may be high:

Correct Answer Excess staffing , Lack of experienced and efficient personnel , H igh labour turnover

Your Answer Lack of experienced and efficient personnel , High labour turnover , No idle time

Multiple Choice Multiple Answer

Question Identify the fixed expenses from the following.

Correct Answer Rent and taxes of the factory , Wages paid to indirect workers li ke cleaners, helpers,etc. , Salary paid to factory supervisor

Your Answer Rent and taxes of the factory , Wages paid to indirect workers like cleaners, helpers,etc. , Salary paid to factory supervisor

Multiple Choice Multiple Answer

Question From the following, select intangible assets: Correct Answer Goodwill , Patents , Trade Marks

Your Answer Goodwill , Patents , Trade Marks 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.

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Correct Answer True Your Answer False Select The Blank

Question Average stock = ________ + (Order size / 2) Correct Answer Safety stock

Your Answer Reorder level True/False

Question High time wages means necessarily high cost of production. Correct Answer False

Your Answer True

Multiple Choice Single Answer

Question The integrated form of all functional budgets is known as : Correct Answer Master budget

Your Answer Master budget Select The Blank

Question Marginal costing is also known as ________. Correct Answer Variable costing

Your Answer Indirect costing Multiple Choice Single Answer

Question Purchased 200 shares of Bharat Forge Ltd. for Rs.850/- per share, which account should be debited?

Correct Answer Investment account - Rs.170,000/- Your Answer Investment account - Rs.170,000/- Multiple Choice Single Answer

Question For a bought out material item the following are the relevant data : Or dering cost Rs.512/- per order; holding cost is 40%; cost per item Rs.100/- and annual demand 1,000 units. The Purchase manager places 5 orders of equal quantit y in one year, in order to avail the discount of 5% on the cost of the item. Wor k out the total cost to the organisation due to his ordering policy for this ite m.

Correct Answer Rs.101,360/- Your Answer Rs.101,360/- True/False

Question Due to compensating errors the arithmetical accuracy of the trial balan ce is affected.

Correct Answer False Your Answer False

Multiple Choice Single Answer

Question From the given information compute the total cost variance. Material co st variance -Rs.4,400/- (Favourable); labour cost variance -Rs.450/- (Adverse); fixed overhead cost variance -Rs.22,000/- (Adverse); variable overhead cost vari ance -Rs.6,000/- (adverse).

Correct Answer Rs.24,050/- (Adverse) Your Answer Rs.32,850/- (Favourable) Multiple Choice Single Answer

Question Advance tax account should appear in which of the final statement of ac counts.

Correct Answer Asset side of the balance sheet

Your Answer Debit side of the profit and loss account Match The Following

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Question Correct Answer Your Answer Operating income Cash Sales Cash Sales

Non-Operating income Issue of shares Issue of shares

Plan of investment in fixed assets Capital Expenditure Budget Cash Budget Plan for surplus/shortage of cash Cash Budget Capital Expenditure Budget

Select The Blank

Question Furniture account will always have a ________ balance. Correct Answer Debit

Your Answer Inflated Select The Blank

Question Payment by ________ method lowers the cost of production through their impact on fixed costs.

Correct Answer Results Your Answer Cash

Multiple Choice Multiple Answer

Question The objects of cost accountancy are . .

Correct Answer To ascertain cost and profitability , Cost Control , Presentation of Information

Your Answer To ascertain cost and profitability , Cost Control , To portray the financial status

Multiple Choice Multiple Answer

Question Select the various methods adopted for treatment of under or over absor bed overheads

Correct Answer Use of supplementary rates , Carrying over the amount to remainin g period , Writing off to the Costing Profit and Loss Account

Your Answer Use of supplementary rates , Carrying over the amount to remaining p eriod , Writing off to the Costing Profit and Loss Account

True/False

Question Absorption costing is more suitable for decision making than marginal c osting

Correct Answer False Your Answer True Select The Blank

Question A low margin of safety indicates ________ fixed overheads. Correct Answer higher

Your Answer higher

Multiple Choice Single Answer

Question Which of the following operations would normally be carried out first w hen preparing a master budget?

Correct Answer Determining the budget period

Your Answer Identifying the principal budget factor True/False

Question Period cost is the cost assigned to the products. Correct Answer False

Your Answer True Select The Blank

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Question Profit = Contribution per unit X ________. Correct Answer Margin of safety (units)

Your Answer Sales (units)

Multiple Choice Multiple Answer

Question Which of the following aspects are mainly responsible for difficulty in application of Uniform costing system.

Correct Answer Capital investment , Plant size , Location Your Answer Capital investment , Plant size , Loans taken Select The Blank

Question As per the provisions of Section 209 of ________, all the company form of organisation is legally required to follow the mercantile or accrual system o f accounting.

Correct Answer The Companies Act, 1956 Your Answer The Companies Act, 1956 Multiple Choice Single Answer

Question ABC Ltd. produces 10,000 units at 100% capacity utilization and its cos t structure is as follows : Fixed cost Rs.50,000/-; variable costs Rs.30,000/- a nd semi-variable costs Rs.40,000/- (40% var

Correct Answer Rs.13.85 Your Answer Rs.11.85 Select The Blank

Question Loss of uninsured goods by fire was debited incorrectly to United India Assurance Company's account instead of debiting it to ________ account.

Correct Answer Goods lost by fire Your Answer Goods lost by fire Multiple Choice Multiple Answer Question Management Accounting isâ ¦

Correct Answer Designed particularly for internal use , Helpful in estimating th e future along with past period , Useful in furnishing the necessary information to the management

Your Answer Helpful in estimating the future along with past period , Useful in furnishing the necessary information to the management , A legal requirement. Multiple Choice Multiple Answer

Question The disadvantages of supplementary overhead rates are:

Correct Answer It can be determined only after the end of the accounting period , Defeats the basic concept of normal cost , Involves lot of clerical activity Your Answer Defeats the basic concept of normal cost , Involves lot of clerical activity , It can be determined only in the beginning of the accounting period True/False

Question GAIL having monopoly in the CNG (Compressed Natural Gas) market can imp lement the Uniform costing system.

Correct Answer False Your Answer True True/False

Question One of the main objection to the contribution approach of costing is th at it ignores fixed cost.

Correct Answer True Your Answer False

Multiple Choice Multiple Answer

Question Pre-requisites of Uniform Costing are . . .

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Your Answer Spirit of mutual trust , Free Exchange of ideas , Tendency of withho lding information

Select The Blank

Question Uniform costing is not a separate method of ________. Correct Answer cost accounting

Your Answer costing

Multiple Choice Single Answer

Question Tom company has sales of Rs.200,000/- with variable expenses of Rs.150, 000/-, fixed expenses of Rs.60,000/-, and an operating loss of Rs.10,000/-. By h ow much would Tom have to increase its sales in order to achieve an operating in come of 10% of sales?

Correct Answer Rs.200,000/- Your Answer Rs.251,000/- True/False

Question An entry in the stores ledger is required for transfer of material from one job to another in the same department.

Correct Answer False Your Answer False

Multiple Choice Multiple Answer

Question For the month of November, a firm has budgeted sales of 20,000 units of X at a price of Rs.10/- and sale of 30,000 untis of Y at a price of Rs.6/- per unit. Actual sale during the month was 35,000 units of X at Rs.9/- per unit and 25,000 units of Y at Rs.8/- per unit. Calculate sales volume variance, sales mix variance and sales quantity variance.

Correct Answer Sales volume variance -Rs.120,000/- (Favourable) , Sales mix vari ance -Rs.44,000/- (Favourable) , Sales Quantity variance-Rs.76,000/- (Favourable )

Your Answer Sales volume variance -Rs.120,000/- (Favourable) , Sales mix varianc e -Rs.44,000/- (Favourable) , Sales Quantity variance-Rs.76,000/- (Favourable) True/False

Question The purpose of the profit and loss account is to bring togethre informa tion which relates to gross profit and the expenses for running the business. Correct Answer True

Your Answer True

Multiple Choice Single Answer

Question A firm has purchased a plant to manufacture a new product, the cost dat a for which is given below : Estimated annual sales 24,000 units. Estimated cost s : Materials Rs.4/- per unit; labour Re.0.60 per unit; overheads Rs.24,000/- pe r year; administrative expenses Rs.28,800/- per year and selling expenses are 15 % of sales; Calculate the selling price per unit if profit per unit is Rs.1.02. Correct Answer Rs.9.20/-

Your Answer Rs.7.74/-

Multiple Choice Single Answer

Question A company wishes to earn a 15% profit margin on selling price when quot ing for a job. Which of the following is the profit margin of cost which will ac hieve the required profit margin ?

Correct Answer 0.1765 Your Answer 0.15

LIST OF ATTEMPTED QUESTIONS AND ANSWERS True/False

Question Purchased goods by paying Rs.35,000/-: In this case, the cash account s hould be debited.

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Correct Answer True Your Answer False True/False

Question The rates at which the depreciation is to be calculated are specified i n the Income Tax Act 1961 and The Companies Act, 1956.

Correct Answer True Your Answer True Select The Blank

Question The various contents of a uniform cost manual are organisation, cost ac counting system and ________.

Correct Answer presentation of information Your Answer organisation structure

True/False

Question It is said that marginal costs are used primarily in guiding decisions that are yet to be made.

Correct Answer True Your Answer True

Multiple Choice Multiple Answer

Question Select the examples of functional budgets:

Correct Answer Sales budget , Production budget , Research and development budge t

Your Answer Sales budget , Production budget , Capital expenditure budget Multiple Choice Single Answer

Question A business's telephone bill should nromally be classified into which on e of the following categories?

Correct Answer Semi-variable cost Your Answer Variable cost

Match The Following

Question Correct Answer Your Answer

Closed the account with State Bank of India Henceforth, there shall be no differ ence in overdraft balances Henceforth, there shall be no difference in overdraft balances

Debit side of bank book is overcast Overdraft as per bank book < Overdraft as pe r pass book Overdraft as per bank book = Balanceas per pass book

Interest on debentures directly credited by bank Overdraft as per bank book > Ov erdraft as per pass book Overdraft as per bank book = Overdraft as per pass book

Received sanction for a loan of Rs.10 lakhs Overdraft as per bank book = Overdra ft as per pass book Overdraft as per bank book < Overdraft as per pass book

Multiple Choice Single Answer

Question The total production cost for making 20,000 units was Rs.21,000/- and t he total production cost for making 50,000 units was Rs.34,000/-. Once productio n exceeds 25,000 units, additional fixed costs of Rs.4,000/- are incurred. The f ull production cost per unit of making 30,000 units is:

Correct Answer Re.0.98 Your Answer Re.0.68 Select The Blank

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Question The process of finding the reasons for the difference in the balance as per bank book and pass book is known as ________.

Correct Answer Reconciliation Your Answer Reconciliation Multiple Choice Multiple Answer

Question State the features of these transactions : (i) Commission paid was posted twice to Commission account (ii) Rs.5,000/- representing goods sold to A, was posted to the credit to commission received account (iii) Sold machine for Rs.8000/-, was credited to Sales account.

Correct Answer The debit side of the trial balance will be in excess by , Involves an error of principle , Involves an error of commission

Your Answer The debit side of the trial balance will be in excess by Rs.250/- , Involves an error of principle , Involves an error of commission

Multiple Choice Single Answer

Question It is difficult to apply Uniform costing system for an industry which h as labour intensive companies as well as capital intensive companies, because : Correct Answer The cost structure is different

Your Answer The cost structure is different Multiple Choice Single Answer

Question Balance sheet is statement of Correct Answer All Assets and Properties Your Answer All Assets and Properties Select The Blank

Question The closing stocks should ________ the cost of the goods which sent on approval basis.

Correct Answer Be increased by Your Answer Not get affected by True/False

Question Under the Rowan plan bonus is a fixed percentage. Correct Answer False

Your Answer True True/False

Question Idle time variance is always favourable. Correct Answer False

Your Answer False

Multiple Choice Multiple Answer

Question Select the items which may be classified as selling and distribution ov erheads.

Correct Answer Delivery van expenses , Rent of finished goods warehouse , Sales research expenses

Your Answer Delivery van expenses , Rent of finished goods warehouse , Rent of r aw material godown

Select The Blank

Question Information as to the cost and profit / loss associated with the firm's operations is provided to the ________ by Management accounting.

Correct Answer Management Your Answer Cost

Multiple Choice Single Answer

Question Compute actual total cost based on the data given below: Total standard cost (standard material cost + standard labour cost) -Rs.19,633.33; labour rate variance-Rs.900/- (adverse); material price variance -Rs.90/- (Favourable); mat

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erial yield variance -Rs.700/- (Favourable); labour yield variance -Rs.333.33 (F avourable).

Correct Answer Rs.19,410/- Your Answer Rs.17,610/-

Multiple Choice Single Answer

Question The standard production for a particular work order is 20 units per day and piece rate wages is 60 paise per unit. Cost of material is 30 paise per uni t. It is proposed to charge factory overheads equal to 100% of labour cost. Indi cate the factory overhead per unit.

Correct Answer Rs.1.50/- Your Answer Rs.1.30/-

Multiple Choice Multiple Answer

Question The suspense account has a debit balance of Rs.40,000/-. Select the tra nsactions which are capable of nullifying this balance.

Correct Answer Conveyance expenses of Rs.25,000/- were posted on the wrong side of the account. , Purchased computer worth Rs.28,000/- was recorded in the ledge r as , The total of the purchase book was cast short by Rs.44,000/-

Your Answer Free samples worth Rs.40,000/- distributed during the year were cred ited to sales account , Conveyance expenses of Rs.25,000/- were posted on the wr ong side of the account. , Purchased computer worth Rs.28,000/- was recorded in the ledger as

Multiple Choice Single Answer

Question Panna Ltd. temporarily has excess production capacity. The idle plant f acilties can be used to manufacture a low-margin item. The low-margin item shoul d be produced if it can be sold for more than its:

Correct Answer Variable costs Your Answer Variable costs Select The Blank

Question Contribution represents pool of resources available for meeting all cos ts other than ________.

Correct Answer Variable costs Your Answer Variable costs Select The Blank

Question Goods returned to the suppliers from whom it was ________d is recorded in thePurchasereturn register.

Correct Answer Purchase Your Answer Purchase

Multiple Choice Multiple Answer

Question From the available information calculate sales value variance and budge ted sales quantity of X.Actual sales of X -500 units; budgeted price per unit -R s.12/-; actual price per unit-Rs.15/- and sales volume variance -Rs.1,200/- (Fav ourable).

Correct Answer Budgeted sales - 400 units , Sales value variance -Rs.2,700/- , T he sales value variance is favourable

Your Answer The sales value variance is adverse True/False

Question Depreciation, interest and property tax continue even when the operatio ns are discontinued.

Correct Answer True Your Answer True Select The Blank

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are

Correct Answer become zero Your Answer become zero

Multiple Choice Multiple Answer

Question Management accounting is concerned with the following activities : Correct Answer Decision making , Safeguarding assets , Planning and controlling activities

Your Answer Decision making , Planning and controlling activities True/False

Question It is said that the income statement represents wealth increase /decrea se for the organisation.

Correct Answer True Your Answer False Select The Blank

Question The difference between sales and prime cost is known as ________. Correct Answer Gross Profit

Your Answer Gross Profit

Multiple Choice Multiple Answer

Question In which of the following situations, the flexible budget should be pre ferred?

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 Single Answer

Question Debtors as on 31st March, 2004 stood as Rs.75,400/-. Out of this amount , Rs.15,884/- is receivable from ABC & Co. Also, Rs.21,555/- included in the cre ditors, indicates amount due to ABC & Co. Total creditors as on 31st March, 2004 = Rs.88,466/-. Find the amount of debtors and creditors that should be disclose d in the balance sheet as on 31st March, 2004.

Correct Answer Debtors - Rs.59,516/-; Creditors - Rs.66,911/- Your Answer Debtors - Rs.53,845/-; Creditors - Rs.72,582/- Match The Following

Question Correct Answer Your Answer

Sunk Cost Historical Cost Historical Cost

Cost Centre Facilitate the fixation of responsibility Facilitate the fixation of responsibility

Cost Control Process of controlling costs of operations Process of controlling c osts of operations

Differential Cost Increase or Decrease in cost Increase or Decrease in cost

Select The Blank

Question Cost volume profit analysis focuses attention on the ________ effect of a particular course of action.

Correct Answer short run

Your Answer short and long run Multiple Choice Multiple Answer

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the balance as per pass book as on the same date is Rs.10,123.60. Select the tr ansactions representing the reasons for this difference.

Correct Answer Interest credited by bank, not entered in the bank book, Rs.125.6 0 , Cheques dishonoured not entered in the bank book Rs.200/- , Debit side of th e cash book is overcast by Rs.100/-

Your Answer Interest credited by bank, not entered in the bank book, Rs.125.60 Multiple Choice Single Answer

Question Uniform costing system is useful in the following areas Correct Answer Classification of cost accounts

Your Answer Preparing financial statements True/False

Question Revenue expenditure indicates the amount of funds spent during a certai n period with the intention to receive the returns in future.

Correct Answer False Your Answer True True/False

Question Price based on Uniform Costing may be taken to be reliable and represen tative of the whole industry.

Correct Answer True Your Answer True True/False

Question Cheque received from a client on 28th September, 2004 must be entered i n the bank book only after it is credited in the pass book.

Correct Answer False Your Answer False

Multiple Choice Multiple Answer

Question The objectives of Uniform costing system are as follows :

Correct Answer To fix a common selling price for the industry as a whole , To co mpare efficiency of each unit against industry's overall performance , To compil e reliable cost data for inter-firm comparison of costs

Your Answer To fix a common selling price for the industry as a whole , To compa re efficiency of each unit against industry's overall performance , To compile r eliable cost data for inter-firm comparison of costs

Multiple Choice Multiple Answer

Question Purchased goods worth Rs.6,450/- on 10th March, 2004. However the goods were delivered directly to the plant situated at Nagar and hence this transacti on was not recorded in the purchase book, which is maintained at the corporate o ffice. Analyse the impact of this transaction.

Correct Answer The gross profit will increase by Rs.6,450/-

Your Answer The purhases will increase by Rs.6,450/- , The closing stock will in crease by Rs.6,450/- , The gross profit will increase by Rs.6,450/-

Select The Blank

Question Carriage charges paid for a new machine purchased if debited to carriag e account would affect the ________

Correct Answer Machinery A/c and carriage A/c Your Answer Carriage A/c

Multiple Choice Multiple Answer

Question Different types of tenders are :

Correct Answer Singly tender , Open tender , Global tender Your Answer Multiple tender , Open tender , Global tender Multiple Choice Single Answer

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Question Purchased 200 shares of Bharat Forge Ltd. for Rs.850/- per share, which account should be debited?

Correct Answer Investment account - Rs.170,000/- Your Answer Investment account - Rs.170,000/- Multiple Choice Single Answer

Question Basic objective of Uniform Costing is . . . Correct Answer comparison

Your Answer To control cost Multiple Choice Multiple Answer

Question Select the entries which need to be rectified

Correct Answer Purchase A/c ... Dr. to Damodar's A/c (Being furniture purc hased from Damodar) , Gopal's A/c ... Dr. to cash A/c (Being entry for p ayment of railway freight for goods purchased) , Cash A/c ...Dr. to Sur esh's A/c (Being cash received from Suresh for goods sold to him for)

Your Answer Gopal's A/c ... Dr. to cash A/c (Being entry for payment of railway freight for goods purchased)

Multiple Choice Single Answer

Question A new computer worth Rs.35,000 was purchased on 18th June, 2003. The co mpany has 10 such computers costing Rs.20,000/- each. The depreciation is charge d @ 18% p.a. Find the depreciation on computers to be charged for the year. Correct Answer Rs.40,953.70

Your Answer Rs.36,000/- Select The Blank

Question The varinace that attempts to ascertain the effect of change in sales v olume on the difference between actual and budgeted contribution is known as ___ _____ variance.

Correct Answer Sales margin volume Your Answer Sales margin yield

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LIST OF ATTEMPTED QUESTIONS AND ANSWERS

True/False

Question Credit balances in all the Personal & Real accounts appear on as set side.

Correct Answer False Your Answer False

Multiple Choice Multiple Answer

Question Contents of Uniform Cost Manual are

Correct Answer Organization , Cost Accounting system , Presentation of information

Your Answer Organization , Cost Accounting system , Presentation of informat ion

Multiple Choice Multiple Answer

Question Uniform Costing Methods may be advantageously applied to . . . Correct Answer Single organization having number of branches. , Number of companies in same industry , Similar Industries such as cotton, jute etc. Your Answer Single organization having number of branches. , Number of compa nies in same industry , Similar Industries such as cotton, jute etc.

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True/False

Question 1) Financial statements are basically in two forms i.e. profitab ility statement and balance sheet.

Correct Answer True Your Answer True

Multiple Choice Multiple Answer

Question The process of accounting has three streams of accounting ---,---and ---.

Correct Answer Financial Accounting , Cost Accounting , Management Acco unting

Your Answer Financial Accounting , Cost Accounting , Management Accounting

True/False

Question Long term loan borrowed from financial institution comes under t he heading of long term liabilities.

Correct Answer True Your Answer True

Match The Following

Question Correct Answer Your Answer

Book-Keeping Books of Accounts Books of Accounts

Financial statement Profitability statement & Balance-sheet Profitability st atement & Balance-sheet

Accounting Process of analyzing & interpretation Process of analyzing & i nterpretation

Profitability statement Indicates the amount of profit earned Indicates the am ount of profit earned

Balance-sheet Financial status Financial status

Multiple Choice Single Answer

Question Judge the statement according to the criteria given : ' The acco unting period for XYZ Ltd. ends on 31st December, 2003. It is noted that office rent for the month of December, 2003 is paid on 15th January, 2004. "According t o concept of matching expenses with the revenues, this expenditure should be rec orded in the books of accounts in January,

Correct Answer The statement and its reason are both incorrect Your Answer The statement is correct but its reason is incorrect

Multiple Choice Multiple Answer

Question Features of money measurement concept are . . .

Correct Answer Only those transactions and facts are included expressed in terms of money are considered , Imposes severe restrictions on the kind of i nformation available from financial statements , Works as a major drawback of fi nancial accounting

Your Answer Only those transactions and facts are included expressed in term s of money are considered , Imposes severe restrictions on the kind of informati

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on available from financial statements , Works as a major drawback of financial accounting

Multiple Choice Single Answer

Question The installation and operation of ___________ accounting require s a very elaborate organizational structure and large number of rules & regulati ons

Correct Answer Management Your Answer Management

Select The Blank

Question ________account can be defined as the record of all the transact ions pertaining to a person, asset, liability income or expenditure which have t aken place in a specified period.

Correct Answer Ledger Your Answer Trading

Match The Following

Question Correct Answer Your Answer Sunk Cost Historical Cost Historical Cost

Cost Centre Facilitate the fixation of responsibility Facilitate the f ixation of responsibility

Cost Control Process of controlling costs of operations Process of contr olling costs of operations

Differential Cost Increase or Decrease in cost Increase or Decrease in cost

Multiple Choice Multiple Answer

Question Which of the following transactions should be excluded while pre paring a cost sheet ?

Correct Answer Interest on loan , Bad debts , Expenses on criminal law suit

Your Answer Sale of scrap material , Interest on loan , Bad debts

True/False

Question In a Balance-Sheet right hand side is referred as assets side an d left hand side is referred as liabilities.

Correct Answer True Your Answer True

True/False

Question Credit note is an intimation send to person dealing with the bus iness that his account being debited for the purpose indicated therein.

Correct Answer False Your Answer False

True/False

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d to the service departments by the production departments. Correct Answer False

Your Answer True

Multiple Choice Multiple Answer

Question Marginal costing is found to be unsuccessful in the following si tuations

Correct Answer Impossible to distinguish costs into fixed and variable component. , With respect to capital intensive industries where fixed costs are very large and hence cannot be ignored , With respect to service industries wher e employee costs are very large and almost fixed in nature

Your Answer Impossible to distinguish costs into fixed and variable componen t. , With respect to capital intensive industries where fixed costs are very lar ge and hence cannot be ignored , With respect to service industries where employ ee costs are very large and almost fixed in nature

True/False

Question Debit Note is an intimation sent to person dealing with the busi ness that his account is being credited for the purpose indicated therein.

Correct Answer False Your Answer True

Multiple Choice Multiple Answer

Question Labour efficiency variance arises due to:

Correct Answer Inefficient supervisor , Poor working conditions , Use o f sub-standard quality of material

Your Answer Inefficient supervisor , Poor working conditions , Use of sub-st andard quality of material

True/False

Question Financial Accounting discloses the financial performance & finan cial statements of the business as a whole.

Correct Answer True Your Answer True

True/False

Question Balance sheet indicates the expenditure & income from the busine ss.

Correct Answer False Your Answer True

Select The Blank

Question The indirect material cost, indirect labour cost and indirect ex penses cost, collectively are termed as ________.

Correct Answer Overhead Your Answer Overhead

Select The Blank

Question A person in charge of a ________ may be held responsible for its proper functioning and cost control.

Correct Answer Cost centre Your Answer Cost centre

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Multiple Choice Multiple Answer

Question The organization chart shows the following aspects :

Correct Answer Functional responsibility of different functional manage rs , Delegation of authority to various managers , Inter-functional relationship s of these managers

Your Answer Functional responsibility of different functional managers , Del egation of authority to various managers , Inter-functional relationships of the se managers

True/False

Question Uniform costing system is a pre-requisite to an inter-firm compa rison of firms belonging to the different industries.

Correct Answer False Your Answer False

True/False

Question P&L statement which is a period statement & relates to a certain period tells about results of operations.

Correct Answer True Your Answer False

Select The Blank

Question Depreciation charged on office furniture on straight line basis is an example of ________.

Correct Answer Administration overheads Your Answer Administration overheads

True/False

Question Under time rate system a worker is paid on the basis of producti on achieved by him in a given time.

Correct Answer False Your Answer False

Select The Blank

Question Information as to the cost and profit / loss associated with the firm's operations is provided to the ________ by Management accounting.

Correct Answer Management Your Answer Management

True/False

Question Danger level for inventory of materials means the safety stock o f inventory.

Correct Answer False Your Answer True

True/False

Question The role of the budget committee may be taken as an advisory rol e to the Chief Executive.

Correct Answer True Your Answer True

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Multiple Choice Multiple Answer

Question The main advantages of profit sharing are :

Correct Answer Employees try to increase productivity , Incentives are shared by all the employees , Augments emplyees' efficiency

Your Answer Employees try to increase productivity , Incentives are shared b y all the employees , Augments emplyees' efficiency

Select The Blank

Question ________ Accounting assists the management in establishing the p lans to attain the economic objectives and take proper decisions for the attainm ent of its objectives.

Correct Answer Management Your Answer Management

Multiple Choice Multiple Answer

Question Which of the following is likely to be a contributory factor to the incidence of excess expenditure on material cost?

Correct Answer The level of control of the used of material in the prod uction cycle , The incorrect choice of purchase order quantity , Failure to cont rol the issue of materials from stores

Your Answer An increase in the maximum material inventory level , The incorr ect choice of purchase order quantity , Failure to control the issue of material s from stores

Multiple Choice Multiple Answer

Question Management accounting is concerned with the following activities :

Correct Answer Decision making , Safeguarding assets , Planning and con trolling activities

Your Answer Decision making , Safeguarding assets , Planning and controlling activities

Multiple Choice Multiple Answer

Question Features of double entry accounting system are . . .

Correct Answer Every business transaction has two elements , When busin ess receives something, it has to pay something , Every debit has a correspondin g credit

Your Answer Every business transaction has two elements , When business rece ives something, it has to pay something , Every debit has a corresponding credit

Select The Blank

Question Under Differential Time Rate method payment is made at Rs. 1.40 per hour when the level of efficiency is between________.

Correct Answer 90% to 100% Your Answer 90% to 100%

True/False

Question Maintenance Department is a service cost centre. Correct Answer True

Your Answer True

True/False

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, cost, management accounting. Correct Answer True Your Answer True

Select The Blank

Question The difference between sales and cost of sales is termed as ____ ____.

Correct Answer Net Profit Your Answer Net Profit

Select The Blank

Question The final result disclosed by trading account is the ________pro fit earned by the organization.

Correct Answer Gross Your Answer Gross

Multiple Choice Multiple Answer

Question Select the accounts to be disclosed on the liability side of the Balance sheet.

Correct Answer Loan , Outstanding expenses , Creditors Your Answer Loan , Outstanding expenses , Creditors

True/False

Question Penalty paid for delay in payment to creditors represents uncont rollable cost.

Correct Answer False Your Answer False

Multiple Choice Single Answer

Question Which document facilitates estimating material cost of a particu lar job, before completion of that job?

Correct Answer Bill of material Your Answer Material requisition note

Multiple Choice Single Answer

Question Purchases returns of Rs.18,000/- were wrongly transferred to the sales returns account. Calculate its impact on net profit.

Correct Answer The net profit will not be affected Your Answer The net profit will not be affected

Multiple Choice Single Answer

Question It is said that adoption of uniform costing creates customer con fidence because . . .

Correct Answer Prices are reliable Your Answer Prices are reliable

Multiple Choice Single Answer

Question An order for goods worth Rs.18,000/- was placed on 25th March, 2 004. The goods were received on 1st April, 2004. Calculate the impact of this tr ansaction on the final statements of accounts for the year ended 31st March, 200 4.

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Your Answer The net profit will not be affected LIST OF ATTEMPTED QUESTIONS AND ANSWERS

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 â ¦ 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 acc ount, 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 ove rhead 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 inform ation 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 char acteristics of the business organisation, tax considerations, statutory requirem ents 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 /decrea se for the organisation.

Correct Answer True Your Answer False

Multiple Choice Single Answer

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ining in office. If his annual salary is Rs.500,000/-, what amount should be cha rged as office overheads ?

Correct Answer Rs.300,000/-Your Answer

Rs.200,000/-Multiple Choice Rs.200,000/-Multiple Answer

Question The factors to be considered while preparing the direct materials budge t are :

Correct Answer Adequacy of material storing space , Availability of funds , Mate rial in stores but reserved for specific purposes

Your Answer Adequacy of material storing space , Availability of funds , Materia l in stores but reserved for specific purposes

Multiple Choice Multiple Answer

Question In which of the following situations, the flexible budget should be pre ferred?

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 costi ng

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 workin g 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 managemen t 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 th e selling efforts

Multiple Choice Multiple Answer

Question From the following, select intangible assets: Correct Answer Goodwill , Patents , Trade Marks

Figure

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