Cost and Managerial Accounting

51. 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:

  1. Rs 3.25
  2. Rs 5.00
  3. Rs 97.50
  4. Rs 150.00
Correct answer: (B)
Rs 5.00

52. After inviting tenders for supply of raw materials, two quotations are received as follows-
Supplier P Rs. 2.20 per unit, Supplier Q Rs. 2.10 per unit plus Rs. 2,000 fixed charges irrespective of the units ordered. The order quantity for which the purchase price per unit will be the same-

  1. 22,000 units
  2. 20,000 units
  3. 21,000 units
  4. None of the above.
Correct answer: (B)
20,000 units

53. Statutory cost audit are applicable only to:

  1. Firm
  2. Company
  3. Individual
  4. Society
Correct answer: (B)
Company

54. The summarized balance sheet of Autolight Limited shows the balances of previous and current year of retained earnings Rs. 25,000 and Rs. 35,000. If dividend paid during the current year amounted to Rs. 5,000 then profit earned during the year will be:

  1. Rs. 5,000
  2. Rs. 55,000
  3. Rs. 15,000
  4. Rs. 65,000
Correct answer: (C)
Rs. 15,000

5. When the sales increase from Rs. 40,000 to Rs. 60,000 and profit increases by Rs. 5,000, the P/V ratio is ______________

  1. 20%
  2. 30%
  3. 25%
  4. 40%.
Correct answer: (C)
25%

56. A profit centre is a centre

  1. Where the manager has the responsibility of generating and maximising profits
  2. Which is concerned with earning an adequate Return on Investment
  3. Both of the above
  4. Which manages cost
Correct answer: (A)
Where the manager has the responsibility of generating and maximising profits

57. Sunk costs are:

  1. relevant for decision making
  2. Not relevant for decision making
  3. cost to be incurred in future
  4. future costs
Correct answer: (B)
Not relevant for decision making

58. 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):?

  1. Rs. 4,000
  2. Rs. 4,500
  3. Rs. 5,000
  4. Rs. 6,000
Correct answer: (C)
Rs. 5,000

59. Economic order quantity is that quantity at which cost of holding and carrying inventory is:

  1. Maximum and equal
  2. Minimum and equal
  3. It can be maximum or minimum depending upon case to case.
  4. Minimum and unequal
Correct answer: (B)
Minimum and equal

60. Calculate Re-order level from the following:
Consumption per week: 100-200 units
Delivery period: 14-28 days

  1. 5600 units
  2. 800 units
  3. 1400 units
  4. 200 units
Correct answer: (B)
800 units
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