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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-6 section-2

Each section contains 100 MCQs on Management Accounting .
51
Actual price of material is less than budgeted price, this means that
Discuss
Answer & Solution
Answer: Option A
Solution:
Actual price of material is less than budgeted price, this means that price variance is favourable. A price variance is the difference between the actual revenue or cost and the budgeted revenue or cost because of a difference between the actual unit price and the budgeted unit price.
52
An actual rate paid to labour is greater than budgeted rate, it means that the
Discuss
Answer & Solution
Answer: Option B
Solution:
An actual rate paid to labour is greater than budgeted rate, it means that the variance is unfavourable, the variance is unfavorable since the company paid more than what it expected. A price variance is the difference between the actual revenue or cost and the budgeted revenue or cost because of a difference between the actual unit price and the budgeted unit price.
53
If flexible budget variance is $95000 and an actual cost is $40000, then flexible budget cost would be
Discuss
Answer & Solution
Answer: Option D
Solution:
Flexible budget cost = Flexible budget variance - An actual cost
= $95000 - $40000 = $55,000.
54
If a company uses large quantity of input than budgeted quantity for output level, then company is known to be
Discuss
Answer & Solution
Answer: Option C
Solution:
If a company uses large quantity of input than budgeted quantity for output level, then company is known to be company is inefficient.
55
In cost accounting, goal of variance analysis is to
Discuss
Answer & Solution
Answer: Option D
Solution:
In cost accounting, goal of variance analysis is to understand variance reason, improve future performance and learning of improvement.
56
In management control, an efficiency variance is also referred as
Discuss
Answer & Solution
Answer: Option C
Solution:
In management control, an efficiency variance is also referred as usage variance. Efficiency variance is the difference between the theoretical amount of inputs required to produce a unit of output and the actual number of inputs used to produce the unit of output. The expected inputs to produce the unit of output are based on models or past experience.
57
If an efficiency variance is 200 units and actual input quantity is 750 units, then budgeted input quantity will be
Discuss
Answer & Solution
Answer: Option C
Solution:
Budgeted input quantity = Actual input quantity - Efficiency variance
= 750 - 200 = 550 units.
58
If budgeted price of input is $70, actual quantity of input is 250 units and allowed budgeted quantity of input is 90 units, then efficiency variance will be
Discuss
Answer & Solution
Answer: Option B
Solution:
Efficiency variance = (Actual quantity of input - Budgeted quantity of input) × Budgeted price of input
= (250 - 90) units × $70 = $11,200.
59
Budgeted input quantity is added in to efficiency variance to calculate
Discuss
Answer & Solution
Answer: Option A
Solution:
Budgeted input quantity is added in to efficiency variance to calculate actual input quantity. AQ means the “actual quantity” of input used to produce the output.
60
Static budget amount is subtracted from actual result to calculate
Discuss
Answer & Solution
Answer: Option C
Solution:
Static budget amount is subtracted from actual result to calculate static budget variance. The static budget is used as the basis from which actual results are compared. The resulting variance is called a static budget variance.