( Best 100+ ) Management Accounting MCQ

by Mr. DJ

( Best 100+ ) Management Accounting MCQ

Management accounting helps managers within a company make decisions. Also known as cost accountingmanagement accounting is the process of identifying, analyzing, interpreting and communicating information to managers to help achieve business goals.

( Best 100+ ) Management Accounting MCQ

What do you mean by management accounting?

Managerial accounting is the practice of identifying, measuring, analyzing, interpreting, and communicating financial information to managers for the pursuit of an organization’s goals.

What is the main purpose of management accounting?

The main objective of managerial accounting is to maximize profit and minimize losses. It is concerned with the presentation of data to predict inconsistencies in finances that help managers make important decisions.

  1. In the computation of the debtors turnover ratio accounts receivable includes
  • Debtors and B/R
  • Creditors and B/P
  • Bank overdraft and loan
  • Debtors and creditors
  1. In the debt equity ratio, equity refers to

Only preference capital

Only equity capital

Both preference and equity capitals plus all reserves

Only reserves

  1. Current ratio is a —— ratio
  • Trading account
  • Profit and loss
  • Profitability
  • Balance sheet
  1. Identify the transaction that has no effect on the current ratio.
  • Preference shares redeemed
  • Bills receivable collected
  • Motor car sold for cash
  • Machinery bought for cash
  1. What does creditors turnover ratio take into account?
  • Total credit sales
  • Total credit purchase
  • Total cash sales
  • Total cash purchases
  1. Current ratio should normally be
  • 2:1
  • 1:1
  • 1:2
  • 2:2
  1. EPS is calculated as
  • EBIT / Equity shares
  • (EBIT – Preference Dividend) / Equity shares
  • (EAT – Preference Dividend) / Equity shares
  • EIT / Equity shares
  1. Interest coverage Ratio is given by
  • Net profit / fixed interest charges
  • Debt capital / Interest on Debt
  • Earning Before Interest and Tax / lnterest on Debt
  • Profit Before Tax / Interest on Debt
  1. To test the liquidity of a concern which of the following ratios are useful?
  • Acid test ratio
  • Capital turnover ratio
  • Bad Debt to sales ratio
  • lnventory turnover ratio

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