Select the correct formulae for calculating break even point.
a)
Fixed
cost / (Selling
b) price per unit
- Variable
cost per unit)
c)
[Fixed
cost /
d) Marginal
contribution]
X Sales
[Fixed
cost /
Marginal
contribution]
X Variable
cost
[Fixed
cost / (Fixed
cost + Net
Profit)] X
Sales
Select the transactions which can be entered in the
Journal proper.
a)
b)
Opening
entries
Closing
entries
c)
Average
entries
d)
Rectification
entries
Compound
journal entry
avoids
duplication of
effort.
True
False
Labour efficiency variance Rs.1,000/(favourable); labour mix variance Rs.260/-
(adverse) and labour rate variance Rs.300/(adverse). Compute labour cost variance
and labour yield variance.
a)
Labour
cost variance
b) -Rs.700/(Favourable)
c)
Labour
yield variance
-Rs.1,260/-
d)
Labour
yield variance
is adverse
Labour
yield variance
is favourable
Commission payable
to General Manager is
10 % of the net profits.
If the net profit before
charging commission
is Rs.29,200/-, then
what will be the
amount of his net
profit after
commission?
a)
b)
Rs.29,200/Rs.26,000/Rs.26,545.45
c)
d)
The credit
purchases are as
follows : July
Rs.80,000/- and
August Rs.140,000/-.
Creditors are paid
either on a 'prompt
basis' (on the spot)
or 30 days basis. It
Rs.26,788.99
is estimated that
10% of the creditors
are in the prompt
category. Find the
amount paid to
a)
b)
Rs.161,000/Rs.121,000/Rs.177,000/-
c)
d)
A company
budgets for a
production of
150,000 units. The
variable cost per
unit is Rs.14/- and
fixed cost is Rs.2/per unit. The
company fixes its
selling price to
fetch a profit of
15% on total cost.
What is the break
even point for the
company?
a)
b)
68,182 units
68,100 units
61,182 units
c)
d)
61,100 units
Rs.118,000/-
LIST OF ATTEMPTED QUESTIONS AND ANSWERS
Select The Blank
Question
Loss is equal to fixed cost minus ________
Correct Answer Contribution
Your Answer
Contribution
Select The Blank
Question
Profit = Contribution per unit X ________.
Correct Answer Margin of safety (units)
Your Answer
Break even point (units)
Multiple Choice Multiple Answer
Question
The different purposes served by standard costing technique are
:
Correct Answer Cost control , Cost awareness , Performance appraisal
Your Answer
Cost control , Cost awareness , Profit planning
True/False
Question
Accounting is an art of recording, classifying & summarizing in a
significant manner.
Correct Answer True
Your Answer
True
True/False
Question
Error of commission refer to a situation where a transaction is
not recorded in the books of account.
Correct Answer False
Your Answer
False
Multiple Choice Multiple Answer
Question
A materials requisition form normally contains the following
aspects:
Correct Answer Quantity requisitioned , Per unit material cost , Job number
Your Answer
Quantity requisitioned , Per unit material cost , Job number
Multiple Choice Single Answer
Question
If a predetermined overhead rate is not employed an the volume
of production is increased over the level planned, the cost per
unit would be expected to :
Correct Answer Decrease for fixed costs and remain unchanged for variable
costs
Your Answer
Remain unchanged for fixed costs and increase for variable
costs
Select The Blank
Question
The variance which measures the difference between what is
paid for a given quantity of materials and what should have been
paid for, is known as ________ variance.
Correct Answer Direct material cost
Your Answer
Direct material cost
True/False
Question
Balance sheet indicates the expenditure & income from the
business.
Correct Answer False
Your Answer
False
Multiple Choice Single Answer
Question
It is said that adoption of uniform costing creates customer
confidence because . . .
Correct Answer Prices are reliable
Your Answer
Prices are reliable
True/False
Question
Deferred revenue expenditure written off account is a real
account.
Correct Answer False
Your Answer
False
Select The Blank
Question
In practical circumstances, the ________ are referred to as
application of funds.
Correct Answer Assets
Your Answer
Liabilities
Multiple Choice Single Answer
Question
The cost of fixed asset is Rs. 1,00,000. Rs. 17,000 is charged as
depreciation. Calculate the rate of depreciation.
Correct Answer 0.17
Your Answer
0.17
True/False
Question
Balance sheet is considered to be a part of the financial
statements.
Correct Answer True
Your Answer
True
Select The Blank
Question
The cost-volume-profit analysis basically highlights the effect of
changes in sales volume on the profit of the company, in the
________.
Correct Answer short run
Your Answer
short run
Multiple Choice Single Answer
Question
The following figures relate to a company manufacturing a varied
range of products : Year 2003 Total sales Rs.22,23,000/- and
total cost Rs.19,83,600/-. Year 2004 : Total sales Rs.24,51,000/and Total cost Rs.21,43,200/-. Assuming stability in prices,
calculate the profit volume ratio
Correct Answer 0.3
Your Answer
0.7
Multiple Choice Single Answer
Question
Calculate the machine hour rate. The amount of overhead
pertaining to June, 2004 to be apportioned is Rs.170,010/-. The
machine cannot work without an operator. During the month
June, 2004 the machine operator has been paid for 5,670 hours.
Correct Answer Rs.29.98
Your Answer
Rs.29.98
True/False
Question
Profitability statement indicates the amount of assets & liabilities.
Correct Answer False
Your Answer
True
Multiple Choice Multiple Answer
Question
While preparing sales budget the following factors must be
considered :
Correct Answer The number and types of products sold by the organisation ,
Whether the organisation's market share is increasing or
decreasing? , Details of seasonal fluctuations in sales
Your Answer
The number and types of products sold by the organisation ,
Whether the organisation's market share is increasing or
decreasing? , Details of seasonal fluctuations in sales
True/False
Question
The sum of indirect material cost, indirect labour cost and
indirect expenses is termed as Overheads.
Correct Answer True
Your Answer
True
Select The Blank
Question
Generally all the liabilities will have ________balance.
Correct Answer Credit
Your Answer
Credit
True/False
Question
Uniform costing system is a pre-requisite to an inter-firm
comparison of firms belonging to the different industries.
Correct Answer False
Your Answer
False
True/False
Question
Error of commission refer to calculation errors, totaling errors,
errors in carrying forward etc.
Correct Answer True
Your Answer
True
Multiple Choice Multiple Answer
Question
Techniques of management accounting include:
Correct Answer Marginal costing , Budgetary control , Standard costing
Your Answer
Marginal costing , Budgetary control , Standard costing
Multiple Choice Multiple Answer
Question
Which of the following aspects are mainly responsible for
difficulty in application of Uniform costing system.
Correct Answer Capital investment , Plant size , Location
Your Answer
Capital investment , Plant size , Location
Select The Blank
Question
The expenses relating to maintenance and creation of demand
for the product should be included in the ________budget
Correct Answer Selling expenses
Your Answer
Selling expenses
Multiple Choice Multiple Answer
Question
Management Accounting is…
Correct Answer Designed particularly for internal use , Helpful in estimating the
future along with past period , Useful in furnishing the necessary
information to the management
Your Answer
Designed particularly for internal use , Helpful in estimating the
future along with past period , Useful in furnishing the necessary
information to the management
True/False
Question
Malik started business by contributing cash Rs.50,000/- and his
personal car worth Rs.25,000/-; thus his capital account should
be credited with Rs.75,000/-.
Correct Answer True
Your Answer
True
Multiple Choice Single Answer
Question
Flood occurred on 18th March, 2004 and goods worth
Rs.28,000/- were destroyed. The insurance company accepted
on 28th March, 2004 the claim for Rs.10,000/- only. The claim
amount was received on 2nd April, 2004. Find the impact of this
transaction on net profit for the year ending 31st March, 2004.
Correct Answer The net profit will decrease by Rs.18,000/Your Answer
The net profit will decrease by Rs.18,000/-
Multiple Choice Multiple Answer
Question
The selection of the supplier may depend upon the following
aspects:
Correct Answer Geographical location of the supplier , Price quoted by the
supplier , Goodwill of the supplier
Your Answer
Price quoted by the supplier , Goodwill of the supplier
Multiple Choice Single Answer
Question
XYZ & Co. has taken a loan of Rs.100,000/- @ 15% p.a.on 1st
October, 2003. Interest is to be paid on half yearly basis. What
treatment should be given in the books of accounts of XYZ & Co.
as on 31st March, 2004?
Correct Answer Interest account should be debited with Rs.7,520.55 and
outstanding interest account should be credited with Rs.7,520.55
Your Answer
Interest account should be debited with Rs.7,520.55 and
outstanding interest account should be credited with Rs.7,520.55
True/False
Question
The labour cost which can be identified with the individual cost
centre is known as the Direct Labour Cost.
Correct Answer True
Your Answer
True
Match The Following
Question
Correct Answer
Your Answer
Ledger
Maintain all types of
accounts
Maintain all types of
accounts
Audit
Reviewing internal control Reviewing internal control
system
system
Accounting
Process of analyzing &
interpretation
Process of analyzing &
interpretation
Journal
Book of original entry
Book of original entry
True/False
Question
A business is an activity carried out with the intention of earning
the profit.
Correct Answer True
Your Answer
True
Select The Blank
Question
If the firm is operating with zero margin of safety, decline of even
a single unit in sales will result in ________.
Correct Answer Loss
Your Answer
Loss
Multiple Choice Multiple Answer
Question
When bank balance as per bank book is considered for
preparing bank reconciliation statement, then following items
need to be added :
Correct Answer Cheques issued but not presented , Direct deposit made by
customer , Wrong credits given by bank
Your Answer
Cheques issued but not presented , Direct deposit made by
customer , Wrong credits given by bank
Select The Blank
Question
Uniform costing is not a separate method of ________.
Correct Answer cost accounting
Your Answer
cost accounting
Multiple Choice Multiple Answer
Question
If you are required to enforce uniform costing system in your
industry, how would you proceed ?
Correct Answer Collecting data from all units of your industry , Ensuring that the
data collected is complete and correct , Maintaining secrecy of
the data collected
Your Answer
Collecting data from all units of your industry , Ensuring that the
data collected is complete and correct , Allowing free access to
all the units to the collected data
True/False
Question
Balance sheet indicates the financial status of the business at
given period.
Correct Answer True
Your Answer
True
Select The Blank
Question
The indirect material cost, indirect labour cost and indirect
expenses cost, collectively are termed as ________.
Correct Answer Overhead
Your Answer
Overhead
True/False
Question
Under time rate system a worker is paid on the basis of
production achieved by him in a given time.
Correct Answer False
Your Answer
False
Multiple Choice Single Answer
Question
Basic objective of Uniform Costing is . . .
Correct Answer comparison
Your Answer
True/False
Question
comparison
Accounting refers to the process of analyzing & interpreting the
information already recorded in the books of accounts.
Correct Answer True
Your Answer
True
Multiple Choice Multiple Answer
Question
Labour efficiency variance Rs.1,000/- (favourable); labour mix
variance Rs.260/- (adverse) and labour rate variance Rs.300/(adverse). Compute labour cost variance and labour yield
variance.
Correct Answer Labour cost variance -Rs.700/- (Favourable) , Labour yield
variance -Rs.1,260/- , Labour yield variance is favourable
Your Answer
Labour cost variance -Rs.700/- (Favourable) , Labour yield
variance -Rs.1,260/- , Labour yield variance is favourable
Select The Blank
Question
If the standard contribution is less than the actual contribution,
then ________ variance arises.
Correct Answer Favourable
Your Answer
Favourable
Match The Following
Question
Correct Answer
Your Answer
Purchase budget
Forecast of quantity and
value of materials
Forecast of quantity and
value of materials
Budget committee
Analyses the performance Analyses the performance
of different budget centres of different budget centres
Cash budget
Assists in predicting
shortage of cash
Assists in predicting
shortage of cash
Budget
Objective is performance
evaluation
Objective is performance
evaluation
Multiple Choice Single Answer
Question
As a part of the data presented in support of a proposal to
icnrease the production of clock radios, the sales manager of
Wittman Electronics reproted the total additional cost required for
the proposed increased production level. The increase in total
cost is known as :
Correct Answer Incremental cost
Your Answer
Incremental cost