McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Business Administration (BBA) , Uncategorized topics .
| 251. |
Any transaction between a non current account and another non current account does not affect . |
| A. | profit. |
| B. | funds. |
| C. | working capital. |
| D. | capital. |
| Answer» C. working capital. | |
| 252. |
Principle’ for preparation of working capital statement -Increase in current asset . |
| A. | increases working capital. |
| B. | decreases working capital. |
| C. | decrease fixed capital. |
| D. | increase fixed capital. |
| Answer» A. increases working capital. | |
| 253. |
Principle’ for preparation of working capital statement - Decrease in current asset . |
| A. | increases working capital. |
| B. | decreases working capital. |
| C. | decrease fixed capital. |
| D. | increase fixed capital. |
| Answer» B. decreases working capital. | |
| 254. |
Principle’ for preparation of working capital statement -Increase in current liability . |
| A. | increases working capital. |
| B. | decreases working capital. |
| C. | decrease fixed capital. |
| D. | increase fixed capital. |
| Answer» B. decreases working capital. | |
| 255. |
Principle’ for preparation of working capital statement -Decrease in current Liability . |
| A. | increases working capital. |
| B. | decreases working capital. |
| C. | decrease fixed capital |
| D. | increase fixed capital. |
| Answer» A. increases working capital. | |
| 256. |
Depreciation on fixed assets is . |
| A. | non operating income. |
| B. | operating expense. |
| C. | operating income. |
| D. | non operating expense. |
| Answer» D. non operating expense. | |
| 257. |
Production cost under marginal costing includes . |
| A. | prime cost only . |
| B. | prime cost and fixed overhead . |
| C. | . prime cost and variable overhead. |
| D. | prime cost, variable overhead and fixed overhead. |
| Answer» C. . prime cost and variable overhead. | |
| 258. |
One of the primary differences between marginal costing and absorption costing regarding the treatment of . |
| A. | prime cost . |
| B. | fixed overheads. |
| C. | variable overheads . |
| D. | direct materials. |
| Answer» B. fixed overheads. | |
| 259. |
Absorption costing differs from marginal costing is the . |
| A. | fact that standard costs can be used with absorption costing but not with marginal costing . |
| B. | amount of costs assigned to individual units of products . |
| C. | kind of activities for which each can be used . |
| D. | amount of fixed costs that will be incurred. |
| Answer» B. amount of costs assigned to individual units of products . | |
| 260. |
Contribution margin is also known as . |
| A. | marginal income . |
| B. | gross profit. |
| C. | net profit. |
| D. | net loss. |
| Answer» A. marginal income . | |
| 261. |
Period costs are . |
| A. | overhead costs . |
| B. | prime cost. |
| C. | variable cost. |
| D. | fixed costs. |
| Answer» D. fixed costs. | |
| 262. |
Contribution margin is equal to . |
| A. | fixed cost - loss . |
| B. | profit + variable cost. |
| C. | sales — fixed cost- profit . |
| D. | sales – profit. |
| Answer» A. fixed cost - loss . | |
| 263. |
P/V Ratio is an indicator of . |
| A. | the rate at which goods are sold . |
| B. | the volume of sales |
| C. | the volume of profit. |
| D. | the rate of profit. |
| Answer» D. the rate of profit. | |
| 264. |
Margin of Safety is the difference between . |
| A. | planned sales and planned profit . |
| B. | actual sales and break-even sales. |
| C. | planned sales and actual sales |
| D. | planned sales and planned expenses. |
| Answer» B. actual sales and break-even sales. | |
| 265. |
An increase in variable costs . |
| A. | increases p/v ratio . |
| B. | increases the profit. |
| C. | reduces contribution . |
| D. | increase margin of safety. |
| Answer» C. reduces contribution . | |
| 266. |
An increase in selling price . |
| A. | increases the break-even point. |
| B. | decreases the break-even point. |
| C. | does not affect the break-even point. |
| D. | optimize the break even point. |
| Answer» B. decreases the break-even point. | |
| 267. |
A large Margin of Safety indicates . |
| A. | over production. |
| B. | over capitalization . |
| C. | the soundness of the business. |
| D. | under capitalization. |
| Answer» C. the soundness of the business. | |
| 268. |
Angie of incidence is . |
| A. | the angle between the sales line and the total cost line. |
| B. | the angle between the sales line and the y-axis. |
| C. | the angle between the sales line and the x-axis. |
| D. | the angle between the sales line and the total profit line. |
| Answer» A. the angle between the sales line and the total cost line. | |
| 269. |
CVP analysis is most important for the determination of . |
| A. | sales revenue necessary to equal fixed costs . |
| B. | relationship between revenues and costs at various levels of operations . |
| C. | variable revenues necessary to equal fixed costs . |
| D. | volume of operations necessary to Break—even. |
| Answer» A. sales revenue necessary to equal fixed costs . | |
| 270. |
The conventional Break-even analysis does not assume that . |
| A. | selling price per unit will remain fixed . |
| B. | total fixed costs remain the same. |
| C. | variable cost per unit will vary . |
| D. | productivity per worker will remain unchanged. |
| Answer» B. total fixed costs remain the same. | |
| 271. |
1f` fixed costs decrease while variable cost per unit remains constant, the new B.E.P in relation to the old B.E.P will be . |
| A. | lower . |
| B. | higher. |
| C. | unchanged . |
| D. | indeterminate. |
| Answer» B. higher. | |
| 272. |
If fixed costs decrease while the variable cost per unit remains constant, the new contribution margin in relation to the old contribution margin will be . |
| A. | lower . |
| B. | unchanged . |
| C. | higher. |
| D. | indeterminate. |
| Answer» B. unchanged . | |
| 273. |
Selling price per unit Rs. 10; Variable cost Rs. 8 per unit; Fixed cost Rs. 20,000; Break-even production in units . |
| A. | 10,000. |
| B. | 16,300. |
| C. | 2,000. |
| D. | 2,500. |
| Answer» A. 10,000. | |
| 274. |
Sales Rs. 25,000; Variable cost Rs. 8,000; Fixed cost Rs. 5,000; Break-even sales in value . |
| A. | Rs. 7,936. |
| B. | Rs. 7,353. |
| C. | Rs. 8,333. |
| D. | Rs. 9,090. |
| Answer» B. Rs. 7,353. | |
| 275. |
Fixed cost Rs. 80,000; Variable cost Rs. 2 per unit; Selling price_Rs. 10 per unit; turnover required for a profit target of Rs. 60,000. |
| A. | Rs. 1,75,000. |
| B. | Rs. 1,17,400. |
| C. | Rs. 1.57,000. |
| D. | Rs. 1,86,667. |
| Answer» A. Rs. 1,75,000. | |
| 276. |
Sales Rs. 25,000; Variable cost Rs. 15,000; Fixed cost Rs .4,000; P/V Ratio is . |
| A. | 40% . |
| B. | 80% |
| C. | 15% |
| D. | 30%. |
| Answer» A. 40% . | |
| 277. |
Sales Rs. 50,000; Variable cost Rs. 30,000; Net profit Rs. 6,000; fixed cost is . |
| A. | Rs. 10,000. |
| B. | b. Rs. l4,000 . |
| C. | Rs. 12,000. |
| D. | Rs. 8,000. |
| Answer» B. b. Rs. l4,000 . | |
| 278. |
Actual sales Rs .4,00,000; Break-even sales Rs. 2,50,000; Margin of Safety in percentage is _. |
| A. | 33.33%. |
| B. | 66.67% |
| C. | 37.5% . |
| D. | 76.33%. |
| Answer» C. 37.5% . | |
| 279. |
P/V Ratio 50%; Variable cost of the produce Rs. 25; Selling price is . |
| A. | Rs. 50 . |
| B. | Rs. 40. |
| C. | Rs. 30 . |
| D. | Rs. 55. |
| Answer» A. Rs. 50 . | |
| 280. |
Fixed cost Rs. 2,00,000; Sales Rs. 8,00,000; P/V Ratio 30%; the amount of' profit is . |
| A. | Rs. 50,000. |
| B. | Rs. 40,000 . |
| C. | Rs. 35,000 . |
| D. | Rs. 45,000 . |
| Answer» B. Rs. 40,000 . | |
| 281. |
P/V Ratio is 25% and Margin of Safety is Rs; 3,00,000, the amount of profit is . |
| A. | Rs. 1,00,000. |
| B. | Rs. 80,000. |
| C. | Rs. 75,000. |
| D. | . Rs. 60,000. |
| Answer» C. Rs. 75,000. | |
| 282. |
Total sales Rs. 20,00,000; Fixed expenses Rs. 4,00,000; P/V Ratio 40%; Break-even capacity in percentage is . |
| A. | 40% . |
| B. | 60% . |
| C. | 50% . |
| D. | 45%. |
| Answer» C. 50% . | |
| 283. |
Break - even point occurs at 40% of` total capacity, margin of safety will be . |
| A. | 40% . |
| B. | 60% . |
| C. | 80% . |
| D. | 85% . |
| Answer» B. 60% . | |
| 284. |
If the P/V Ratio of a product is 30% and selling price is Rs. 25 per unit, the marginal cost of the product would be . |
| A. | Rs. 18.75 |
| B. | Rs. 16.50 |
| C. | Rs. 15.40 |
| D. | Rs. 17.50 |
| Answer» D. Rs. 17.50 | |
| 285. |
Absorption costing is also known as . |
| A. | historical costing. |
| B. | real costing. |
| C. | marginal costing. |
| D. | real costing . |
| Answer» A. historical costing. | |
| 286. |
Under marginal costing stock are valued at . |
| A. | fixed cost. |
| B. | semi-variable cost. |
| C. | variable cost. |
| D. | market price. |
| Answer» C. variable cost. | |
| 287. |
The budget is a . |
| A. | a post-mortem analysis . |
| B. | a substitute of management |
| C. | an aid to management |
| D. | calculation . |
| Answer» C. an aid to management | |
| 288. |
One of the most important tools of cost planning is . |
| A. | budget. |
| B. | direct cost. |
| C. | unit cost. |
| D. | cost sheet. |
| Answer» A. budget. | |
| 289. |
Sales budget is a . |
| A. | Functional budget. |
| B. | Expenditure budget. |
| C. | Master budget . |
| D. | Flexible budget. |
| Answer» A. Functional budget. | |
| 290. |
The budget which usually takes the form of budgeted profit and loss account and balance sheet is known as |
| A. | Flexible budget . |
| B. | Master budget. |
| C. | Cash budget . |
| D. | Purchase budget. |
| Answer» B. Master budget. | |
| 291. |
Which of the following is usually a long-term budget?. |
| A. | .Fixed budget. |
| B. | Cash budget. |
| C. | Sales budget |
| D. | Capital expenditure budget. |
| Answer» D. Capital expenditure budget. | |
| 292. |
The fixed-variable cost classification has `a special significance in the preparation of . |
| A. | Capital budget. |
| B. | Cash budget. |
| C. | Master budget . |
| D. | Flexible budget . |
| Answer» D. Flexible budget . | |
| 293. |
Preparing budget figures for different levels of activity within a range under flexible budgeting is . |
| A. | Formula method. |
| B. | Multi-activity method. |
| C. | Budget cost allowance method. |
| D. | Proportionate method. |
| Answer» B. Multi-activity method. | |
| 294. |
What type of budget is designed to take into account forecast change in costs, prices, etc? |
| A. | Master budget. |
| B. | Rolling budget. |
| C. | Flexible budget . |
| D. | Functional budget. |
| Answer» B. Rolling budget. | |
| 295. |
Operation budgets normally cover a period of . |
| A. | one to ten years. |
| B. | one to two years. |
| C. | one to five years. |
| D. | one year or less. |
| Answer» D. one year or less. | |
| 296. |
The entire process of preparing the budgets is known as . |
| A. | Planning. |
| B. | Organizing. |
| C. | Budgeting. |
| D. | Controlling. |
| Answer» C. Budgeting. | |
| 297. |
Budgetary control starts with . |
| A. | Planning. |
| B. | Organizing. |
| C. | Budgeting. |
| D. | Controlling. |
| Answer» C. Budgeting. | |
| 298. |
Budget designed to remain constant irrespective of the level of activity attained is called . |
| A. | Fixed budget. |
| B. | Flexible budget. |
| C. | Sales budget. |
| D. | Production budget |
| Answer» A. Fixed budget. | |
| 299. |
Long-term budgets are prepared for . |
| A. | 1 year. |
| B. | 1-3 years. |
| C. | 1-5 years. |
| D. | 5-10 years. |
| Answer» D. 5-10 years. | |
| 300. |
The budget which shows the budgeted quantity of output to be produced during a specific period is. |
| A. | Fixed budget. |
| B. | Flexible budget. |
| C. | Sales budget. |
| D. | Production budget |
| Answer» D. Production budget | |
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