McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Management Studies (BMS) , Bachelor of Accounting and Finance (BAF) , Bachelor of Commerce (B Com) .
| 101. |
…………..cost is irrecoverable cost. |
| A. | marginal |
| B. | out of pocket |
| C. | Sunk |
| D. | none of these |
| Answer» C. Sunk | |
| 102. |
……………….is the value of a benefit where no actual cost is incurred. |
| A. | Imputed |
| B. | sunk |
| C. | out of pocket |
| D. | none of these |
| Answer» A. Imputed | |
| 103. |
……………is the cost which involves payment to outsiders. |
| A. | Out of pocket cost |
| B. | Imputed cost |
| C. | notional cost |
| D. | none of these |
| Answer» A. Out of pocket cost | |
| 104. |
………………… is the maximum possible alternative earning that might have been earned if the productive capacity is put to some alternative use. |
| A. | Opportunity |
| B. | incremental revenue |
| C. | alternative revenue |
| D. | none of these |
| Answer» A. Opportunity | |
| 105. |
An item of cost that is direct for one business may be …………..for another business. |
| A. | Important |
| B. | direct |
| C. | Indirect |
| D. | none of the above. |
| Answer» C. Indirect | |
| 106. |
The total of all direct expenses is known as …………..cost. |
| A. | Prime |
| B. | Works |
| C. | Production |
| D. | both a & b |
| Answer» A. Prime | |
| 107. |
……………costs are partly fixed and partly variable in relation to output. |
| A. | Variable |
| B. | fixed |
| C. | Semi-variable |
| D. | both a & b |
| Answer» C. Semi-variable | |
| 108. |
An opportunity cost is ………………….. |
| A. | the advantage foregone |
| B. | the cost |
| C. | the income |
| D. | none of the above. |
| Answer» A. the advantage foregone | |
| 109. |
Works cost is a total of……………… |
| A. | Indirect material, Indirect labour |
| B. | Direct material, direct labour, direct or chargeable expenses and works expenses |
| C. | Direct material, direct labour |
| D. | Indirect material, Indirect labour, Indirect expenses |
| Answer» B. Direct material, direct labour, direct or chargeable expenses and works expenses | |
| 110. |
An opportunity cost does not involve………… |
| A. | Cash outlays |
| B. | direct cost |
| C. | indirect cost |
| D. | none of the above |
| Answer» A. Cash outlays | |
| 111. |
Variable costs change ……………………with change in output. |
| A. | Proportionately |
| B. | Inversely |
| C. | Disproportionately |
| D. | Sometimes |
| Answer» A. Proportionately | |
| 112. |
Fixed cost per unit …………………….with increase in output. |
| A. | decreases |
| B. | increases |
| C. | changes |
| D. | sometimes |
| Answer» A. decreases | |
| 113. |
Depreciation is…………………expenditure. |
| A. | fixed |
| B. | variable |
| C. | adjustable |
| D. | Semi-variable |
| Answer» D. Semi-variable | |
| 114. |
Out of pocket costs involve payment to ………………… |
| A. | Outsiders |
| B. | self |
| C. | employees |
| D. | none of the above |
| Answer» A. Outsiders | |
| 115. |
Added value is the change in………………… |
| A. | Market value |
| B. | cost |
| C. | income |
| D. | none of the above. |
| Answer» A. Market value | |
| 116. |
…………………. Accounting is not only a positive science but also a normative science because it includes techniques of budgetary control and standard costing. |
| A. | Financial |
| B. | Cost |
| C. | both a & b |
| D. | none of these |
| Answer» B. Cost | |
| 117. |
Material control does not cover the following stage. |
| A. | Purchase of materials |
| B. | storing of materials |
| C. | issue of materials |
| D. | production |
| Answer» D. production | |
| 118. |
Material control aims at achieving effective………… |
| A. | Material management |
| B. | quality control |
| C. | accounting of material |
| D. | material supply |
| Answer» A. Material management | |
| 119. |
Stores Ledger is maintained in the………………… |
| A. | Store |
| B. | finance department |
| C. | cost accounting department |
| D. | Both a & b |
| Answer» C. cost accounting department | |
| 120. |
Stock verification sheets are maintained to record the results of ………. |
| A. | Physical verification |
| B. | financial control |
| C. | financial verification |
| D. | quality verification |
| Answer» A. Physical verification | |
| 121. |
Stock Adjustment Account is debited with ……….and credited with ……….. |
| A. | Surplus, shortage of stock |
| B. | shortage of stock, surplus |
| C. | excess, loss |
| D. | none of these |
| Answer» B. shortage of stock, surplus | |
| 122. |
Bin card is a record of ………….only. |
| A. | Cost |
| B. | value |
| C. | quantity |
| D. | expense |
| Answer» C. quantity | |
| 123. |
Bin card is maintained by the……………. |
| A. | Cost accountant |
| B. | Clerk |
| C. | storekeeper |
| D. | branch accountant |
| Answer» C. storekeeper | |
| 124. |
Material abstract is also known as ……………… |
| A. | Material issue analysis sheet |
| B. | bill of materials |
| C. | stores ledger |
| D. | none of the above |
| Answer» A. Material issue analysis sheet | |
| 125. |
Material should be issued by the store keeper against………………. |
| A. | Material requisition |
| B. | bill of materials |
| C. | both a & b |
| D. | none of these |
| Answer» C. both a & b | |
| 126. |
First in first out method of valuing material issues is suitable in times of………… |
| A. | Rising prices |
| B. | falling prices |
| C. | fluctuating prices |
| D. | none of these |
| Answer» B. falling prices | |
| 127. |
Last in first out method is suitable in times of……………… |
| A. | Rising prices |
| B. | falling prices |
| C. | fluctuating prices |
| D. | none of these |
| Answer» A. Rising prices | |
| 128. |
Average cost method of valuing material issues is suitable when…………. |
| A. | Prices rise |
| B. | prices fall |
| C. | prices fluctuate considerably |
| D. | none of these |
| Answer» C. prices fluctuate considerably | |
| 129. |
Inflated price method of valuing material issues is suitable when………… |
| A. | Materials are subject to natural wastage |
| B. | prices rise |
| C. | prices fall |
| D. | none of these |
| Answer» A. Materials are subject to natural wastage | |
| 130. |
Specific price method of valuing material issue is used when…………. |
| A. | Materials are purchased for specific job or work order |
| B. | materials are subject to natural wastage |
| C. | prices fluctuate |
| D. | none of these |
| Answer» A. Materials are purchased for specific job or work order | |
| 131. |
Market price method is considered to be the best method when………….. |
| A. | Quotations have to be sent |
| B. | prices fluctuate |
| C. | materials are subject to natural wastage |
| D. | none of these |
| Answer» A. Quotations have to be sent | |
| 132. |
A bill of material serves the purpose of………………… |
| A. | Material requisition |
| B. | stores ledger |
| C. | material issue analysis sheet |
| D. | none of these |
| Answer» A. Material requisition | |
| 133. |
A bill of material is prepared in case of a …………………job |
| A. | Standard job |
| B. | non-standardized job |
| C. | both a & b |
| D. | none of these |
| Answer» B. non-standardized job | |
| 134. |
Stock verification sheets are maintained to record the results of……… |
| A. | Physical verification |
| B. | financial control |
| C. | financial verification |
| D. | quality verification |
| Answer» A. Physical verification | |
| 135. |
The quantity of material to be ordered at one time is known as………… |
| A. | Ordering quantity |
| B. | commercial order quantity |
| C. | economic order quantity |
| D. | none of these |
| Answer» A. Ordering quantity | |
| 136. |
…………………represents that quantity of material which is normally ordered when a particular material reaches reordering level. |
| A. | maximum level |
| B. | re-order level |
| C. | minimum level |
| D. | Re-order quantity |
| Answer» D. Re-order quantity | |
| 137. |
The principle types of inventories are raw materials and ,…………and finished goods |
| A. | Processed materials |
| B. | Goods-in-progress |
| C. | stored goods |
| D. | goods for dispatch |
| Answer» B. Goods-in-progress | |
| 138. |
Re-ordering level = Maximum consumption x ………………………… |
| A. | Average re-order period |
| B. | Maximum usage |
| C. | Maximum re-order period |
| D. | Normal usage |
| Answer» C. Maximum re-order period | |
| 139. |
Inventory turnover ratio = Cost of inventory consumed during the period ÷ Cost of ……………………held during the period |
| A. | Average inventory |
| B. | minimum inventory |
| C. | maximum inventory |
| D. | none of these |
| Answer» A. Average inventory | |
| 140. |
Inventory turnover in days = Days during the period ÷……………….. |
| A. | Inventory turnover ratio |
| B. | material consumed during the period |
| C. | cost of average stock during the period |
| D. | none of these |
| Answer» A. Inventory turnover ratio | |
| 141. |
………….is a technique of material cost control which leads to low carrying cost as a result of low investment in inventory |
| A. | ABC Analysis |
| B. | JIT Inventory System |
| C. | VED Analysis |
| D. | Perpetual Inventory System |
| Answer» B. JIT Inventory System | |
| 142. |
………………is a technique of stock control which leads to saving of time of the management because attention is required to be paid only to some of the items rather than on all the items. |
| A. | ABC Analysis |
| B. | JIT Inventory System |
| C. | VED Analysis |
| D. | Perpetual Inventory System |
| Answer» A. ABC Analysis | |
| 143. |
……………….. is used primarily for control of spare parts. |
| A. | ABC Analysis |
| B. | JIT Inventory System |
| C. | VED Analysis |
| D. | Perpetual Inventory System |
| Answer» C. VED Analysis | |
| 144. |
Inventory turnover ratio = Cost of …………………..during the period ÷ Cost of average inventory held during the period. |
| A. | Inventory consumed |
| B. | minimum inventory |
| C. | maximum inventory |
| D. | none of these |
| Answer» A. Inventory consumed | |
| 145. |
Re-ordering level = ……………………. X Maximum re-order period |
| A. | Average re-order period |
| B. | Maximum usage |
| C. | Maximum consumption |
| D. | Normal usage |
| Answer» C. Maximum consumption | |
| 146. |
……………obviates the necessity for the physical checking of all items of stores at the end of the year and thereby avoids dislocation of production. |
| A. | ABC Analysis |
| B. | JIT Inventory System |
| C. | VED Analysis |
| D. | Perpetual Inventory System |
| Answer» D. Perpetual Inventory System | |
| 147. |
…………….forms part of cost of production. |
| A. | Abnormal waste |
| B. | normal waste |
| C. | both a & b |
| D. | none of these |
| Answer» B. normal waste | |
| 148. |
………………does not form part of production. |
| A. | Abnormal waste |
| B. | normal waste |
| C. | both a & b |
| D. | none of these |
| Answer» A. Abnormal waste | |
| 149. |
Material losses due to abnormal reasons should be transferred to………………… |
| A. | Profit and loss account |
| B. | Costing Profit and Loss Account |
| C. | Trading Account |
| D. | none of these |
| Answer» B. Costing Profit and Loss Account | |
| 150. |
Defectives are that portion of production which can be ………………at some extra cost of re-operation. |
| A. | Sold |
| B. | rectified |
| C. | purchased |
| D. | none of these |
| Answer» B. rectified | |
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