27 + Mcqs in Advanced Management Accounting Page 1 McqOptions

1.	The tendency for low-quality cars to drive high quality cars out of the used car market is an example of
A.	Hedging.
B.	Adverse selection.
C.	Portfolio analysis.
D.	Moral hazard.
Answer» C. Portfolio analysis.

Discussion

2.	Given production is 1,00,000 units, fixed costs is Rs 2,00,000 Selling price is Rs 10 per unit and variable cost is Rs 6 per unit. Determine profit using technique of marginal costing.
A.	Rs 2, 00,000
B.	Rs 8, 00,000
C.	Rs 6, 00,000
D.	None of the above
Answer» B. Rs 8, 00,000

Discussion

3.	When fixed cost is Rs. 20,000 and Profit volume ratio is 25 per cent, then breakeven point will occur at
A.	Rs. 5000
B.	5000 units
C.	Rs. 80,000
D.	80,000 units
Answer» D. 80,000 units

Discussion

4.	The essence of marginal costing is that cost is considered on the whole as separate.
A.	Fixed
B.	variable
C.	both of these
D.	none of these
Answer» B. variable

Discussion

5.	is concerned with providing information to management for taking managerial decisions.
A.	Management Accounting
B.	Financial accounting
C.	Cost accounting
D.	All of these
Answer» B. Financial accounting

Discussion

6.	The following information belongs to John Manufacturing Company that uses a standard costing system: Basic wage rate:Rs.12 per hour Fringe benefits: Rs. 2 per hour Basic time: 2 hours per unit Allowance for down time: 0.3 hours per unit Allowance for brakes: 0.2 hours per unitBased on the above information, what is the standard direct labor cost per unit?
A.	RS.35
B.	RS.28
C.	RS.30
D.	RS.32.2
Answer» B. RS.28

Discussion

7.	A management concept under which all managers and employees at all stages of company operations strive toward higher standards and a reduced number of defective units are called:
A.	Continuous Improvement
B.	Total Quality Management (TQM)
C.	Theory of Constraints (TOC)
D.	Total Quality Control (TQC)
Answer» C. Theory of Constraints (TOC)

Discussion

8.	Flexible manufacturing systems (FMS) are reported to have a number of benefits. Which is NOT a reported benefit of FMS?
A.	Lead time and throughput time reduction
B.	Increased quality
C.	More flexible than the manufacturing systems they replace
D.	Increased utilisation
Answer» D. Increased utilisation

Discussion

9.	During the month of December actual direct labor cost amounted to Rs. 39,550, the standard direct labor rate was Rs.10 per hour and the direct labor rate variance amounted toRs.450 favorable. The actual direct labor hours worked was:
A.	3,955 hours
B.	4,000 hours
C.	3,910 hours
D.	4,500 hours
Answer» C. 3,910 hours

Discussion

10.	What would be the most likely cause of an unfavourable labour rate variance together with a favourable labour efficiency variance?
A.	The employment of more highly skilled staff than budgeted
B.	Poor wage negotiation by the Human Resources manager
C.	The employment of less well-train
D.	staff than in
Answer» B. Poor wage negotiation by the Human Resources manager

Discussion

11.	Which of the following is not likely to be a reason of unfavorable direct labor efficiency variance?
A.	Increase in direct materials prices
B.	Lack of proper supervision
C.	Frequent break downs during production process
D.	Use of old, outdated or faulty equipment
Answer» B. Lack of proper supervision

Discussion

12.	Question Selling price per tonne is Rs. 69.50, variable cost per tonne is Rs. 35.50 and fixed cost is Rs. 18, 02,000. Find out the BEP in units
A.	49000
B.	51000
C.	53000
D.	55000
Answer» D. 55000

Discussion

13.	A good _____ system will not punish the workers for the matters beyond the control of the workers.
A.	Wage payment
B.	Appraisal
C.	Promotion
D.	none of the above
Answer» B. Appraisal

Discussion

14.	Analyzers tend to emphasis both ______ and _______ and employee extensive training programmes.
A.	Skill building and skill acquisition
B.	Current performance and past performance
C.	Strategy a
D.	behaviour
Answer» B. Current performance and past performance

Discussion

15.	The use of Internet-based technology, either to support existing business processes or to create entirely new business opportunities, has become known as what?
A.	E-globalization
B.	E-business
C.	E-value creation
D.	E-process management
Answer» C. E-value creation

Discussion

16.	______ is an objective assessment of an individual's performance against well-defined benchmarks.
A.	Performance Appraisal
B.	HR Planning
C.	Information for goal identification
D.	None of the above
Answer» B. HR Planning

Discussion

17.	Match the following general applications of performance assessment with their specific purposesI. Administrative Uses/ Decisions ----- A. Performance FeedbackII. Documentation ------ B. Lay - offsIII Organizational Maintenance/ Objectives ---- C. Helping to meet legal requirementsIV. Developmental Uses ----- D. Evaluation of HR systems
A.	I-C, II-D, III-B, IV-A
B.	I-B, II-C, III-D, IV-A
C.	I-B, II-C, III-D, IV
D.	D. I-A, II-B, III-D, IV-C
Answer» C. I-B, II-C, III-D, IV

Discussion

18.	The responsibility accounting is a system by which the responsibility is assigned to the concerned persons
A.	To increase sales
B.	To control cash
C.	To increase production
D.	All of the above
Answer» C. To increase production

Discussion

19.	The analysis of a complex decision situation by constructing a mathematical model of the situation and then performing a large number of iterations in order to determine the probability distribution of outcomes is called
A.	Sensitivity analysis.
B.	Expected utility analysis.
C.	Simulation
D.	A decision tree.
Answer» D. A decision tree.

Discussion

20.	The definition Management Accounting is the presentation of accounting information in such a way as to assist management in the creation of policy and the day-to-day operation of an undertaking.
A.	Anglo American Council on Productivity
B.	AICPA
C.	Robert N. Anthony
D.	All of the above
Answer» B. AICPA

Discussion

21.	A situation in which a decision maker must choose between strategies that have more than one possible outcome when the probability of each outcome is unknown is referred to as
A.	Diversification.
B.	Certainty.
C.	Risk.
D.	Uncertainty.
Answer» E.

Discussion

22.	Which of the following cannot be a reason of unfavorable direct materials quantity variance?
A.	Unmotivated workers
B.	Lack of supervision
C.	Frequent power failures
D.	Uneconomical order size
Answer» E.

Discussion

23.	Responsibility centres are departments or organizational functions whose performance is the direct responsibility of specific managers. One type of responsibility centre is a revenue centre, which is responsible for
A.	Investments and costs
B.	sales and profits
C.	profits
D.	sales
Answer» E.

Discussion

24.	A budgeting process which demands each manager to justify his entire budget in detail from beginning is
A.	Functional budget
B.	Master budget
C.	Zero base budgeting
D.	none of the above
Answer» D. none of the above

Discussion

25.	__________ contains the picture of total plans during the budget period and it comprises information relating to sales, profit, cost, production etc.
A.	Master budget
B.	Functional budget
C.	Cost budget
D.	None of the above
Answer» B. Functional budget

Discussion

26.	During the month of January, the standard cost of actual hours worked amounted to Rs.25, 000, the standard direct labor rate was Rs.10 per hour and the direct labor efficiency variance amounted to Rs.1, 000 favorable. The standard hours allowed for actual production were:
A.	2,500 hours
B.	2,400 hours
C.	10,000 hours
D.	2,600 hours
Answer» E.

Discussion

27.	In comparison to the traditional manufacturing environment, overhead costs in a JIT environment all the following are true except
A.	is more easily tracked to products.
B.	is frequently direct in nature.
C.	includes rent, insurance a
D.	utilities.
Answer» E.

Discussion

Explore topic-wise MCQs in Master of Commerce (MDotcom).

The tendency for low-quality cars to drive high quality cars out of the used car market is an example of

Given production is 1,00,000 units, fixed costs is Rs 2,00,000 Selling price is Rs 10 per unit and variable cost is Rs 6 per unit. Determine profit using technique of marginal costing.

When fixed cost is Rs. 20,000 and Profit volume ratio is 25 per cent, then breakeven point will occur at

The essence of marginal costing is that cost is considered on the whole as separate.

is concerned with providing information to management for taking managerial decisions.

A management concept under which all managers and employees at all stages of company operations strive toward higher standards and a reduced number of defective units are called:

Flexible manufacturing systems (FMS) are reported to have a number of benefits. Which is NOT a reported benefit of FMS?

During the month of December actual direct labor cost amounted to Rs. 39,550, the standard direct labor rate was Rs.10 per hour and the direct labor rate variance amounted toRs.450 favorable. The actual direct labor hours worked was:

What would be the most likely cause of an unfavourable labour rate variance together with a favourable labour efficiency variance?

Which of the following is not likely to be a reason of unfavorable direct labor efficiency variance?

Question Selling price per tonne is Rs. 69.50, variable cost per tonne is Rs. 35.50 and fixed cost is Rs. 18, 02,000. Find out the BEP in units

A good _____ system will not punish the workers for the matters beyond the control of the workers.

Analyzers tend to emphasis both and _ and employee extensive training programmes.

The use of Internet-based technology, either to support existing business processes or to create entirely new business opportunities, has become known as what?

______ is an objective assessment of an individual's performance against well-defined benchmarks.

The responsibility accounting is a system by which the responsibility is assigned to the concerned persons

The analysis of a complex decision situation by constructing a mathematical model of the situation and then performing a large number of iterations in order to determine the probability distribution of outcomes is called

The definition Management Accounting is the presentation of accounting information in such a way as to assist management in the creation of policy and the day-to-day operation of an undertaking.

A situation in which a decision maker must choose between strategies that have more than one possible outcome when the probability of each outcome is unknown is referred to as

Which of the following cannot be a reason of unfavorable direct materials quantity variance?

Responsibility centres are departments or organizational functions whose performance is the direct responsibility of specific managers. One type of responsibility centre is a revenue centre, which is responsible for

A budgeting process which demands each manager to justify his entire budget in detail from beginning is

__________ contains the picture of total plans during the budget period and it comprises information relating to sales, profit, cost, production etc.

During the month of January, the standard cost of actual hours worked amounted to Rs.25, 000, the standard direct labor rate was Rs.10 per hour and the direct labor efficiency variance amounted to Rs.1, 000 favorable. The standard hours allowed for actual production were:

In comparison to the traditional manufacturing environment, overhead costs in a JIT environment all the following are true except

Explore topic-wise MCQs in Master of Commerce (MDotcom).

The tendency for low-quality cars to drive high quality cars out of the used car market is an example of

Given production is 1,00,000 units, fixed costs is Rs 2,00,000 Selling price is Rs 10 per unit and variable cost is Rs 6 per unit. Determine profit using technique of marginal costing.

When fixed cost is Rs. 20,000 and Profit volume ratio is 25 per cent, then breakeven point will occur at

The essence of marginal costing is that cost is considered on the whole as separate.

is concerned with providing information to management for taking managerial decisions.

A management concept under which all managers and employees at all stages of company operations strive toward higher standards and a reduced number of defective units are called:

Flexible manufacturing systems (FMS) are reported to have a number of benefits. Which is NOT a reported benefit of FMS?

During the month of December actual direct labor cost amounted to Rs. 39,550, the standard direct labor rate was Rs.10 per hour and the direct labor rate variance amounted toRs.450 favorable. The actual direct labor hours worked was:

What would be the most likely cause of an unfavourable labour rate variance together with a favourable labour efficiency variance?

Which of the following is not likely to be a reason of unfavorable direct labor efficiency variance?

Question Selling price per tonne is Rs. 69.50, variable cost per tonne is Rs. 35.50 and fixed cost is Rs. 18, 02,000. Find out the BEP in units

A good _____ system will not punish the workers for the matters beyond the control of the workers.

Analyzers tend to emphasis both ______ and _______ and employee extensive training programmes.

The use of Internet-based technology, either to support existing business processes or to create entirely new business opportunities, has become known as what?

______ is an objective assessment of an individual's performance against well-defined benchmarks.

The responsibility accounting is a system by which the responsibility is assigned to the concerned persons

The analysis of a complex decision situation by constructing a mathematical model of the situation and then performing a large number of iterations in order to determine the probability distribution of outcomes is called

The definition Management Accounting is the presentation of accounting information in such a way as to assist management in the creation of policy and the day-to-day operation of an undertaking.

A situation in which a decision maker must choose between strategies that have more than one possible outcome when the probability of each outcome is unknown is referred to as

Which of the following cannot be a reason of unfavorable direct materials quantity variance?

Responsibility centres are departments or organizational functions whose performance is the direct responsibility of specific managers. One type of responsibility centre is a revenue centre, which is responsible for

A budgeting process which demands each manager to justify his entire budget in detail from beginning is

__________ contains the picture of total plans during the budget period and it comprises information relating to sales, profit, cost, production etc.

During the month of January, the standard cost of actual hours worked amounted to Rs.25, 000, the standard direct labor rate was Rs.10 per hour and the direct labor efficiency variance amounted to Rs.1, 000 favorable. The standard hours allowed for actual production were:

In comparison to the traditional manufacturing environment, overhead costs in a JIT environment all the following are true except

Analyzers tend to emphasis both and _ and employee extensive training programmes.