1. The business environmental factors are _________.
Correct : B. Dynam
2. The control ratios used by the management to know whether the deviations of the actual performance from the budgeted performance are favourable or unfavourable are __________.
Correct : A. Capacity ratio and calendar ratio.
3. The problems associated with marginal costing are
Correct : D. All of the above
4. ___________ is not suitable where selling price is determined on the basis of cost-plus method.
Correct : B. Marginal costing
5. Managers utilizes marginal costing for
Correct : D. All of the above
6. Which of the following are advantages of marginal costing?
Correct : D. and budgetary control D. All of the above
7. Given production is 1,00,000 units, fixed costs is Rs 2,00,000 Selling price is Rs 10 per unit
and variable cost is Rs 6 per unit. Determine profit using technique of marginal costing.
Correct : A. Rs 2, 00,000
8. Contribution margin is also known as
Correct : D. Marginal income
9. Contribution is the difference between
Correct : A. Sales and variable cost
10. When fixed cost is Rs. 20,000 and Profit volume ratio is 25 per cent, then breakeven point
will occur at
Correct : C. Rs. 80,000
11. Period cost means
Correct : B. Fixed costs
12. If profit-volume ratio is 25 per cent and sales is Rs. 100,000, the variable cost will be
Correct : C. Rs. 75,000
13. The valuation of stock in marginal costing as compared to absorption costing is
Correct : D. None of the above
14. The term standard cost refers to the:
Correct : B. Budgeted unit cost of product produced in a particular period
15. The term budgeted cost refers to the:
Correct : A. Estimated expenses of budgeted production
16. ……………is concerned with providing information to management for taking managerial
decisions.
Correct : A. Management Accounting
17. Which among the following is not a management accounting technique?
Correct : D. None
18. The essence of marginal costing is that ……………… cost is considered on the whole as
separate.
Correct : A. Fixed
19. A document that records the standard cost of a single unit of product is known as:
Correct : C. Standa
20. Following is used as tool for Cost Control
Correct : D. cost (D) All of the above
21. Which phrase best describes the current role of the managerial accountant?
Correct : B. Managerial accountants facilitate the decision-making process within an organization.
22. In comparison to the traditional manufacturing environment, overhead costs in a JIT
environment all the following are true except
Correct : D. utilities.
23. As production increases within the relevant range,
Correct : B. variable costs will vary in total.
24. Which of the following statements regarding graphs of fixed and variable costs is true?
Correct : D. costs are zero when production is equal to zero.
25. All of the following statements regarding budgeting is true except
Correct : C. Budgeting is a bookkeeping task
26. A 'direct' cost is a cost that is classified by:
Correct : B. traceability
27. Which of the following costs is not capitalized as inventory?
Correct : B. factory (manufacturing) overhead
28. A management concept under which all managers and employees at all stages of company
operations strive toward higher standards and a reduced number of defective units are called:
Correct : B. Total Quality Management (TQM)
29. The following information belongs to John Manufacturing Company that uses a standard costing system:
• Basic wage rate:Rs.12 per hour
• Fringe benefits: Rs. 2 per hour
• Basic time: 2 hours per unit
• Allowance for down time: 0.3 hours per unit
• Allowance for brakes: 0.2 hours per unit
Based on the above information, what is the standard direct labor cost per unit?
Correct : A. RS.35
30. Which of the following is a correct formula for computing direct materials price variance?
Correct : B. Actual quantity purchased × (Actual rate - Standard rate)
31. A favorable direct materials price variance occurs when:
Correct : C. Actual rate of direct materials is less than standa
32. The “standard hours allowed” or “standard quantity allowed” is equal to:
Correct : B. Actual output in units × standard output allowed
33. During the month of January, the standard cost of actual hours worked amounted to
Rs.25, 000, the standard direct labor rate was Rs.10 per hour and the direct labor efficiency variance amounted to Rs.1, 000 favorable. The standard hours allowed for actual production were:
Correct : D. 2,600 hours
34. Which one of the following does measure risk?
Correct : C. Expect
35. A situation in which a decision maker knows all of the possible outcomes of a decision and also knows the probability associated with each outcome is referred to as
Correct : B. Risk.
36. A situation in which a decision maker must choose between strategies that have more than
one possible outcome when the probability of each outcome is unknown is referred to as
Correct : D. Uncertainty.
37. Circumstances that influence the profitability of a decision are referred to as
Correct : C. States of nature.
38. The analysis of a complex decision situation by constructing a mathematical model of the
situation and then performing a large number of iterations in order to determine the probability distribution of outcomes is called
Correct : C. Simulation
39. The tendency for low-quality cars to drive high quality cars out of the used car market is an
example of
Correct : B. Adverse selection.
40. Which of the following is a way to deal with decision making under uncertainty?
Correct : A. Simulation
41. ______ is an objective assessment of an individual's performance against well-defined
benchmarks.
Correct : A. Performance Appraisal
42. what is linked with performance appraisal?
Correct : C. Job analysis
43. which of the following is an alternate term used for performance appraisal?
Correct : C. Employee assessment
44. Match the following general applications of performance assessment with their specific purposes
I. Administrative Uses/ Decisions ----- A. Performance Feedback
II. Documentation ------ B. Lay - offs
III Organizational Maintenance/ Objectives ---- C. Helping to meet legal requirements
IV. Developmental Uses ----- D. Evaluation of HR systems
Correct : B. I-B, II-C, III-D, IV-A
45. Which of these is the main purpose of employee assessment?
Correct : B. To effect promotions based on competence and performance
46. How performance appraisal can contribute to a firm's competitive advantage?
Correct : D. All of the above
47. From the strategic point of view, in which three categories can an organisation, be grouped?
Correct : D. All of the above
48. Successful defenders use performance appraisal for identifying ____________.
Correct : C. Training needs
49. Analyzers tend to emphasis both ______ and _______ and employee extensive training
programmes.
Correct : A. Skill building and skill acquisition
50. What do successful analyzers tend to examine?
Correct : C. Current performance with past performance
51. which of the following cannot be a reason of unfavorable direct materials price variance?
Correct : C. Appointment of inexperienc
52. Which of the following is not likely to be a reason of unfavorable direct labor efficiency
variance?
Correct : A. Increase in direct materials prices
53. Question Selling price per tonne is Rs. 69.50, variable cost per tonne is Rs. 35.50 and fixed
cost is Rs. 18, 02,000. Find out the BEP in units
Correct : C. 53000
54. Labour Efficiency Standards are decided by considering following factor(s)
Correct : D. All of the above
55. A good _____ system will not punish the workers for the matters beyond the control of the
workers.
Correct : A. Wage payment
56. ________ do not give the returns during the same period during which they are paid for
Correct : B. Fixed assets
57. --------------- Following is (are) called the element(s) of Cost
Correct : D. All of the above
58. The cause(s) of idle time can be analysed as
Correct : D. All of the above
59. __________ Accounting becomes a source of information for Management Accounting.
Correct : A. Financial
60. Which of the following cannot be a reason of unfavorable direct materials quantity
variance?
Correct : D. Uneconomical order size
61. Which of the following is not likely to be a reason of unfavorable direct labor rate variance?
Correct : C. Frequent break downs
62. Standard Costing specifically relates to the function of
Correct : B. Production
63. Cost Accounting restrict itself with _____ transactions
Correct : C. Historical
64. In Cash budget, Non- operating cash inflow include(s)
Correct : D. assets (D) All of the above
65. Sales Budget is a forecast expressed in
Correct : C. Both (A) a
66. Following is used as tool for Cost Control
Correct : C. Standa
67. The term management accounting was first coined in
Correct : B. 1950
68. Management accounting is 1) Subjective 2) Objective
Correct : A. Only 1
69. The use of management accounting is
Correct : A. Optional
70. The management accounting can be stated an extension of 1) Cost Accounting 2 ) Financial Accounting 3) Responsibility Accounting
Correct : D. 1, 2, 3
71. Who coined the concept of management accounting?
Correct : B. James H. Bliss
72. The definition ‘Management Accounting is the presentation of accounting information in
such a way as to assist management in the creation of policy and the day-to-day operation of an undertaking.’
Correct : A. Anglo –American Council on Productivity
73. During the month of December actual direct labor cost amounted to Rs. 39,550, the
standard direct labor rate was Rs.10 per hour and the direct labor rate variance amounted toRs.450 favorable. The actual direct labor hours worked was:
Correct : B. 4,000 hours
74. Responsibility centres are departments or organizational functions whose performance is the
direct responsibility of specific managers. One type of responsibility centre is a revenue centre, which is responsible for
Correct : D. sales
75. Key motivational factors in budgeting do not include
Correct : B. correct identification of the blame for below budget performance
76. Which of the following does not help to minimize the problems encountered in budgeting?
Correct : D. keeping bad news from the managing director
77. What would be the most likely cause of an unfavourable labour rate variance together with a
favourable labour efficiency variance?
Correct : A. The employment of more highly skilled staff than budgeted
78. A budgeting process which demands each manager to justify his entire budget in detail
from beginning is
Correct : C. Zero base budgeting
79. ________ is the first step of budgetary system and all other budgets depends on it.
Correct : B. Sales budget
80. __________ contains the picture of total plans during the budget period and it comprises
information relating to sales, profit, cost, production etc.
Correct : A. Master budget
81. Budgetary control system acts as a friend, philosopher and guide to the…
Correct : A. Management
82. Budgetary control facilitates easy introduction of the…
Correct : C. Standa
83. Key factor is also known as…
Correct : D. All
84. The responsibility accounting stresses on _________
Correct : A. Decentralization
85. In responsibility accounting system…
Correct : D. All of the above
86. The responsibility accounting emphasizes the performance of ____
Correct : B. Men
87. The responsibility accounting is also called…
Correct : C. Both
88. The responsibility accounting is the part of …
Correct : B. Management accounting
89. The responsibility accounting is a controlling tool for…
Correct : A. Top‐level management
90. The accounting department in an organization is…
Correct : A. Investment centre
91. The responsibility accounting is a system by which the responsibility is assigned to the
concerned persons…
Correct : B. To control cash
92. According to responsibility accounting, the entire organization is divided into various…
Correct : C. Responsibility centre
93. In responsibility centre, the output is called as…
Correct : A. Revenue
94. If the responsibility centre gets more revenue from output, then it is called…
Correct : C. Profit centre
95. Internal transfer of process at profit _________ of the company
Correct : A. Will not increase the asset
96. The determination of actual value of assets employed in a responsibility centre is…
Correct : C. Difficult
97. Flexible manufacturing systems (FMS) are reported to have a number of benefits. Which is
NOT a reported benefit of FMS?
Correct : C. More flexible than the manufacturing systems they replace
98. The use of Internet-based technology, either to support existing business processes or to
create entirely new business opportunities, has become known as what?
Correct : B. E-business
99. Which one of the following is not one of the Balanced Scorecard’s four generic perspectives?
Correct : A. Marketing and advertising
100. Which one of the following statements is true?