This quiz works best with JavaScript enabled. Home > Finance > Accounting > Management Accounting > Management Accounting – Quiz 24 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Management Accounting Quiz 24 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. If the cost of goods sold is $ 8000, the gross margin is $ 5000 then the revenue will be A) $ 3, 000. B) $ 13, 000. C) -$ 13000. D) -$ 3000. Show Answer Correct Answer: B) $ 13, 000. 2. TEK, Inc., is considering whether to replace a production machine with a newer model of the same machine. If TEK keeps the old machine, the trade-in value of the old machine is an example of a(n) A) Sunk cost. B) Variable Cost. C) Opportunity cost. D) Avoidable cost. Show Answer Correct Answer: C) Opportunity cost. 3. What is the reporting frequency for management accounting? A) As frequently as information needed for decision making purposes. B) Once at the end of accounting period. Show Answer Correct Answer: A) As frequently as information needed for decision making purposes. 4. If Liabilities are $ 23, 000 and Capital is $ 9, 750, how much are Assets? A) $ 23, 000. B) $ 32, 750. C) $ 13, 250. D) None of above. Show Answer Correct Answer: B) $ 32, 750. 5. "The allotment of overheads to cost units" is a definition for A) ABC method. B) Absorption method. C) High and low method. D) Period cost manufacturing method. Show Answer Correct Answer: B) Absorption method. 6. As volume/unit decreases, total fixed costs A) Are constant and cost per unit decreases. B) Are constant and cost per unit increases. C) Increase. D) Decrease. Show Answer Correct Answer: B) Are constant and cost per unit increases. 7. The price that one division of a company charges another division for goods and services provided is called A) Distress price. B) Outlay price. C) Market price. D) Transfer price. Show Answer Correct Answer: D) Transfer price. 8. "Managemnt Accounting is the process of identification measurement accumulation analysis preparation interpretation and communication of information that assist executives in fulfilling organisational objectives" this definition given by A) Charles T Horngren. B) Smith. C) American Accountants. D) Asburne. Show Answer Correct Answer: A) Charles T Horngren. 9. Which of these is not a component of Prime Cost A) Direct Expenses. B) Factory Expenses. C) Direct Material. D) Direct Labour. Show Answer Correct Answer: B) Factory Expenses. 10. Can we afford to give our employees a pay raise? A) Management. B) Labour Union. C) Human Resource. D) Finance. Show Answer Correct Answer: C) Human Resource. 11. Capital Expenditure is money spent by the business on non-current assets that will stay in the business for a reasonable period of time; (E.g Land) A) False. B) True. Show Answer Correct Answer: B) True. 12. Payment of Electricity Bill A) Capital Expenditure. B) Revenue Expenditure. Show Answer Correct Answer: B) Revenue Expenditure. 13. A budgeting process which demands each manager to justify his entire budget in detail from beginning isa. b. c. d. A) Functional budget. B) Master budget. C) Zero base budgeting. D) None of the above. Show Answer Correct Answer: C) Zero base budgeting. 14. A cost which does not vary with volume of production is called A) Fixed cost. B) Semi fixed cost. C) Semi variable cost. D) Variable cost. Show Answer Correct Answer: A) Fixed cost. 15. Owner's drawing and expenses decrease with a A) Debit. B) Credit. Show Answer Correct Answer: B) Credit. 16. The amount of sales quantity required to earn a targeted profit is equal to A) Total fixed cost divided by contribution margin per unit. B) Targeted profit divided by the variable cost ratio. C) Total fixed cost plus targeted profit divided by contribution margin per unit. D) Targeted profit divided by the contribution margin per unit. Show Answer Correct Answer: C) Total fixed cost plus targeted profit divided by contribution margin per unit. 17. Michelle wants to know her company's anticipated cash outflows for the upcoming year. Which schedule would give Michelle this information? A) Sales Budget. B) Cash Payments Budget. C) Cash Receipts Budget. D) Budgeted Income. Show Answer Correct Answer: B) Cash Payments Budget. 18. Cost of Production + Opening stock of Finished goods-Closing stock of finished goods is equal to A) Cost of Goods Sold. B) Factory cost. C) Cost of Sales. D) Total Cost. Show Answer Correct Answer: A) Cost of Goods Sold. 19. An accounting term for a company that has the resources needed to continue operating indefinitely until it provides evidence to the contrary A) Liabilities. B) Liquidity. C) Assets. D) Going Concern. Show Answer Correct Answer: D) Going Concern. 20. In a segmented income statement, which of the following statements is true? A) Segment margin is equal to contribution margin less direct fixed expenses. B) Common fixed expenses must be allocated to each segment. C) Segment margin is greater than contribution margin. D) I don't understand the answer until I want to cry. Show Answer Correct Answer: A) Segment margin is equal to contribution margin less direct fixed expenses. 21. Statement of Cash Flow shows the movement in owner's equity over a period A) False. B) True. Show Answer Correct Answer: A) False. 22. In the balance sheet of Praveen for 2013 and 2014, 4% debentures are Rs 5, 00, 000 and Rs 4, 00, 000, respectively. Profit on redemption of debentures in 2013 is nil while in 2014 is Rs 4, 000. What is the amount of redemption for the purpose of funds flow statement? A) Rs 96, 000. B) Rs 9, 00, 000. C) Rs 1, 04, 000. D) Rs 9, 04, 000. Show Answer Correct Answer: A) Rs 96, 000. 23. While computing profit in marginal costing A) Fixed costs gets added to the contribution. B) Marginal costing is not an independent system of costing. C) Marginal costing is not an independent system of costing. D) Both (Marginal costing is not an independent system of costing and Marginal costing is not an independent system of costing). Show Answer Correct Answer: D) Both (Marginal costing is not an independent system of costing and Marginal costing is not an independent system of costing). 24. What are personal assets? A) An amount of money that one can use for a certain budget category. B) Report showing status of a bank account. C) Your items of value. D) Person's reputation for paying bills on time. Show Answer Correct Answer: C) Your items of value. 25. Which personnel of a financial firm plays a key role in management accounting A) Investors. B) Managers. C) Suppliers. D) Customers. Show Answer Correct Answer: B) Managers. 26. Hours of skilled labour are required for the job. The Idle time for current labour force is 70 hours. The per hour rate is Rs.25/-. What is the relevant labour cost? A) 1250. B) 750. C) 2500. D) 1750. Show Answer Correct Answer: B) 750. 27. Facing Outwards refers to: A) Non-financial measures are increasingly being used to manage the business. B) Modern costing and cost management techniques, such as total life-cycle costing, target costing and kaizen costing, reflect a concern for long-term cost management. As a result, they fall within the scope of strategic management accounting. C) It encourages a balanced approach to managing the business. D) Competitor analysis examines the objectives, strategies, assumptions and resource capabilities of competitors. The purpose is to gain a source of competitive advantage. Show Answer Correct Answer: D) Competitor analysis examines the objectives, strategies, assumptions and resource capabilities of competitors. The purpose is to gain a source of competitive advantage. 28. P/V Ratio is an indicator of A) The measurement of rate at which goods and services are bought and sold. B) The measurement of change in profit due to change in volume of sales. C) The measurement of volume of profit to be earned. D) None of the above. Show Answer Correct Answer: B) The measurement of change in profit due to change in volume of sales. 29. ..... also known as subsidiary budgets. A) Master budget. B) Functional budget. C) Cost budget. D) None of the above. Show Answer Correct Answer: B) Functional budget. 30. A historical cost which is not relevant in any future decision ..... A) Opportunity Cost. B) Normal Cost. C) Imputed Cost. D) Sunk Cost. Show Answer Correct Answer: D) Sunk Cost. ← PreviousNext →Related QuizzesAccounting QuizzesFinance QuizzesManagement Accounting Quiz 1Management Accounting Quiz 2Management Accounting Quiz 3Management Accounting Quiz 4Management Accounting Quiz 5Management Accounting Quiz 6Management Accounting Quiz 7Management Accounting Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books