McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Commerce (B Com) .
| 101. |
In marginal costing managerial decisions are guided by…………than by profit |
| A. | Marginal cost |
| B. | Variable cost |
| C. | Incremental cost |
| D. | Contribution margin |
| Answer» D. Contribution margin | |
| 102. |
There will be…………in marginal costing when there is production but no sales |
| A. | Profit |
| B. | Loss |
| C. | Cost |
| D. | Income |
| Answer» B. Loss | |
| 103. |
Marginal costing is a technique of |
| A. | Cost reduction |
| B. | Cost control |
| C. | Profit planning |
| D. | Profit maximization |
| Answer» B. Cost control | |
| 104. |
In differential cost analysis decisions are taken by comparing the………… with differential cost |
| A. | Marginal cost |
| B. | Marginal revenue |
| C. | Incremental revenue |
| D. | Either (b) or (c) |
| Answer» C. Incremental revenue | |
| 105. |
A………… is useful only when the actual level of activity corresponds to the budgeted level of activity |
| A. | Flexible budget |
| B. | Master budget |
| C. | Fixed budget |
| D. | Sales budget |
| Answer» C. Fixed budget | |
| 106. |
………… is the act of building budgets |
| A. | Budgeting |
| B. | Estimating |
| C. | Forecasting |
| D. | ZBB |
| Answer» A. Budgeting | |
| 107. |
Budgeting system……………. key managerial functions |
| A. | Co-ordinate |
| B. | Integrates |
| C. | Controls |
| D. | Organize |
| Answer» B. Integrates | |
| 108. |
……………. is a budget starts from zero |
| A. | ZBB |
| B. | PB |
| C. | PPB |
| D. | All of these |
| Answer» A. ZBB | |
| 109. |
……………. is the budget incorporating all the components functional budgets |
| A. | Sales budget |
| B. | Production budget |
| C. | Capital budget |
| D. | Master budget |
| Answer» D. Master budget | |
| 110. |
……………. is the most important budget |
| A. | Master budget |
| B. | Cash budget |
| C. | Sales budget |
| D. | Production budget |
| Answer» C. Sales budget | |
| 111. |
……………. forms the basis on which all other budgets are built up |
| A. | Master budget |
| B. | Cash budget |
| C. | Sales budget |
| D. | Summary budget |
| Answer» C. Sales budget | |
| 112. |
The job costing each job is a ……………. to which all costs are assigned |
| A. | Profit unit |
| B. | Cost unit |
| C. | Expenses |
| D. | Variable |
| Answer» B. Cost unit | |
| 113. |
Job costing can be used in industries using |
| A. | Farm costing |
| B. | Multiple costing |
| C. | Standard costing |
| D. | One-operation costing |
| Answer» C. Standard costing | |
| 114. |
The loss incurred on an incomplete contract is transferred to |
| A. | Profit and Loss Account |
| B. | Contract account |
| C. | Work certified |
| D. | Work in progress account |
| Answer» A. Profit and Loss Account | |
| 115. |
Contract costing is a basic method of |
| A. | Specific costing |
| B. | Specific order costing |
| C. | Economic batch costing |
| D. | Economic order costing |
| Answer» B. Specific order costing | |
| 116. |
In cost-plus contract, the contractor will get costplus |
| A. | Accumulated profit |
| B. | Stipulated profit |
| C. | Earned profit |
| D. | Budgeted profit |
| Answer» B. Stipulated profit | |
| 117. |
In marginal costing valuation of stock of work in progress is done on the basis of |
| A. | Market cost |
| B. | Marginal cost |
| C. | Product cost |
| D. | Cost price |
| Answer» B. Marginal cost | |
| 118. |
In marginal costing selling price is based on |
| A. | Contribution |
| B. | Marginal cost |
| C. | Market cost |
| D. | Marginal cost plus contribution |
| Answer» D. Marginal cost plus contribution | |
| 119. |
The difference between selling price and marginal cost is |
| A. | Profit |
| B. | Marginal cost |
| C. | Contribution |
| D. | Loss |
| Answer» C. Contribution | |
| 120. |
Fixed expenses + profit=? |
| A. | Contribution |
| B. | Marginal cost |
| C. | Prime cost |
| D. | Variable cost |
| Answer» A. Contribution | |
| 121. |
Stock of work in progress and finished goods are valued at marginal costing not include |
| A. | Fixed cost |
| B. | Semi-fixed |
| C. | Semi-variable |
| D. | Variable |
| Answer» A. Fixed cost | |
| 122. |
In the marginal costing method, the actual amount of fixed overheads is wholly charged to |
| A. | Cost sheet |
| B. | Profit and loss |
| C. | Balance sheet |
| D. | Cost account |
| Answer» B. Profit and loss | |
| 123. |
……………..is a financial plan |
| A. | Budget |
| B. | Budgetary control |
| C. | P/V ratio |
| D. | BEP |
| Answer» A. Budget | |
| 124. |
Budget control is exercised by |
| A. | Budget officer |
| B. | Budget director |
| C. | Budget controller |
| D. | All the above |
| Answer» D. All the above | |
| 125. |
Period for which budget is prepared is called |
| A. | Budget period |
| B. | Financial period |
| C. | Fiscal period |
| D. | Accounting period |
| Answer» A. Budget period | |
| 126. |
The most important budget having primary importance is called |
| A. | Sales budget |
| B. | Cash budget |
| C. | Master budget |
| D. | Fixed budget |
| Answer» A. Sales budget | |
| 127. |
……………..is a forecast of the total output of the whole organization |
| A. | Sales budget |
| B. | Production budget |
| C. | Master budget |
| D. | Material budget |
| Answer» B. Production budget | |
| 128. |
……………..budget provides information about the materials to be acquired from the market |
| A. | Material budget |
| B. | Production budget |
| C. | Cash budget |
| D. | Purchase budget |
| Answer» D. Purchase budget | |
| 129. |
……………..budget gives different budgeted cost for different levels of activity |
| A. | Flexible budget |
| B. | Fixed budget |
| C. | Master budget |
| D. | Production budget |
| Answer» A. Flexible budget | |
| 130. |
In contract costing payment of cash to the contractor is made on the basis of |
| A. | Estimated work |
| B. | Standard work |
| C. | Certified work |
| D. | Uncertified work |
| Answer» C. Certified work | |
| 131. |
In job costing each job is a ……………..to which all cost are assigned |
| A. | Profit unit |
| B. | Cost unit |
| C. | Expenses |
| D. | Variable |
| Answer» B. Cost unit | |
| 132. |
In contract costing credit is taken only for a part of the profit on |
| A. | Incomplete contract |
| B. | Complete contract |
| C. | Estimated contract |
| D. | Initial contract |
| Answer» A. Incomplete contract | |
| 133. |
If the contract is almost complete, the amount of profit generally transferred to profit and loss account is equal to |
| A. | Estimated profit*(Contract price/Work certified) |
| B. | National profit*(Cash Received/Work certified) |
| C. | Estimated profit*(Work certified/Contract price) |
| D. | Work certified*(Contract price/Estimated price) |
| Answer» C. Estimated profit*(Work certified/Contract price) | |
| 134. |
Job costing can be done in conjunction with |
| A. | Standard costing |
| B. | Process costing |
| C. | Multiple costing |
| D. | Marginal costing |
| Answer» D. Marginal costing | |
| 135. |
In contract costing most of the items of cost are |
| A. | Direct |
| B. | Indirect |
| C. | Variable |
| D. | Semivariable |
| Answer» A. Direct | |
| 136. |
When the completion stage of a contract is less than ¼ of the total expenditure on the contract is transferred to |
| A. | Profit & Loss account |
| B. | Work certified account |
| C. | Work in progress account |
| D. | Contract account |
| Answer» C. Work in progress account | |
| 137. |
Contract testing is a basic method of |
| A. | Specific costing |
| B. | Specific order costing |
| C. | Economic batch costing |
| D. | Economic order costing |
| Answer» B. Specific order costing | |
| 138. |
At break even point, the |
| A. | Fixed cost equal to the total sales value |
| B. | Variable cost equal to the total sales value |
| C. | Total cost equal to the total sales value |
| D. | Variable cost equal to fixed cost |
| Answer» C. Total cost equal to the total sales value | |
| 139. |
At break even point, the contribution equal to |
| A. | Fixed cost |
| B. | Variable cost |
| C. | Total cost |
| D. | Zero |
| Answer» A. Fixed cost | |
| 140. |
Break even chart depicts |
| A. | Cost volume profit relationship |
| B. | Relationship between fixed and variable cost only |
| C. | Relationship between price and quantity demanded |
| D. | Relationship between price and quantity supplied |
| Answer» A. Cost volume profit relationship | |
| 141. |
Period costs means |
| A. | Variable cost |
| B. | Fixed cost |
| C. | Prime cost |
| D. | Direct cost |
| Answer» B. Fixed cost | |
| 142. |
The valuation of stock, in marginal costing, as compared to absorption costing is |
| A. | Higher |
| B. | Lower |
| C. | Same |
| D. | Difficult to say |
| Answer» B. Lower | |
| 143. |
Contribution margin is also known as |
| A. | Gross profit |
| B. | Net profit |
| C. | Earning before interest and tax |
| D. | Marginal income |
| Answer» D. Marginal income | |
| 144. |
Contribution is the difference in |
| A. | Sales and fixed cost |
| B. | Sales and variable cost |
| C. | Sales and total cost |
| D. | Variable cost and fixed cost |
| Answer» B. Sales and variable cost | |
| 145. |
Contribution is the sum of |
| A. | Fixed cost and profit |
| B. | Variable cost and profit |
| C. | Total cost and profit |
| D. | Factory cost and profit |
| Answer» A. Fixed cost and profit | |
| 146. |
The angle formed at the intersection of sales line and variable cost line is called |
| A. | Angle of incidence |
| B. | Acute angle |
| C. | Loss area |
| D. | Profit area |
| Answer» A. Angle of incidence | |
| 147. |
Profit-volume ratio is a relationship between |
| A. | Profit earned to sales volume |
| B. | Target profit to target sales volume |
| C. | Contribution to sales |
| D. | All of the above |
| Answer» C. Contribution to sales | |
| 148. |
During the boom period, the profits of a firm will increase at a much faster rate whose P/V ratio is, |
| A. | Very high |
| B. | Moderate |
| C. | Low |
| D. | Very low |
| Answer» A. Very high | |
| 149. |
During the recession period, the profits of a firm will decrease at a much slower rate whose P/V ratio is, |
| A. | Very high |
| B. | Moderate |
| C. | Low |
| D. | Very low |
| Answer» D. Very low | |
| 150. |
When variable cost per unit increases break even point ………………. |
| A. | Increase |
| B. | Decreases |
| C. | Does not change |
| D. | Difficult to say |
| Answer» A. Increase | |
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