McqMate
1. |
Which of the following statements is false ? |
A. | the limitations of financial accounting have led to the origin and evolution of cost accounting |
B. | financial accounts fail to give a product wise break up of profit or loss |
C. | financial accounts helps to judge the efficiency or productivity of the concern |
D. | cost accounting techniques helps the management in making decision or planning for future |
Answer» C. financial accounts helps to judge the efficiency or productivity of the concern |
2. |
Cost Accounting is directed towards the needs of |
A. | government |
B. | external users |
C. | internal users |
D. | shareholders |
Answer» C. internal users |
3. |
Which of the following is not function of Cost Accounting |
A. | cost ascertainment |
B. | planning and control |
C. | decision making |
D. | external reporting |
Answer» D. external reporting |
4. |
Cost behaviour refers to |
A. | how costs react to a change in the level of activity |
B. | whether a cost is incurred in a manufacturing trading or service company |
C. | classifying costs as either product or period costs |
D. | whether a particular expense has been incurred honestly |
Answer» A. how costs react to a change in the level of activity |
5. |
An example of fixed cost is |
A. | materials consumed |
B. | depreciation |
C. | factory power |
D. | packing material |
Answer» B. depreciation |
6. |
Which of the following would not be considered a fixed cost |
A. | rent |
B. | depreciation |
C. | cost of bottles use in the production of soft drinks |
D. | property taxes |
Answer» C. cost of bottles use in the production of soft drinks |
7. |
Variable Cost per Unit |
A. | varies when output varies |
B. | remain constant |
C. | increases when output increases |
D. | decreases when output decreases |
Answer» B. remain constant |
8. |
Which of the following is not an example of variable cost |
A. | straight line depreciation on a machine expected to last five years |
B. | piece-rate wages paid to manufacturing workers |
C. | wood used to make furniture |
D. | commissions paid to sales personnel |
Answer» A. straight line depreciation on a machine expected to last five years |
9. |
Which of the following costs will vary directly with the level of production |
A. | total manufacturing costs |
B. | total cost of sales |
C. | variable selling costs |
D. | variable product costs |
Answer» D. variable product costs |
10. |
Which of the following is / are true with regard to the period of budget?
|
A. | only (i) above |
B. | only (ii) above |
C. | both (i) and (ii) above |
D. | all (i), (ii) and (iii) above |
Answer» D. all (i), (ii) and (iii) above |
11. |
Which of the following statements is / are true with regard to flexible budgeting? |
A. | both (a) and (b) |
B. | it involves a careful differentiation between fixed and variable expenses |
C. | it is a system of budgeting under which budgets are recast quickly for changes in the volume of activity |
D. | a flexible budget is one which changes from year to year |
Answer» A. both (a) and (b) |
12. |
The classification of fixed and variable cost has a specific significance in the preparation of |
A. | zero-based budget |
B. | flexible budget |
C. | capital budget |
D. | cash budget |
Answer» B. flexible budget |
13. |
When a flexible budget is used a decrease in the actual production level within a relevant range would |
A. | increased total fixed cost |
B. | decrease variable cost per unit |
C. | decrease variable cost |
D. | increase variable cost per unit |
Answer» C. decrease variable cost |
14. |
If the activity level is reduced from 80 % to 70%, the fixed cost |
A. | will increase by 10% |
B. | per unit will decrease |
C. | will decrease by 10% |
D. | per unit will increase |
Answer» D. per unit will increase |
15. |
Which of the following are purpose of a budget?
|
A. | (i) and (ii) only |
B. | (ii), (iii) and (iv) only |
C. | (i) and (iv) only |
D. | (ii) and (iv) only |
Answer» D. (ii) and (iv) only |
16. |
Which of the information below should be contained in a budget manual? |
A. | a list of account codes |
B. | an organisation chart |
C. | timetable for budget preparation |
D. | all of the above |
Answer» D. all of the above |
17. |
A budget that gives a summary of all the functional budget is known as |
A. | fixed budget |
B. | capital budget |
C. | master budget |
D. | flexible budget |
Answer» C. master budget |
18. |
Master budget comprises |
A. | a the budgeted profit and loss account |
B. | budget cash flow |
C. | budgeted cash flow budgeted profit and loss budgeted balance sheet |
D. | entire sets of budgets prepared |
Answer» C. budgeted cash flow budgeted profit and loss budgeted balance sheet |
19. |
A master budget comprises the |
A. | budgeted income statement budgeted balance sheet and budgeted cash flow only |
B. | budgeted income statement and positive cash flow only |
C. | budgeted income statement and budgeted balance sheet only |
D. | budgeted income statement and budgeted capital expenditure only |
Answer» A. budgeted income statement budgeted balance sheet and budgeted cash flow only |
20. |
Which of the following is normally the most appropriate sequence of events in the preparation of the indicated budgets? |
A. | sales budget, cash budget, production budget, budgeted balance sheet |
B. | sales budget, cash budget, budgeted balance sheet, production budget |
C. | sales budget, production budget, budgeted balance sheet, cash budget |
D. | sales budget, production budget, cash budget, budgeted balance sheet |
Answer» D. sales budget, production budget, cash budget, budgeted balance sheet |
21. |
When preparing a production budget, the quantity to be produced equals: |
A. | sales quantity plus opening stock minus closing stock |
B. | sales quantity - opening stock + closing stock |
C. | sales quantity + opening stock + closing stock |
D. | sales quantity - opening stock minus closing stock |
Answer» B. sales quantity - opening stock + closing stock |
22. |
Which one of the following items would NOT be included in a cash budget? |
A. | dividend payments |
B. | capital repayments of loans |
C. | depreciation charges |
D. | proceeds of sale of fixed assets |
Answer» C. depreciation charges |
23. |
Which of the following items should be included in a cash budget?
|
A. | (i) and (ii) |
B. | (iii) and (iv) |
C. | (ii) and (iii) |
D. | (i) and (iv) |
Answer» D. (i) and (iv) |
24. |
The CIMA definition of zero-based budgeting is set out below, with two blank sections.
|
A. | to be specifically justifies, & were being undertaken for the first time |
B. | to be set zero, & could be out-sourced to an external supplier |
C. | to be specifically justifies, & could be out-sourced to an external supplier |
D. | to be set zero, & were being undertaken for the first time |
Answer» A. to be specifically justifies, & were being undertaken for the first time |
25. |
A company estimates its direct material requirements for the month of November 2014 to be Rs. 2,40,000 and the direct labour to be Rs. 1,500,00. It is the policy of the company to absorb overheads as under :
|
A. | rs. 9,21,600 |
B. | rs. 8,56,800 |
C. | rs. 6,87,150 |
D. | rs. 9,09,900 |
Answer» B. rs. 8,56,800 |
26. |
A company is preparing a production budget for the next year. The following information is relevant :
|
A. | 8,900 units |
B. | 9,900 units |
C. | 11,000 units |
D. | 10,900 units |
Answer» C. 11,000 units |
27. |
PP Ltd is preparing the production and material purchase budgets for one of their products,
|
A. | 31225 |
B. | 30000 |
C. | 28775 |
D. | 38225 |
Answer» A. 31225 |
28. |
A company has the following budget for the six month:
|
A. | 21,700 kg |
B. | 20,900 kg |
C. | 21,100 kg |
D. | 21,500 kg |
Answer» A. 21,700 kg |
29. |
ABC ltd. uses the following flexible budget formula to annual maintenance cost:
|
A. | rs. 12,800 |
B. | rs. 13,360 |
C. | rs. 12,240 |
D. | rs. 13,600 |
Answer» B. rs. 13,360 |
30. |
ABC Ltd. has furnished the following information for 4,000 units of product for the year 2014-2015 :
|
A. | rs. 10,80,120 |
B. | rs. 10,42,500 |
C. | rs. 10,95,000 |
D. | rs. 10,76,665 |
Answer» D. rs. 10,76,665 |
31. |
The budgeted cost of electricity is Rs. 62,500 for 5,000 units of production per month and Rs. 71,500 for 6,200 units of production per month. If the company manufactures 6,900 units in the month of May 2014, the budgeted amount of electricity for the month is |
A. | rs. 77,770 |
B. | rs. 76,750 |
C. | rs. 74,360 |
D. | rs. 79,572 |
Answer» B. rs. 76,750 |
32. |
ABC Ltd. has prepared the cash budget for the year 2014-2015 and provided the following information pertaining to sales value :
|
A. | rs. 2,78,400 |
B. | rs. 3,00,000 |
C. | rs. 3,20,000 |
D. | rs. 3,32,000 |
Answer» A. rs. 2,78,400 |
33. |
The following details have been extracted from the debtors collection records of X limited:
|
A. | rs. 1,16,750 |
B. | rs. 1,15,190 |
C. | rs. 1,23,000 |
D. | rs. 1,21,440 |
Answer» D. rs. 1,21,440 |
34. |
Under integrated system of Accounting , purchase of raw material is debited to which account? |
A. | work in progress control account |
B. | none of the above |
C. | stores ledger control account/raw material control account |
D. | purchase account |
Answer» C. stores ledger control account/raw material control account |
35. |
Under integrated system of Accounting , issue of raw material is debited to which account? |
A. | purchase account |
B. | work in progress control account |
C. | stores ledger control account/raw material control account |
D. | none of the above |
Answer» B. work in progress control account |
36. |
Notional costs |
A. | none of the above |
B. | may be included in interlocking accounts |
C. | cannot be included in interlocking accounts |
D. | may be integrated accounts |
Answer» B. may be included in interlocking accounts |
37. |
In a period Rs. 50,000 was incurred on indirect labour. In a Cost Ledger, the double entry will be: |
A. | wages control a/c dr overhead control a/c cr |
B. | overhead control a/c dr wages control a/c cr |
C. | wip control a/c dr wages control a/c cr |
D. | wages control a/c dr wip control a/c cr |
Answer» B. overhead control a/c dr wages control a/c cr |
38. |
In an integrated accounting system the accounting entries for factory overhead absorbed would be : |
A. | cost of sales a/c dr overhead control a/c cr |
B. | overhead control a/c dr wip control a/c cr |
C. | overhead control a/c dr cost of sales a/c cr |
D. | wip control a/c dr overhead control a/c cr |
Answer» D. wip control a/c dr overhead control a/c cr |
39. |
At the end of a financial period, accounting entries for under absorbed overheads would be |
A. | overhead control a/c dr p&l a/c cr |
B. | wip control a/c dr overhead control a/c cr |
C. | p&l a/c dr wip control a/c cr |
D. | p&l a/c dr overhead control a/c cr |
Answer» D. p&l a/c dr overhead control a/c cr |
40. |
The double entry for factory cost of production in a cost ledger is |
A. | costing p&l a/c dr finished goods control a/c cr |
B. | cost of sales a/c dr finished goods control a/c cr |
C. | wip control a/c dr finished goods control a/c cr |
D. | finished goods control a/c dr wip control a/c cr |
Answer» D. finished goods control a/c dr wip control a/c cr |
41. |
Entry under Integrated System for : Credit purchase of materials for stock |
A. | stores ledger a/c dr general ledger adjustment a/c cr |
B. | stores ledger a/c dr creditors a/c cr |
C. | purchases a/c dr general ledger adjustment a/c cr |
D. | purchases a/c dr sundry creditors a/c cr |
Answer» B. stores ledger a/c dr creditors a/c cr |
42. |
Entry under Integrated System for : Cash purchase of materials for stock |
A. | store ledger control a/cdr general ledger adjustment a/c cr |
B. | purchases a/c dr cash a/c cr |
C. | store control a/c dr cash a/c cr |
D. | general ledger adjustment a/c dr cash a/c cr |
Answer» C. store control a/c dr cash a/c cr |
43. |
Entry under Integrated System for : Cash purchase of special materials for direct use in a job |
A. | work in progress a/c dr cash a/c cr |
B. | purchases a/c dr cost ledger control cr |
C. | purchases a/c dr cash a/c cr |
D. | wip control a/c dr cost ledger a/c cr |
Answer» A. work in progress a/c dr cash a/c cr |
44. |
Entry under Integrated system for : Materials returned to supplier from stock |
A. | creditors a/c dr store control a/c cr |
B. | cost ledger control a/c dr stores control a/c cr |
C. | cost ledger control a/c dr purchases a/c cr |
D. | sundry creditors a/c dr purchases a/c cr |
Answer» A. creditors a/c dr store control a/c cr |
45. |
Entry under Integrated system for : Issues of Direct Materials for production |
A. | wip control a/c dr store control a/c cr |
B. | factory overhead control a/c dr store control a/c cr |
C. | wip control a/c dr store control a/c cr |
D. | no entry |
Answer» C. wip control a/c dr store control a/c cr |
46. |
Entry under Integrated system for : Purchases of Direct Materials for production |
A. | factory overhead control a/c dr store control a/c cr |
B. | wip control a/c dr store control a/c cr |
C. | wip control a/c dr store control a/c cr |
D. | no entry |
Answer» A. factory overhead control a/c dr store control a/c cr |
47. |
Entry under Integrated system for : Transfer of goods completed from production to finished goods |
A. | wip a/c dr finished goods control a/c cr |
B. | wip control a/c dr finished goods a/c cr |
C. | finished goods control a/c dr wip a/c cr |
D. | no entry |
Answer» C. finished goods control a/c dr wip a/c cr |
48. |
Purchase of raw materials of Rs. 1,000 on credit. Under Integrated Accounts, the transaction will appear as |
A. | cost ledger control a/c dr 1,000 to creditors a/c cr 1,000 |
B. | store ledger control a/c dr 1,000 to creditors a/c cr 1,000 |
C. | purchases a/c dr 1,000 to creditors a/c cr 1,000 |
D. | store ledger control a/c dr 1,000 to general ledger adjustment a/c cr 1,000 |
Answer» B. store ledger control a/c dr 1,000 to creditors a/c cr 1,000 |
49. |
Payment of wages Rs. 5,000. Under Integrated Accounts, the transaction will appear as |
A. | wages a/c dr 5,000 to cash/bank a/c cr 5,000 |
B. | wages control a/c dr 5,000 to general ledger adjustment a/c cr 5,000 |
C. | wages control a/c dr 5,000 to cash/bank a/c cr 5,000 |
D. | cost ledger control a/c dr 5,000 to general ledger adjustment a/c cr 5,000 |
Answer» B. wages control a/c dr 5,000 to general ledger adjustment a/c cr 5,000 |
50. |
What accounting entry under integrated system will be passed for payment to creditors for supplies made? |
A. | creditors a/c dr to cash a/c cr |
B. | creditors a/c dr to stores ledger control a/c cr |
C. | no entry required |
D. | stores ledger a/c dr to cash a/c cr |
Answer» A. creditors a/c dr to cash a/c cr |
51. |
What will be the accounting entry in integrated accounts for absorption of works overheads? |
A. | factory overhead a/c dr wip a/c cr |
B. | factory overhead a/c dr factory overhead control a/c cr |
C. | wip control a/c dr factory overhead control a/c cr |
D. | no entry required |
Answer» C. wip control a/c dr factory overhead control a/c cr |
52. |
The accounting entry is integrated accounts for recording sales will be |
A. | debtors or cash a/c dr p&l a/c cr |
B. | debtors or cash a/c dr sales a/c cr |
C. | sales a/c dr p&l a/c cr |
D. | cost ledger control a/c dr p&l a/c cr |
Answer» B. debtors or cash a/c dr sales a/c cr |
53. |
Under integral system, the accounting entry for recording depreciation charges on machinery will be |
A. | machinery a/c dr factory overhead control a/c cr |
B. | factory overhead control a/c dr machinery a/c cr |
C. | depreciation a/c dr machinery a/c cr |
D. | factory overhead control a/c dr cost ledger control a/c cr |
Answer» B. factory overhead control a/c dr machinery a/c cr |
54. |
Integral accounts eliminate the necessity of operating |
A. | overhead adjustment account |
B. | stores ledger control account |
C. | all of these |
D. | cost ledger control account |
Answer» D. cost ledger control account |
55. |
____________ Accounts is the name given to a system whereby cost and financial accounts are kept in the same set of books. |
A. | non-integrated |
B. | finalize |
C. | cost |
D. | integrated |
Answer» D. integrated |
56. |
In Entry under Integrated System for Credit purchase of material for stock, Stores Ledger Control is ____________. |
A. | non impacted |
B. | increased |
C. | debited |
D. | credited |
Answer» C. debited |
57. |
In Entry under Integrated System for Cash purchase of materials for stock, ____________ account is debited. |
A. | general ledger adjustment |
B. | none of the mentioned |
C. | none of the above |
D. | stores ledger control |
Answer» D. stores ledger control |
58. |
In Entry under Integrated System for Cash purchase of Special Materials for direct use in a Job, ____________ account is debited. |
A. | general ledger adjustment |
B. | stores ledger control |
C. | cost ledger control account |
D. | work-in-progress |
Answer» D. work-in-progress |
59. |
……………………provides information for income determination. |
A. | Financial accounting |
B. | cost accounting |
C. | management accounting |
D. | none of these |
Answer» A. Financial accounting |
60. |
……………….helps in ascertaining costs beforehand. |
A. | Financial accounting |
B. | cost accounting |
C. | management accounting |
D. | none of these |
Answer» B. cost accounting |
61. |
The scope of cost accounting include…………..,…………… and…………… |
A. | Cost ascertainment, cost presentation, cost control |
B. | tax planning, tax accounting, financial accounting |
C. | presentation of accounting information, creation of policy, day-to day operation |
D. | none of the above |
Answer» A. Cost ascertainment, cost presentation, cost control |
62. |
Cost accounting disclose ……………. |
A. | The Financial position |
B. | profit/loss of a product, job or service |
C. | effect and impact of cost on business |
D. | none of these |
Answer» B. profit/loss of a product, job or service |
63. |
………..is a post mortem of past costs. |
A. | Financial accounting |
B. | cost accounting |
C. | both a & b |
D. | none of these |
Answer» A. Financial accounting |
64. |
………………….aids in price fixation. |
A. | Financial accounting |
B. | cost accounting |
C. | management accounting |
D. | none of these |
Answer» B. cost accounting |
65. |
………………is the oldest branch of accounting. |
A. | Financial accounting |
B. | cost accounting |
C. | management accounting |
D. | none of these |
Answer» A. Financial accounting |
66. |
……………..includes financial and cost accounting, tax planning and tax accounting. |
A. | Financial accounting |
B. | cost accounting |
C. | management accounting |
D. | none of these |
Answer» C. management accounting |
67. |
In automobile, …………………costing is used |
A. | Process |
B. | batch |
C. | multiple |
D. | job |
Answer» C. multiple |
68. |
Service costing is used in industries producing……………… |
A. | Products |
B. | service |
C. | both a & b |
D. | none of these |
Answer» B. service |
69. |
…………………..costing is applicable to printers. |
A. | Process |
B. | batch |
C. | multiple |
D. | job |
Answer» D. job |
70. |
Process costing is also known as……………….costing. |
A. | Continuous |
B. | batch |
C. | multiple |
D. | job |
Answer» A. Continuous |
71. |
Operating costing is also known as ……………..costing. |
A. | Service |
B. | batch |
C. | multiple |
D. | job |
Answer» A. Service |
72. |
………………..costing is a type or technique of costing. |
A. | Marginal |
B. | batch |
C. | multiple |
D. | job |
Answer» A. Marginal |
73. |
………………..costing is a type or technique of costing. |
A. | Absorption |
B. | batch |
C. | multiple |
D. | job |
Answer» A. Absorption |
74. |
…………………..is not the scope ofCost Accountancy. |
A. | Ascertaining cost |
B. | cost accounting |
C. | cost control |
D. | tax planning |
Answer» D. tax planning |
75. |
Cost Accounting has been developed becauseof……………… of Financial Accounting. |
A. | Limitations |
B. | advantages |
C. | both a & b |
D. | none of these |
Answer» A. Limitations |
76. |
Cost Accountancy is the science, art and ……………….of a cost accountant. |
A. | Practice |
B. | exercise |
C. | hard work |
D. | effort |
Answer» A. Practice |
77. |
The ordinary trading account is a locked storehouse of most valuable information to which cost system is the………………. |
A. | Key |
B. | lock |
C. | house |
D. | none of these |
Answer» A. Key |
78. |
Cost accounts deal partly with facts and figures and partly with……… |
A. | Estimates |
B. | costs |
C. | income |
D. | revenue |
Answer» A. Estimates |
79. |
Cost accounting provides data for managerial……………. |
A. | Decision making |
B. | recruitment |
C. | retrenchment |
D. | none of the above. |
Answer» A. Decision making |
80. |
Cost accounting is based on……………….figures. |
A. | Estimated |
B. | historical |
C. | actual |
D. | none of these. |
Answer» A. Estimated |
81. |
Cost accounting provides detailed information about …………………of various products, processes, services and operations. |
A. | Costs |
B. | income |
C. | either a or b |
D. | none of these. |
Answer» A. Costs |
82. |
Cost accounting records both monetary and …………… units. |
A. | Physical |
B. | cost |
C. | both a & b |
D. | none of these. |
Answer» A. Physical |
83. |
The method of costing used in a refinery is……………..costing. |
A. | Process |
B. | batch |
C. | multiple |
D. | job |
Answer» A. Process |
84. |
……………….costing is used in transport undertakings. |
A. | Process |
B. | service |
C. | multiple |
D. | job |
Answer» B. service |
85. |
The total variable cost …………………… in total proportion to output. |
A. | Increases |
B. | does not increase |
C. | decreases |
D. | none of these. |
Answer» A. Increases |
86. |
Sunk costs are ………………. for decision-making |
A. | irrelevant |
B. | relevant |
C. | useful |
D. | none of these. |
Answer» A. irrelevant |
87. |
Fixed cost …………………… in the same proportion in which output changes. |
A. | does not change |
B. | changes |
C. | increases |
D. | none of these. |
Answer» A. does not change |
88. |
Administration expenses are mostly………………. |
A. | semi-variable |
B. | variable |
C. | fixed |
D. | none of these. |
Answer» C. fixed |
89. |
Abnormal cost is ………………….. |
A. | Uncontrollable |
B. | controllable |
C. | fixed |
D. | none of these |
Answer» A. Uncontrollable |
90. |
Cost of production is equal to …………………… |
A. | Works cost plus Administration Overheads |
B. | Prime cost plus Works cost |
C. | prime cost plus works overhead |
D. | works overhead plus administration overheads |
Answer» A. Works cost plus Administration Overheads |
91. |
Variable cost increases with ………….in output. |
A. | Increase |
B. | decrease |
C. | increase or decrease |
D. | none of these. |
Answer» A. Increase |
92. |
……………………….Accounting provides information for cost control. |
A. | Financial |
B. | Cost |
C. | Human Resource |
D. | none of these. |
Answer» B. Cost |
93. |
………………………. is one which can be conveniently identified with and charged to a particular unit of cost. |
A. | Direct cost |
B. | Indirect cost |
C. | Overhead |
D. | none of these |
Answer» A. Direct cost |
94. |
Cost centre and cost unit are…………………… |
A. | not the same |
B. | the same |
C. | not related |
D. | none of these |
Answer» A. not the same |
95. |
Fixed cost per unit …………………… with rise in output and …………… with fall in output. |
A. | Decreases, increases |
B. | increases, decreases |
C. | is constant, remains same |
D. | none of the above |
Answer» A. Decreases, increases |
96. |
Period costs charged to………………. |
A. | cost of production |
B. | Products |
C. | Period |
D. | none of these |
Answer» C. Period |
97. |
Standard costs is………………….. |
A. | Predetermined cost |
B. | budgeted cost |
C. | Actual cost |
D. | none of these |
Answer» A. Predetermined cost |
98. |
……………………are costs which have been applied against revenue of particular accounting period. |
A. | Expenses |
B. | income |
C. | loss |
D. | none of these |
Answer» A. Expenses |
99. |
……………….is the smallest segment of activity or area or responsibility for which costs are accumulated. |
A. | Cost Object |
B. | Cost centre |
C. | cost driver |
D. | none of the above |
Answer» B. Cost centre |
100. |
The primary emphasis of………………..cost is on the planning function of management. |
A. | Budgeted |
B. | standard |
C. | period |
D. | none of these |
Answer» A. Budgeted |
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