This quiz works best with JavaScript enabled. Home > Accounting > Management Accounting > Management Accounting – Quiz 3 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Management Accounting Quiz 3 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Bowden Corporation used the following data to evaluate their current operating system. The company sells items for $ 20 each and used a budgeted selling price of $ 20 per unit. Actual Budgeted Units sold 46, 000 units 45, 000 units Variable costs $ 225, 400 $ 216, 000 Fixed costs $ 47, 500 $ 50, 000 What is the static-budget variance of operating income? A) $ 10, 600 favorable. B) $ 10, 600 unfavorable. C) $ 13, 100 favorable. D) $ 13, 100 unfavorable. Show Answer Correct Answer: C) $ 13, 100 favorable. 2. . A company is planning to purchase a machinery costing $ 500, 000 having useful life of 5 years. Its cash flows for the next 5 years will be as follows. Year Cash flows 1 (200, 000) 2 300, 000 3 300, 000 4 500, 000 5 100, 000Calculate the payback period. A) 3 years 2 months. B) 4 years 2 months. C) 3 years 9 months. D) 2 years 8 months. Show Answer Correct Answer: A) 3 years 2 months. 3. In October, Raddatz Inc. incurred $ 73, 000 of direct labor costs and $ 6, 000 of indirect labor costs. The journal entry to record the accrual of these wages would include a: A) Debit to Manufacturing Overhead of $ 6, 000. B) Debit to Work in Process of $ 79, 000. C) Credit to Manufacturing Overhead of $ 6, 000. D) Credit to Work in Process of $ 79, 000. Show Answer Correct Answer: A) Debit to Manufacturing Overhead of $ 6, 000. 4. The term fund means A) Cash. B) Bank. C) Capital. D) Working capital. Show Answer Correct Answer: D) Working capital. 5. If break even point in Unit is 4, 800 units and with budgeted sales being 5, 000 units, calculate the margin of safety? A) 500 units. B) -800 units. C) 800 units. D) 200 Units. Show Answer Correct Answer: D) 200 Units. 6. At the break-even point, A) Total revenue equals variable cost. B) Total fixed cost equals variable cost. C) Total contribution margin equals total fixed cost. D) Total margin of safety equals variable cost. Show Answer Correct Answer: C) Total contribution margin equals total fixed cost. 7. Single entry system is suitable for ..... concerns. A) Big. B) Medium. C) Small. D) Cooperatives. Show Answer Correct Answer: C) Small. 8. A factory produces a single product with the following budgeted costs:Direct materials £3.40 Direct labour £6.80 Variable overheads £1.20 Fixed overheads £340, 000 Overheads are absorbed on the machine hour basis and it is estimated that in the next accounting period machine hours will total 100, 000. Each unit requires two hours of machine time. What is the cost per unit using:(a) Marginal Costing, (b) using Absorption Costing A) £11.40b) £11.80. B) £11.80b) £11.40. C) £11.40b) £18.20. D) £18.20b) £11.40. Show Answer Correct Answer: C) £11.40b) £18.20. 9. Choose the odd one out A) Sales budget. B) Labour Budget. C) Fixed Budget. D) Production Budget . Show Answer Correct Answer: C) Fixed Budget. 10. Marketing manager A) Internal User. B) External User. Show Answer Correct Answer: A) Internal User. 11. Target cost is $ 19, Estimated cost is $ 15. What is the difference $ 4 called as ..... A) Difference. B) Target cost. C) Target Cost gap. D) Gap. Show Answer Correct Answer: C) Target Cost gap. 12. If Assets are $ 7, 300 and Liabilities are $ 500, how much is Capital? A) $ 7, 800. B) $ 7, 300. C) $ 6, 800. D) None of above. Show Answer Correct Answer: C) $ 6, 800. 13. Purchased supplies on credit from XZE Supplies $ 4400 incl. GST. Calculate the value of GST. A) $ 40. B) $ 400. C) $ 440. D) $ 444. Show Answer Correct Answer: B) $ 400. 14. What determines the degrees of freedom in pricing decision making? A) The price range. B) The cost and demand conditions. C) The strategic objectives of the firm. D) The size and growth of the firm. Show Answer Correct Answer: A) The price range. 15. Given production is 1, 00, 000 units, fixed cost is Rs. 2, 00, 000, Selling price is Rs. 10 per unit and variable cost is Rs. 6 per unit. Determine profit A) Rs. 2, 00, 000. B) Rs. 8, 00, 000. C) Rs. 6, 00, 000. D) None of the above. Show Answer Correct Answer: A) Rs. 2, 00, 000. 16. A company should use cost-based transfer prices: A) When a company's product is specialized. B) The market for the intermediate product is perfectly competitive. C) The interdependencies of subunits are minimal. D) There is no benefit from market-based transfer price. Show Answer Correct Answer: A) When a company's product is specialized. 17. Cost of production-Administration overhead = ..... A) Prime Cost. B) Cost of Sales. C) Work Cost. D) Work in Progress. Show Answer Correct Answer: C) Work Cost. 18. The balance sheet shows the assets and liabilities of a business at a particular point in time. A) YES. B) NO. Show Answer Correct Answer: A) YES. 19. Overhead refers to: A) Direct or Prime Cost. B) All Indirect costs. C) Only Factory indirect costs. D) Only indirect expenses. Show Answer Correct Answer: B) All Indirect costs. 20. If margin of safety-20%, profit volume ratio-60%, Fixed cost = Rs.75, 000. Find Actual sales. A) Rs.1, 25, 000. B) Rs. 1, 58, 000. C) Rs. 1, 50, 250. D) Rs. 1, 56, 250. Show Answer Correct Answer: D) Rs. 1, 56, 250. ← PreviousNext →Related QuizzesAccounting QuizzesManagement Accounting Quiz 1Management Accounting Quiz 2Management Accounting Quiz 4Management Accounting Quiz 5Management Accounting Quiz 6Management Accounting Quiz 7Management Accounting Quiz 8Management Accounting Quiz 9Management Accounting Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books