📘 FULL MOCK TEST – FMT- 3 (100 MCQs – Advanced & Case-Based)

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1. If fixed cost increases while contribution remains constant, BEP will:
   A. Decrease
   B. Increase
   C. Remain same
   D. Zero
   Answer: B
2. Major Head classification is primarily based on:
   A. Nature
   B. Function
   C. Object
   D. Scheme
   Answer: B
3. Delegation of power without written authority is:
   A. Valid
   B. Irregular
   C. Acceptable
   D. None
   Answer: B
4. A tender with unrealistic low rates is:
   A. Always accepted
   B. Always rejected
   C. Subject to scrutiny
   D. Ignored
   Answer: C
5. Internal check primarily prevents:
   A. Past errors
   B. Future errors
   C. Audit
   D. Budget
   Answer: B
6. Contribution per unit decreases when:
   A. SP increases
   B. VC increases
   C. FC increases
   D. Sales increase
   Answer: B
7. Budgetary control focuses on:
   A. Past data
   B. Future planning
   C. Both
   D. None
   Answer: C
8. Capital expenditure is characterized by:
   A. Recurring nature
   B. Asset creation
   C. Expense only
   D. None
   Answer: B
9. Object Head classification relates to:
   A. Function
   B. Nature of expense
   C. Scheme
   D. None
   Answer: B
10. Appropriation Accounts highlight:
    A. Profit
    B. Budget compliance
    C. Revenue
    D. None
    Answer: B

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26. Limited tender is used when:
    A. High competition needed
    B. Limited suppliers available
    C. Public bidding
    D. None
    Answer: B
27. Performance guarantee is forfeited when:
    A. Work completed
    B. Contractor fails
    C. Audit done
    D. None
    Answer: B
28. Accrued income affects:
    A. Asset
    B. Liability
    C. Expense
    D. None
    Answer: A
29. Outstanding expenses affect:
    A. Asset
    B. Liability
    C. Income
    D. None
    Answer: B
30. Prepaid expenses result in:
    A. Asset
    B. Liability
    C. Income
    D. None
    Answer: A
31. Re-appropriation is allowed within:
    A. Same grant
    B. Different grant
    C. No grant
    D. None
    Answer: A
32. Excess expenditure requires:
    A. Ignoring
    B. Regularization
    C. Audit only
    D. None
    Answer: B
33. Contract variation without approval is:
    A. Valid
    B. Irregular
    C. Profit
    D. None
    Answer: B
34. Internal check is strengthened by:
    A. Segregation of duties
    B. Combining duties
    C. Ignoring control
    D. None
    Answer: A
35. Tender committee ensures:
    A. Bias
    B. Fair evaluation
    C. Delay
    D. None
    Answer: B

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51. SP ₹150, VC ₹90 → contribution =
    A. 60
    B. 90
    C. 150
    D. None
    Answer: A
52. FC ₹60,000, contribution ₹30 → BE units =
    A. 2,000
    B. 3,000
    C. 1,000
    D. None
    Answer: A
53. Budget ₹20L, actual ₹25L →
    A. Saving
    B. Excess ₹5L
    C. Profit
    D. None
    Answer: B
54. Contract ₹30L, completed ₹24L →
    A. ₹30L
    B. ₹24L
    C. ₹6L
    D. None
    Answer: B
55. Cash ₹80,000, found ₹70,000 → shortage =
    A. 10,000
    B. 70,000
    C. 80,000
    D. None
    Answer: A
56. Bids ₹15L, ₹12L, ₹18L, ₹10L → L1 =
    A. ₹15L
    B. ₹12L
    C. ₹10L
    D. None
    Answer: C
57. Limit ₹25L, sanction ₹30L → excess =
    A. ₹5L
    B. ₹25L
    C. ₹30L
    D. None
    Answer: A
58. Margin of safety decreases when:
    A. Sales increase
    B. BE increases
    C. VC decreases
    D. None
    Answer: B
59. If VC = SP → contribution =
    A. Positive
    B. Zero
    C. Negative
    D. None
    Answer: B
60. If contribution < FC →
    A. Profit
    B. Loss
    C. BE
    D. None
    Answer: B

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76. Audit primarily ensures:
    A. Profit
    B. Compliance
    C. Loss
    D. None
    Answer: B
77. Financial propriety emphasizes:
    A. Waste
    B. Prudence
    C. Excess
    D. None
    Answer: B
78. Suspense account is cleared by:
    A. Final classification
    B. Audit
    C. Payment
    D. None
    Answer: A
79. Deposit account represents:
    A. Asset
    B. Liability
    C. Income
    D. None
    Answer: B
80. Contract must satisfy:
    A. Legal enforceability
    B. Profit
    C. Audit
    D. None
    Answer: A
81. Delegation reduces:
    A. Delay
    B. Efficiency
    C. Control
    D. None
    Answer: A
82. Internal check is effective when:
    A. Duties segregated
    B. Duties combined
    C. No control
    D. None
    Answer: A
83. Tender system prevents:
    A. Competition
    B. Bias
    C. Profit
    D. None
    Answer: B
84. Budget control ensures:
    A. Overspending
    B. Discipline
    C. Loss
    D. None
    Answer: B
85. Appropriation Accounts help in:
    A. Profit calculation
    B. Control
    C. Loss
    D. None
    Answer: B
86. Railway finance system ensures:
    A. Transparency
    B. Accountability
    C. Control
    D. All
    Answer: D
87. Marginal costing ignores:
    A. Variable cost
    B. Fixed cost
    C. Total cost
    D. None
    Answer: B
88. Contribution is key for:
    A. Profit planning
    B. BEP
    C. Decision making
    D. All
    Answer: D
89. Financial rules ensure:
    A. Discipline
    B. Control
    C. Efficiency
    D. All
    Answer: D
90. Railway accounts depend on:
    A. Budget
    B. Audit
    C. Control
    D. All
    Answer: D
91. Misclassification leads to:
    A. Audit objection
    B. Profit
    C. Loss
    D. None
    Answer: A
92. Internal check avoids:
    A. Fraud
    B. Error
    C. Both
    D. None
    Answer: C
93. Contract management ensures:
    A. Compliance
    B. Control
    C. Efficiency
    D. All
    Answer: D
94. Tender evaluation ensures:
    A. Value for money
    B. Quality
    C. Price
    D. All
    Answer: D
95. Budget is essential for:
    A. Planning
    B. Control
    C. Decision
    D. All
    Answer: D
96. Railway financial system ensures:
    A. Transparency
    B. Accountability
    C. Control
    D. All
    Answer: D
97. BEP depends on:
    A. SP
    B. VC
    C. FC
    D. All
    Answer: D
98. Delegation ensures:
    A. Efficiency
    B. Accountability
    C. Control
    D. All
    Answer: D
99. Internal check is:
    A. Continuous
    B. One-time
    C. Optional
    D. None
    Answer: A
100. Financial discipline ensures:
     A. Control
     B. Efficiency
     C. Transparency
     D. All
     Answer: D