( Best ) Managerial Accounting MCQ Set-6

by Mr. DJ

Managerial Accounting MCQ Set-6

How Managerial Accounting Works

Managerial accounting encompasses many facets of accounting aimed at improving the quality of information delivered to management about business operation metrics. Managerial accountants use information relating to the cost and sales revenue of goods and services generated by the company. Cost accounting is a large subset of managerial accounting that specifically focuses on capturing a company’s total costs of production by assessing the variable costs of each step of production, as well as fixed costs. It allows businesses to identify and reduce unnecessary spending and maximize profits.

Managerial Accounting MCQ Set-6

Managerial Accounting MCQ Set-6

  1. Cost accounting information can be used for:
  1. Budget control and evaluation.
  2. Determining standard costs and variances.
  3. Pricing and inventory valuation decisions.
  4. All of these

Correct answer: (D)
All of these

  1. Current liability does not include
  1. Sundry creditors
  2. Acceptances
  3. Unclaimed dividend
  4. Short term investment

Correct answer: (D)
Short term investment

  1. The term Management Accounting was first used in
  1. 1910
  2. 1939
  3. 1950
  4. 1960

Correct answer: (C)

  1. ______________ system records only actual cash receipts and payments
  1. Cash basis
  2. Accrual basis
  3. Mercantile basis
  4. Single entry basis

Correct answer: (A)
Cash basis

  1. Aggregate of direct costs is known as:
  1. Direct material costs
  2. Direct Wages
  3. Direct Expenses
  4. Prime Cost

Correct answer: (D)
Prime Cost

  1. 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

  1. Information about an item is ______________ if its omission or misstatement might influence the financial decision of the users taken on the basis of that information
  1. Concrete
  2. Complete
  3. Immaterial
  4. Material

Correct answer: (D)

  1. Proposed dividends” is shown in the Balance Sheet of a company under the head:
  1. Provisions
  2. Reserves and Surplus
  3. Current Liabilities
  4. Other Liabilities

Correct answer: (A)

  1. Authorized capital, also known as
  1. ominal capital
  2. Paid up capital
  3. Issues capital
  4. None of these

Correct answer: (A)
Nominal capital

  1. Trade Payables are recorded in ______________
  1. Asset side of B/S
  2. Liability side of B/S
  3. P & L a/c
  4. None of the above

Correct answer: (B)
Liability side of B/S

  1. Cost accounting emerged mainly on account of:
  1. Statutory requirements
  2. Competition in the market
  3. Labour unrest
  4. Limitations of financial accounting

Correct answer: (D)
Limitations of financial accounting

  1. Rent paid to landlord should be credited to
  1. Landlords account
  2. Rent account
  3. Cash account
  4. Expense account

Correct answer: (C)
Cash account

  1. The primary objective of management accounting is
  1. Prepare final a/c
  2. Provide management complete and true information
  3. Both (a) & (b)
  4. None of these

Correct answer: (B)
Provide management complete and true information

  1. Cost of goods sold= opening stock+ net purchases+ expenses on Purchases – sales Which part of formula is wrong?
  1. opening stock
  2. net purchases
  3. expenses on Purchases
  4. sales

Correct answer: (D)

  1. Interest on drawings is:
  1. Expenditure for the business
  2. Cost for the business
  3. Gain for the business
  4. None of the above

Correct answer: (C)
Gain for the business

KEY TAKEAWAYS Managerial Accounting MCQ set-6

  • Managerial accounting involves the presentation of financial information for internal purposes to be used by management in making key business decisions.
  • Techniques used by managerial accountants are not dictated by accounting standards, unlike financial accounting.
  • The presentation of managerial accounting data can be modified to meet the specific needs of its end-user.
  • Managerial accounting encompasses many facets of accounting, including product costing, budgeting, forecasting, and various financial analysis.

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