Mange Rial Accounting 11

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LIST OF ATTEMPTED QUESTIONS AND ANSWERS

True/FalseQuestion Balance sheet is a part of the ledger accounts maintained by the company.

Correct Answer False

Your Answer False

True/False

Question The actual hours taken by the labour are compared with the standard hoursallowed for output to find out the labour yield variance.

Correct Answer True

Your Answer True

Select The Blank

Question Preparation of direct material ________ budget is the responsibility of the

Purchase manager.

Correct Answer PurchaseYour Answer Purchase

Select The Blank

Question The principle of ________ is followed while preparing the financial

statements.Correct Answer Going concern

Your Answer Going concern

True/FalseQuestion Depreciation can be defined as a permanent, continuous and gradual reduction

in the book value of a fixed asset.Correct Answer TrueYour Answer True

True/FalseQuestion Accounting is an art of recording, classifying & summarizing in a significant

manner.

Correct Answer True

Your Answer True

Select The Blank

Question Interest receivable is a________ for the organisation.Correct Answer Current asset

Your Answer Current sset

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

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additional cost required for the proposed increased production level. The increase in total

cost is known as :

Correct Answer Incremental costYour Answer Incremental cost

True/FalseQuestion The role of the budget committee may be taken as an advisory role to the Chief

Executive.

Correct Answer TrueYour Answer True

True/False

Question Accounting refers to the process of analyzing & interpreting the informationalready recorded in the books of accounts.

Correct Answer True

Your Answer True

True/False

Question Profitability statement indicates the amount of assets & liabilities.Correct Answer False

Your Answer False

True/False

Question Uniform costing system is defined as a system using common concepts and

standard accounting practices by different entities in different industry to facilitate inter-

firm comparison.Correct Answer True

Your Answer True

Select The Blank

Question Budgeted profit and loss account and budgeted balance sheet are also known as

________.Correct Answer Master budget

Your Answer Master budget

True/FalseQuestion Balance sheet indicates the expenditure & income from the business.


Your Answer True


Question 200 units of material were purchased from X @ Rs.5/- per unit and 300 unitswere purchased from Y @ Rs.6/- per unit. The organisation follows FIFO system of pricing

of issues and the above purchases have been recorded in stores ledger. 120 units have

already been issued. 60 units received from X are defective and are therefore returned. Find

the value of the material returned to X.

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Correct Answer Rs.300/-

Your Answer Rs.300/-


Question Which system can assist in fixing a common selling price for the industry as a

whole on the basis of cost of production of all units belonging to that industry ?Correct Answer Uniform costingYour Answer Uniform costing

Select The Blank

Question Marginal costing is also known as ________.

Correct Answer Variable costing

Your Answer Variable costing

Multiple Choice Multiple Answer

Question The disadvantages of time rate system are :

Correct Answer Ignores the efficiency of workers , Higher labour cost , Lack ofmotivation to increase productivity

Your Answer Ignores the efficiency of workers , Higher labour cost , Lack of motivationto increase productivity

Match The FollowingQuestion Correct Answer Your Answer

Open Tender Any supplier from the local market can fill the tender Any supplier from the

local market can fill the tender

Global Tender Any supplier from the global market can fill the tender Any supplier from

the global market can fill the tender

Single Tender Tender from only one supplier Tender from only one supplier

Limited Tender Tenders from reliable but few suppliers Tenders from reliable but few

suppliers


Question The store-keeper should initiate action for the purchase of a material, when it

reaches its :Correct Answer Re-order level

Your Answer Re-order level

Select The Blank

Question An adjustment relating to outstanding expenses will ________ the net profit.

Correct Answer Decrease

Your Answer Decrease

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True/False

Question The process of accounting split into three steams i.e. financial, cost,management accounting.

Correct Answer True

Your Answer True

True/False

Question 1) Financial statements are basically in two forms i.e. profitability statementand balance sheet.

Correct Answer True

Your Answer True


Question Items credited to Trading Account are

Correct Answer Sales , Goods lost by fire , Closing stock

Your Answer Sales , Goods lost by fire , Closing stock

True/FalseQuestion All personal expenses of the owner should be debited to the organisation's

profit and loss account.

Correct Answer FalseYour Answer True

True/False

Question A firm earns profit when contribution is equal to fixed costs under variablecosting.


Your Answer False

Select The Blank

Question ________ Accounting is the process of analysis and interpretation of financialdata collected with help of financial accounting & cost accounting

Correct Answer Management

Your Answer Management


Question Contents of Uniform Cost Manual are

Correct Answer Organization , Cost Accounting system , Presentation of informationYour Answer Cost Accounting system , Presentation of information , Financial

accounting system


Question Going concern concept is also known

Correct Answer Continuity concept

Your Answer Continuity concept

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Select The Blank

Question Education facility to workers and their children, pension, superannuation fundare examples of ________ incentives.

Correct Answer Non-monetary

Your Answer Non-monetary


Question Management Accounting isCorrect 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


Question Ram and Laxman are partners of Kush & Bros. As on 1st April, 2003 Ram's

capital is Rs.50,000/- and Laxman's capital is Rs.80,000/-. If interest on capital is to beprovided @ 10% p.a., what will be amount of capital of each of the partners as on 31st

March, 2004, assuming there were no additions during this period? Also, state thetreatment of this item in the Profit and loss account.

Correct Answer Ram's capital Rs.55,000/- , Laxman's capital Rs.88,000/- , Interest on

capital should be debited to the Profit and loss accountYour Answer Ram's capital Rs.55,000/- , Laxman's capital Rs.88,000/- , Interest on

capital should be debited to the Profit and loss account

Multiple Choice Single AnswerQuestion The credit side of the sales book was overcast by Rs.2,000/-. As a result of this

rectification, what of the given impacts is likely to happen?

Correct Answer The liability side of the balance sheet will increase by Rs.2,000/-Your Answer The liability side of the balance sheet will increase by Rs.2,000/-

True/FalseQuestion A business is an activity carried out with the intention of earning the profit.

Correct Answer True

Your Answer True


Question Double entry system of accounting follows the principle of :

Correct Answer Every debit has corresponding creditYour Answer Every debit has corresponding credit

Multiple Choice Multiple AnswerQuestion Identify the fixed expenses from the following.

Correct Answer Rent and taxes of the factory , Wages paid to indirect workers like

cleaners, helpers,etc. , Salary paid to factory supervisor

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Your Answer Rent and taxes of the factory , Wages paid to indirect workers like

cleaners, helpers,etc. , Salary paid to factory supervisor

Select The Blank

Question Depreciation charged on office furniture on straight line basis is an example of

________.Correct Answer Administration overheads

Your Answer Administration overheads

True/False

Question Balance sheet indicates the financial status of the business at given period.

Correct Answer True

Your Answer True

True/False

Question Long term loan borrowed from financial institution comes under the heading of

long term liabilities.Correct Answer True

Your Answer True

True/False

Question Under the Rowan plan bonus is a fixed percentage.Correct Answer False

Your Answer False

True/FalseQuestion The amount of income for the current period which is not received during the

current period, is called Accrued Income.



Ledger Maintain all types of accounts Maintain all types of accounts

Audit Reviewing internal control system Reviewing internal control system

Accounting Process of analyzing & interpretation Process of analyzing & interpretation

Journal Book of original entry Book of original entry


Question Management accounting is concerned with the following activities :

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Correct Answer Decision making , Safeguarding assets , Planning and controlling

activities

Your Answer Decision making , Safeguarding assets , Planning and controlling activities


Question Quantify the increase in profit on account of following errors : (a) Repairs offurniture amounting to Rs.2,000/- were debited to furniture account. Furniture is

depreciated @10% p.a. (b) Interest received on bank deposits was credited to dividend

received account, Rs.1,550/- (c) A television purchased for the managing director's officefor Rs.45,000/- was debited to Interior decoration expenses.

Correct Answer Rs.43,200/-

Your Answer Rs.43,200/-


Question Trade Discount refers to the discount . . .

Correct Answer received on purchases

Your Answer received on purchases

Select The BlankQuestion If the total amount on the ________ side of commission account is more than

the total of its credit side, the commission account is said to have a Debit balance.

Correct Answer DebitYour Answer Debit


Question Features of convention of materiality are . . .Correct Answer transactions having material impact on profitability should be

considered , Insignificant transactions will be ignored

Your Answer transactions having material impact on profitability should be considered ,Insignificant transactions will be ignored

LIST OF ATTEMPTED QUESTIONS AND ANSWERS

True/False

Question Generally speaking income represents wealth increase and business success;

higher the income, lower will be the success of a business.Correct Answer False

Your Answer False


Question Labour efficiency variance Rs.1,000/- (favourable); labour mix variance

Rs.260/- (adverse) and labour rate variance Rs.300/- (adverse). Compute labour costvariance and labour yield variance.

Correct Answer Labour cost variance -Rs.700/- (Favourable) , Labour yield variance

-Rs.1,260/- , Labour yield variance is favourable

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Your Answer Labour cost variance -Rs.700/- (Favourable) , Labour yield variance


True/False

Question P&L statement which is a period statement & relates to a certain period tells

about results of operations.Correct Answer True

Your Answer True

Select The Blank

Question ________ system of wage payment is a combination of Halsey system and

Gantt system.

Correct Answer DiemerYour Answer Diemer

Select The Blank

Question A ________ can be defined as a part of the orgainsation for which separatebudget can be prepared and implemented.

Correct Answer Budget centreYour Answer Budget centre

Multiple Choice Single AnswerQuestion A factory has 8 hours a day and the standard daily wage is Rs.80/-. Standard

output per hour is 5 units. During a day worker P produced 30 units, Q produced 36 units

and S produced 42 units. Calculate wages payable to P,Q and S under Merrick Multiple

Piece Rate System.Correct Answer P - Rs.60/-; Q - Rs.79.20; S - Rs.100.80

Your Answer P - Rs.60/-; Q - Rs.79.20; S - Rs.100.80

True/False

Question Treating capital receipt as revenue income is an example of errors of

commission.Correct Answer False

Your Answer False

True/FalseQuestion Due to compensating errors the arithmetical accuracy of the trial balance is

affected.


True/FalseQuestion Cost Accounting is concerned with calculation of the profitability and state of

affairs of the organization as a whole.


Your Answer False

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Question Two competing companies Hero Ltd. and Zero Ltd. sell the same type ofproduct in the market. Their forecasted profit and loss accounts for the year ending

December 2003 are as follows : Hero Ltd.: Sales Rs.500,000/-; Variable cost Rs.400,000/-;

fixed costs Rs.50,000/-. Zero Ltd.:Sales Rs.500,000/-; Variable cost Rs.300,000/-; fixedcosts Rs.150,000/-. You are

Correct Answer Hero Ltd.

Your Answer Hero Ltd.

Select The Blank

Question The combination in which different products are sold by a company is known

as ________.Correct Answer Sales mix

Your Answer Sales mix

Select The BlankQuestion The ________ adjustment is necessary to relfect the cost for the use of fixed

asset during the year.Correct Answer Depreciation

Your Answer Depreciation

True/False

Question Cheque received from a client on 28th September, 2004 must be entered in the

bank book only after it is credited in the pass book.

Correct Answer FalseYour Answer False

Multiple Choice Single AnswerQuestion 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


Profit and loss account Commission received Commission received

Manufacturing account Work in Progress Work in Progress

Balance Sheet Land & Building Land & Building

Trading account Closing stock of finished goods Closing stock of finished goods

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Select The Blank

Question While preparing trial balance, the balance as per ________ book is consideredas bank balance.

Correct Answer Bank

Your Answer Bank

True/False

Question Financial accounting may deal with the ascertainment of cost & calculation ofprofitability of the individual product.


Your Answer False

True/False

Question Debit all the expenses and credit all the income is the rule of the Real Account.


Your Answer False

True/FalseQuestion Management Accounting is the process of analysis and interpretation of

financial data collected with help of financial accounting and cost accounting



Question The operating profit as per cost statement may differ from the profit as perProfit and Loss Account due to existence of

Correct Answer Depreciation on plant and machinery , Interest on loans taken from other

, Interest on loans granted to othersYour Answer Interest on loans granted to others , Depreciation on plant and machinery ,

Interest on loans taken from other


Question These are the preventive costs of labour turnover.

Correct Answer Cost of maintaining good relations with the workers , Cost of medical

services , Cost of welfare facilitiesYour Answer Cost of maintaining good relations with the workers , Cost of medical

services , Cost of welfare facilities

True/False

Question Management Accounting aims at enabling the management to take the

decisions about the future. It may consider future data as well as non-financial factors.Correct Answer True

Your Answer True

True/False

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Question GAIL having monopoly in the CNG (Compressed Natural Gas) market can

implement the Uniform costing system.


True/FalseQuestion The amount of profit which is retained by the organisation is transferred to

'Reserves and Surplus' in the balance sheet.



Question Uniform costing system can be successfully implemented in any industry onlywhen :

Correct Answer Information is freely supplied by all the units , Well organised sector is

ready to share the technological improvements , Information furnished by the units is

complete and correctYour Answer Information is freely supplied by all the units , Well organised sector is

ready to share the technological improvements , Information furnished by the units iscomplete and correct

Multiple Choice Single AnswerQuestion As cost centers facilitate the control function, in many cases, they are termed as

. . .

Correct Answer Responsibility centers

Your Answer Responsibility centers

Match The Following

Question Correct Answer Your Answer

Book-Keeping Books of Accounts Books of Accounts

Financial statement Profitability statement & Balance-sheet Profitability statement &

Balance-sheet


Profitability statement Indicates the amount of profit earned Indicates the amount of profit

earned

Balance-sheet Financial status Financial status


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Question Judge the sentence in italics according to criteria given below : " It is difficult

to adopt Uniform costing system when a product can be manufactured by employing more

than one method because the cost of production will vary according to the method used."Correct Answer The assertion and the reason are both correct

Your Answer The assertion and the reason are both correct

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

Multiple Choice Single AnswerQuestion Creditors as on 31st March, 2004 amount to Rs.15,225/-. Provision for

discount from creditors is to made @ 5%. Find the impact of this provision on the net

profit.

Correct Answer The net profit will increase by Rs.761.25Your Answer The net profit will increase by Rs.761.25


Question The reasons and objectives of budgets may be stated as :

Correct Answer To aid the planning of annual operations , To communicate theorganisational plans to the different departments , To motivate the managers to strive for

attainment of the organisational goals

Your Answer To aid the planning of annual operations , To communicate the

organisational plans to the different departments , To motivate the managers to strive fortheir promotions

Multiple Choice Single AnswerQuestion Rent of Rs.7,500/- for the month of April was received in March. Which

account should be credited in the books of accounts for making an entry for receipt of the

said amount?Correct Answer Rent received in advance account

Your Answer Rent received in advance account

Select The BlankQuestion The assets which are suppoed to be used by the organisation to do business, are

known as ________assets.

Correct Answer FixedYour Answer Fixed

True/FalseQuestion Financial Accounting discloses the financial performance & financial

statements of the business as a whole.

Correct Answer True

Your Answer True

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True/False

Question The purpose of profit and loss account is to brign together information whichrelates to gross profit and the expenses for running the business.

Correct Answer True

Your Answer True

Select The Blank

Question Angle formed by the intersection of total cost line and sales line is called angleof ________.

Correct Answer Incidence

Your Answer Incidence


Question The suspense account has a debit balance of Rs.40,000/-. Select the

transactions which are capable of nullifying this balance.

Correct Answer Conveyance expenses of Rs.25,000/- were posted on the wrong side ofthe account. , Purchased computer worth Rs.28,000/- was recorded in the ledger as , The

total of the purchase book was cast short by Rs.44,000/-Your Answer Conveyance expenses of Rs.25,000/- were posted on the wrong side of the

account. , Purchased computer worth Rs.28,000/- was recorded in the ledger as , The total

of the purchase book was cast short by Rs.44,000/-


Question The objectives of Uniform costing system are as follows :

Correct Answer To fix a common selling price for the industry as a whole , To compareefficiency of each unit against industry's overall performance , To compile reliable cost

data for inter-firm comparison of costs

Your Answer To fix a common selling price for the industry as a whole , To compareefficiency of each unit against industry's overall performance , To compile reliable cost

data for inter-firm comparison of costs


Question The key factor determines the :

Correct Answer Level of activity , Capacity utilization , Level of sales

Your Answer Level of activity , Capacity utilization , Level of sales


Question Flood occurred on 18th March, 2004 and goods worth Rs.28,000/- weredestroyed. 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/-


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Correct Answer True

Your Answer True

True/FalseQuestion Balance sheet indicates the financial status of the business at given period.

Correct Answer True

Your Answer TrueTrue/False

Question Accounting refers to the process of analyzing & interpreting the information

already recorded in the books of accounts.Correct Answer True

Your Answer True

True/False

Question Accounting is an art of recording, classifying & summarizing in asignificant manner.

Correct Answer True

Your Answer True

True/FalseQuestion Profitability statement indicates the amount of assets & liabilities.


Match The Following



Profitability statement Indicates the amount of profit earned Indicates the amount of profitearned

Balance-sheet Financial status Financial status

Book-Keeping Books of Accounts Books of Accounts

Financial statement Profitability statement & Balance-sheet Profitability statement

& Balance-sheet


Bills Payable Amount payable to supplier Amount payable to supplier

Bills Receivable Amount received from the customer Amount received from the

customer

Trade Discount Not accounted for in the books of Accounts Not accounted for in

the books of Accounts

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Cash Discount Accounted for in the books of Accounts Accounted for in the books of

Accounts

Bad debts Amount not received from customer Amount not received from customer

True/FalseQuestion Real Accounts may also consist the accounts of some intangible assets like

Goodwill Account


True/False

Question The rate at which the depreciation is to be calculated are also specified in

the Income Tax Act 1961.Correct Answer True

Your Answer True


Question Cash and---------------are the two systems of accounting.Correct Answer Mercantile

Your Answer MercantileMultiple Choice Multiple Answer

Question P/L A/C debit side includes

Correct Answer salary , discount allowed , postage & telegramYour Answer salary , postage & telegram


Question Trading a/c credit side includes

Correct Answer sales , goods lost by fire , closing stockYour Answer sales , goods lost by fire , closing stock


Question Amit sold Goods to Atul for Rs. 50,000 on cash & Rs. 50,000 on creditbasis & allowed 10% discount on on the spot transaction. Cash Account debited to Rs.

_____________

Correct Answer 45,000Your Answer 45,000


Question A proprietor purchase goods worth Rs. 5500 & cash account credited to Rs.

5000 rectification of the suspense accounted debited to RsCorrect Answer 500

Your Answer 500

Multiple Choice Single AnswerQuestion Amit purchase of Rs. 6710 had been posted to the debit of the creditors A/C

as 6170 rectifying the transaction the creditor A/C is to be debited amount to Rs

Correct Answer 540Your Answer 540


Question Following error affect the trial balance

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Correct Answer Wrong totaling of subsidiary books , Posting on the wrong side of

an account , Omission of posting an account in the ledger

Your Answer Wrong totaling of subsidiary books , Posting on the wrong side ofan account , Omission of posting an account in the ledger


Question Following error affect the trial balanceCorrect Answer Wrong totaling of subsidiary books , Posting on the wrong side of

an account , Omission of posting an account in the ledger

Your Answer Wrong totaling of subsidiary books , Posting on the wrong side ofan account , Omission of posting an account in the ledger

True/False

Question A bill of Rs. 500 for old furniture sold to Raj, was entered in the sales day

bookCorrect Answer False

Your Answer True

True/False

Question Abnormal cost indicates that cost which is normally incurred at a certainlevel of output under normal circumstances.



Question This cost indicates increased or decreased cost due to the increased ordecreased volume of operations.

Correct Answer Differential cost

Your Answer Opportunity Cost

True/False

Question Indirect material cost assist the manufacturing process is an integral part of

finish goods.Correct Answer False

Your Answer True


Question The prime cost is Rs. 10,00,000 the factory cost is Rs. 13,00,000, the total

administration overheads are 14,00,000 and having selling overhead of Rs. 86000. What is

the Total cost?Correct Answer 37,86,000

Your Answer 37,86,000


Question Indirect Expenses includes

Correct Answer Rent , Telephone expenses , InsuranceYour Answer Rent , Telephone expenses , Insurance

True/False

Question Material cost is the first and probably the most important element of cost.

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Your Answer False

Multiple Choice Multiple AnswerQuestion Limitations of marginal costing are

Correct Answer difficult for classification as fixed cost and variable cost. , does not

provide any standard for the evaluation of performance. , it is useful technique only in theshort run.

Your Answer difficult for classification as fixed cost and variable cost. , does not

provide any standard for the evaluation of performance. , it is useful technique only in theshort run.


Question Budgetory Control deals withCorrect Answer Establishment of budgets , Comparison of budgeted results with

actuals , Computation of variance.

Your Answer Establishment of budgets , Comparison of budgeted results with

actuals , Computation of variance.

True/FalseQuestion The analysis of overhead variances is different and the most complex task.

Correct Answer True

Your Answer True

True/False

Question Standard costing and Marginal Costing are the best possible tools available

to the management for cost controlCorrect Answer False

Your Answer False


Question Current standards includes

Correct Answer Expected standards , Normal standards , Ideal standardsYour Answer Expected standards , Normal standards , Ideal standards


Question In case of industries where capital investment is very high, budget should beprepared for a

Correct Answer Longer period

Your Answer Longer period

Select The Blank

Question Financial Accounting protects the interest of outsiders . it considers________ transaction and it is a ________ requirement

Correct Answer historical

Your Answer historical

Correct Answer legal

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Your Answer vary

Correct Answer level of activity

Your Answer level of activitySelect The Blank

Question ________ and ________ are examples of semi- variable overheads.

Correct Answer Maintenance costYour Answer Maintenance cost

Correct Answer electricity

Your Answer electricitySelect The Blank

Question Rs.5000 paid as ________ to ________ should be debited to salary account

Correct Answer Mahesh

Your Answer MaheshCorrect Answer salary

Your Answer salary

Accts assgn :2:

Select The BlankQuestion If the profit volume ratio is 25%, then the variable cost is equal to ________ of

sales value.

Correct Answer 0.75

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

Multiple Choice Multiple AnswerQuestion Direct Cost includes

Correct Answer Direct material , Direct labour , Direct expenses


Question Which of the following costs is most likely to have a cost behaviour pattern

described as ..a fixed cost upto an activity level of 1,000 units, with a variable cost there

after which decreases from 10paise to 8 paise per unit at 2,000 units?

Correct Answer Wages payment which is fixed for a minimum output quantity after

which a bonus per unit is paid which reduces when activity level exceeds 1,000 units

True/False

Question The phrase 'By Balance c/d.' written on the credit side of the rent account,indicates credit balance for this account.


Select The Blank

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Question Fixed deposit bearing interest @ 5.50%, for Rs.10,000/- was kept with Bank ofIndia on 1st June, 2003, for a period of one year. The type of the fixed deposit is

cumulative, i.e. interest shall be received only on maturity. What treatment should be given

in the books of accounts on 31st March, 2004, the year ending date?Correct Answer An entry for Rs.458.34, debiting interest accrued but not due account

should be passed


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 datacollected is complete and correct, Maintaining secrecy of the data collected

True/False

Question Uniform Costing simplifies the work of wage boards of fixing minimum wagesand fair wages.

Correct Answer True


Question Marginal costing is found to be unsuccessful in the following situations :-Correct Answer Impossible to distinguish costs into fixed and variable component. , With

respect to capital intensive industries where fixed costs are very large and hence cannot be

ignored , With respect to

service industries where employee costs are very large and almost fixed in nature

True/False


Correct Answer True


Question Master budget provides a basis for computing effect of changes in :

Correct Answer product mix of the company , sales volume , production facilities

True/False

Question Accounting is an art of recording, classifying & summarizing in a significant

manner.Correct Answer True

Accts assgn :3:

Select The Blank

Question Over absorption of overheads may take place due to the reasons like

________ overheads being less than the ________ overheads

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Select The Blank

Question Financial Accounting protects the interest of outsiders . it considers

________ transaction and it is a ________ requirementCorrect Answer historical

Your Answer historical

Correct Answer legalYour Answer legal

Select The BlankQuestion variable cost is the cost that tend to ________ in direct proportion with

________

Correct Answer vary

Your Answer varyCorrect Answer level of activity

Your Answer level of activity

Multiple Choice Multiple AnswerQuestion Office & Administration overhead includes

Correct Answer Salary , Rent & Taxes , Stationary & postageYour Answer Stationary & postage , Traveling Expenses

Multiple Choice Single AnswerQuestion Calculate Labour Efficiency Variance, If actual rate per hour is Rs.3.50/- ,

Standard rate is Rs.3/- per unit and standard hours are 15,000 and Actual hours are 13, 500.

Correct Answer Rs.4500/- ( Favorable )

Your Answer Rs.4500/- ( Favorable )


Question Cost-sheet may be prepared separately for eachCorrect Answer Different Cost Centre

Your Answer Cost Centre


Question The prime cost is Rs. 10,00,000 the factory cost is Rs. 13,00,000, the total

administration overheads are 14,00,000 and having selling overhead of Rs. 86000. What is

the Total cost?Correct Answer 37,86,000

Your Answer 37,00,000


Question The cost of asset is Rs. 1,10,000, Estimated scrap value 10,000,estimated

life 10 yrs. Calculate the depreciation according to straight line methodCorrect Answer 10,000

Your Answer 10,000

Select The Blank

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Question To ascertain the ________ of all the transactions recorded in the ledger

account, the account is required to be ________

Correct Answer Net effectYour Answer Net effect

Correct Answer Balanced

Your Answer Balanced


Question In fixed overhead variance, the volume variance is further analyzed asCorrect Answer Variance Efficiency Variance , Capacity Variance , Calendar

Variance

Your Answer Variance Efficiency Variance , Capacity Variance , Calendar

Variance


Question For a unit, if opening stock of raw material is 10,000 units, closing stock of

raw material is 5,000 units and consumption is 3,20,000 units, what will be the quantum ofraw material to be purchased

Correct Answer 3,15,000Your Answer 3,15,000

Multiple Choice Multiple AnswerQuestion Accounts is a

Correct Answer Record of all transaction

Your Answer Record of all transaction

True/False

Question Whatever is to be sold need not be produced.


True/FalseQuestion Patents and Trade Marks Account is a Real Account.

Correct Answer True

Your Answer True


Question Budget is prepared in terms of

Correct Answer Quantity and/or MoneyYour Answer Quantity and/or Money

True/FalseQuestion Favorable variances need on investigation


Your Answer False

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Question Standard Costing may not be useful in

Correct Answer Small concerns , Industries having non-standardized products ,Contract jobs

Your Answer Small concerns , Industries having non-standardized products ,

Contract jobs

True/False

Question A business is an activity carried out with the intention of earning the profit.Correct Answer True

Your Answer True

Multiple Choice Single AnswerQuestion __________ Accounting becomes a source of information for Management

Accounting.

Correct Answer Financial

Your Answer Financial

Select The BlankQuestion The levels indicated on the Bin card enables the ________ department to

keep a watch on the balance and replace the material as soon as it reached at ________

level.Correct Answer Stores

Your Answer Stores

Correct Answer Re-order level

Your Answer Re-order level


Question Standard costs are the targets to be attained by the actual performance.Correct Answer Minimum

Your Answer All the above


Question During one week X makes 200 units. He receives wages for a guaranted

44hours per week at a rate of Rs. 1.50 per hour. Estimated time to produce one unit is 15

minutes. Time allowed is increased by 2Correct Answer Rs. 75

Your Answer Rs. 78

Accts assgn :4:

True/False


Correct Answer True

Your Answer True

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Question When bank balance as per bank book is considered then following to be

added.

Correct Answer cheques issued but not presented , direct deposit by customer ,wrong credits given by bank

Your Answer cheques issued but not presented , direct deposit by customer ,

wrong credits given by bank

True/False

Question As soon as the suspense account balance is wiped out , it may be assumedthat all mistakes have been corrected.


Your Answer True

True/False

Question Credit sale of Rs. 5000 to Bobby should be entered in the purchase book.


Your Answer False

Multiple Choice Single AnswerQuestion This cost indicates historical cost which is incurred in past.

Correct Answer Sunk cost

Your Answer Sunk cost


Question Manufacturing process involves study of

Correct Answer Designing the product , The quantity and quality , Material usedYour Answer Designing the product , The quantity and quality , Material used

Multiple Choice Multiple AnswerQuestion LAST IN FIRST OUT (LIFO)

Correct Answer The price of the latest available lot is considered first , If that lot is

exhausted, the price of the 10% prior to that is considered , Physical issue of the materialmay not be made out of the said lot

Your Answer The price of the latest available lot is considered first , Physical

issue of the material may not be made out of the said lot , Only a and c


Question The Bin card and stores ledges do not match due to the following reasons:

Correct Answer Arithmetical errors in calculating , Non- posting a certaindocument , Posting a wrong Bin card

Your Answer Arithmetical errors in calculating , Non- posting a certain

document , Posting a wrong Bin card

True/False

Question Flux method is important method of wage payment.


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Select The BlankQuestion Generally accounts of the assets will have ________ balance and liabilities

will have ________ balance

Correct Answer debitsYour Answer debits

Correct Answer credits

Your Answer credits

Select The Blank

Question Interest on overdraft charged by the bank is ________ to the pass book and

________ to the cash bookCorrect Answer debited

Your Answer debited

Correct Answer credited

Your Answer credited

Select The BlankQuestion While selecting source of supply ________ epartment may call for the

________ from the prospective suppliers

Correct Answer purchaseYour Answer purchase

Correct Answer quotation

Your Answer quotation

Select The Blank

Question After material is received from the supplier, quantity actually received is

compared with quantity ________-and ________-if any, are taken up with the supplierCorrect Answer ordered

Your Answer ordered

Correct Answer variationYour Answer variation

Select The Blank

Question Labour Turnover indicates ________ in labour force showing a highlyincreasing trend or highly ________ trend

Correct Answer change

Your Answer changeCorrect Answer decreasing

Your Answer decreasing

Select The Blank

Question Administration overheads are ________ in nature and can be controlled

mainly at ________ level of the management

Correct Answer fixed

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Accts assgn :5:

True/FalseQuestion Profitability statement indicates the amount of assets & liabilities.


Your Answer False

Select The Blank

Question Advance received from customers is ________ for the organisation.Correct Answer A liability

Your Answer A liability

Multiple Choice Multiple AnswerQuestion The features of multiplicity of key factors are as follows :

Correct Answer More than one key factors , Refers to a complex situation , Can be

resolved by using linear programming technique

Your Answer More than one key factors , Refers to a complex situation , Can beresolved by using linear programming technique

True/False

Question Maintenance Department is a service cost centre.


Match The Following


Liabilities All the amount owed by the business All the properties owned by the

business

Drawing Withdrawn for personal use Withdrawn for personal use

JournalBook of original entry Book of original entry

Ledger Maintain all types of Accounts Maintain all types of Accounts

Assets All the properties owned by the business All the amount owed by the business

Select The Blank

Question The ________ adjustment is necessary to relfect the cost for the use of fixed


Your Answer Depreciation


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Question Basic objective of Uniform Costing is . . .

Correct Answer comparisonYour Answer comparison

Multiple Choice Multiple AnswerQuestion Identify the causes due to which the cost of labour may be high:

Correct Answer Excess staffing , Lack of experienced and efficient personnel , High

labour turnoverYour Answer Excess staffing , Lack of experienced and efficient personnel , High

labour turnover

Multiple Choice Single AnswerQuestion Two competing companies Hero Ltd. and Zero Ltd. sell the same type of

product in the market. Their forecasted profit and loss accounts for the year ending

December 2003 are as follows : Hero Ltd.: Sales Rs.500,000/-; Variable cost Rs.400,000/-;

fixed costs Rs.50,000/-. Zero Ltd.:Sales Rs.500,000/-; Variable cost Rs.300,000/-; fixedcosts Rs.150,000/-. You are

Correct Answer Hero Ltd.Your Answer Both will earn profits

Multiple Choice Multiple AnswerQuestion Features of Sunk cost are . . .

Correct Answer Indicates historical cost , Not relevant in decision making process ,

Incurred in past

Your Answer Indicates historical cost , Not relevant in decision making process ,Incurred in past

True/FalseQuestion For a manufacturing company, dividend received is a non-operating

income.

Correct Answer TrueYour Answer False


Question Features of purchase requisition slip are :Correct Answer Raised when the stock of a raw material has fallen to the re-order

level. , Indicates the type, quantity and quality of material required , The information about

the price of material is excludedYour Answer Raised when the stock of a raw material has fallen to the re-order

level. , Raised to intimate the supplierteh quantity and quality of new material required. ,

Indicates the type, quantity and quality of material required


Question Judge the sentence in italics according to criteria given below : " It is

difficult to adopt Uniform costing system when a product can be manufactured by

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employing more than one method because the cost of production will vary according to the

method used."

Correct Answer The assertion and the reason are both correctYour Answer The assertion and the reason are both correct

Select The BlankQuestion Crane expenses should be apportioned on the basis of ________.

Correct Answer Number of hours crane worked in the department

Your Answer Number of employees working on the crane

Select The Blank

Question Information as to the cost and profit / loss associated with the firm's

operations is provided to the ________ by Management accounting.Correct Answer Management

Your Answer Management

Multiple Choice Multiple AnswerQuestion Features of convention of consistency are . . .

Correct Answer The accounting policies and procedures should be followedconsistently , Facilitates the comparison of financial statements , It facilitates comparison

of financial statements on period-to-period basis

Your Answer The accounting policies and procedures should be followedconsistently , Facilitates the comparison of financial statements , It facilitates comparison

of financial statements on period-to-period basis

Select The BlankQuestion Uniform costing is not a separate method of ________.

Correct Answer cost accounting

Your Answer costing

True/False

Question Suspense account is closed automatically after rectification of all the errors.Correct Answer True

Your Answer False

True/FalseQuestion Manufacturing overheads represents all costs incurred in the factory

including direct material cost and direct labour cost.


Select The BlankQuestion Generally all the liabilities will have ________balance.

Correct Answer Credit

Your Answer Debit

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Correct Answer Rs.29.98

Your Answer Rs.29.98

True/False

Question Profitability statement indicates the amount of assets & liabilities.


Multiple Choice Multiple AnswerQuestion 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 salesYour 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 expensesis termed as Overheads.

Correct Answer True

Your Answer True

Select The Blank

Question Generally all the liabilities will have ________balance.

Correct Answer CreditYour Answer Credit

True/FalseQuestion Uniform costing system is a pre-requisite to an inter-firm comparison of

firms belonging to the different industries.


True/False

Question Error of commission refer to calculation errors, totaling errors, errors incarrying forward etc.

Correct Answer True

Your Answer True


Question Techniques of management accounting include:Correct Answer Marginal costing , Budgetary control , Standard costing

Your Answer Marginal costing , Budgetary control , Standard costing


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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


Ledger Maintain all types of accounts Maintain all types of accounts

Audit Reviewing internal control system Reviewing internal control system


JournalBook of original entry Book of original entry

True/FalseQuestion 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


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 bycustomer , 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


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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 thedata 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 collecteddata

True/FalseQuestion 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 OverheadYour 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 AnswerQuestion Basic objective of Uniform Costing is . . .

Correct Answer comparison

Your Answer comparison

True/False


Correct Answer True

Your Answer True


Question Labour efficiency variance Rs.1,000/- (favourable); labour mix variance

Rs.260/- (adverse) and labour rate variance Rs.300/- (adverse). Compute labour costvariance and labour yield variance.

Correct Answer Labour cost variance -Rs.700/- (Favourable) , Labour yield variance

-Rs.1,260/- , Labour yield variance is favourableYour Answer Labour cost variance -Rs.700/- (Favourable) , Labour yield variance


Select The Blank

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Question The material physically received is compared with material ordered as per thethis order

Correct Answer Purchase order

Match The Following

Question Correct Answer

Straight Piece rate system-The rate of payment is fixed per pieceDiemer system-Halsey system & Gantt System

Time rate System-Worker is paid on the basis of time attended by him

Payment by Result-Workers are paid according to the production achieved by him

Differential Time rate-Different hourly rates are fixed for different levels of efficiency


Question When bank balance as per pass book is considered then following to be added.

Correct Answer cheques deposited but not cleared , Interest debited by bank , bankcharges debited by bank

True/False


already recorded in the books of accounts.Correct Answer True

True/False

Question (No. of unit * Rate of depreciation per unit ) this formula is used for writtendown value method.



Question Sold Goods of Amitabh worth Rs. 15,000 against 15% Trade discount. The

Goods worth appear on account ___________Correct Answer 12750


Question Cash and---------------are the two systems of accounting.Correct Answer Mercantile

Multiple Choice Single AnswerQuestion This cost indicates increased or decreased cost due to the increased or decreased

volume of operations.

Correct Answer Differential costMatch The Following

Question Correct Answer

Fixed cost + variable cost=Total cost

Total cost fixed cost=variable cost

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Question Convention of Materiality __________________

Correct Answer Only those transactions will be considered which have material impact onprofitability , Insignificant transaction will be ignored , The cost of non-used should not be

considered as the item of

cost

True/False

Question Amount with drawn for personal purpose drawing A/C to be debited.Correct Answer True

Select The Blank

Question Under the repeated distribution method the overheads of ________ departmentare distributed to other departments on agreed ________

Correct Answer service

Correct Answer percentage

True/False

Question Under time rate system a worker is paid on the basis of production achieved byhim.



Question Calculate Labour Rate Variance, If actual rate per hour is Rs.3.50/- , Standard

rate is Rs.3/- per unit and actual hours are 13, 500.

Correct Answer Rs.6750/- ( Adverse )


Question The causes of idle time can be analysed asCorrect Answer Administrative causes , Productive causes , economic causes

Multiple Choice Multiple AnswerQuestion Cost Accountancy is a science, art and practice of a cost Accountant.

Correct Answer Science indicates the possession and the application of relevant

systematic knowledge. , Art indicates the skill and ability. , Practice indicates continuous

effects on the part of costaccountant.

Accts assgn :8:


Question Benefits available from revenue expenditure are received in the :Correct Answer Same year

Your Answer Same year

True/False

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Select The Blank

Question In calculation of total sales margin variance, the ________cost of sales is

deducted from the actual sales revenue.Correct Answer Standard

Your Answer Standard

True/False

Question The sales mix variance highlights the fact that the actual mix of sales has

been in the same ratio as budgeted.Correct Answer False

Your Answer False

Accts assgn :9:

True/False

Question A business is an activity carried out with the intention of earning the profit.Correct Answer True

Your Answer True

True/False

Question Balance sheet indicates the financial status of the business at given period.Correct Answer True

Your Answer True

True/FalseQuestion Balance sheet indicates the expenditure & income from the business.


Your Answer False

True/False

Question The process of accounting split into three steams i.e. financial, cost,management accounting.

Correct Answer True

Your Answer True

Match The Following


Personal A/C Debit the receiver, Credit the giver Debit the receiver, Credit the giver

Real A/C Debit what comes in, Credit what goes out Debit what comes in, Creditwhat goes out

Nominal A/C Debit all the expenses, Credit all the incomes Debit all the expenses, Credit

all the incomes

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Your Answer Record of all receipts and issue transactions , Maintained in Stores

department , Maintenance of Store ledges provides a second check


Question Following points are taking into consideration for evaluation of receipts

Correct Answer The Price , The trade discount is to be deducted , Other amountssuch as sales tax, excise duty, octroi duty

Your Answer The Price , The trade discount is to be deducted , Advertisement

cost


Question In EOQ, to express carrying cost as a percentage of the unit cost of

purchases this is used in the formula-----------Correct Answer i

Your Answer A , O , C

Multiple Choice Single AnswerQuestion Under the differential time rate method of wage payment between 90% to

100% of efficiency following rate is offered.Correct Answer Rs. 1.40 per hour

Your Answer Rs. 1.40 per hour

True/False

Question Where overheads chargeable to the department are Rs. 5000/- , direct labour

hours worked are 24000 then labour hour rate is Re. 0.2083 labour hour.


Multiple Choice Multiple AnswerQuestion The selection of the base on which overheads should be apportioned depend

on the following principles.

Correct Answer service or use basis , survey basis , ability to pay basisYour Answer service or use basis , survey basis , ability to pay basis

True/False

Question The Budget key factor may be in the form of sales, raw material, labour etc.Correct Answer True

Your Answer True


Question For a material, if standard quantity is 500 kg and standard price is Rs.6/- per

kg. Find out the Material Cost variance if actual quantity is 400 kg and actual price isRs.6/- per kg.

Correct Answer Rs.600/-( favorable )

Your Answer Rs.500/-( favorable )

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Question Find out Labour Efficiency Variance, if Standard Rate is Rs.1.50/- per hour,

Standard hours are 12,000 and Actual hours are 12,600.Correct Answer Rs.900/- ( Adverse )

Your Answer Rs.750/- ( Favorable )


Question Calculate Efficiency Variance, If actual production is 22,000 units, Standard

production in actual hours is 21,000 units and Standard rate per unit is Rs.1.5/-.Correct Answer Rs.1,500/-( Favorable )

Your Answer Rs.1,500/-( Favorable )

Multiple Choice Single AnswerQuestion Calculate Labour Mix Variance, If revised standard hours are 16,500/-,

Standard rate is Rs.3/- and Actual hours are 13, 500.

Correct Answer Rs.9,000/- ( favourable )

Your Answer Rs.9,000/- ( unfavorable )

Multiple Choice Single AnswerQuestion Standard costs are the targets to be attained by the actual performance.

Correct Answer Minimum

Your Answer Minimum


Question Calendar Variance arises only if there is abnormal increase or decrease in

Correct Answer Actual number of working daysYour Answer Actual number of working days

Multiple Choice Multiple AnswerQuestion The following factors affects the budgeted advertisement cost

Correct Answer Percentage of profits , Availability of funds , Competitors policy

Your Answer Percentage of profits , Availability of funds , Competitors policy

Match The Following


Token or Disc MethodToken number & identification number allotted to worker Token

number & identification number allotted to worker

Time Recording Clock Method Ticket number & clock card allotted to worker

Ticket number & clock card allotted to worker

Daily Time sheets Time spent by worker on job is recorded Attendance register

Weekly Time sheets Record of time for all the jobs during the week is made Record

of time for all the jobs during the week is made

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Correct Answer True

Your Answer True

True/False

Question There is no need to open a suspense account if the trial balance does not

agree.Correct Answer False

Your Answer False

Select The Blank

Question Interest on overdraft charged by the bank is ________ to the pass book and

________ to the cash book

Correct Answer debitedYour Answer credited

Correct Answer credited

Your Answer debited

Select The Blank

Question Bank reconciliation statement is the statement prepared to explain the________ as to why the bank balance as per ________ and bank balance as per bank book

does not match

Correct Answer reasonsYour Answer reasons

Correct Answer pass book

Your Answer pass book


Question Old furniture sold for Rs. 5400 has been entered as Rs 4500 in the cash

book, for rectifying the same Suspense A/C credited to RsCorrect Answer 900

Your Answer 900


Question Material Price Variance may occur due to

Correct Answer Change in price of material , Failure to take discounts , Weak

purchase organizationYour Answer Careless use of material , Change in price of material

Select The BlankQuestion In financial statements P& L Accounts relates to a specific duration whereas

________ is for a given point of time

Correct Answer P& L AccountsYour Answer Balance sheet

Correct Answer Balance sheet

Your Answer

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Question Goods return by Pande worth Rs. 2000 should have appeared on the credit

side of Pandes account for rectifying the same. Following account to be creditedCorrect Answer Suspense A/C

Your Answer Suspense A/C

True/False

Question Accounting is an art of recording, classifying & summarizing in a

significant manner.Correct Answer True

Your Answer True

Select The BlankQuestion Bin Card is not an ________ record but only a ________ record.

Correct Answer Accounting

Your Answer Qualitative

Correct Answer QuantitativeYour Answer Quantitative


Question Salary given in trial balance Rs. 5000/-, still 2000/- is to be paid . The

outstanding salary is debited to Profit &Loss A/C. The second effect is --Correct Answer Transfer to balance sheet liability side

Your Answer Transfer to balance sheet liability side

Select The BlankQuestion While selecting source of supply ________ epartment may call for the

________ from the prospective suppliers

Correct Answer purchaseYour Answer purchase

Correct Answer quotation

Your Answer quotation

True/False

Question Profitability statement indicates the amount of assets & liabilities.


Multiple Choice Single AnswerQuestion Calculate Sales Price Variance, If actual price is Rs.5.40/- per unit, Standard

price is Rs.5/- per unit and actual sales volume is 500 units.

Correct Answer Rs.200/- ( Favorable )Your Answer Rs.250/- ( Favorable )

True/False

Question Debit the receiver & credit the giver is a rule of Real a/c.

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Your Answer True


Question If at 50% capacity, total factory overheads are Rs.10,000/- (out of which

60% are fixed and 40 % are variable) then what will the amount of total factory overheadsat 60% capacity

Correct Answer Rs.10,800/-


True/False

Question 1) Financial statements are basically in two forms i.e. profitability statement

and balance sheet.Correct Answer True

Your Answer True

Select The BlankQuestion Administration overheads are ________ in nature and can be controlled

mainly at ________ level of the managementCorrect Answer fixed

Your Answer variable

Correct Answer topYour Answer top

Match The Following


Advance Not related in current year Not related in current year

Application Increase in Assets Increase in Assets

Outstanding Amount still payable in current year Amount still payable in current year

PrepaidAmount paid for next year Amount paid for next year

Drawing Amount of personal use Amount of personal use

Multiple Choice Multiple AnswerQuestion These are the features of fixed overheads

Correct Answer total cost remains the same , per unit cost may vary , not dependent

on volume of outputYour Answer total cost remains the same , per unit cost may vary , not dependent

on volume of output , per unit cost remains the same.


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Question If production overheads to be absorbed are Rs. 20000/- and machine hours

worked are 5000 then the machine hour rate will be,

Correct Answer Re. 4 per machine hour.Your Answer Rs. 5 per machine hour.

True/FalseQuestion Due to errors of principle the arithmetical accuracy of the trial balance get

affected.



Question P/L A/C debit side includesCorrect Answer salary , discount allowed , postage & telegram

Your Answer discount allowed , interest received

Multiple Choice Multiple AnswerQuestion These are the methods of measuring labour turnover.

Correct Answer Replacement Method , Separation Method , Flux MethodYour Answer Replacement Method , Job card Method , Flux Method

Multiple Choice Multiple AnswerQuestion Trading a/c credit side includes

Correct Answer sales , goods lost by fire , closing stock

Your Answer sales , closing stock


Question From the following data, workout the EOQ annual demand. 5000 units,

ordering cost Rs. 60 per unit, price per unit Rs. 100, inventory carrying cost15% onaverage inventory

Correct Answer 300

Your Answer 200

Select The Blank

Question Financial Accounting protects the interest of outsiders . it considers

________ transaction and it is a ________ requirementCorrect Answer historical

Your Answer Current

Correct Answer legalYour Answer legal

Multiple Choice Single AnswerQuestion Under the Emersons Efficiency Bonus System at following efficiency level

no bonus is payable.

Correct Answer Below 66.66%

Your Answer Below 66.66%

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Select The Blank

Question Standard Costing system facilitates ________ and ________ for eachindividual or department

Correct Answer Delegation of authority

Your Answer Fixation of responsibilityCorrect Answer Fixation of responsibility

Your Answer Delegation of authority

True/False

Question If actual cost is more than the standard cost then it is called favorable

variance.


True/False



True/FalseQuestion The aggregate of indirect material cost, indirect labour cost and indirect

expenses is termed as factory cost.


Your Answer True

Select The Blank

Question Fixed cost is the cost that tend to remain ________ irrespective of________

Correct Answer constant

Accts assgn :11: Parmeet

True/False

Question A business is an activity carried out with the intention of earning the profit.


True/False

Question Balance sheet indicates the financial status of the business at given period.Correct Answer True

Your Answer False

True/FalseQuestion Accounting refers to the process of analyzing & interpreting the information

already recorded in the books of accounts.

Correct Answer True

Your Answer True

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True/False

Question Accounting is an art of recording, classifying & summarizing in a

significant manner.Correct Answer True

Your Answer True

True/FalseQuestion Cost Accounting restrict itself with historical transactions


Your Answer FalseTrue/False

Question A very wide scope of Management Accounting is the limitation by itself.

Correct Answer True

Your Answer True


Question Journal is popularly known as 'Book of . . .

Correct Answer Original EntryYour Answer Original Entry

True/FalseQuestion In a Balance-Sheet right hand side is referred as assets side and left hand

side is referred as liabilities.

Correct Answer TrueYour Answer False


Question Locate the steps involved in rectifying the errors in the books of accounts

Correct Answer Find the wrong entry passed , Find the correct entry to be passed ,Find the entry that will resolve the mistake in the books

Your Answer Find the wrong entry passed , Find the correct entry to be passed ,

Find the entry that will resolve the mistake in the books


Question The cost that indicates historical cost, which is incurred in past, is known asCorrect Answer Sunk cost

Your Answer Sunk cost

Multiple Choice Single AnswerQuestion Presentation of information to enable managerial decision making' is one of

the objects of which of the following

Correct Answer Cost AccountingYour Answer Cost Accounting

Multiple Choice Multiple AnswerQuestion The objects of cost accountancy are . .

Correct Answer To ascertain cost and profitability , Cost Control , Presentation of

Information

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Question In the adjustment entry passed for closing stock, the ________ account

should be credited.

Correct Answer TradingYour Answer Trading

Select The BlankQuestion An adjustment relating to outstanding expenses will ________ the net

profit.

Correct Answer DecreaseYour Answer Decrease

Select The Blank

Question Goods returned to the suppliers from whom it was ________d is recorded inthePurchasereturn register.

Correct Answer Purchase

Your Answer Purchase


Question An advertisement contract was made with an artist which stated that theremuneration will be 12% of net sales. On an average the monthly sales were Rs.36,000/-,

however the average rate of sales return was 5% of that month's sale. Find the expenditure

on account of advertisement.Correct Answer Rs.49,248/-


Multiple Choice Single AnswerQuestion Goods kept in the godown were destroyed by fire on 18th June, 2004. The

cost of such goods was Rs.18,950/-. The goods were not insured. Find the amont which

should be debited to the profitability statement.Correct Answer Rs.18,950/-


True/False

Question Generally speaking income represents wealth increase and business success;

higher the income, lower will be the success of a business.


Multiple Choice Single AnswerQuestion While preparing the bank reconciliation statement as on 31st March, 2004

you find the following discrepancy : 'a cheque of Rs.3,700/- received and deposited in bank

on 27th March, 2004 was entered credited in the pass book on 3rd April, 2004.' In thisbackground, which of the following statement holds true as on 31st March, 2004?

Correct Answer Balance as per pass book < Balance as per bank book

Your Answer Balance as per pass book < Balance as per bank book

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True/False

Question Bank reconciliation statement is a systematic presentation of errors made by

the accountant.Correct Answer False

Your Answer False

Select The Blank

Question The stores department is a ________ department.

Correct Answer ServiceYour Answer Service

Select The Blank

Question The ________ is responsible for material losses while in storage.Correct Answer Store-keeper

Your Answer Store-keeper

Select The BlankQuestion The ________ is a perpetual inventory record.

Correct Answer Bin cardYour Answer Goods received note

Multiple Choice Single AnswerQuestion A written request sent to a supplier for specified goods at an agreed upon

price is often called as :

Correct Answer Purchase order

Your Answer Purchase order


Question Selecting an appropriate method of valuation of inventory is importantbecause :

Correct Answer It influences the figure of gross profit

Your Answer It influences the figure of gross profit

True/False

Question Re-order level for materials is determined considering maximum

consumption and maximum delivery period.Correct Answer True

Your Answer True

True/False

Question Control on purchase of material is exercised by the storekeeper.



Question The disadvantages of time rate system are :

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Correct Answer Ignores the efficiency of workers , Higher labour cost , Lack of

motivation to increase productivity

Your Answer Ignores the efficiency of workers , Lack of motivation to increaseproductivity

True/FalseQuestion The best way to reduce labour cost is to recruit cheap labour.


Your Answer False

True/False

Question Under some circumstances, it may be advisable to sell at prices equal to or

below the marginal cost ignoring fixed cost.Correct Answer True

Your Answer True


Increase in fixed cost will lead to Increase in break even point Increase in break even

point

Decrease in variable cost will lead to Increase in profit volume ratioIncrease in profit

volume ratio

Decrease in selling price will lead to Decrease in contribution Decrease in loss

Increase in contribution will lead to Increase in profits Decrease in break even point

Select The Blank

Question Economical use of labour, materials and facilities can achieved with thehelp of ________.

Correct Answer Budgetary control

Your Answer Budgetary control


Question Select the advantages of standard cost system.

Correct Answer Provides reliable basis for budgeting , Facilitates delegation ofauthority , Promotes economy and efficiency

Your Answer Provides reliable basis for budgeting , Facilitates delegation of

authority


Question Which variance is used to analyse the effect of change in the quantity of

output from a given mix of inputs?

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Correct Answer Materials yield variance

Your Answer Materials mix variance

Accts assgn:12: Sejal


Question Interest on drawings of partners should be credited to which account?

Correct Answer Profit and loss account

Select The Blank

Question The ________ adjustment is necessary to relfect the cost for the use of fixed


True/False

Question The actual loss incurred by a company, due to fire, is the extent of differencebetween the cost of goods destroyed and the amount of claim settled by the insurance

company.Correct Answer True

True/FalseQuestion Penalty paid for delay in payment to creditors represents uncontrollable cost.


Multiple Choice Multiple AnswerQuestion Subsidiary books include:

Correct Answer Cash Book , Purchase Register , Sales Register

True/False

Question Balance sheet is a part of the ledger accounts maintained by the company.


Select The Blank

Question Average stock = ________ + (Order size / 2)

Correct Answer Safety stock


Question Based on the journal entry given, identify what transaction has taken place.Suresh Account.Dr. Rs.500 To Cash Account Rs.500 (Being paid to Kailash on

behalf of creditor Suresh)

Correct Answer Cash paid to Kailash should not be recovered from creditor Suresh

True/False

Question A business is an activity carried out with the intention of earning the profit.

Correct Answer True

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Question Loss on account of goods lost due to earthquake should be debited to which

account?Correct Answer Profit and loss account

True/FalseQuestion A very wide scope of Management Accounting is the limitation by itself.

Correct Answer True

True/False


already recorded in the books of accounts.

Correct Answer True

Match The Following

Question - Correct Answer Your Answer

Operating income-Cash SalesNon-Operating income-Issue of shares

Plan of investment in fixed assets-Capital Expenditure BudgetPlan for surplus/shortage of cash-Cash Budget

Select The BlankQuestion Under the average cost method of valuing material issues, new issue price is

determined after ________ issue.

Correct Answer Each

True/False

Question Cost Accounting restrict itself with historical transactions



Question Features of convention of consistency are . . .Correct Answer The accounting policies and procedures should be followed consistently ,

Facilitates the comparison of financial statements , It facilitates comparison of financial

statements on period-to-period basis

True/FalseQuestion Narration must be mentioned in the ledger.


True/False


Correct Answer True

True/False

Question The sum of indirect material cost, indirect labour cost and indirect expenses is

termed as factory cost.

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Select The BlankQuestion Information as to the cost and profit / loss associated with the firm's operations

is provided to the ________ by Management accounting.

Correct Answer Management

Select The Blank

Question The term ________ indicates expenditure incurred on or attributable to a giventhing.

Correct Answer Cost

Multiple Choice Multiple AnswerQuestion Items credited to Profit & Loss Account are

Correct Answer Gross profit , Commission received , Interested received

True/FalseQuestion Yield variance equal to zero indicates that the standard yield and actual yield are

the same.Correct Answer True

Multiple Choice Single AnswerQuestion Balance sheet is statement of

Correct Answer All Assets and Properties

Select The BlankQuestion If the profit of Y Ltd. is Rs.10,000/- and its profit volume ratio is 10%, then its

margin of safety will be Rs.________.

Correct Answer 100,000/-


Question Inventory holding cost comprises of :Correct Answer Cost of insurance , Rent of store house , Salary of store keeper


Question Identify the steps involved in the process of decision making :Correct Answer Determination of the problem , Ascertainment of alternative courses of

action , Screening each alternative so as to select the best one


Question Management Accounting is

Correct Answer Designed particularly for internal use , Helpful in estimating the futurealong with past period , Useful in furnishing the necessary information to the management

True/False

82

Mange Rial Accounting 11

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