Management Financial And Cost Accounting MCQs With Answers

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  • 1/12 Questions

    ------------------ costing is used in transport undertaking

    • Service
    • Fixed
    • Standing
    • Product
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About This Quiz

Play this knowledgeable 'Management Financial And Cost Accounting MCQs With Answers' quiz and check how good are you in the cost accounting management system. This test covers many subtopics like costing, budgeting, related numerical, and standing charges used in many businesses systems. So, if you think you can easily pass the quiz below and secure good marks, then try it out and see for yourself. Should we proceed now? All the best, buddy!

Management Financial And Cost Accounting MCQs With Answers - Quiz

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  • 2. 

    An example of fixed cost

    • Property tax.

    • Direct material cost

    • Direct wages

    • Rent for building

    Correct Answer
    A. Rent for building
    Explanation
    Rent for building is an example of a fixed cost because it remains constant regardless of the level of production or sales. Fixed costs are expenses that do not vary with the quantity of goods or services produced. In the case of rent for a building, the cost remains the same whether the business produces 100 units or 1000 units. This makes it a fixed cost that the business must pay regularly to maintain the use of the building for its operations.

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  • 3. 

    Depreciation of plant can be apportioned on the basis of

    • Plant size

    • Working days

    • Output produced

    • Plant value

    Correct Answer
    A. Plant value
    Explanation
    Depreciation of plant can be apportioned on the basis of plant value because the value of a plant is directly related to its useful life and the amount of wear and tear it undergoes. By allocating depreciation based on plant value, it ensures that the depreciation expense is distributed in proportion to the value of each plant, reflecting the actual usage and deterioration of the assets over time. This method is commonly used to accurately reflect the depreciation of plant assets in financial statements.

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  • 4. 

    Estimate the Materials to be debited to Contract A/c. Materials direct to site Rs.4,40,000; Materials returned to store Rs.20,000 and Materials received from Store Rs.81,200.

    • Rs.500,000

    • Rs.500,200

    • Rs.510,200

    • Rs.501,200

    Correct Answer
    A. Rs.501,200
    Explanation
    The correct answer is Rs.501,200. The materials debited to the Contract A/c can be calculated by subtracting the materials returned to the store from the materials direct to the site and then adding the materials received from the store. Therefore, Rs.4,40,000 - Rs.20,000 + Rs.81,200 = Rs.501,200.

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  • 5. 

    EOQ stands for

    • Economic Order Quantity

    • Economic Order Quality

    • Estimated Order Quality

    • Estimated Order Quantity

    Correct Answer
    A. Economic Order Quantity
    Explanation
    EOQ stands for Economic Order Quantity. This is a commonly used inventory management formula that calculates the optimal quantity of goods to be ordered in order to minimize total inventory costs. It takes into account factors such as demand, ordering costs, and holding costs to determine the most cost-effective order quantity. By using EOQ, businesses can ensure that they maintain an optimal level of inventory while minimizing costs associated with ordering and holding inventory.

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  • 6. 

    Bin card is maintained by

    • Costing department

    • Sales department

    • Purchase department

    • Stores department

    Correct Answer
    A. Stores department
    Explanation
    The correct answer is Stores department. A bin card is a document used to track the quantity of inventory items in a specific location, such as a bin or shelf. It is maintained by the Stores department, as they are responsible for managing and monitoring the inventory levels in the store or warehouse. The bin card helps the Stores department keep track of stock movements, update inventory records, and ensure efficient stock management.

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  • 7. 

    If notional profit is Rs.30,000, 2/3 of contract is complete and 75% of work certified is received in cash. Estimate the profit to be taken to P&L account.

    • 10,000

    • 20,000

    • 25,000

    • 30,000

    Correct Answer
    A. 20,000
    Explanation
    The profit to be taken to the P&L account can be estimated by multiplying the notional profit by the percentage of work certified received in cash. In this case, 75% of the work certified is received in cash. Therefore, the profit to be taken to the P&L account would be 75% of Rs.30,000, which is Rs.22,500. However, since only 2/3 of the contract is complete, we need to further calculate 2/3 of Rs.22,500. This equals Rs.15,000. Therefore, the estimated profit to be taken to the P&L account is Rs.20,000.

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  • 8. 

    It is the difference between the value of work-in-progress certified and the cost of such work-in-progress certified.

    • Gross profit

    • Notional profit

    • Net profit

    • Total profit

    Correct Answer
    A. Notional profit
    Explanation
    The correct answer is "Notional profit." Notional profit refers to the profit that is calculated based on the difference between the value of work-in-progress certified and the cost of such work-in-progress certified. It is a theoretical or hypothetical profit that is recognized before the completion of the project. This term is commonly used in construction contracts or projects where the value of work completed is measured and certified at different stages. It helps in assessing the profitability of the project and making financial projections.

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  • 9. 

    Material requisition is meant for

    • Purchase of material.

    • Sale of material

    • Storage of material.

    • Supply of material from stores.

    Correct Answer
    A. Supply of material from stores.
    Explanation
    Material requisition is a process used to request and obtain materials from the stores. It is not related to the purchase or sale of materials, but rather the internal supply of materials within an organization. When materials are needed for a specific task or project, a material requisition is submitted to the stores department, which then supplies the requested materials. This ensures that the necessary materials are available for use in various operations and helps maintain an efficient workflow within the organization.

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  • 10. 

    The cost that helps to calculate per unit and total cost of farming activities are called _______ costing.

    • Garden Costing

    • Agricultural Costing

    • Specific Order Costing

    • Farm Costing

    Correct Answer
    A. Farm Costing
    Explanation
    Farm costing is the correct answer because it refers to the cost calculation method used in farming activities. It helps in determining the per unit and total cost of various farming activities such as cultivation, harvesting, irrigation, and maintenance. Farm costing takes into account all the expenses incurred in the farm operations, including labor, machinery, seeds, fertilizers, and other inputs. By accurately calculating the costs, farmers can make informed decisions regarding pricing, budgeting, and profitability analysis.

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  • 11. 

    Number of worker employed is used as basis for the apportionment of

    • Taxes

    • Canteen Expenses

    • Revenues

    • All of the above

    Correct Answer
    A. Canteen Expenses
    Explanation
    The number of workers employed is used as a basis for the apportionment of canteen expenses. This means that the cost of running the canteen is divided among the workers based on the number of employees. This method ensures that each worker pays their fair share of the canteen expenses, as the cost is distributed proportionally.

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  • 12. 

    If prime cost is Rs.30,000 and factory cost is Rs.45,000 (no opening & closing stock and no WIP), estimate factory overheads

    • Rs.30,000

    • Rs.75,000

    • Rs.50,000

    • Rs.65,000

    Correct Answer
    A. Rs.30,000
    Explanation
    The correct answer is Rs.30,000. This is because the factory cost includes both the prime cost and the factory overheads. Therefore, the factory overheads would be equal to the prime cost, which is Rs.30,000.

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  • Current Version
  • Mar 22, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • Feb 15, 2022
    Quiz Created by
    Themes
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