Q. A document which provides for the detailed cost centre and cost unit is _______.
✅ Correct Answer: (B)
Cost Sheet
Management Accounting MCQs and Notes
Q. A department makes a product whose contribution per unit is £1,000, and which takes 20 hours machine time. A component used in this product with a marginal cost of £300 (taking 5 hours of machine time) could be purchased from an external supplier. The department is working at full capacity. What is the maximum price that the company may pay to buy the component from an external supplier?
✅ Correct Answer: (A)
£550
Q. Long Term Solvency is indicated by:
✅ Correct Answer: (B)
Debt / Equity Ratio
Q. Which of the following is an example of Semi-Variable Costs
✅ Correct Answer: (C)
Telephone Expenses
Q. The Carl Care Company established the following direct labour cost standards for one unit of product Z:
•Standard hours: 1.5 hours
•Standard rate: $20 per hour
•Standard cost: $30 (1.5 hours @ $20 per hour)
During the month of July, 20,000 direct labour hours were worked, and 12,500 units of
product Z were manufactured. The total wages related to direct labour in July were
$405,000. The direct labour rate variance for July was:
•Standard hours: 1.5 hours
•Standard rate: $20 per hour
•Standard cost: $30 (1.5 hours @ $20 per hour)
During the month of July, 20,000 direct labour hours were worked, and 12,500 units of
product Z were manufactured. The total wages related to direct labour in July were
$405,000. The direct labour rate variance for July was:
✅ Correct Answer: (A)
$5,000 unfavourable
Q. Which of the below is an Accounting Concept
✅ Correct Answer: (B)
Separate Legal Entity
Q. Determine Contribution if Fixed cost is Rs 50,000 and loss is Rs 20,000.
✅ Correct Answer: (C)
Rs 30,000
Q. In case of other enterprises cash flow arising from interest paid should be classified as cash flow from ________ while dividends and interest received should be stated as cash flow from ____.
✅ Correct Answer: (B)
Financing activities, investing activities
Q. Which of the following statements are true?
✅ Correct Answer: (C)
Both a and b
Q. If total cost of 100 units is Rs 5000 and those of 101 units is Rs. 5030 then increase of Rs. 30 in total cost is
✅ Correct Answer: (A)
Marginal cost