Free Accounting MCQs Mock Test Online with Answers

Q1 : A situation when groups and individuals work together for achieving a particular goal can be classified as _________?

A: motivation B: goal congruence C: effort D: autonomy

Q2 : The cost allocation base used by an operating manager is classified as ____________?

A: machine hours B: flexible hours C: variable hours D: fixed hours

Q3 : The last step in developing operating budget is ____________?

A: implementing income B: implementing the decision C: efficient implementation D: effective implementation

Q4 : An organizational practice, according to which the decision making freedom is available to lower level managers is known as _____________?

A: decentralization B: centralization C: autonomy of effort D: congruency

Q5 : The return on investment is also known as _____________?

A: accrual accounting rate of return B: accounting rate of return C: nominal rate of return D: both a and b

Q6 : An average inventory in units is multiplied with annual relevant carrying cost of each unit to calculate ____________?

A: annual irrelevant ordering costs B: annual relevant carrying costs C: annual relevant ordering costs D: annual irrelevant carrying costs

Q7 : The costs associated with storage of finished goods such as spoilage, obsolescence and insurance of goods are classified as ___________?

A: carrying costs B: purchasing costs C: stock-out costs D: ordering costs

Q8 : The sum of working capital and current liabilities is equal to _____________?

A: imputed assets B: residual assets C: current assets D: nominal assets

Q9 : If an actual manufacturing overhead costs is $485000 and actual total quantity of cost allocation base is 4500 labor hours, then the overhead rate would be _____________?

A: 109.87 B: $107.78 C: $106.56 D: $104.34

Q10 : If an average inventory is 2000 units, annual relevant carrying cost of each unit is $5, then the annual relevant carrying cost will be __________?

A: $5,000 B: $4,500 C: $5,500 D: $6,000

Q11 : The first step in developing an operating budget is to ___________?

A: identify the product B: identify the problem C: identify the quartiles D: identify the percentiles

Q12 : The cost of abnormal spoilage is not treated as _____________?

A: conversion costs B: sunk costs C: inventoriable costs D: non inventoriable costs

Q13 : The costing method, which calculates per equivalent unit cost of all the production related work done, till calculated date is termed as __________?

A: weighted average method B: net present value method C: Gross production method D: net present value method

Q14 : The service sector companies include _____________?

A: cellular phone producers B: mutual fund companies C: radio stations D: wholesalers

Q15 : The measures that analyze the performance of a company, such as residual income, economic value added and customer satisfaction are collectively called ____________?

A: interactive control systems B: belief systems C: boundary systems D: diagnostic control systems

Q16 : In accounting system, a document which consists of all assigned cost for specific job is classified as __________?

A: job cost record B: job cost sheet C: source document D: both a and b

Q17 : The step by step business functions, in which product or services must have customer usefulness, is classified as ___________?

A: value chain B: useful chain C: product chain D: services chain

Q18 : If fixed overhead allocated for actual output units is $25000 and the production volume variance is $9000, then budgeted fixed overhead will be _____________?

A: $34,000 B: $24,000 C: $16,000 D: $18,000

Q19 : The amount invested by the proprietor to start the business is called:

A: Capital B: Business C: Drawings D: All of them

Q20 : The system in an organization that articulates the purpose, mission and core values of a company is classified as ____________?

A: interactive control system B: belief system C: boundary system D: diagnostic control system

Q21 : The merchandising sector companies include _____________?

A: food processing companies B: automotive companies C: distribution companies D: advertising agencies

Q22 : An Art of reading, classifying & Summarizing of accounts in a systematic way is called__________?

A: Accounting B: Accountancy C: Auditing D: Book Keeping

Q23 : If the economic order quantity for one year is 15000 packages and demand in units for one year are 1500 units, then number of deliveries in a year will be ____________?

A: 16 B: 12 C: 10 D: 14

Q24 : If the relevant incremental costs are $5000 and the relevant opportunity cost of invested capital is $2500, then the relevant inventory carrying costs would be ____________?

A: $7,500 B: $7,000 C: $6,500 D: $6,000

Q25 : In cost benefit approach, the type of costs include ____________?

A: cost of ongoing operations B: investments in physical assets C: training of managers D: all of above

Q26 : If the budgeted annual indirect cost is $85000 and budgeted annual quantity of cost allocation base is $7500, then budgeted indirect cost rate would be __________?

A: 112.34 per piece B: 113.34 per piece C: 111.34 per piece D: 110.34 per piece

Q27 : An operating income is divided by the revenues to calculate ______________?

A: residual income B: return on after-tax operating income C: return on sales D: return on investment

Q28 : In process costing method, when the work done in current accounting period, and beginning inventory before current accounting period, is classified as _________?

A: partial inventory costing method B: current period inventory method C: Last-in, first-out method D: First-in, first-out method

Q29 : The decisions regarding usage of material, kind and changes in plant processing are a part of ____________?

A: past management B: future management C: help management D: cost management

Q30 : The quantitative expression of decided plan and coordination, for plan implementation is known as __________?

A: cost format B: decided plan C: coordination plan D: budget

Q31 : An under allocated indirect cost is also called ____________?

A: under applied indirect cost B: under absorbed indirect cost C: absorbed indirect cost D: both a and b

Q32 : The purchase order lead time is multiplied to the number of units sold per unit of time, to calculate ____________?

A: carrying costs B: relevant total costs C: economic order quantity D: reorder point

Q33 : An availability of after sale support, to the existing or potential customers in value chain analysis is known as ___________?

A: customer services B: utility services C: resource services D: acquiring services

Q34 : Total cost related to work in process inventory is divided by total units of work done is used to calculate _____________?

A: Gross weighted margin B: weighted average revenue C: weighted average cost D: weighted average conversion cost

Q35 : If the budgeted indirect cost is $225 and the budgeted cost allocation base is $750 per hour, then the annual indirect cost (budgeted) would be __________?

A: $168,750 B: $148,570 C: $186,750 D: $125,680

Q36 : The process of assigning the direct or indirect cost to any cost object is known as ____________?

A: cost assignment B: cost expectation C: event assignment D: probability assignment

Q37 : In the standard costing, the standard quantity allocation is multiplied to standard overhead rates for allocating __________?

A: flexible costs B: variable costs C: overhead costs D: fixed costs

Q38 : The part of the master budget, which covers the capital expenditures, budgeted statement of cash flows and balance sheets are classified as ___________?

A: financial budget B: capital budget C: cash flows budget D: balanced budget

Q39 : The first step in process costing system is to ___________?

A: summarize flow of output B: compute output in units C: summarize total costs D: compute cost for each equivalent unit

Q40 : The difference between actual variable overhead cost and flexible budget variable overhead amount is termed as __________?

A: overhead flexible budget variance B: overhead fixed budget variance C: overhead flexible cost variance D: overhead flexible price variance

Q41 : Goods Return by the customer are termed as :

A: Purchase return B: Customer return C: Sales return D: Inventory return

Q42 : The method of costing that supports creation of value for customer by accounting whole value stream, rather than individual departments or products is classified as __________?

A: economic accounting B: back-flush accounting C: lean accounting D: lead accounting

Q43 : The costing system, which omits some of the journal entries in accounting system is known as ____________?

A: in-time costing B: trigger costing C: back flush costing D: lead time costing

Q44 : The per unit opportunity cost to the selling subunit of company, is added into per unit incremental cost is incurred at point of transfer to calculate ____________?

A: minimum operating cost B: maximum operating costs C: maximum transfer price D: minimum transfer price

Q45 : The cost computed by dividing total manufacturing cost and total manufactured units is known as ____________?

A: per unit cost B: total cost C: total indirect cost D: total effective cost

Q46 : An amount of spoilage that is not natural in a specific production process is categorized as ____________?

A: normal scrap B: normal spoilage C: abnormal spoilage D: weighted spoilage

Q47 : The type of plan of a company, which quantities the expectations of cash flows, income and financial position is known as ___________?

A: budget B: batching C: complexity D: process

Q48 : In financial accounting, the investors, banks, suppliers and government agencies are classified as _____________?

A: external parties B: internal parties C: environmental parties D: transactional parties

Q49 : Double entry means______________?

A: Entry in two sets of books B: Entry at two ends C: Entry at two dates D: Entry for two aspects of the transaction

Q50 : The better administration of budget in budgeting plans require:_____________?

A: intelligent interpretations B: participation C: persuasion D: all of above

Q51 : In master budgeting, the cost drivers for manufacturing overhead costs are ___________?

A: direct manufacturing labor-hours B: setup labor-hours C: budgeted labor-hours D: both a and b

Q52 : The sum of beginning work in process inventory units and started units, is subtracted from the sum of ending work in process inventory units and transferred out units of goods, to calculate ____________?

A: Gross weighted spoilage B: inventoriable spoilage C: partial spoilage D: total spoilage

Q53 : The formula to calculate return on investment, according to profitability analysis in DuPont method is ____________?

A: return on sales * investment turnover B: return on sales + investment turnover C: return on sales – investment turnover D: investment turnover + residual income

Q54 : The decision model to calculate optimal quantity of inventory to be ordered is called ____________?

A: efficient order quantity B: economic order quantity C: rational order quantity D: ptimized order quantity

Q55 : The number of purchase orders for each year is multiplied to relevant ordering cost for each purchase order to calculate _____________?

A: annual irrelevant ordering costs B: annual relevant carrying costs C: annual relevant ordering costs D: annual irrelevant carrying costs

Q56 : The focus on budget cost of all the activities necessary to sell and produce market offerings is known as _________?

A: cost based budgeting B: activity based budgeting C: production based budgeting D: raw material budgeting

Q57 : If the demand of one year is 25000 units, relevant ordering cost for each purchase order is $210, carrying cost of one unit of stock is $25 then the economic order quantity will be ___________?

A: 678 packages B: 648 packages C: 658 packages D: 668 packages

Q58 : The strategy that interlinks technology and people, to enhance relationships in all the business functions is classified as ____________?

A: technology management B: people management C: customer relationship management D: resource management

Q59 : The continuous budget is also known as ________?

A: rolling budget B: pin budget C: specific budget D: past budget

Q60 : Current assets are subtracted from current liabilities to calculate: ____________?

A: opportunity cost of capital B: working capital C: total long term assets D: weighted average cost of capital

Q61 : The fifth step in process costing system is to ___________?

A: allocate separable costs B: allocate joint costs C: compute gross margin D: assign total cost to completed units

Q62 : An implementation of planning decisions and evaluating performance is classified as ___________?

A: control B: evaluation C: deciding D: performing

Q63 : The cash receipts are added in to beginning cash balance to calculate __________?

A: total goods manufactured B: total cash available C: total revenue D: total goods sold

Q64 : A systematic way to maintain the books of accounts is called_________?

A: Accountancy B: Economics C: Book Keeping D: Auditing

Q65 : If the operating income is $5650000 and the revenue is $68558000, then the return on sales will be ___________?

A: 8.24% B: 7.24% C: 9.24% D: 10.24%

Q66 : The products or services that are transferred between different subunits of a company are classified as _____________?

A: mobile products B: dysfunctional products C: intermediate product D: territorial product

Q67 : The costing system, which classify cost into cost categories in a way when an expense is incurred in the process is called ____________?

A: conversion expense costing system B: inventory costing system C: process costing system D: job costing system

Q68 : In a normal accounting period, the allocated amount of indirect cost is $2000 and the actual amount is $2200, it classified as __________?

A: over allocated budget B: under allocated budget C: under allocated indirect cost D: over allocated direct cost

Q69 : The non-financial and financial aspects of the plan by the company management, is classified as ___________?

A: complexity B: process C: budget D: batching

Q70 : The stage in manufacturing cycle at which journal entries are made in system of accountancy is known as _________?

A: chaining point B: recording point C: lead point D: trigger point

Q71 : The concession received on the price of defective goods is called:

A: Discount B: Cash discount C: Allowance D: Trading discount

Q72 : The formal information systems, used in organizations to focus company’s learning and attention, given to the most important strategic issues are known as ____________? 0

A: interactive control system B: belief systems C: boundary systems D: diagnostic control systems

Q73 : If the budgeted annual indirect cost is $60000, budgeted annual quantity of cost allocation base is $3600, then budgeted indirect cost rate will be __________?

A: 15.67 per piece B: 16.67 per piece C: 14.67 per piece D: 13.67 per piece

Q74 : If the budget sales units are 8000, the ending inventory is 2000 units and the beginning inventory is 3000, then the budget production would be ___________?

A: 11000 units B: 13000 units C: 10000 units D: 7000 units

Q75 : The experimentation and generation of ideas related to new product or services are included in ____________?

A: addressing management B: research and development C: value development D: service provider

Q76 : An energy, machine maintenance, indirect materials and engineering support are considered as ____________? 0

A: variable overhead cost B: fixed overhead cost C: fixed batch cost D: variable batch cost

Q77 : The type of budget, which is always available for the specified period of future is called __________?

A: period budget B: batch budget C: discontinued budget D: continuous budget

Q78 : The cost of previous department is a part of ____________?

A: transferred-in costs B: transferred-out costs C: FIFO costs D: LIFO costs

Q79 : Companies that are part of an industry of ‘service providers’ are ____________?

A: manufacturing sector companies B: merchandising sector companies C: service sector companies D: raw material companies

Q80 : The partial or completed units of manufactured goods, that do not meet customer specifications and get sold at reduced price or simply discarded, are called ____________?

A: spoilage B: rework C: scrap D: equivalence

Q81 : An investment is multiplied to required rate of return, to calculate: _____________?

A: congruent cost of investment B: transfer cost of investment C: operating cost of investment D: imputed cost of investment

Q82 : The person to whom goods are sold on credit is called___________?

A: Buyer B: Seller C: Debtor D: Creditor

Q83 : The master budget includes all the projections of company’s budget and focuses on __________?

A: serial correlation B: marketing plan C: financial plan D: both B and C

Q84 : The spread of over allocated overhead and under allocated overhead among work in process, finished goods and goods sold cost is classified as __________?

A: proration approach B: appreciation approach C: depreciation approach D: adjusted approach

Q85 : An engineering of products or detailed planning of products or services is called ___________?

A: product design B: research steps C: useful chain D: value added

Q86 : The costing technique, in which the actual direct rates are multiplied to quantity of direct cost inputs is classified as __________?

A: priced costing B: actual costing C: direct costing D: indirect costing

Q87 : The depreciation on plant equipment, salaries of plant managers and plant leasing costs are considered a _____________?

A: fixed batch cost B: variable batch cost C: variable overhead cost D: fixed overhead cost

Q88 : The forth step in process costing system is to __________?

A: summarize total costs B: compute cost for each equivalent unit C: summarize flow of output D: compute output in units

Q89 : The plan of action; how an organization meets its opportunities and capabilities is classified as ___________?

A: action plan B: strategy C: step wise plan D: complex plan

Q90 : An exertion for achieving a set goal is known as ____________?

A: motivation B: goal congruence C: effort D: autonomy

Q91 : If an actual indirect cost incurred is $25000 and the indirect cost allocated is $23000, then the over allocated indirect cost would be ________?

A: $48,000 B: −$2000 C: $2,000 D: −$48000

Q92 : An accounting which records and measures the business transactions and is followed by generally accepted accounting principles is classified as ____________?

A: external accounting B: internal accounting C: financial accounting D: financial accounting

Q93 : An availability of financial information, to oversee operations and system of accounting is known as ____________?

A: manager ship B: controllership C: proprietorship D: functional line

Q94 : The mathematical relationships exist between operating and financing activities that affect master budget are called _____________?

A: math plan model B: financial planning models C: operating plan models D: master plan models

Q95 : If the demand in units are 18000, relevant ordering cost for each year is $150 and an order quantity is 1500, then annual relevant ordering cost would be __________?

A: $200 B: $190 C: $160 D: $180

Q96 : The dysfunctional decision making is also known as ___________?

A: dysfunctional decision making B: congruent decision making C: incongruent decision making D: both a and c

Q97 : If the budgeted total direct labor hours are 3800 and budgeted direct labor cost is $480000, then the budgeted direct labor cost rate will be ___________?

A: $126.32 per labor hour B: $128.32 per labor hour C: $130 per labor hour D: $132 per labor hour

Q98 : The companies in the industry that purchase the finished goods, and further sell the products into the market are classified as ______________?

A: service sector companies B: raw material companies C: manufacturing sector companies D: merchandising sector companies

Q99 : The systematic flow of services, goods or information from the buying material for product delivery to the customers is known as __________?

A: supply chain B: value chain C: material flow chain D: manufacturing flow chain

Q100 : The total indirect cost in the pool by an actual quantity of cost allocation base, is used to calculate ____________?

A: actual manufacturing overhead rate B: manufacturing overhead costs C: overhead rate D: direct rate

Free Accounting MCQs Mock Test Online with Answers

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