Beruflich Dokumente
Kultur Dokumente
_____________________________________________________________________________
Part A (1 Mark questions)
(50 * 1 = 50 marks)
1. ___________ sets the targets for each individual, reviews their working and points out
their effectiveness and inefficiencies.
A) Responsibility accounting
B) Ratio Analysis
C) Cost Accounting
D) Cause and effect analysis
2. If the ________ ratio of the company is more than that of other companies, it is worth
investing.
A) Dividend yield
B) Earnings per share
C) Dividend payout
D) Return on Investment
3. The finished products, when sold on credit, get converted into ________.
A) Short-term funds
B) Sundry creditors
C) Sundry debtors
D) Circulating capital
4. _____________ is a method of budgeting income earned and adjusting some part of the
budget downwards for each part that should be adjusted upwards.
A) Zero-base budgeting
B) Performance budgeting
C) Labour budgeting
D) Cash budgeting
5. Ratio analysis helps to compare items found in ____________ with other items with the
aim of analysing the financial state of a business.
A) Budget report
B) Database
C) Inventory
D) Financial statements
6. In which of the following policy, a company can use short-term financing to obtain funds
for a part of its permanent current assets.
A) Dividend policy
B) Credit policy
C) Conservative policy
D) Aggressive policy
7. ___________ ratio portrays the long-term solvency, that is, long-term financial position
of a business and are useful to the long-term creditors, owners and the management?
A) Capital structure ratio
B) Turnover ratio
C) Profitability ratio
D) Coverage ratio
D) Conventional budgeting
11. Which of the following approaches does a company follow when it uses more short-term
financing?
A) Aggressive approach
B) Matching approach
C) Conservative approach
D) Decision theory approach
13. ________ refers to that part of total working capital which is required by a business over
and above permanent working capital.
A) Permanent working capital
B) Zero working capital
14. Which among the following provides information to outsiders such as shareholders,
debenture holders, creditors and bankers?
A) Tax accounting
B) Management accounting
C) Financial accounting
D) Project accounting
15. Which among the following is the correct calculation of budgeted production?
A) Estimated sales + estimated closing stock - estimated opening stock
B) Estimated sales - estimated closing stock + estimated opening stock
C) Estimated opening stock + estimated closing stock - estimated production
D) Estimated opening stock + estimated closing stock - estimated purchase
16. Which of the following has failed to communicate proper information to the
management?
A) Cost accounting
B) Financial accounting
C) Management accounting
D) Project accounting
17. Which among the following options summarises the sources and uses of working capital?
A) Funds flow statement
B) Income statement
C) Marginal cost statement
D) Cash flow statement
18. Which among the following deals with the operation of the business as a whole in terms
of revenue and expenditure and hence considered extensive?
A) Budgetary control
B) Standard costing
C) Historical costing
D) Variance analysis
19. The _____________ department ascertains the quality of the material by referring to
historic records.
A) Marketing
B) Purchase
C) Production
D) Logistics
21. _____________ can rearrange the firm's financing more effectively on the basis of
information received from fund flow statement.
A) Production manager
B) Marketing manager
C) Finance manager
D) Sales manager
23. Which among the following options is a classification of fixed overhead volume
variance?
A) Yield variance
B) Rate of pay variance
C) Idle time variance
D) Calendar variance
25. Which among the following variances is calculated on the basis of time expended?
A) Standard cost
B) Historical cost
C) Labour cost
D) Material cost
26. Transactions that increase the cash position of the entity are called ____________.
A) Cash inflows
B) Cash outflows
C) Reserve fund
D) Deposits
27. Which among the following are the limitations of Cash flow statement?
A) Not a substitute for an income statement
B) No controversies over the term 'Cash'
C) Non-cash transaction are included
28. Which among the following is a cash inflow from investing activity?
A) Cash payments to acquire shares.
B) Cash proceeds from issuing shares.
C) Cash receipts from the repayment of advances and loans made to third parties.
D) Cash repayments of amounts borrowed and redemption of debentures.
29. The payback reciprocal is a helpful tool for quickly estimating the rate of return of a
project provided its life is _____________ the payback period.
A) At least four times
B) At least once
C) At least thrice
D) At least twice
30. Decisions that involve planning for an activity like installing machinery or setting up a
factory can be termed as ______________.
A) Capital budgeting
B) Expense budgeting
C) Revenue budgeting
D) Cash budgeting
31. Which among the following is the method to calculate the period within which the total
cash inflows from the project equal the cost of project?
A) Discounted cash flows
B) Average Rate of Return (ARR)
C) Payback reciprocal
D) Payback period
32. In this form of dividend the directors decide to pay between two annual general meetings.
A) Interim dividend
B) Regular dividend
C) Stock dividend
D) Scrip dividend
33. __________________ states that a company's dividend policy has no direct impact on the
cost of its capital or value.
A) Property Dividend
B) The Residual Dividend Policy
C) The Optimal Dividend Policy
D) The Dividend Irrelevance Theory
34. In fund flow statement the term 'Fund refers to ____________ and flow refers to
movement.
A) Debt capital
B) Working capital
C) Equity capital
D) Long-term capital
37. Which centre among the following accounts for inputs in terms of costs, outputs in terms
of revenues and assets used in terms of their values?
A) Investment centre
B) Profit centre
C) Cost centre
D) Expense centre
38. In ___________________, the profit per unit is affected by the actual volume of
production in any period.
A) Absorption costing
B) Direct costing
C) Variable costing
D) Marginal costing
39. Which among the following options is equal to total sales minus the sales at breakeven
point?
A) Total revenue
B) Total cost
C) Margin of safety
D) Standard cost
40. Which among the following options calculates and records the interviewing, selecting,
training and development costs of employees?
A) Human resource accounting
B) Inflation accounting
C) Financial accounting
D) Responsibility accounting
C) Period cost
D) Standard cost
42. Which among the following ratios is used when the business is dealing with a range of
products and breakeven has to be found out for each product?
A) Profit volume ratio
B) Net profit ratio
C) Gross profit ratio
D) Operating ratio
43. Financial accounts do not consider the effect of the increase in the prices of assets and
output as they are kept on ____________ basis.
A) Estimated cost
B) Standard cost
C) Historical cost
D) Material cost
45. Which among the following options refers to personnel who do not have access to the
books of accounts?
A) Financial planner
B) Auditor
C) Creditors
D) Cost accountant
46. _______________ is also known as final dividend because it is usually paid after
finalisation of accounts.
A) Stock dividend
B) Regular dividend
C) Interim dividend
D) Bond dividend
48. Splitting up or regrouping of the figures found in the financial statements in to the desired
homogeneous component parts is known as ___________________.
A) Analysis of the component parts
B) Comparison of the component parts
C) Interpretation of component parts
D) Preparation of organisation chart
49. The size of ____________ variance reflects the degree of efficiency of the person or
department concerned.
A) Controllable
B) Uncontrollable
C) Favourable
D) Unfavourable
50. Which among the following options is the objectives of financial analysis?
A) To indicate the trend of achievements
B) To measure the variances and control of cost
C) Ascertainment of cost
(25*2 = 50 marks)
Mere financial data is sufficient for effective managerial decision making and
control.
2.
Management accounting does not follow set principles like the double-entry
system.
53. The manager can deduce the reasons for the Imbalances in uses of _____________ in the
________ and take necessary corrective actions.
1. Past
2. Present
3. Cash
4. Funds
A) Option 1 & 2
B) Option 2 & 3
C) Option 3 & 4
D) Option 1 & 4
57. Applications
of
fund
flow
statement
include
___________________
and
___________________
1. Acceptance of deposits
2. Repayment of deposits
3. Purchase of fixed assets
4. Sale of fixed assets
A) Option 1 & 2
B) Option 2 & 3
C) Option 3 & 4
D) Option 1 & 4
63. Depending on the actual resulting cost, variances can be classified as ________________
and ___________________.
1. Favourable
2. Controllable
3. Unfavourable
4. Uncontrollable
A) Options 1 & 3
B) Options 3 & 4
C) Options 1 & 4
D) Options 2 & 4
65. Which among the following are cash outflows from operating activities?
1. Cash payments relating to futures contracts, forward contracts, option contracts and
swap contracts.
2. Cash payments to acquire shares, warrants or debt instruments of other enterprises.
3. Cash payments of an insurance enterprise for claims, annuities and other policy
benefits.
4. Cash receipts from collecting principal amount of loans made to third parties.
A) Options 1 & 3
B) Options 1 & 4
C) Options 1 & 2
D) Options 2 & 3
66. Which among the following are the accept- reject rule in IRR method?
67. Capital budgeting process includes four interrelated steps such as _________, evaluation,
selection and _________ that are used to evaluate and select long-term proposals.
A) Proposal generation, Follow-up
B) Analysis, Rejection
C) Research, Suggestion
D) Expansion, Implementation
68. Which among the following are the factors that influence a company in the formulation of
dividend policy?
1. Expansion of new business
2. Obtaining finance
3. Effect on market prices
4. Level of inflation in the economy
A) Options 3 & 4
B) Options 2 & 3
C) Options 1 & 4
D) Options 1 & 2
72. Which options among the following are the problems in responsibility accounting?
1. Inter-departmental conflicts
2. Variations in the price level
3. Too many conversion and calculations
4. Overload of information
A) Options 1 & 2
B) Options 2 & 3
C) Options 1 & 4
D) Options 3 & 4
73. Which among the following options are the features that distinguish marginal costing from
absorption costing?
1. Value of closing stock
2. Over- and under-absorbed overheads
3. Difference in stock valuation
4. Volume of production
A) Options 1 & 2
B) Options 2 & 3
C) Options 1 & 4
D) Options 3 & 4
A) 1-True, 2-True
B) 1-False, 2-True
C) 1-False, 2-False
D) 1-True, 2-False
(4*10 = 40 marks)