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Management Accounting MCQ Questions and Solutions with Explanations | Management

Management Accounting MCQ Questions and answers with easy and logical explanations. Management provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Management MCQ is important for exams like MAT, CAT, CA, CS, CMA, CPA, CFA, UPSC, Banking and other Management department exam. Page-3 section-4

Each section contains 100 MCQs on Management Accounting .
21
If sales volume variance is $8500 and static budget amount is $2000, then flexible budget amount would be
Discuss
Answer & Solution
Answer: Option A
Solution:
Flexible budget amount = Sales volume variance - Static budget amount
= $8500 - $2000 = $6,500.
22
Difference between static budget amount and flexible budget amount is named as
Discuss
Answer & Solution
Answer: Option B
Solution:
Difference between static budget amount and flexible budget amount is named as sales volume variance. Sales volume variance is the change in revenue or profit caused by the difference between actual and budgeted sales units.
23
Corporate sustaining costs and distribution channel costs are also classified as
Discuss
Answer & Solution
Answer: Option C
Solution:
Corporate sustaining costs and distribution channel costs are also classified as fixed costs. A fixed cost is a cost that does not change with an increase or decrease in the amount of goods or services produced or sold. Fixed costs are expenses that have to be paid by a company, independent of any specific business activities.
24
In customer cost hierarchy, costs of all activities incurred to sell group of units to end consumers are classified as
Discuss
Answer & Solution
Answer: Option C
Solution:
In customer cost hierarchy, costs of all activities incurred to sell group of units to end consumers are classified as customer batch-level costs. Batch-level costs are expenses related to a group of products that cannot readily be traced back to an individual item. In other words, these production costs are incurred to produce a set of products or a batch and can't be allocated to an individual unit.
25
If an actual result is $5500 and corresponding amount of flexible budget on basis of actual level of output is $3500, then flexible budget variance will be
Discuss
Answer & Solution
Answer: Option D
Solution:
Flexible budget variance = Actual result - Flexible budget
= $5500 - $3500 = $2,000.
26
If flexible budget amount is $7500 and sales volume variance is $6500, then static budget amount would be
Discuss
Answer & Solution
Answer: Option C
Solution:
Static budget amount = Flexible budget amount - Sales volume variance
= $7500 - $6500 = $1,000.
27
For increasing sales, decrease in selling price below selling price list is known as
Discuss
Answer & Solution
Answer: Option D
Solution:
For increasing sales, decrease in selling price below selling price list is known as price discount. Typically, a store will discount an item by a percent of the original price. The rate of discount is usually given as a percent, but may also be given as a fraction.
28
Customer sustaining costs, customer batch-level costs and customer output-unit level costs are classified as
Discuss
Answer & Solution
Answer: Option A
Solution:
Customer sustaining costs, customer batch-level costs and customer output-unit level costs are classified as customer level indirect costs. Indirect costs include administration, personnel and security costs. These are those costs which are not directly related to production. Some indirect costs may be overhead. But some overhead costs can be directly attributed to a project and are direct costs.
29
If budgeted contribution margin for budgeted and actual sales mix are $35000 and $27000, then sales mix variance will be
Discuss
Answer & Solution
Answer: Option A
Solution:
Sales mix variance = Budgeted sales - Actual sales
= $35000 - $27000 = $8,000.
30
In corporate costs, cost incurred to finance construction of new equipment are classified as
Discuss
Answer & Solution
Answer: Option A
Solution:
In corporate costs, cost incurred to finance construction of new equipment are classified as treasury costs.