Management Accounting Set 7
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This set of Management Accounting Multiple Choice Questions & Answers (MCQs) focuses on Management Accounting Set 7
Q1 | Which of the following matter is relevant with cash receipts and disbursement method ofpreparing Cash Budget ?
- While determining the cash payments, it is necessary to estimate the credit sales.
- While estimating cash receipts, it is not necessary to estimate the figure of credit sales.
- Debtors Ratio is used to estimate the timings when cash collections would be obtained from credit sales.
- While estimating the total amount of cash payment for purchases, it is necessary to decide from which suppliers materials are to be purchased.
Q2 | Budget period depends upon -
- The type of budget
- The nature of business
- The length of trade cycles
- All of the above
Q3 | Usually the production budget is stated in terms of -
- Money
- Quantity
- Both (a) and (b)
- None
Q4 | Recording of actual performance is -
- An advantage of budgetary control
- A step in budgetary control
- A limitation of budgetary control
- None of the above
Q5 | Budgetary control system helps the management to eliminate -
- Undercapitalization
- Overcapitalization
- Both (a) and (b)
- None
Q6 | Budgetary control facilitates easy introduction of the -
- Marginal costing
- Ratio analysis
- Standard costing
- Subjective matter
Q7 | Budgetary control system acts as a friend, philosopher and guide to the -
- Management
- Share holders
- Creditors
- Employees
Q8 | Budgetary control system defines the objectives and policies of the -
- Production department
- Finance department
- Marketing department
- Subjective matter
Q9 | A budget is tool which helps the management in planning and control of -
- All business activities
- Production activities
- Purchase activities
- Sales activities
Q10 | In responsibility centre, the output is called as -
- Revenue
- Cost
- Both (a) and (b)
- None
Q11 | If the responsibility centre gets more revenue from output, then it is called -
- Investment centre
- Cost centre
- Profit centre
- Expense centre
Q12 | Cost Unit is defined as -
- Unit of quantity of product, service or time in relation to which costs may be ascertained or expressed
- A location, person or an item of equipment or a group of these for which costs are ascertained and used for cost control.
- Centres having the responsibility of generating and maximising profits
- Centres concerned with earning an adequate return on investment
Q13 | Fixed cost is a cost -
- Which changes in total in proportion to changes in output
- Which is partly fixed and partly variable in relation to output
- Which do not change in total during a given period despise changes in output
- Which remains same for each unit of output
Q14 | Uncontrollable costs are the costs which be influenced by the action of a specified member of an undertaking. -
- can not
- can
- may or may not
- must
Q15 | Element/s of Cost of a product are -
- Material only
- Labour only
- Expenses only
- Material, Labour and expenses
Q16 | Overhead refers to -
- Direct or Prime Cost
- All Indirect costs
- Only Factory indirect costs
- Only indirect expenses
Q17 | Which of the following is not a method of cost absorption?
- Percentage of direct material cost
- Machine hour rate
- Labour hour rate
- Repeated distribution method
Q18 | A Local Authority is preparing cash Budget for its refuse disposal department. Which ofthe following items would not be included in the cash budget?
- Capital cost of a new collection vehicle
- Depreciation of the machinery
- Operatives wages
- Fuel for the collection Vehicles
Q19 | Which of the following characteristics does NOT pertain to management accounting?
- Provides information and estimates about future activity
- Generates specific-purpose financial statements and reports
- Provides financial and operating data multidisciplinary in scope
- Has externally imposed standards
Q20 | A budget which is prepared in a manner so as to give the budgeted cost for any level ofactivity is known as -
- Master budget
- Zero base budget
- Functional budget
- Flexible budget
Q21 | ___________ is a summary of all functional budgets in a capsule form.
- Functional Budget
- Master Budget
- Long Period Budget
- Flexible Budget
Q22 | When the sales increase from Rs. 40,000 to Rs. 60,000 and profit increases by Rs. 5,000,the P/V ratio is -
- 20%
- 30%
- 25%
- 40%
Q23 | From following which is not a principle of good reporting ?
- Simplicity
- Accountability
- Promptness
- Accuracy
Q24 | From day to day operation which report is prepare ?
- Routine
- Special
- Investigative
- External
Q25 | Any special event happen into the business then which report is prepared ?
- Routine
- Special
- External
- Control