MCQ – CASH FLOW, FUND FLOW, RATIO ANALYSIS
1. Financial
Accounting deals with ________.
A. Determination
of costs
B. Determination
of profits
C. Determination
of prices
D. Determination
of transactions
ANSWER: B
2. The ratios
which reveal the final result of the managerial policies and performance
is__________.
A. turnover
ratios.
B. profitability
ratios.
C. short
term solvency ratio.
D. long
term solvency ratio.
ANSWER: B
3. Which of the
following is not a tool of management accounting?
A. Ratio
analysis
B. budget
and budgetary control
C.
marginal costing D. unit casting
ANSWER: D
4. Retained
earnings statement depicts __________.
A. appropriation
of profits
B. estimated
profits
C.
estimated costs D. estimated prices
ANSWER: A
5. The ratio
which measures the profit in relation to capital employed is known as
__________.
A. return
on investment.
B. gross
profit ratio.
C. operating
ratio.
D.
operating profit ratio.
ANSWER: A
6. Prepaid
expenses is an example of _________.
A. fixed
assets.
B. current
assets.
C.
fictitious assets. D. current
liabilities.
7. Stock
velocity ratio is known as ___________.
A. turnover
ratio.
B. solvency
ratio.
C.
liquidity ratio. D. profitability
ratio.
ANSWER: A
8. Which ratio
is calculated to ascertain the efficiency of inventory management?
A. Stock
velocity ratio.
B. Debtors
velocity ratio.
C. Creditors
velocity ratio.
D.
Working capital turnover ratio.
ANSWER: A
9. Sales -
Gross Profit =_________.
A. net
profit.
B. cost
of production.
C. administrative
expenses.
D. cost
of goods sold.
ANSWER: D
10. Which ratio
measures the number of times the receivables are rotated in a year in terms of
sales?
A. Stock
turnover ratio.
B. Debtors
turnover ratio.
C. Creditors
velocity ratio.
D. Working
capital turnover ratio.
ANSWER: B
11. The ratio
which indicates the number of times the payables are rotated in a year is
____________.
A. stock
turnover ratio.
B. stock
turnover ratio.
C. creditors
velocity ratio.
D.
working capital turnover ratio.
ANSWER: C
12. Current
assets - current liabilities =_______.
A. fixed
capital.
B. working
capital.
C.
opening capital. D. closing capital.
ANSWER: B
13. The ratio of
current assets to current liabilities is called_______.
A. liquid
ratio.
B. acid
test ratio.
C. current
ratio.
D.
cash position ratio.
ANSWER: C
14. Management
accounting is also called as _________.
A. price
level accounting
B. historical
cost accounting
D. decision accounting
ANSWER: D
15. Current
assets - (stock + prepaid expenses) =______________.
A. current
assets.
B. fixed
assets.
C.
liquid assets. D. fictitious assets.
ANSWER: C
16. Operating
profit to sales gives us ____________.
A. Gross
Profit ratio
B. Net
Profit ratio
C. Operating
ratio
D.
Operating profit ratio
ANSWER: D
17. An ideal
debt equity ratio is________.
A. 1:1
B. 2:1
C.
3:1 D. 4:1
ANSWER: A
18. Capital
gearing ratio is also known as___________.
A. leverage
ratio.
B. fixed
assets turnover ratio.
C.
proprietary ratio. D. debt equity
ratio.
ANSWER: A
19. Shareholders
funds + Long-term loans =_____________.
A. current
assets.
B. current
liabilities.
C. fixed
assets.
D.
capital employed.
ANSWER: D
20. Net capital
employed is equal to_________.
A. total
assets minus total liabilities.
B. fixed
assets plus net-working capital.
C. total
assets minus long-term liabilities. D. total assets.
ANSWER: B
21. All
those assets which are converted into cash in the normal course of business
within one year are known as _________.
A. current
assets.
B. fixed
assets.
C.
fictitious assets. D. wasting
assets.
ANSWER: A
22. All
those liabilities which are payable in cash in the normal course of business within
a period of one year are called _________.
A. long
term liabilities.
B. outside
liabilities
C.
short term loans. D. current
liabilities.
ANSWER: D
23. Any
transaction between a current item and another current item does not affect
__________.
A. profit.
B. funds.
C.
working capital. D. capital.
ANSWER: B
24. Principle
for preparation of working capital statement -Increase in current asset
_______.
A. increases
working capital.
B. decreases
working capital.
C.
decrease fixed capital. D. increase
fixed capital.
ANSWER: A
25. Principle
for preparation of working capital statement - Decrease in current asset
______________.
A. increases
working capital.
B. decreases
working capital.
C.
decrease fixed capital. D. increase
fixed capital.
ANSWER: B
26. Principle
for preparation of working capital statement -Decrease in current liability
_____________.
A. increases
working capital.
B. decreases
working capital.
C.
decrease fixed capital. D. increase
fixed capital.
ANSWER: A
27. Principle
for preparation of working capital statement -Increase in current liability
___________.
A. increases
working capital.
B. decreases
working capital.
C.
decrease fixed capital. D. increase
fixed capital.
ANSWER: B
28. Depreciation
on fixed assets is _________.
A. non
operating income.
B. operating
expense.
C. operating
income.
D.
non operating expense.
ANSWER: D
29. Provision
for Income tax is ____________.
A. non
operating income.
B. operating
expense.
C. operating
income.
ANSWER: D
30. Profit on
sale of fixed assets is __________.
A. non
trading income.
B. operating
income.
C.
non trading gains. D. long term
gain.
ANSWER: C
31. In fund flow
statement, issue of shares is ________.
A. sources
of funds.
B. applications
of funds.
C. sources
of cash.
D.
applications of cash.
ANSWER: A
32. In funds
flow statement, sale of fixed assets is ___________.
A. applications
of funds.
B. sources
of cash.
C.
applications of cash. D. sources of
funds.
ANSWER: D
33. In funds
flow statement, funds from operations is _________.
A. applications
of funds.
B. sources
of cash.
C.
applications of cash. D. sources of
funds.
ANSWER: D
34. In funds
flow statement, increase in working capital is ________.
A. applications
of funds.
B. sources
of cash.
C.
applications of cash. D. sources of
funds.
ANSWER: A
35. In funds
flow statement, decrease in working capital is _________.
A. applications
of funds.
B. sources
of cash.
C.
applications of cash. D. sources of
funds.
ANSWER: D
36. In funds
flow statement, repayment of long-term loans is ________.
A. applications
of funds.
B. sources
of cash.
C.
applications of cash. D. sources of funds.
ANSWER: A
37. In
funds flow statement, purchase of fixed assets is _________. A. sources of
cash.
C. applications of cash.
D.
sources of funds.
ANSWER: B
38. A cash flow
statement is a statement which portrays the changes in the cash position
between _______.
A. two
accounting periods.
B. three
accounting periods.
C.
four accounting periods. D. five
accounting periods.
ANSWER: A
39. The term
cash in the context of cash flow analysis includes the cash balance and the
__________.
A. working
capital.
B. bank
balance.
C. capital.
D.
fixed assets
ANSWER: B
40. Cash flow
analysis is based on the ______.
A. capital.
B. fixed
assets.
C.
cash concept of funds. D. working
capital.
ANSWER: C
41. For the
calculation of trend percentage which year is considered 100 percent?
A. first
year
B. second
year
C.
third year D. last year
ANSWER: A
42. Management
accounting information is used by _______.
A. management
B. banks
C.
creditors D. government
ANSWER: A
43. Financial
statements are classified into _____ statements.
A. four
B. three
C.
two D. five
ANSWER: A
44. Which one of
the following is not management accounting tool?
A. Standard
costing
B. Marginal
costing
C. budgeting
D.
process costing
ANSWER: D
45. Which one of
the following is not mandatory according to the laws?
A. Financial
accounting
B. cost
accounting
C.
Management accounting D. none of the
above
ANSWER: C
46. If working
capital is Rs. 1,00,000 and current ratio is 2:1, then the amount of current
asset is _________.
A. Rs.1,00,000
B. Rs.
2,00,000
C.
Rs. 1,50,0000 D. Rs. 2,50,000
ANSWER: B
47. Types of
financial statements are ____.
A. three
B. four
C.
five D. two
ANSWER: B
48. Which one of
the following is not the determinant of the working capital?
A. size
of the firm
B. operating
cycle
C.
terms of credit D. competitors
ANSWER: D
49. Permanent
working capital ___
A. will
vary at all times
B. will
vary with volumes
C. fixed
at all times
D. fluctuates
according to the season
ANSWER: C
50. Which one of
the following is correct?
A. Cost
of goods sold=sales -gross profit
B. cost
of goods sold= op. stock- purchases + clo. stock
C. cost
of goods sold= op. stock+ purchases + clo. stock
D. cost
of goods sold= op. stock- purchases - clo. stock
ANSWER: A
51. Operating
costs include cost of goods sold and _____.
A. purchases
B. sales
C. gross
profit
D. other
operating expenses
ANSWER: D
52. In common
size income statement analysis, which is taken as 100 percent?
A. sales
B. cost
of goods sold
C.
purchases D. total assets
53. Profit on
sale of fixed assets is __________.
A. non
trading income.
B. operating
income.
C.
non trading gains. D. long term gain.
ANSWER: A
54. In fund flow
statement, issue of shares is ________.
A. sources
of funds.
B. applications
of funds.
C. sources
of cash.
D.
applications of cash.
ANSWER: A
55. In funds
flow statement, funds from operations is _________.
A. applications
of funds.
B. sources
of cash.
C.
applications of cash. D. sources of
funds.
ANSWER: D
56. In funds
flow statement, increase in working capital is ________.
A. applications
of funds.
B. sources
of cash.
C.
applications of cash. D. sources of
funds.
ANSWER: A
57. In funds
flow statement, decrease in working capital is _________.
A. applications
of funds.
B. sources
of cash.
C.
applications of cash. D. sources of
funds.
ANSWER: D
58. A cash flow
statement is a statement which portrays the changes in the cash position
between _______.
A. two
accounting periods.
B. three
accounting periods.
C.
four accounting periods. D. five
accounting periods.
ANSWER: A
59. While
preparing working capital requirement, tax paid in advance is considered as
_________.
A. current
asset
B. current
liability
C. capital.
D.
fixed assets.
ANSWER: A
60. Cash flow
analysis is based on the ______.
A. capital.
B. fixed
assets.
D. working capital.
ANSWER: C
61. In cash flow
statement, issue of shares is _______
A. cash
from financing activities
B. cash
from operating activities
C. cash
from investment activities D. none of the above
ANSWER: A
62. In cash flow
statement, sale of fixed assets is ________.
A. cash
from financing activities
B. cash
from operating activities
C. cash
from investment activities D. none of the above
ANSWER: C
63. In fund flow
statement, Increase in debtors is ___________.
A. cash
from financing activities
B. cash
from operating activities
C. cash
from investment activities D. none of the above
ANSWER: B
64. Decrease in
current liabilities is ___________.
A. cash
raised from operating activity
B. cash
raised from financing activity
C. cash
raised form investment activities D. none of the above
ANSWER: A
65. Increase in
current assets is _______.
A. cash
used i9n operating activities
B. cash
used in financing activity
C. cash
used in investment activities D. none of the above
ANSWER: A
66. The basic
function of management accounting is _________.
A. to
record busi. transaction
B. to
interpret the financial data
C. to
classify the accounts
D. to
assists management in performing their functions
ANSWER: D
67. Management
accounting involves
A. preparation
of financial statements
B. analysis
and interpretation of data
C. recording
of busi. transaction
D. none
ANSWER: B
68.
Management accounting provides services to management in performing
B. coordinating functions
C.
controlling functions
D.
HRD functions
ANSWER: A
69. Which one is
the main reason for the introduction of management accounting?
A. limitation
of financial accounting
B. limitations
of cost accounting
C. limitations
of HRD accounting D. Limitations of inflation accounting
ANSWER: A
70. When the
analysis is done by external people, it is known as
A. internal
analysis
B. external
analysis
C. vertical
analysis
D.
horizontal analysis
ANSWER: B
71. Which one of
the following is not a tool of financial analysis?
A. Trend
percentages
B. common
size statement analysis
C. comparative
financial analysis D. budgeting
ANSWER: D
72. The
statement which shows the net result of business is
A. income
statement
B. balance
sheet
C.
fund flow statement D. cash flow
statement
ANSWER: A
73. The
statement which shows the financial position of the business is
A. income
statement
B. balance
sheet
C.
fund flow statement D. cash flow
statement
ANSWER: B
74. The
statement which shows the movement of funds between two periods of the business
is
A. income
statemen
B. balance
sheet
C.
fund flow statement D. cash flow
statement
ANSWER: C
75. Comparative
statement analysis is
A. vertical
analysis
B. horizontal
analysis
C. either
vertical or horizontal analysis D. neither vertical nor horizontal analysis
ANSWER: B
76. The term
fixed assets include
A. cash
B. marketable
investment
C.
plant D. debtors
ANSWER: C
77. The term
fixed assets does not include
A. plant
B. machinery
C.
land D. stock
ANSWER: D
78. For the
purpose of analysis, the liabilities are grouped into _____ categories.
A. three
B. two
C.
four D. five
ANSWER: A
79. A low
capital gearing ratio indicates _______.
A. under
capitalization.
B. over
capitalization.
C.
borrowed capital. D. long term
funds.
ANSWER: B
80. Low turnover
of stock ratio indicates ________.
A. solvency
position.
B. monopoly
situation.
C. overinvestment
in inventory. D. liquidity position.
ANSWER: C
81. Sale of
goods on credit results in __________.
A. increase
in working capital
B. decrease
in working capital
C. increase
or decrease in working capital D. none of the above
ANSWER: D
82. The
difference between actual and planned results is referred to as a(n):
A. variance.
B. exception
C.
budget. D. life cycle.
ANSWER: A
83. P/V ratio
50%; variable cost of the produce Rs.25, then selling price is _______.
A. Rs.
50
B. Rs.
40
C. Rs. 30
ANSWER: A
84. Which of the
following is/are the tool/s of financial statement analysis?
A. Comparative
statement analysis
B. Common
size statement analysis
C.
Trend analysis D. All the above
ANSWER: D
85. Formula for
Calculating Cash from Operations
A. Net
Profit + non cash and non -operating items which are debited in profit and loss
account - Cash and Operating items which are credited in profit and loss
account
B. Cash
sales - ( Cash purchase + Cash operating expenses )
C. Cash
Sales - Credit Purchase - Non Cash and Non-operating expenses. D. Credit Sales
- Cash purchase - cash operating expenses
ANSWER: A
86. Adjusted
profit and loss a/c is prepared to know __________.
A. funds
from operation
B. inflows
of funds from financing activities
C. outflows
of funds from financing activities D. changes in working capital
ANSWER: A
87. In fund flow
statement, redemption of preference capital is
A. source
of funds
B. source
of cash
C.
application of funds D. application
of cash
ANSWER: D
88. In
working capital calculation, when cost of goods sold is Rs. 1,50 ,000 p.a and
finished goods are in stock for 15 days, the amounts to be invested in finished
goods is
A. 6250
B. 7500
C.
12500 D. 75000
ANSWER: A
89. Which one of
the following is not a method to find working capital requirement?
A. percent
of sales method
B. working
capital components method
C.
operating cycle method D. physical
method
ANSWER: D
90. Which one is
the long term solvency ratio?
A. current
ratio
B. net
profit ratio
C. debt
equity ratio
D.
debtors turnover ratio
ANSWER: C
91. Production
cost under marginal costing includes _________.
A. prime
cost only.
B. prime
cost and fixed overhead.
C. prime
cost and variable overhead.
D. prime
cost, variable overhead and fixed overhead.
ANSWER: C
92. Marginal
cost considers only the _________ for reporting to management.
A. variable
cost
B. fixed
cost
C. standard
cost
D. production
cost
ANSWER: A
93. One of the
primary differences between marginal costing and absorption costing regarding
the treatment of
__________.
A. prime
cost.
B. fixed
overheads.
C.
variable overheads. D. direct
materials.
ANSWER: C
94. Absorption
costing differs from marginal costing is the ________.
A. fact
that standard costs can be used with absorption costing but not with marginal
costing.
B. amount
of costs assigned to individual units of products.
C. kind
of activities for which each can be used. D. amount of fixed costs that will be
incurred.
ANSWER: B
95. Contribution
margin is also known as ________.
A. marginal
income.
B. gross
profit.
C.
net profit. D. net loss.
ANSWER: A
96. Period costs
are ___________.
A. overhead
costs.
B. prime
cost.
C.
variable cost. D. fixed costs.
ANSWER: D
97. Contribution
margin is equal to ________.
A. fixed
cost+Profits
B. profit
+ variable cost.
C.
sales - fixed cost- profit. D. sales
- profit.
ANSWER: A
98. P/V Ratio is
an indicator of ________.
A. the
rate at which goods are sold.
B. the
volume of sales.
C. the volume
of profit.
ANSWER: D
99. Margin of
Safety is the difference between _______.
A. planned
sales and planned profit.
B. actual
sales and break-even sales.
C. planned
sales and actual sales.
D.
planned sales and planned expenses.
ANSWER: B
100. An increase
in variable costs _______.
A. increases
p/v ratio.
B. increases
the profit.
C. reduces
contribution.
D. increase
margin of safety.
ANSWER: C
101. An increase
in selling price ________.
A. increases
the break-even point.
B. decreases
the break-even point.
C. does
not affect the break-even point.
D. optimize
the break even point.
ANSWER: B
102. A high
margin of safety indicates ______.
A. over
production.
B. over
capitalization.
C. the
soundness of the business.
D. under
capitalization.
ANSWER: C
103. Angle of
incidence is ________.
A. the
angle between the sales line and the total cost line.
B. the
angle between the sales line and the y-axis.
C. the
angle between the sale and the x-axis. D. the angle between the sale and total.
ANSWER: A
104. CVP analysis
is most important for the determination of _______.
A. relationship
between revenues and costs at various levels of operations.
B. sales
revenue necessary to equate fixed costs.
C. variable
revenues necessary to equal fixed costs. D. volume of operations necessary to
Break-even.
ANSWER: B
105. The
conventional Break-even analysis does not assume that _______.
A. selling
price per unit will remain fixed.
B. total
fixed costs remain the same.
C. variable
cost per unit will vary.
D.
productivity per worker will remain unchanged.
ANSWER: B
106. 1f`
fixed costs decrease while variable cost per unit remains constant, the new
B.E.P in relation to the old B.E.P will be _______.
B. higher.
C. unchanged.
D. indeterminate.
ANSWER: B
107. If
fixed costs decrease while the variable cost per unit remains constant, the new
contribution margin in relation to the old contribution margin will be ______.
A. lower.
B. unchanged.
C. higher.
D. indeterminate.
ANSWER: B
108. Selling
price per unit Rs. 10; Variable cost Rs. 8 per unit; Fixed cost Rs. 20,000;
Break-even production in units _______.
A. 10,000.
B. 16,300.
C.
2,000. D. 2,500.
ANSWER: A
109. Sales Rs.
25,000; Variable cost Rs. 8,000; Fixed cost Rs. 5,000; Break-even sales in
value ________.
A. Rs.
7,936.
B. Rs.
7,353.
C.
Rs. 8,333. D. Rs. 9,090.
ANSWER: B
110. Fixed
cost Rs. 80,000; Variable cost Rs. 2 per unit; Selling price_Rs. 10 per unit;
Turnover required for a profit target of Rs. 60,000 will be _______.
A. Rs.
1,75,000.
B. Rs.
1,17,400.
C.
Rs. .57,000. D. Rs. 1,86,667.
ANSWER: A
111. Sales Rs.
25,000; Variable cost Rs. 15,000; Fixed cost Rs .4,000; P/V Ratio is ______.
A. 40
percent
B. 80
percent
C.
15 percent D. 30 percent
ANSWER: A
112. Sales Rs.
50,000; Variable cost Rs. 30,000; Net profit Rs. 6,000; fixed cost is__________.
A. Rs.
I0,000.
B. Rs.l4,000.
C.
Rs. 12,000. D. Rs. 8,000.
ANSWER: B
113. Actual sales
Rs .4,00,000; Break-even sales Rs. 2,50,000; Margin of Safety in percentage
is_______.
A. 33.3
percent
B. 66.67
percent
D. 76.33 percent
ANSWER: C
114. P/V Ratio
50%; Variable cost of the produce Rs. 25; Selling price is________.
A. Rs.
50.
B. Rs.
40.
C.
Rs. 30. D. Rs. 55.
ANSWER: A
115. Fixed cost
Rs. 2,00,000; Sales Rs. 8,00,000; P/V Ratio 30%; the amount of' profit
is________.
A. Rs.
50,000.
B. Rs.
40,000.
C.
Rs. 35,000. D. Rs. 45,000.
ANSWER: B
116. P/V Ratio is
25% and Margin of Safety is Rs; 3,00,000, the amount of profit is_____.
A. Rs.
1,00,000.
B. Rs.
80,000.
C.
Rs. 75,000. D. Rs. 60,000.
ANSWER: C
117. Total
sales Rs. 20,00,000; Fixed expenses Rs. 4,00,000; P/V Ratio 40 percent
Break-even capacity in percentage is_______.
A. 40
B. 60
C.
50 D. 45
ANSWER: C
118. Break - even
point occurs at 40 percent of` total capacity, margin of safety will be _____
percent.
A. 40
B. 60
C.
80 D. 85
ANSWER: B
119. If
the P/V Ratio of a product is 30 percent and selling price is Rs. 25 per unit,
the marginal cost of the product would be ___________.
A. Rs.18.75.
B. Rs.16.
C.
Rs. 15. D. Rs.20.
ANSWER: A
120. Absorption
costing is also known as ______.
A. historical
costing.
B. real
costing.
C.
marginal costing. D. real costing.
ANSWER: A
121. Under
marginal costing, stock are valued at _________.
A. cost
less
B. cost
more.
C.
variable cost. D. market price.
ANSWER: C
122. Absorption
costing lays emphasis on _____.
A. production.
B. sales.
C.
marketing. D. advertising.
ANSWER: A
123. Marginal
costing lays emphasis on ___________.
A. production.
B. sales.
C.
marketing. D. advertising.
ANSWER: B
124. Selling
price - marginal cost =____________.
A. fixed
cost.
B. semi-variable
cost.
C. contribution.
D.
break-even point.
ANSWER: C
125. Total sales
- total variable cost ________.
A. fixed
cost.
B. semi-variable
cost.
C. contribution.
D.
break-even point.
ANSWER: C
126. Fixed cost +
net profit =__________.
A. BEP
B. semi-variable
cost.
C.
margin of safety. D. contribution.
ANSWER: D
127. A high P/V
ratio indicates_____.
A. high
profitability.
B. low
profitability.
C.
high loss. D. break even.
ANSWER: A
128. Fixed cost /
P/V ratio =___________.
A. Contribution
B. Margin
of safety.
C. Break even
point.
ANSWER: C
129. Profit / P/V
ratio =_____________.
A. Break
even point.
B. Margin
of safety.
C.
Contribution. D. Variable cost.
ANSWER: B
130. When,
sales:Rs. 80,000; Variable cost: Rs. 50,000 the P/V ratio is _____ percent.
A. 37.5
B. 40
C. 25
D.
27.5
ANSWER: A
131. The budget
is a________.
A. post-mortem
analysis.
B. substitute
of management.
C.
an aid to management. D.
calculation.
ANSWER: C
132. One of the
most important tools of cost planning is_________.
A. budget.
B. direct
cost.
C.
unit cost. D. cost sheet.
ANSWER: A
133. Sales budget
is a______.
A. functional
budget.
B. expenditure
budget.
C. master
budget.
D. flexible
budget.
ANSWER: A
134. The
budget which usually takes the form of budgeted profit and loss account and
balance sheet is known as _________.
A. flexible
budget.
B. master
budget.
C. cash
budget.
D. purchase
budget.
ANSWER: B
135. Which of the
following is usually a long-term budget?
A. Fixed
budget.
B. Cash
budget.
C. Sales
budget.
D.
Capital expenditure budget.
ANSWER: D
136.
The fixed and variable cost classification has a special significance in the
preparation of ______.
B. cash budget.
C.
master budget.
D.
flexible budget.
ANSWER: D
137. The budget,
which is prepared first of all is_________.
A. master
budget.
B. cash
budget.
C.
budget for key factor. D. none of
these.
ANSWER: C
138. Preparing
budget figures for different levels of activity within a range under flexible
budgeting is_____________.
A. formula
method.
B. multi-activity
method.
C. budget
cost allowance method. D. none of these.
ANSWER: B
139. What type of
budget is designed to take into account forecast change in costs, prices, etc?
A. master
budget.
B. rolling
budget.
C.
flexible budget. D. functional
budget.
ANSWER: B
140. Operation
budgets normally cover a period of ________.
A. one
to ten years.
B. one
to two years.
C.
one to five years. D. one year or
less.
ANSWER: D
141. The entire
process of preparing the budgets is known as _______.
A. planning.
B. organizing.
C.
budgeting. D. controlling.
ANSWER: C
142. Which one is
to be known for preparation of production budget?
A. Estimated
sales
B. estimated
opening stock of raw materials
C. estimated
closing stock of raw materials D. cost of raw materials
ANSWER: A
143. Budgetary
control ends with _______.
A. planning.
B. organizing.
C.
budgeting. D. control.
144. Budget
designed to remain constant irrespective of the level of activity attained is
called ________.
A. fixed
budget.
B. flexible
budget
C. sales
budget.
D.
production budget.
ANSWER: A
145. Long-term
budgets are prepared for ________.
A. 1
year.
B. 1-3
years
C.
1-5 years. D. 5-10 years.
ANSWER: D
146. The
budget prepared for various levels of activity by classification of expenditure
under fixed, variable and semi fixed categories is __________.
A. fixed
budget.
B. flexible
budget.
C. sales
budget.
D.
production budget.
ANSWER: B
147. Budget
which shows quantity of finished products to be sold and price at which they
are to be sold is____________.
A. fixed
budget.
B. flexible
budget.
C. sales
budget.
D.
production budget.
ANSWER: C
148. The
budget which shows the budgeted quantity of output to be produced during a
specific period is_____________.
A. fixed
budget
B. flexible
budget.
C. sales
budget.
D.
production budget.
ANSWER: D
149. Material
consumption budget is prepared on the basis of ________.
A. sales
budget.
B. production
budget.
C.
fixed budget. D. flexible budget.
ANSWER: B
150. Budget
of indirect costs in the form of indirect wages, indirect material and indirect
expenses in the factory is ______.
A. production
overhead budget.
B. administration
overhead budget.
C. selling
and distribution overhead budget. D. master budget.
ANSWER: A
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