Management Accounting MCQ Questions and Solutions with Explanations

31

In the context of standard costing, baste standard is established for

A) short period B) current period C) indefinite period D) pre-defined period

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Answer & Solution

Answer: Option B

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32

Match the following.

List-I	List-II
a. Labour cost variance	1. Actual hours paid (Standard rate - Actual rate)
b. Labour rate variance	2. Standard cost - Actual cost
c. Efficiency variance	3. Idle hours × Standard rate per hour
d. Idle time variance	4. Standard rate (Standard hours - Actual hours worked)

A) a-4, b-3, c-2, d-1 B) a-2, b-3, c-4, d-1 C) a-4, b-1, c-2, d-3 D) a-2, b-1, c-4, d-3

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Answer & Solution

Answer: Option D

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33

Using the marginal costing method, contrtbution is equal to total sales revenue less

A) fixed costs B) direct labour costs C) variable costs D) total costs

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Answer & Solution

Answer: Option C

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34

An increase in fixed costs will result, in which of the following?

A) Adecrease in the contribution-sales ratio B) A decrease in the contribution per point C) An increase in the break-evenpoint sales level D) An increase in the margin of safety

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Answer & Solution

Answer: Option C

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35

Which of the following statement(s) is/are correct?

A) Difference between sales and total cost is profit is called absorption costing B) Fixed costs recovered from contribution is called standard costing C) Both A and B D) None of the above

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Answer & Solution

Answer: Option A

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36

The standards that require peak efficiency and do not allow any work interruptions are known as

A) normal standards B) practical standards C) ideal standards D) budgeted standards

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Answer & Solution

Answer: Option C

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37

The main purpose of cost accounting is to

A) assist management in decision-making B) maximise profits and minimise losses C) comply norms issued by the Government of India from thime to time D) prepare cost accounts in line with the accounting standards

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Answer & Solution

Answer: Option D

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38

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

A) 1, 3, 4 and 6 B) 2, 3, 5 and 6 C) 3, 4, 5 and 6 D) 1, 3, 5 and 6

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Answer & Solution

Answer: Option A

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39

What may be the principle budget factor in case of plant?

A) General shortage of power B) Shortage of experienced salesman C) Insufficient capacity D) All of the above

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Answer & Solution

Answer: Option C

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40

Marginal costing technique helps the management in deciding

A) pricing B) to accept fresh orders at low price C) to make or buy D) all of the above

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Answer & Solution

Answer: Option D

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Management Accounting MCQ Questions and Solutions with Explanations | Management