Accounting For Management Set 6 MCQs

Q1 | Which of the following best describes a fixed cost ?

remains constant irrespective of the level of activity

represents a fixed proportion of total costs

increases proportionately with output

has a direct relationship with output

Q2 | The weighted average method of stock valuation would be mostappropriate for ………….

chemical manufacturer

a food retailer

a building contractor

a motor components retailer

Q3 | Direct labour costs will include……………

all labor costs attributable to product

direct labor costs plus any bonuses

total direct labor hours at the normal hourly rate of pay

direct labor costs plus any bonuses and overtime premium

Q4 | Management accounting is said to meet:

the internal accounting needs of the organization

the needs of laws that govern company financial reporting.

the regulatory requirements of the organization

the external accounting needs of the organisation.

Q5 | Which one of the following is not a recognised cost classification?

time

function

performance

type

Q6 | Direct costs are also known as:

indirect cost

overhead costs

prime costs

marginal costs

Q7 | Indirect costs are also known as

direct cost

overhead costs

prime costs

marginal costs

Q8 | Which of the following is not true?

managerial accounting information is prepared for internal users

managerial accounting information is not required by various laws

there are specific standards of acceptability for managerial accounting

the structure of managerial accounting practice is relatively flexible

Q9 | Which of the following are basic inventories for a manufacturer?

indirect materials, goods in process, and raw materials

finished goods, raw materials, and direct materials

raw materials, goods in process, and finished goods

raw materials, factory overhead, and direct labour

Q10 | The three basic elements of the cost of a manufactured product are:

indirect materials, indirect labour, and manufacturing overhead

merchandise inventory, work in process, and finished goods inventory

direct materials, work in process, and finished goods inventory

direct materials, direct labour, and manufacturing overhead

Q11 | A cost which changes in proportion to changes in volume of activity iscalled

fixed cost

controllable cost

variable cost

opportunity cost

Q12 | A 'direct' cost is a cost that is classified by:

behaviour

traceability

controllability

relevance

Q13 | A 'product' cost is a cost that is classified by:

behaviour

function

controllability

relevance

Q14 | Which of the following is a period cost?

direct materials

indirect materials

factory utilities

administrative expenses

Q15 | Managerial accounting information is generally prepared for

shareholders

creditors

managers

regulatory agencies

Q16 | Which of the following is not an internal user of management information?

creditor

department manager

controller

treasurer

Q17 | Sales commissions are classified as

prime costs

period costs

product costs

indirect labour