Management Accounting MCQ

Test your knowledge with important Management Accounting MCQ and their applications. These MCQs are beneficial for competitive exams too. Explore 30 + more Management Accounting MCQs at Bissoy

• Fixed cost is a cost
  ক

  which changes in total in proportion to changes in output

  খ

  which remains same for each unit of output

  গ

  which is partly fixed and partly variable in relation to output

  ঘ

  which do not change in total during a given period despise changes in output
• Cost accounting is a specialised field of accounting dealing with
  ক

  classification, recording, allocation and directing

  খ

  classification, processing, allocation and directing

  গ

  classification, recording, planning and control of costs

  ঘ

  classification, recording, allocation and control of costs
• If total cost of 200 units is Rs. 55,000 and those of 201 units is Rs. 55,030, then upsurge of Rs. 30 in total cost is
  ক

  marginal cost

  খ

  prime cost

  গ

  all variable overheads

  ঘ

  none of these
• In increasing production volume situation, the behaviour of fixed cost and variable cost will be
  ক

  decreases, increases

  খ

  increase, decreasing

  গ

  constant, increase

  ঘ

  increase, constant
• Which of the following gives formula for direct material price variance?
  ক

  Actual quantity purchased × (Actual rate + Standard rate)

  খ

  Actual quantity purchased × (Actual rate - Standard rate)

  গ

  Standard quantity purchased × (Actual rate + Standard rate)

  ঘ

  Standard quantity purchased × (Actual rate - Standard rate)
• Which part of cost of production report explains the cost incurred during the process?
  ক

  Cost charge to the department

  খ

  Quantity schedule

  গ

  Both A and B

  ঘ

  None of the above
• The break-even point in units is calculated using
  ক

  fixed expenses and the contribution margin ratio

  খ

  variable expenses and the contribution margin ratio

  গ

  fixed expenses and the unit contribution margin

  ঘ

  variable expenses and the unit contribution margin
• The term 'standard cost' refers to the
  ক

  average unit cost of product produced in the current period

  খ

  budgeted unit cost of product produced in a particular period

  গ

  average unit cost of product produced by other companies

  ঘ

  average unit cost of product produced in the previous period
• Fixed cost per unit decreases when
  ক

  variable cost per unit increases

  খ

  variable cost per unit decreases

  গ

  production volume increases

  ঘ

  production volume decreases
• When calculating cost variances under a standard costing system we must
  ক

  compare actual costs with those that were budgeted

  খ

  compare standard costs with actual costs at the standard level of activity

  গ

  compare actual outputs against budgeted outputs

  ঘ

  compare actual costs with standard costs at the actual level of output
• When costing takes into account only the variable cost and not the full production cost we will be using
  ক

  absorption costing

  খ

  full costing

  গ

  activity based costing

  ঘ

  marginal costing
• Which one of the following cost would not be termed as product cost?
  ক

  Administrative salaries

  খ

  Direct labour

  গ

  Indirect material

  ঘ

  Plant supervisor's salary
• Marginal cost is computed as
  ক

  Total costs - All fixed overheads

  খ

  Prime cost + All variable overheads

  গ

  Fixed overheads + All variable overheads

  ঘ

  All of the above
• Expenditure incurred on material, labour, machinery, production and inspection are summed up to find the
  ক

  factory cost of product

  খ

  selling price of product

  গ

  total cost of product

  ঘ

  none of these
• Which of the following is not a valid possible cause of direct materials quantity variances?
  ক

  Obtaining quantity discounts for large orders of materials

  খ

  Poor functioning of machinery giving rise to excessive wastage

  গ

  Better or worse quality of materials purchased

  ঘ

  Increased/decreased level of quality checks on the production process
• Which of the following does not comprise of (Cost of Good Sold) COGS?
  ক

  Factory electricity expense

  খ

  Transportation for purchasing the raw material

  গ

  Electricity

  ঘ

  Sales, managers commission
• An adverse labour efficiency variance together with a favourable labour rate variance may mean that
  ক

  less labour hours are needed to make the same amount of output

  খ

  the business is paying a higher hourly rate than the standard

  গ

  more products are being made per hour

  ঘ

  less skilled staff are being used in production
• Sales budget is
  ক

  expenditure budget

  খ

  master budget

  গ

  functional budget

  ঘ

  cash budget
• Cost of production report is
  ক

  production process report

  খ

  order sheet

  গ

  financial statement

  ঘ

  none of these
• Which of the following are direct expenses?
  ক

  Carriage outwards

  খ

  Carriage inward

  গ

  Both A and B

  ঘ

  None of these
• The difference between fixed and variable cost has a special significance in the preparation of
  ক

  flexible budget

  খ

  master budget

  গ

  cash budget

  ঘ

  all of these
• Marginal costing may be preferred to absorption costing because it
  ক

  ensures the recovery of total costs in sales pricing

  খ

  complies with Accounting Standards

  গ

  complies with the accruals or matching concept

  ঘ

  enables use of the opportunity cost approach
• Which of the following statements are true?<br>1. Marginal costing is not an independent system of costing.<br>2. In marginal costing, all fundamentals of cost are divided into fixed and variable components.<br>3. In marginal costing, fixed costs are treated as product cost.<br>4. Marginal costing is not a technique of cost analysis.
  ক

  Both 4 and 1

  খ

  Both 2 and 3

  গ

  Both 1 and 2

  ঘ

  Both 2 and 4
• The standard cost of a product is
  ক

  the average unit cost of products produced in the previous period

  খ

  the average unit cost of products produced during a particular period

  গ

  the planned unit cost of products produced during a particular period

  ঘ

  the unit cost of products incurred at the start of a particular period
• The accountant's concept of marginal cost differs from the Economist's concept of marginal cost in the matter of exclusion of
  ক

  variable cost

  খ

  semi-variable cost

  গ

  fixed cost

  ঘ

  none of these
• Standard costing refers to
  ক

  a repetitive series of standardised operations are carried out

  খ

  goodsare supplied in standard sizes only

  গ

  there are likely to be large fluctuations in costs

  ঘ

  each product is customised to purchaser requirements
• Marginal costing technique helps the management in deciding
  ক

  pricing

  খ

  to accept fresh orders at low price

  গ

  to make or buy

  ঘ

  all of the above
• Which of the following are possible causes of material price variance?<br>1. Change in market price.<br>2. Use of poor quality of material.<br>3. Inefficient buying.<br>4. Untimely buying.<br>5. Paying overtime for urgent work.<br>6. Use of substitute material of different prices.<br>Select the correct answer:
  ক

  1, 3, 4 and 6

  খ

  2, 3, 5 and 6

  গ

  3, 4, 5 and 6

  ঘ

  1, 3, 5 and 6
• The main purpose of cost accounting is to
  ক

  assist management in decision-making

  খ

  maximise profits and minimise losses

  গ

  comply norms issued by the Government of India from thime to time

  ঘ

  prepare cost accounts in line with the accounting standards
• The standards that require peak efficiency and do not allow any work interruptions are known as
  ক

  normal standards

  খ

  practical standards

  গ

  ideal standards

  ঘ

  budgeted standards