Cost and Managerial Accounting

131. In case of rising prices (inflation), LIFO will:

  1. provide lowest value of closing stock and profit
  2. provide highest value of closing stock and profit
  3. provide highest value of closing stock but lowest value of profit
  4. provide highest value of profit but lowest value of closing stock
Correct answer: (A)
provide lowest value of closing stock and profit

132. Capital gearing ratio is ______________.

  1. Market test ratio
  2. Long-term solvency ratio
  3. Liquid ratio
  4. urnover ratio
Correct answer: (B)
Long-term solvency ratio

133. A transport company is running five buses between two towns, which are 50 kms apart. Seating capacity of each bus is 50 passengers. Actually passengers carried by each bus were 75% of seating capacity. All buses ran on all days of the month. Each bus made one round trip per day. Passenger kms are:

  1. 2,81,250
  2. 1,87,500
  3. 5,62,500
  4. None of the above
Correct answer: (C)
5,62,500

134. ______________ is a summary of all functional budgets in a capsule form.

  1. Functional Budget
  2. Master Budget
  3. Long Period Budget
  4. Flexible Budget
Correct answer: (B)
Master Budget

135. CA Co manufactures a single product and has drawn up the following flexed budget for the year.

60% 70% 80%
Rs Rs Rs
Direct materials 120,000 140,000 160,000
Direct labour 90,000 105,000 120,000
Production overheads 54,000 58,000 62,000
Other overheads 40,000 40,000 40,000
Total Cost 304,000 343,000 382,000
What would be the total cost in a budget that is prepared at the 77% level of activity?
  1. Rs 330,300
  2. Rs 370,300
  3. Rs 373,300
  4. Rs 377,300
Correct answer: (B)
Rs 370,300

136. ______________ provides information for income determination.

  1. Financial accounting
  2. cost accounting
  3. management accounting
  4. none of these
Correct answer: (A)
Financial accounting

137. ______________ includes financial and cost accounting, tax planning and tax accounting.

  1. Financial accounting
  2. cost accounting
  3. management accounting
  4. none of these
Correct answer: (C)
management accounting

138. ______________ costing is a type or technique of costing.

  1. Marginal
  2. batch
  3. multiple
  4. job
Correct answer: (A)
Marginal

139. Cost Accountancy is the science, art and ______________ of a cost accountant.

  1. Practice
  2. exercise
  3. hard work
  4. effort
Correct answer: (A)
Practice

140. Cost accounting records both monetary and ______________ units.

  1. Physical
  2. cost
  3. both a & b
  4. none of these.
Correct answer: (A)
Physical
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