Management Accounting MCQ

In this exclusive page, you will get chapter wise Management Accounting MCQs for various exams such B.Com, BBA, MBA, CMA, CS and ICAI. In this post you will also get Introduction to Management Accounting MCQs, management accounting MBA MCQ, management accounting MCQs questions Chapter wise.

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1. Management accounting deals with what kind of information?

a) Qualitative

b) Quantitative

c) Both

d) None of the above

Ans: c) Both Qualitative and Quantitative information

2. Management accounting provides valuable services to management in performing:

a) Coordinating

b) Controlling

c) Planning

d) All managerial functions

Ans: d) All managerial functions

3. Which of the following are tools of management accounting?

a) Standard Costing

b) Marginal Costing

c) Budget and Budgetary control

d) All of the above

Ans: d) All of the above

4. Which of the following are not the tools of management accounting?

a) Funds flow statement

b) Cash Flow Statement

c) Ratio analysis

d) Process costing

Ans: d) Process costing

5. Which of the following are tools of management accounting?

a) Financial Planning

b) Analysis of financial statements

c) Historical cost accounting

d) All of the above

Ans: d) All of the above

6. Management accounting is suitable for:

a) Small trading organization

b) Large industrial and trading organization

c) NPOs

d) Co-operative societies

Ans: b) large industrial and trading organization

7. Management accounting is a structure for:

a) Cost Accounting

b) Financial accounting

c) Decision making

d) Budgeting

Ans: c) Decision making

8. Management accounting and cost accounting are:

a) Contradictory in nature

b) Complementary in nature

c) Neutral in effect

d) None of the above

Ans: b) Complementary in nature

9. Who coined the concept of management accounting?

a) James H. Bliss

b) R. N. Carter

c) Philip Cotler

d) F. W. Taylor

Ans: a) James H. Bliss

10. Management accounting maintains

a) Journal

b) Ledger

c) Trial Balance

d) None of these

Ans: d) None of these

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11. Management accounting provides invaluable services to management in performing:

(a) all management functions

(b) interpret the financial data

(c) controlling functions

(d) none of the above

Ans: (a) all management functions

12. Management accounting is the branch of accounting concerned with reporting to:

a) internal managers

b) shareholders

c) the government

d) bankers

Ans: a) internal managers

13. Which of the following is not an objective of managerial accounting?

a) To help in planning and decision making

b)  To provide data about the latest position of the firm

c) To help in policy formulation

d) To find profit or loss of the firm

Ans: d) To find profit or loss of the firm

14. Which of the following statement is true about management accounting?

a) Management accounting is mainly concerned with future.   True

b) The use of management accounting is compulsory.

c) Management accounting is objective in nature.

d) Management Accounting and Cost Accounting are Synonymous.

Ans: a) Management accounting is mainly concerned with future.   

15. The branch of accounting which primarily deals with processing and presenting accounting data for internal use in a concern is:

a) management accounting

b) financial accounting

c) cost accounting

d) inflation accounting

Ans: a) management accounting

16. Management accounting provides valuable services to management in performing:

a) planning function

b) controlling function

c) co-coordinating functions

d) all managerial functions

Ans: d) all managerial functions

17. Which statement is prepared in the process of funds flow analysis?

a) Schedule of changes in working capital

b) Funds Flow statement

c) Calculation of funds from operations

d) All of the above

Ans: d) All of the above

18. Which of the following are not the tools of management accounting?

a) fund flow statement

b) process costing

c) cash flow statement

d) ratio analysis

Ans: b) process costing

19. Which of the following is not a tool of management an accounting?

a) marginal costing

b) p/l account

c) standard costing

d) variance analysis

Ans: b) p/l account

20. Which of the following is a scope of management accounting?

a) budgeting

b) forecasting

c) cost accounting

d) all of the above

Ans: d) all of the above

21. Which of the following statement is not true about management accounting?

a) It is future oriented

b) Not based on double entry system of accounting

c) It has been done for internal users

d) Management accounting is based on historical records

Ans: b) Not based on double entry system of accounting

22. Management accounting analyses accounting data with the help of

a) auditors

b) statutory forms

c) tools and techniques

d) none of these

Ans: c) tools and techniques

23. The sales objective are stated in:

a) quantitative term

b) qualitative term

c) both (a) & (b)

d) none of these

Ans: c) both (a) & (b)

24. Which one of the following is not mandatory according to the laws?

a) financial accounting

b) cost accounting

c) management accounting

s) none of the above

Ans: c) management accounting

25. Management accounting is related with

a) the problem of choice making

b) recording of transactions

c) cause and effect relationships

Option:

1. a) A and b
2. b) A, B and C
3. c)  A and C
4. d) A only

Ans: c) A and C

26. Accounting is basically concerned with select one:

a) forecasting

b) measurement

c) management

d) none of the above

Ans: c) management

27. Management accounting helps management in:

a) preparation of final accounts

b) raising finance

c) filing tax returns

d) decision making

Ans: d) decision making

28. The functions of management accounting include:

a) Collection of data.

b) Analysis of data.

c) Presentation of data.

d) All of the above.

Ans: d) All of the above.

29. Balance sheet is a statement of:

a) Assets & Liabilities.

b) Working Capital.

c) Operating Results.

d) None of the above.

Ans: a) Assets & Liabilities.

30. Comparative Statement shows:

a) One year’s performance.

b) Financial performance.

c) Comparative performance.

d) Profitability performance.

Ans: c) Comparative performance.

31. Current Ratio shows:

a) Short term financial position.

b) Collection efficiency.

c) Financial stability.

d) Higher profitability.

Ans: a) Short term financial position.

32. Working Capital is the capital required to finance:

a) Day to day operations.

b) Purchase of fixed assets.

c) Settlement of long term liabilities.

d) None of the above.

Ans: a) Day to day operations.

33. Long term decisions are called as:

a) Profit volume analysis.

b) Working capital decisions.

c) Future decisions.

d) Capital budgeting decisions.

Ans: d) Capital budgeting decisions.

34. The basic function of management accounting is:

a) To serve Government.

b) To serve the management in performing it’s function effectively.

c) To serve the public.

d) None of the above

Ans: b) To serve the management in performing it’s function effectively.

Management Accounting MCQs

Fill in the blanks (64 Questions)

1. Management accounting is related with presentation of accounting data.
2. Management accounting assists the management in creation of policy.
3. Management accounting is suitable for large industrial and trading organizations.
4. Management accounting is a structure for decision making.
5. Management accounting is an offshoot (branch on a plant) of cost and financial accounting.
6. Management accounting is also known as managerial accounting.
7. Management accounting is simply a use of financial and cost accountingdata in taking various managerial decisions.
8. management accounting is also called managerial accounting.
9. The use of management accounting is optional.
10. Management accounting is subjectivein nature.
11. Management accounting is basically concerned with accounting information which is useful to management.
12. Management Accounting is based on accountinginformation.
13. Financial accounting is governed by GAAP.
14. Management accounting is a toolof management but not a substitute of management.
15. Management accounting analysis accounting data with the help of tools and techniques.
16. Management accounting deals with both quantitative and qualitative information.
17. Only Quantitativeinformation is recorded in accounting.
18. Accounting is an art of recording financial transactions.
19. Management Accountant is Superiorin position to Cost Accountant.
20. Management accounting and cost accounting are complementaryin nature.
21. Accounting information is analyzedand interpreted to make it useful.
22. Management Accounting supplies information to the managementso that later may be able to discharge all its functions properly.
23. the focus of management accounting is on future growth.
24. Standard costing is a cost control methodused in management accounting.
25. Management accounting helps in analysis and interpretation of data.
26. Management accounting uses no fixed normsin its function.
27. The accounting data are analyzed by the management for effective planning and decision making.
28. The management accountant is a memberof management team.
29. Management accounting system cannotbe installed without financial and cost accounting system.
30. The scope of management accounting is widerthan that of cost accounting.
31. Management accounting assures maximumreturn on capital employed.
32. Revaluation accounting is also known as replacement or price level accounting.
33. Publication of Management Accounting Report is not compulsory.
34. The term management accounting refers to accounting for managers.
35. In a Funds Flow Statement, all receiptsare treated as source of funds.
36. Purchase of plant will mean decreasein working capital.
37. Funds flow statement is also known as a statement of Sources and Applications of funds.
38. Issue of equity shares in a cash flow from financingactivities.
39. Income from investment is a cash flow from Investingactivities.
40. Cash receipt from issue of shares is a Financingactivity.
41. Repayment of borrowing causes cash Outflow.
42. Decrease in creditor is outflowof cash.
43. Goodwill is a non-cashtransaction.
44. Fixed cost per unit Decreaseswhen volume of production increases.
45. Variable cost per unit remains same/increases/decreases due to increase in production.
46. The practice of charging all costs to product is marginal costing/absorption costing/standard costing.
47. P/V ratio exhibits the percentage of contribution included in Sales
48. Margin of safety can be improved by reducing the variablecost.
49. Contribution is the difference between sales and variable.
50. Margin of safety can be improved by reducing the Variablecost.
51. P/V ratio exhibits the percentage of contribution included in Sales.
52. In marginal costing system, fixed cost is considered as Periodcost.
53. In marginal costing system, variable cost is considered as productcost.
54. Any transaction that increases working capital is a applicationof fund.
55. Repayment of borrowing causes cash Outflow.
56. Funds flow statements are based upon accrual basis of accounting.
57. Masterbudget is a summary of all functional budgets.
58. Budgetary Control is a system of controlling Cost.
59. A budget manual spells out Duties and Responsibilitiesof various executives concerned with budget.
60. Flexible budget is a capacitybudget.
61. Budgetary control is a system of controlling cost.
62. Zero-base budgeting was first used by carter.
63. Standard cost is a predeterminedcost.
64. Direct Labour Cost Variance = Standard Cost for actual production x actual Cost of Production.

Management Accounting MCQ

State whether the following statements are True or False (59 Questions):

1. The origin of management accounting is due to limitations of financial accounting and cost accounting. True
2. The term management accounting was first coined in the year 1981.               False, 1950
3. Management accounting is basically concerned with accounting information which is useful to management.                        True (Definition by R. N. Anthony)
4. Management Accounting and Cost Accounting are Synonymous.      False
5. Management accounting provides decision to management.              False, information
6. Management accounting provides only data which is helpful to the management in decision making, not the decisions.    True
7. Management accounting is a technique of selective nature.                True
8. Management accounting is not helpful to management in discharging its functions. False
9. Management accounting is based on the past records provided by financial and cost accounting for making decision for the future. True
10. Management accounting is mainly concerned with future.   True
11. The use of management accounting is compulsory. False
12. Who coined the concept of management accounting? James H. Bliss
13. Management accounting is objective in nature.         False
14. Publication of management accounting statement is mandatory
15. Management Accounting is concerned with accounting information that is useful to the management.  True
16. Management accounting deals only with the information which is useful to the management. True
17. In management accounting, only those figures are used which can be measured in monetary terms.         False
18. Management accounting deals with both qualitative and quantitative information. True
19. Management accounting will not provide information in a prescribed Proforma like that of financial accounting.                        True
20. Management accounting analyze the effect of different variables on the profits and profitability of the concern.      True
21. The main objective of management accounting is to help the internal management.               True
22. Management accounting is a structure of decision making.  True
23. In management accounting no emphasis is given to the actual figures.           True
24. Management accounting uses historical data for planning and forecasting.   True
25. Management accounting is not bound by the accounting standards.                True
26. Period of reporting in management accounting may be weekly, fortnightly and monthly.      True
27. Auditing of management accounting is compulsory.                False
28. Management accounting needs cost and financial accounting as its base for its installation.  True
29. Management accountant is senior in position to cost accountant.     True
30. Maintaining management accounts are a statutory requirement for all limited companies. False
31. Management accounting information is used by the management only.        True
32. In management accounting, approximate figures presented timely are more important than accurate figures presenting late. True
33. Management accounting is based on double entry system. False
34. Financial statements are only interim reports.            True
35. Management accounting is only a blend of financial and cost accounting.      True
36. Accountability is one of the concepts of management accounting.    True
37. Machinery sold for cash is an application of fund.         False, source
38. Building sold on credit is a source of fund.                 False
39. Depreciation of machinery is a source of funds.         True
40. Cash flow statement is useful for short-term financial analysis.          True
41. Cash Flow Statement is a substitute of Cash Account.             False
42. Cash Flow Statement is based upon accrual basis of accounting.        False, Cash Basis
43. Cash Flow Statement is a statement of sources and application of cash during a particular period of time.      True
44. Cash flow statement is also known as statement of cash flows.          True
45. Contribution is the difference between sales and total cost of sales.               False, sales -vc
46. In marginal costing, the problem of over and under absorption of overhead is avoided.         True
47. Margin of Safety = Fixed Cost/PV Ratio.        False
48. P/V ratio can be improved by reducing the fixed cost.    False
49. Material Cost Variance = Material Price Variance x Material Usage Variance.                False
50. Marginal Cost = Total Cost – Variable Cost.      False, Fixed Cost
51. Idle Time Variance = Idle Hours x Standard Rate.           False
52. The difference between actual cost and standard cost is known as differential cost.   Variance
53. Profit changes in the same proportion of the changes in contribution.   False
54. At break-even point, the company earns only a marginal profit.        False
55. Break-even analysis is also known as CVP analysis.  True
56. Budget is related to a definite future period.        True
57. Budgeting may be said to be an act of determining costing standards.             False
58. A system of budgetary control cannot be used in an organization where standard costing is in use.   False
59. Budgetary control is a system of controlling cost.        True