McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Business Administration (BBA) , Bachelor of Banking and Insurance (BBI) , Bachelor of Commerce (B Com) .
Chapters
| 251. |
The accounting department in an organization is - |
| A. | Investment centre |
| B. | Expense centre |
| C. | Profit centre |
| D. | All of the above |
| Answer» A. Investment centre | |
| 252. |
What is the main advantage of responsibility accounting ? |
| A. | Improves performance |
| B. | It fixes responsibility |
| C. | Helpful in decision making |
| D. | All of the above |
| Answer» D. All of the above | |
| 253. |
The responsibility accounting is a system by which the responsibility is assigned to the concerned persons - |
| A. | To increase sales |
| B. | To control cash |
| C. | To increase production |
| D. | All of the above |
| Answer» B. To control cash | |
| 254. |
The contribution of accounting department in an organization - |
| A. | Cannot be measured in monetary terms |
| B. | Can be measured in monetary terms |
| C. | May or may not be measured in monetary terms |
| D. | None of the above |
| Answer» A. Cannot be measured in monetary terms | |
| 255. |
According to responsibility accounting, the entire organization is divided into various - |
| A. | Business centre |
| B. | Profit centre |
| C. | Responsibility centre |
| D. | None of the above |
| Answer» C. Responsibility centre | |
| 256. |
It may not be ______ to measure exactly the output of service departments in an organization. |
| A. | Feasible |
| B. | Necessary |
| C. | Either (a) or (b) |
| D. | None of these |
| Answer» C. Either (a) or (b) | |
| 257. |
Internal transfer of process at profit _________ of the company. |
| A. | Will not increase the asset |
| B. | Will increase the asset |
| C. | Can’t say |
| D. | Inadequate information |
| Answer» A. Will not increase the asset | |
| 258. |
The success of budgetary control system depends upon the willing cooperation of ….… |
| A. | Shareholders |
| B. | Management |
| C. | Creditors |
| D. | All the functional areas of management |
| Answer» D. All the functional areas of management | |
| 259. |
A key factor is one which restricts …… |
| A. | The volume of production |
| B. | The volume of sales |
| C. | The volume of purchase |
| D. | All of the above |
| Answer» A. The volume of production | |
| 260. |
The classification of fixed and variable cost is useful for the preparation of …… |
| A. | Master budget |
| B. | Flexible budget |
| C. | Cash budget |
| D. | Capital budget |
| Answer» B. Flexible budget | |
| 261. |
In ‘make or buy’ decision, it is profitable to buy from outside only when the supplier’s price is below the firm’s own ___________. |
| A. | Fixed Cost |
| B. | Variable Cost |
| C. | Total Cost |
| D. | Prime Cost |
| Answer» B. Variable Cost | |
| 262. |
__________ is a detailed budget of cash receipts and cash expenditure incorporating both revenue and capital items. |
| A. | Cash Budget |
| B. | Capital Expenditure Budget |
| C. | Sales Budget |
| D. | Overhead Budget |
| Answer» A. Cash Budget | |
| 263. |
Sunk costs are __________. |
| A. | Relevant for decision making |
| B. | Not relevant for decision making |
| C. | Cost to be incurred in future |
| D. | Future costs |
| Answer» B. Not relevant for decision making | |
| 264. |
Abnormal cost is the cost ___________. |
| A. | Cost normally incurred at a given level of output |
| B. | Cost not normally incurred at a given level of output |
| C. | Cost which is charged to customer |
| D. | Cost which is included in the cost of the product |
| Answer» B. Cost not normally incurred at a given level of output | |
| 265. |
Responsibility Centre can be categorised into ___________. |
| A. | Cost Centres only |
| B. | Profit Centres only |
| C. | Investment Centres only |
| D. | All of the above |
| Answer» D. All of the above | |
| 266. |
A profit centre is a centre ___________. |
| A. | Where the manager has the responsibility of generating and maximising profits |
| B. | Which is concerned with earning an adequate Return on Investment |
| C. | Both (a) and (b) |
| D. | Which manages cost |
| Answer» A. Where the manager has the responsibility of generating and maximising profits | |
| 267. |
Management Accounting is and financial accounting differ in that management accounting information is prepared – |
| A. | Following prescribed rules |
| B. | Using whatever methods the company finds beneficial |
| C. | For shareholders |
| D. | To summarize the whole company with little detail |
| Answer» B. Using whatever methods the company finds beneficial | |
| 268. |
Purpose of Management Accounting is to – |
| A. | Past orientation |
| B. | Help banks make decisions |
| C. | Help managers make decisions |
| D. | Help investors make decisions |
| Answer» C. Help managers make decisions | |
| 269. |
Management Accounting is the branch of accounting concerned with reporting to – |
| A. | Internal Managers |
| B. | Shareholders |
| C. | The Government |
| D. | Bankers |
| Answer» A. Internal Managers | |
| 270. |
Which of the following does NOT describe management accounting? |
| A. | Evaluation of segments or products within the firm |
| B. | Emphasis on the future |
| C. | Externally focused |
| D. | Detailed information |
| Answer» C. Externally focused | |
| 271. |
Management accounting reports are prepared |
| A. | To meet the needs of decision makers within the firm |
| B. | Whenever shareholders request them |
| C. | According to guidelines prepared by the shares and Financial Services Authority |
| D. | According to financial accounting standards |
| Answer» A. To meet the needs of decision makers within the firm | |
| 272. |
Management accounting is primarily concerned with - |
| A. | Providing investors with useful information for valuing securities. |
| B. | Providing creditors information on the status of their loans. |
| C. | Providing managers with relevant information to help achieve organizational goals. |
| D. | Providing the relevant taxation authorities with information to determine the amount |
| Answer» C. Providing managers with relevant information to help achieve organizational goals. | |
| 273. |
Which matters are taken into consideration while preparing production budget ? |
| A. | The estimate of the number of units to be produced during the budget period. |
| B. | Estimate of number of units to be sold. |
| C. | Policy regarding the wage fixation for labourers. |
| D. | Policy regarding the selection of suppliers from whom materials would be purchased. |
| Answer» A. The estimate of the number of units to be produced during the budget period. | |
| 274. |
Which of the following matter is to be taken into account which preparing Material Purchase Budget ? |
| A. | The supplier from whom materials are to be purchased. |
| B. | The procedure of storing and preserving materials after they are received. |
| C. | The prices at which receipts and issues of materials are to be recorded in stores ledger. |
| D. | The maximum and minimum quantities of materials to be purchased. |
| Answer» D. The maximum and minimum quantities of materials to be purchased. | |
| 275. |
Which of the following matter is relevant with cash receipts and disbursement method of preparing Cash Budget ? |
| A. | While determining the cash payments, it is necessary to estimate the credit sales. |
| B. | While estimating cash receipts, it is not necessary to estimate the figure of credit sales. |
| C. | Debtors Ratio is used to estimate the timings when cash collections would be obtained from credit sales. |
| D. | While estimating the total amount of cash payment for purchases, it is necessary to decide from which suppliers materials are to be purchased. |
| Answer» C. Debtors Ratio is used to estimate the timings when cash collections would be obtained from credit sales. | |
| 276. |
Budget period depends upon - |
| A. | The type of budget |
| B. | The nature of business |
| C. | The length of trade cycles |
| D. | All of the above |
| Answer» D. All of the above | |
| 277. |
Usually the production budget is stated in terms of - |
| A. | Money |
| B. | Quantity |
| C. | Both (a) and (b) |
| D. | None |
| Answer» C. Both (a) and (b) | |
| 278. |
Recording of actual performance is - |
| A. | An advantage of budgetary control |
| B. | A step in budgetary control |
| C. | A limitation of budgetary control |
| D. | None of the above |
| Answer» B. A step in budgetary control | |
| 279. |
Budgetary control system helps the management to eliminate - |
| A. | Undercapitalization |
| B. | Overcapitalization |
| C. | Both (a) and (b) |
| D. | None |
| Answer» C. Both (a) and (b) | |
| 280. |
Budgetary control facilitates easy introduction of the - |
| A. | Marginal costing |
| B. | Ratio analysis |
| C. | Standard costing |
| D. | Subjective matter |
| Answer» C. Standard costing | |
| 281. |
Budgetary control system acts as a friend, philosopher and guide to the - |
| A. | Management |
| B. | Share holders |
| C. | Creditors |
| D. | Employees |
| Answer» A. Management | |
| 282. |
Budgetary control system defines the objectives and policies of the - |
| A. | Production department |
| B. | Finance department |
| C. | Marketing department |
| D. | Subjective matter |
| Answer» D. Subjective matter | |
| 283. |
A budget is tool which helps the management in planning and control of - |
| A. | All business activities |
| B. | Production activities |
| C. | Purchase activities |
| D. | Sales activities |
| Answer» A. All business activities | |
| 284. |
In responsibility centre, the output is called as - |
| A. | Revenue |
| B. | Cost |
| C. | Both (a) and (b) |
| D. | None |
| Answer» A. Revenue | |
| 285. |
If the responsibility centre gets more revenue from output, then it is called - |
| A. | Investment centre |
| B. | Cost centre |
| C. | Profit centre |
| D. | Expense centre |
| Answer» C. Profit centre | |
| 286. |
Cost Unit is defined as - |
| A. | Unit of quantity of product, service or time in relation to which costs may be ascertained or expressed |
| B. | A location, person or an item of equipment or a group of these for which costs are ascertained and used for cost control. |
| C. | Centres having the responsibility of generating and maximising profits |
| D. | Centres concerned with earning an adequate return on investment |
| Answer» A. Unit of quantity of product, service or time in relation to which costs may be ascertained or expressed | |
| 287. |
Fixed cost is a cost - |
| A. | Which changes in total in proportion to changes in output |
| B. | Which is partly fixed and partly variable in relation to output |
| C. | Which do not change in total during a given period despise changes in output |
| D. | Which remains same for each unit of output |
| Answer» C. Which do not change in total during a given period despise changes in output | |
| 288. |
Uncontrollable costs are the costs which be influenced by the action of a specified member of an undertaking. - |
| A. | can not |
| B. | can |
| C. | may or may not |
| D. | must |
| Answer» A. can not | |
| 289. |
Element/s of Cost of a product are - |
| A. | Material only |
| B. | Labour only |
| C. | Expenses only |
| D. | Material, Labour and expenses |
| Answer» D. Material, Labour and expenses | |
| 290. |
Overhead refers to - |
| A. | Direct or Prime Cost |
| B. | All Indirect costs |
| C. | Only Factory indirect costs |
| D. | Only indirect expenses |
| Answer» B. All Indirect costs | |
| 291. |
Which of the following is not a method of cost absorption? |
| A. | Percentage of direct material cost |
| B. | Machine hour rate |
| C. | Labour hour rate |
| D. | Repeated distribution method |
| Answer» D. Repeated distribution method | |
| 292. |
A Local Authority is preparing cash Budget for its refuse disposal department. Which of the following items would not be included in the cash budget? |
| A. | Capital cost of a new collection vehicle |
| B. | Depreciation of the machinery |
| C. | Operatives wages |
| D. | Fuel for the collection Vehicles |
| Answer» B. Depreciation of the machinery | |
| 293. |
Which of the following characteristics does NOT pertain to management accounting? |
| A. | Provides information and estimates about future activity |
| B. | Generates specific-purpose financial statements and reports |
| C. | Provides financial and operating data multidisciplinary in scope |
| D. | Has externally imposed standards |
| Answer» D. Has externally imposed standards | |
| 294. |
A budget which is prepared in a manner so as to give the budgeted cost for any level of activity is known as - |
| A. | Master budget |
| B. | Zero base budget |
| C. | Functional budget |
| D. | Flexible budget |
| Answer» D. Flexible budget | |
| 295. |
___________ is a summary of all functional budgets in a capsule form. |
| A. | Functional Budget |
| B. | Master Budget |
| C. | Long Period Budget |
| D. | Flexible Budget |
| Answer» B. Master Budget | |
| 296. |
When the sales increase from Rs. 40,000 to Rs. 60,000 and profit increases by Rs. 5,000, the P/V ratio is - |
| A. | 20% |
| B. | 30% |
| C. | 25% |
| D. | 40% |
| Answer» C. 25% | |
| 297. |
From following which is not a principle of good reporting ? |
| A. | Simplicity |
| B. | Accountability |
| C. | Promptness |
| D. | Accuracy |
| Answer» B. Accountability | |
| 298. |
From day to day operation which report is prepare ? |
| A. | Routine |
| B. | Special |
| C. | Investigative |
| D. | External |
| Answer» A. Routine | |
| 299. |
Any special event happen into the business then which report is prepared ? |
| A. | Routine |
| B. | Special |
| C. | External |
| D. | Control |
| Answer» B. Special | |
| 300. |
Internal report use for _______________ . |
| A. | Share holders |
| B. | Government |
| C. | Managerial personnel |
| D. | Creditors |
| Answer» C. Managerial personnel | |
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