McqMate
| 101. |
Profit Volume ratio is the ratio of ……………. To sales |
| A. | contribution |
| B. | profit |
| C. | sales |
| D. | none of these |
| Answer» A. contribution | |
| 102. |
…………..is the angle caused by intersection of total cost line and total sales line |
| A. | angle of contribution |
| B. | angle of incidence |
| C. | all of these |
| D. | none of these |
| Answer» B. angle of incidence | |
| 103. |
At Break even point contribution will be equal to ……………. |
| A. | variable cost |
| B. | fixed cost |
| C. | profit |
| D. | none of these |
| Answer» B. fixed cost | |
| 104. |
The ratio of contribution to ……………. Is called P/V ratio |
| A. | volume |
| B. | sales |
| C. | profit |
| D. | none of these |
| Answer» B. sales | |
| 105. |
Marginal cost is the aggregate of prime cost and ………………. |
| A. | fixed overheads |
| B. | variable overheads |
| C. | contribution |
| D. | none of these |
| Answer» B. variable overheads | |
| 106. |
When fixed cost is deducted from contribution, the balance will be ………. |
| A. | variable cost |
| B. | profit |
| C. | total cost |
| D. | sales |
| Answer» B. profit | |
| 107. |
When sales are Rs.30000 and P/V ratio is 20% then contribution will be…. |
| A. | 2000 |
| B. | 4000 |
| C. | 6000 |
| D. | 8000 |
| Answer» C. 6000 | |
| 108. |
When fixed costs are Rs.4000 and P/v ratio is 25%, then break even point will be ………….. |
| A. | 40000 |
| B. | 20000 |
| C. | 16000 |
| D. | 10000 |
| Answer» C. 16000 | |
| 109. |
When profit is Rs.5000 and P/v ratio is 20% , Margin of safety is………… |
| A. | 10000 |
| B. | 25000 |
| C. | 30000 |
| D. | 50000 |
| Answer» B. 25000 | |
| 110. |
Fixed costs Rs.6000, Profit required Rs.4000 and P/v ratio is 50% , then sales required will be…………. |
| A. | 6000 |
| B. | 4000 |
| C. | 10000 |
| D. | 20000 |
| Answer» D. 20000 | |
| 111. |
Variable cost ratio is 60% Sales Rs.20000 and fixed cst Rs.5000, then profit will be …….. |
| A. | 15000 |
| B. | 12000 |
| C. | 3000 |
| D. | 10000 |
| Answer» C. 3000 | |
| 112. |
Responsibility Accounting is also called ……………. Accounting |
| A. | profitability |
| B. | management |
| C. | all of these |
| D. | none of these |
| Answer» A. profitability | |
| 113. |
In responsibility accounting the organization is divided into different ………centers |
| A. | responsibility |
| B. | cost |
| C. | profit |
| D. | none of these |
| Answer» A. responsibility | |
| 114. |
A cost centre is a segment of the organization where the manager is responsible for ………………….. |
| A. | costs |
| B. | inputs |
| C. | a or b |
| D. | none of these |
| Answer» C. a or b | |
| 115. |
Both costs and revenues are measured in ………………… centers |
| A. | cost |
| B. | profit |
| C. | revenue |
| D. | all of these |
| Answer» B. profit | |
| 116. |
A …………….is that factor which causes cost. |
| A. | cost driver |
| B. | profit driver |
| C. | all of these |
| D. | none of these |
| Answer» A. cost driver | |
| 117. |
cost driver for activities is called ……………. |
| A. | activity driver |
| B. | expense driver |
| C. | driver |
| D. | none of these |
| Answer» A. activity driver | |
| 118. |
A centre where the manager is responsible for sales is ………….. |
| A. | cost centre |
| B. | revenue centre |
| C. | investment centre |
| D. | none of these |
| Answer» B. revenue centre | |
| 119. |
The performance of investment centre is based on ………………. |
| A. | cost of the centre |
| B. | profit of the centre |
| C. | profit and investment of the centre |
| D. | revenue of the centre |
| Answer» C. profit and investment of the centre | |
| 120. |
Responsibility accounting is used for ………………. |
| A. | cost control |
| B. | planning |
| C. | decision making |
| D. | pricing |
| Answer» A. cost control | |
| 121. |
ABC system is used for ……………… |
| A. | material control |
| B. | wages control |
| C. | overhead allocation |
| D. | pricing decisions |
| Answer» C. overhead allocation | |
| 122. |
.A cost centre is ………………… |
| A. | a production department where all production costs are aggregated |
| B. | an area of business accountable for both costs and revenues |
| C. | the part of the business where all costs are paid to suppliers |
| D. | an area for which costs are accumulated |
| Answer» D. an area for which costs are accumulated | |
| 123. |
An investment centre is a responsibility centre where the manager has control of ……………… |
| A. | costs and profits |
| B. | cost profits and product quality |
| C. | costs profits and assets |
| D. | costs |
| Answer» C. costs profits and assets | |
| 124. |
Responsibility accounting aims to ……………. |
| A. | ensure that costs become the responsibility of a specific manager |
| B. | reduce the costs that a department incurs |
| C. | allocate costs to all areas of a business |
| D. | ensure that a manager is punished if things go wrong |
| Answer» A. ensure that costs become the responsibility of a specific manager | |
| 125. |
Prime costs may be defined as |
| A. | the total costs of manufacturing a product |
| B. | the total direct costs of manufacturing a product |
| C. | the cost of the first stage of manufacturing |
| D. | the total cost of production |
| Answer» B. the total direct costs of manufacturing a product | |
| 126. |
Which of the following best describes a fixed cost ? |
| A. | remains constant irrespective of the level of activity |
| B. | represents a fixed proportion of total costs |
| C. | increases proportionately with output |
| D. | has a direct relationship with output |
| Answer» A. remains constant irrespective of the level of activity | |
| 127. |
The weighted average method of stock valuation would be most appropriate for …………. |
| A. | chemical manufacturer |
| B. | a food retailer |
| C. | a building contractor |
| D. | a motor components retailer |
| Answer» A. chemical manufacturer | |
| 128. |
Direct labour costs will include…………… |
| A. | all labor costs attributable to product |
| B. | direct labor costs plus any bonuses |
| C. | total direct labor hours at the normal hourly rate of pay |
| D. | direct labor costs plus any bonuses and overtime premium |
| Answer» C. total direct labor hours at the normal hourly rate of pay | |
| 129. |
Management accounting is said to meet: |
| A. | the internal accounting needs of the organization |
| B. | the needs of laws that govern company financial reporting. |
| C. | the regulatory requirements of the organization |
| D. | the external accounting needs of the organisation. |
| Answer» A. the internal accounting needs of the organization | |
| 130. |
Which one of the following is not a recognised cost classification? |
| A. | time |
| B. | function |
| C. | performance |
| D. | type |
| Answer» C. performance | |
| 131. |
Direct costs are also known as: |
| A. | indirect cost |
| B. | overhead costs |
| C. | prime costs |
| D. | marginal costs |
| Answer» C. prime costs | |
| 132. |
Indirect costs are also known as |
| A. | direct cost |
| B. | overhead costs |
| C. | prime costs |
| D. | marginal costs |
| Answer» B. overhead costs | |
| 133. |
Which of the following is not true? |
| A. | managerial accounting information is prepared for internal users |
| B. | managerial accounting information is not required by various laws |
| C. | there are specific standards of acceptability for managerial accounting |
| D. | the structure of managerial accounting practice is relatively flexible |
| Answer» C. there are specific standards of acceptability for managerial accounting | |
| 134. |
Which of the following are basic inventories for a manufacturer? |
| A. | indirect materials, goods in process, and raw materials |
| B. | finished goods, raw materials, and direct materials |
| C. | raw materials, goods in process, and finished goods |
| D. | raw materials, factory overhead, and direct labour |
| Answer» C. raw materials, goods in process, and finished goods | |
| 135. |
The three basic elements of the cost of a manufactured product are: |
| A. | indirect materials, indirect labour, and manufacturing overhead |
| B. | merchandise inventory, work in process, and finished goods inventory |
| C. | direct materials, work in process, and finished goods inventory |
| D. | direct materials, direct labour, and manufacturing overhead |
| Answer» D. direct materials, direct labour, and manufacturing overhead | |
| 136. |
A cost which changes in proportion to changes in volume of activity is called |
| A. | fixed cost |
| B. | controllable cost |
| C. | variable cost |
| D. | opportunity cost |
| Answer» C. variable cost | |
| 137. |
A 'direct' cost is a cost that is classified by: |
| A. | behaviour |
| B. | traceability |
| C. | controllability |
| D. | relevance |
| Answer» B. traceability | |
| 138. |
A 'product' cost is a cost that is classified by: |
| A. | behaviour |
| B. | function |
| C. | controllability |
| D. | relevance |
| Answer» B. function | |
| 139. |
Which of the following is a period cost? |
| A. | direct materials |
| B. | indirect materials |
| C. | factory utilities |
| D. | administrative expenses |
| Answer» D. administrative expenses | |
| 140. |
Managerial accounting information is generally prepared for |
| A. | shareholders |
| B. | creditors |
| C. | managers |
| D. | regulatory agencies |
| Answer» C. managers | |
| 141. |
Which of the following is not an internal user of management information? |
| A. | creditor |
| B. | department manager |
| C. | controller |
| D. | treasurer |
| Answer» A. creditor | |
| 142. |
Sales commissions are classified as |
| A. | prime costs |
| B. | period costs |
| C. | product costs |
| D. | indirect labour |
| Answer» B. period costs | |
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