This quiz works best with JavaScript enabled. Home > Finance > Accounting > Management Accounting > Management Accounting – Quiz 41 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Management Accounting Quiz 41 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Solvency ratio measures A) Ability to meet sundry creditors in time. B) Ability to meet its long term debts. C) Ability to solve problems. D) Ability to meet its short term debts. Show Answer Correct Answer: B) Ability to meet its long term debts. 2. Financial analysis and interpretation can be done through trend analysis A) True. B) False. C) May be. D) None. Show Answer Correct Answer: A) True. 3. In comparing financial and management accounting, which of the following more accurately describes management accounting information? A) Budgeted, informative, adaptable. B) Historical, precise, useful. C) Comparable, verifiable, monetary. D) Required, estimated, internal. Show Answer Correct Answer: A) Budgeted, informative, adaptable. 4. In a make-or-buy decision, which of the following would NOT be relevant? A) The portion of fixed costs that could be eliminated by outsourcing. B) A lease that could be discontinued upon accepting the ""buy proposal"". C) The quality of the product. D) Property taxes on the plant that will still be necessary even if the product is outsourced. Show Answer Correct Answer: D) Property taxes on the plant that will still be necessary even if the product is outsourced. 5. The difference between a person's assets and liabilities. A) Interest. B) Net worth. C) Credit. D) Owner's equity. Show Answer Correct Answer: B) Net worth. 6. A graph of the relationship between total cost and activity level is called a A) Scattergraph. B) Relevant range. C) Contribution margin graph. D) Dependent variable. Show Answer Correct Answer: A) Scattergraph. 7. STATEMENTS BELOW ARE THE BENEFIT OF ENVIRONMENT MANAGEMENT ACCOUNTING IMPLEMENTATION FOR COMPANY, EXCEPT ..... A) MAINTAIN THE STAKEHOLDERS SATISFY. B) HELP FOR MAKING DECISIONS. C) INCREASE ENVIRONMENT AND ECONOMIC PERFORMANCE. D) DECREASE TAX PAYMENT. Show Answer Correct Answer: D) DECREASE TAX PAYMENT. 8. Which type of bank account typically offers the highest interest? A) Checking. B) Savings. C) CD. D) Money market. Show Answer Correct Answer: C) CD. 9. Wages and Salaries of office workers A) Revenue Expenditure. B) Capital Expenditure. Show Answer Correct Answer: A) Revenue Expenditure. 10. ..... is Period cost A) Variable Cost. B) Fixed cost. C) Direct cost. D) Total cost. Show Answer Correct Answer: B) Fixed cost. 11. Which of the following is irrelevant for decision making? A) Further Processing Cost. B) Variable Cost. C) Sunk Cost. D) Opportunity Cost. Show Answer Correct Answer: C) Sunk Cost. 12. Selling Price ..... = Target cost A) Overheads. B) Desired Profit. C) Cost of Production. D) Cost drivers. Show Answer Correct Answer: B) Desired Profit. 13. Securities and Exchange Commission (SEC) A) External User. B) Internal User. Show Answer Correct Answer: A) External User. 14. This is a cost that is incurred in the course of making a product, delivering a service or running a department, but which cannot be traced directly and in full to the product, service or department. A) Fixed. B) Direct. C) Variable. D) Indirect. Show Answer Correct Answer: D) Indirect. 15. The per unit Variable Cost ..... A) Is inversely related to the output. B) Is constant. C) Has no relation with output. D) Is directly related to the output. Show Answer Correct Answer: B) Is constant. 16. For product consting purposes, an indirect factory cost A) Is chargeable to prime cost. B) Is chargeable to conversion costs. C) Is never included in the computation of product costs. D) Is not directlty chargeable to the company. Show Answer Correct Answer: B) Is chargeable to conversion costs. 17. Which of the following describes a cost centre? A) A unit of output or service for which costs are ascertained. B) An amount of expenditure attributable to a particular activity. C) A function or location for which costs are ascertained. D) A segment of the organisation for which budgets are prepared. Show Answer Correct Answer: C) A function or location for which costs are ascertained. 18. Dividends This shows the amount of net profit after interest and tax that is distributed to the owners (shareholders) of the company. A) True. B) False. Show Answer Correct Answer: A) True. 19. The term fund refers to A) Reserves. B) Working capital. C) Profits. D) None of these. Show Answer Correct Answer: B) Working capital. 20. A company absorbs overheads on machine hours which were budgeted at 11, 250 with overheads of £258, 750. Actual results were 10, 980 hours with overheads of £254, 692. Overheads were? A) Over-absorbed by £4, 058. B) Under-absorbed by £4, 058. C) Under-absorbed by £2, 152. D) Over-absorbed by £2, 152. Show Answer Correct Answer: C) Under-absorbed by £2, 152. 21. Where is management accounting applied? A) Small trading organisations. B) NPOs. C) Cooperative societies. D) Large industrial and trading organisations. Show Answer Correct Answer: D) Large industrial and trading organisations. 22. Materials cost in the original budget was increased by 5% to £3.15. We are now revising the budget and need to increase the materials cost by 8% rather than by 5%. What is the revised amount? A) £3.15. B) £3.40. C) £3.24. D) £3.23. Show Answer Correct Answer: C) £3.24. 23. There are three sections to an income statement:the trading account, the profit and loss account, and the appropriationaccount. A) True. B) False. Show Answer Correct Answer: A) True. 24. Which of the following transactions will improve the Current Ratio? A) Cash collected from Trade Receivables. B) Payment to Trade Payables. C) Credit purchase of Goods. D) Purchase of Goods for Cash. Show Answer Correct Answer: B) Payment to Trade Payables. 25. Which convention in accounting states that profits are not recognized until realized, but expected losses are accounted for even if not yet certain? A) Historic Cost Convention. B) Prudence Convention. C) Going Concern Convention. D) Business Entity Convention. Show Answer Correct Answer: B) Prudence Convention. 26. Sales =500000, VC = 160000, Fc = 30000, Profit = 40000 find sales to earn a profit of 50000 and profit at a sales of 900000. A) 514706. B) 441176. C) 58824. D) 514706312000. Show Answer Correct Answer: D) 514706312000. 27. What is the main purpose of the Statement of Change in Equity? A) To show the relationship between assets, liabilities, and equity. B) To assess the value of the business. C) To provide a basis for decision making. D) To show shareholder contribution and movement in equity. Show Answer Correct Answer: D) To show shareholder contribution and movement in equity. 28. Liquid Ratio is equal to liquid assets divided by ..... A) Contingent Liabilities. B) Non-Current Liabilities. C) Current Liabilities. D) Total Liabilities. Show Answer Correct Answer: C) Current Liabilities. 29. Which of the following statements refers to management accounting information? A) There are no regulations governing the reports. B) The audience tends to be stockholders, creditors, and tax authorities. C) The reports are generally delayed and historical. D) It primarily measures and records business transactions. Show Answer Correct Answer: A) There are no regulations governing the reports. 30. ..... provides an estimate of the capital amount that may be required for buying fixed assets needed for meeting production requirements. A) Production budget. B) Cash budget. C) Capital expenditure budget. D) None of the above. Show Answer Correct Answer: B) Cash budget. ← 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