Cost and Management Accounting 3

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Objective Questions and Answers of MBA: Cost and Management Accounting 3

Subject: Objective Questions and Answers of MBA: Cost and Management Accounting 3

Part 3: Objective questions and answers of Cost and Management Accounting

 

Q1. Describe the cost unit applicable to the Bicycle industry:

a) Per part of bicycle

b) Per bicycle

c) Per tonne

d) Per day

 

Q2. Cost of abnormal wastage is:

a) Charged to the product cost

b) Charged to the profit & loss account

c) Charged partly to the product and partly profit & loss account

d) Not charged at all.

 

Q3. A worker is allowed 60 hours to complete the job on a guaranteed wage of Rs. 10 per hour. Under the Rowan Plan, he gets an hourly wage of Rs. 12 per hour. For the same saving in time, how much he will get under the Halsey Plan?

a) Rs. 720

b) Rs. 540

c) Rs. 600

d) Rs. 900

 

Q4. A Local Authority is preparing cash Budget for its refuse disposal department. Which of the following items would not be included in the cash budget?

a) Capital cost of a new collection vehicle

b) Depreciation of the machinery

c) Operatives wages

d) Fuel for the collection Vehicles

 

Q5. A process costing system for J Co used an input of 3,500Kg of materials at Rs20 per Kg and labour hours of 2,750 at Rs25 per hour. Normal loss is 20% and losses can be sold at a scrap value of Rs5per Kg. Output was 2,950 Kg. What is the value of the output?

a) Rs 142,485

b) Rs 146,183

c) Rs 149,746

d) Rs 152,986

 

Q6. The following information is available for the W hotel for the latest thirty day period.

Number of rooms available per night 40 percentage occupancy achieved 65% room servicing

cost incurred Rs. 3900.The room servicing cost per occupied room-night last period, to the nearest Rs, was:

a) Rs 3.25

b) Rs 5.00

c) Rs 97.50

d) Rs 150.00

 

Q7. Statutory cost audit are applicable only to:

a) Firm

b) Company

c) Individual

d) Society

 

Q8. A profit center is a center

a) Where the manager has the responsibility of generating and maximizing profits

b) Which is concerned with earning an adequate Return on Investment

c) Both of the above

d) Which manages cost

 

Q9. Calculate value of closing stock from the following

Opening stock of finished goods (500 units) : Rs. 2,000

Cost of production (10000 units) : Rs. 50,000 Closing stock (1000 units)

a) Rs. 4,000

b) Rs. 4,500

c) Rs. 5,000

d) Rs. 6,000

 

Q10. Calculate Re-order level from the following:

Consumption per week: 100-200 units

Delivery period: 14-28 days

a) 5600 units

b) 800 units

c) 1400 units

d) 200 units

 

Q11. Which of the following is not an avoidable cause of labour turnover?

a) Dissatisfaction with Job

b) Lack of training facilities

c) Low wages and allowances

d) Disability, making a worker unfit for work

 

Q12. Most suitable basis for apportioning insurance of machine would be:

a) Floor Area

b) Value of Machines

c) No. Of Workers

d) No. Of Machines

 

Q13. The actual output of 162,500 units and actual fixed costs of Rs. 87000 were exactly as budgeted. However, the actual expenditure of Rs 300,000 was Rs. 18,000 over budget. What was the budget variable cost per unit?

a) Rs 1.20

b) Rs 1.31

c) Rs1.42

d) Rs 1.50

 

Q14. A company calculates the prices of jobs by adding overheads to the prime cost and adding 30% to total costs as a profit margin. Job number Y256 was sold for Rs1690 and incurred overheads of Rs 694. What was the prime cost of the job?

a) Rs 489

b) Rs 606

c) Rs 996

d) Rs 1300

 

Q15. The cost per unit of a product manufactured in a factory amounts to Rs. 160 (75% variable) when the production is 10,000 units. When production increases by 25%, the cost

 of production will be Rs. Per unit.

a) Rs. 145

b) Rs. 150

c) Rs. 152

d) Rs. 140

 

Q16. If credit sales for the year is Rs. 5,40,000 and Debtors at the end of year is Rs. 90,000 the Average Collection Period will be

a) 30 days

b) 61 days

c) 90 days

d) 120 days

 

Q17. Responsibility Centre can be categorised into:

a) Cost Centres only

b) Profit Centres only

c) Investment Centres only

d) Cost Centres, Profit Centres and Investment Centres

 

Q18. Bin Card is a

a) Quantitative as well as value wise records of material received, issued and balance;

b) Quantitative record of material received, issued and balance

c) Value wise records of material received, issued and balance

d) A record of labour attendance

 

Q19. Calculate the value of closing stock from the following according to Weighted Average method:

1st January, 2014: Opening balance: 50 units @ Rs. 4

Receipts:

5th January, 2014: 100 units @ Rs. 5

12th January, 2014: 200 units @ Rs. 4.50

Issues:

2nd January, 2014: 30 units

18th January, 2014: 150 units

a) Rs. 765

b) Rs. 805

c) Rs. 786

d) Rs. 700

 

Q20. Overhead refers to:

a) Direct or Prime Cost

b) All Indirect costs

c) Only Factory indirect costs

d) Only indirect expenses

 

Part 3: Objective questions and answers of Cost and Management Accounting

 

Q1. Answer b

 

Q2. Answer b

 

Q3. Answer b

 

Q4. Answer b

 

Q5. Answer a

 

Q6. Answer b

 

Q7. Answer b

 

Q8. Answer a

 

Q9. Answer c

 

Q10. Answer b

 

Q11. Answer d

 

Q12. Answer b

 

Q13. Answer a

 

Q14. Answer b

 

Q15. Answer c

 

Q16. Answer b

 

Q17. Answer d

 

Q18. Answer b

 

Q19. Answer c

 

Q20. Answer b

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