Q. Under High and Low Point method, the output at two different levels is compared with the amount of __________ incurred at these two points.
✅ Correct Answer: (B)
Total costs
Management Accounting MCQs and Notes
Q. While computation of profit in marginal costing
✅ Correct Answer: (A)
Total marginal cost is deducted from total sales revenues
Q. Which of the following statements are true?
(a) Marginal costing is not an independent system of costing.
(b) In marginal costing all elements of cost are divided into fixed and variable components.
(c) In marginal costing fixed costs are treated as product cost.
(d) Marginal costing is not a technique of cost analysis.
(a) Marginal costing is not an independent system of costing.
(b) In marginal costing all elements of cost are divided into fixed and variable components.
(c) In marginal costing fixed costs are treated as product cost.
(d) Marginal costing is not a technique of cost analysis.
✅ Correct Answer: (A)
A and B
Q. Marginal costing is also known as Direct costing
✅ Correct Answer: (C)
None of the above
Q. Marginal cost is computed as
✅ Correct Answer: (A)
Prime cost + All Variable overheads
Q. Material price, mix, usage and revised quantity variances are measured on _______ basis, whereas material yield variance is measured on _______ basis.
✅ Correct Answer: (C)
Input, Output
Q. Idle time variance arises when
✅ Correct Answer: (C)
Both a and b
Q. The formula used for calculation of labor rate variance is
✅ Correct Answer: (B)
(Standard rate per hour - Actual rate per hour) * Actual Hours
Q. .Which of the following statements are true about labor idle time?
✅ Correct Answer: (C)
Labour idle time variance is always unfavorable or adverse
Q. Sales margin variance due to sales quantities is measured as
✅ Correct Answer: (B)
Revised standard profit - Budgeted profit