Free Accounting MCQs Mock Test Online with Answers

Q1 : 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

Q2 : The cost management technique which specially addresses strategic issues is classified as ____________?

A: address management B: issue management C: strategic cost management D: managerial cost

Q3 : The means of collecting and using information, to coordinate decision and planning through an organization are termed as _____________?

A: customer control system B: business control system C: financial control system D: management control systems

Q4 : If the indirect manufacturing labor is $20000, power cost is $5000, maintenance and supplies are of $10000 then the manufacturing budget will be ____________?

A: $5,000 B: $35,000 C: $15,000 D: $45,000

Q5 : 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

Q6 : If the beginning work in process equivalent units are 2500 units, work done in current period equivalent units are 3800 units and ending work in process equivalent units are 5000, then complete equivalent units in current period are _____________?

A: 1500 units B: 1300 units C: 1500 units D: 1800 units

Q7 : A push through system, according to which goods are manufactured for finished inventory solely, on the basis of forecasted demand can be classified as ___________?

A: in-time production B: materials requirement planning C: on-time production D: pull strategy of production

Q8 : The stage in production process, where the manufactured goods are checked; whether the units are acceptable or not is classified as __________?

A: rework point B: inspection point C: spoilage point D: scrap point

Q9 : A document which consists information about labor time usage, for specific job in a specific department, is known as __________?

A: selling time record B: labor time record C: buying time record D: direct time record

Q10 : 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

Q11 : An average unit cost, applicable to each similar produced unit is classified as __________?

A: per unit cost B: per post cost C: per price cost D: application cost

Q12 : The budgeted total direct labor cost is divided with budgeted total direct labor, to calculate ___________?

A: budgeted indirect labor cost rate B: expected direct labor cost rate C: budgeted direct labor cost rate D: expected indirect labor cost rate

Q13 : The costing, which explains how and when scrap affects the operating income of company is classified as ___________?

A: inventory costing B: conversion costing C: normal scrap costing D: abnormal scrap costing

Q14 : 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

Q15 : In process and job costing system, the normal spoilage cost is considered as ___________? 0

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

Q16 : The type of accounting which reports to external parties of the organization is known as ____________?

A: cost accounting B: decision accounting C: financial accounting D: management accounting

Q17 : 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

Q18 : 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

Q19 : 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

Q20 : The budget sales, plus target ending finished goods inventory, minus beginning finished goods inventory is equal to ___________?

A: budget production B: planned production C: setup production D: stand by production

Q21 : A unit cost calculated in costing system, by assigning total costs incurred to many similar units is categorized as _________?

A: accounting period costing system B: process costing system C: job costing system D: none of above

Q22 : 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

Q23 : The costs of goods acquired from suppliers are classified as ___________?

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

Q24 : 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

Q25 : An Art of reading, classifying & Summarizing of accounts in a systematic way is called__________?

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

Q26 : If the budgeted cost in indirect cost pool is $139600 and total quantity of cost allocation base is $155600, then the budgeted indirect cost rate would be __________? 0

A: 69.72% B: 79.72% C: 99.75% D: 89.72%

Q27 : 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

Q28 : 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

Q29 : 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

Q30 : 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

Q31 : The companies that buy the raw materials and convert them into the finished goods for customers are a part of ____________?

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

Q32 : The variable overhead flexible budget variance is added to flexible budget amount to calculate _____________?

A: actual cost incurred B: fixed cost incurred C: variable cost incurred D: manufacturing cost incurred

Q33 : An accounting approach, in which the expected benefits exceed the expected cost is classified as ___________?

A: benefit approach B: cost approach C: cost-benefit approach D: accounting approach

Q34 : The price charged by one subunit to supply products or services to another unit is called _____________?

A: subunit autonomy cost B: transfer price C: performance prices D: effort cost

Q35 : 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

Q36 : The model which refers possibility for management to conduct sensitivity analysis can be categorized under __________?

A: investment planning models B: financial planning models C: cost planning models D: revenues forecast models

Q37 : 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

Q38 : In support of business transaction, any written evidence is called ___________?

A: Discount B: Voucher C: Allowance D: Price

Q39 : 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

Q40 : 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

Q41 : If the budgeted direct labor hours are 3550 and direct labor cost rate is $500 per labor hour, then total direct labor cost would be __________?

A: $1,775,000 B: $1,675,000 C: $1,875,000 D: $1,975,000

Q42 : 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

Q43 : The reorder point is divided by number of sold units for per unit of time to calculate ___________?

A: relevant carrying cost B: relevant ordering cost C: purchase order lease time D: number of purchase orders

Q44 : The units of normal spoilage are divided to total completed units, rather than total actual produced units to calculate ____________?

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

Q45 : In cost accounting, the types of inventory do not include ______________?

A: direct materials inventory B: work in process inventory C: finished goods inventory D: indirect material inventory

Q46 : 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

Q47 : 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

Q48 : 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

Q49 : The types of spoilage include ___________?

A: normal spoilage B: abnormal spoilage C: weighted spoilage D: both a and b

Q50 : 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

Q51 : 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

Q52 : If an actual indirect cost incur is $35000 and the indirect cost allocated is $43000, then the under allocated indirect cost will be __________?

A: $78,000 B: −$78000 C: −$8000 D: $8,000

Q53 : In normal costing, the manufacturing overhead allocated is also called _________?

A: manufacturing overhead applied B: labor overhead applied C: cost overhead applied D: budget overhead applied

Q54 : The rupee amount for required return of investment is subtracted from income to calculate _____________?

A: net income B: after tax income C: residual income D: operating income

Q55 : If the budgeted total cost in fixed overhead is $385000 and the budgeted total quantity is $6730, then budgeted fixed overhead cost per unit will be __________?

A: $57.21 per unit B: $67.21 per unit C: $77.21 per unit D: $87.21 per unit

Q56 : The difference of current assets and the working capital is equal to __________?

A: current liabilities B: long-term liabilities C: residual assets value D: net residual income

Q57 : An officer responsible for financial operations of organization is considered as ___________?

A: chief financial officer B: chief manager C: chief line function D: chief staff function

Q58 : The normal spoilage is subtracted from total spoilage to calculate _____________?

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

Q59 : If the budgeted direct labor hours are 4550 and direct labor cost rate is $600 per labor hour then, total direct labor cost would be _____________?

A: $4,730,000 B: $3,730,000 C: $2,730,000 D: $1,730,000

Q60 : The production units that do not meet customer specification, but can be sold to other customers as finished goods are classified as ____________?

A: reduced work B: spoilage C: rework D: scrap

Q61 : The higher and accurate budgeted profit forecast of managers lead to __________?

A: high incentive bonus B: revenue bonus C: low incentive bonus D: influence bonus

Q62 : If the current assets are $250000 and the current liabilities are $135500, then the working capital would be ___________?

A: $3,855,500 B: $314,500 C: $214,500 D: $114,500

Q63 : The maximum freedom for managers and minimum constraints are the main features of ___________?

A: total autonomy B: total centralization C: total decentralization D: total congruency

Q64 : If the budgeted annual manufacturing indirect cost is $2250000 and the cost allocation base is 2800 labor hour, then budgeted manufacturing overhead rate will be ___________?

A: $803.571 per labor hour B: $805 per labor hour C: $905 per labor hour D: $802 per labor hour

Q65 : If the total manufacturing cost is $60000 and the total units manufactured is 3000 units, then the per unit cost will be ____________?

A: $40 B: $20 C: $60 D: $80

Q66 : Marketing, production and management of distribution comes under the category of ___________?

A: staff management B: line management C: marketing management D: production management

Q67 : The balancing of all aspects of products or services and all the departments in the company are classified as ____________?

A: annual profit plan B: budgeting C: coordination D: complex plan

Q68 : 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

Q69 : If an actual variable quantity is 70, the actual and budgeted overhead cost of allocation is $8650 and $3500 respectively, then the variable overhead spending variance will be __________?

A: $660,500 B: $560,500 C: $460,500 D: $360,500

Q70 : 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

Q71 : An example of shrinkage costs is _____________?

A: incoming freight B: storage costs C: insurance D: clerical errors

Q72 : The procedure of assigning the direct cost to any cost abject is classified as ____________? 0

A: sales allocation B: cost tracing C: cost allocation D: sales tracing

Q73 : A desire to achieve a particular goal with pursuit of that goal is called _____________?

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

Q74 : 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

Q75 : 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

Q76 : The method of pricing, when two separate pricing methods are used to price, transfer of products from one subunit to another, is called _____________?

A: dual pricing B: functional pricing C: congruent pricing D: optimal pricing

Q77 : 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

Q78 : The decision making step, which consists of organization goals, predicting alternatives and communicating goals is called _____________?

A: organization B: alternation C: planning D: valuing

Q79 : 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

Q80 : In value chain analysis, the coordination, acquiring and assembling of resources to produce a product is classified as _____________?

A: resourcing B: value acquiring C: production D: value acquaintance

Q81 : An ability of an accounting system, to point out the use of resources in every step of production process is called ___________?

A: back-flush trails B: audit trails C: trigger trails D: lead manufacturing trails

Q82 : The type of spoilage, which is considered as controllable and can be avoided is called _____________?

A: abnormal spoilage B: normal spoilage C: transferred-in spoilage D: transferred-out spoilage

Q83 : The last step in developing operating budget is ____________?

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

Q84 : The accounting process of gradually converting the unexpired cost of fixed assets into expenses over a series of accounting periods is_________?

A: Depreciation B: Physical deterioration of the asset C: Decrease in market value of the asset D: Valuation of an asset at a point of time

Q85 : If the beginning work in process inventory units are 2600, units started are 9000, ending work in process units are 2300 and the completed good units are 8000 then total spoilage will be ____________?

A: 1200 units B: 990 units C: 1300 units D: 1000 units

Q86 : 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%

Q87 : 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

Q88 : The service sector companies include _____________?

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

Q89 : 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

Q90 : 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

Q91 : The activities related to coordinating, controlling and planning flow of inventory are classified as ___________?

A: decisional management B: . throughput management C: inventory management D: manufacturing management

Q92 : The financial statements and the budget plans of some companies are also called ___________?

A: cost statement B: preformed statement C: sales statement D: market statement

Q93 : 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

Q94 : The flexible budget amount is added in to variable overhead flexible budget variance to calculate ____________?

A: manufacturing costs incurred B: variable costs incurred C: fixed costs incurred D: actual costs incurred

Q95 : The fourth step in development of operating budget is to __________?

A: choose alternatives B: evaluate alternatives C: efficiency improvements D: predicted improvements

Q96 : If the cost incurred for work in process inventory is $350000 and total equivalent units completed till date are 3500, then weighted average cost will be __________?

A: $10 B: $100 C: $1,000 D: $1,200

Q97 : The aspects of accounting for scrap includes __________?

A: physical tracking B: non-inventoriable costing C: inventory costing D: both a and c

Q98 : The budget, which highlights the difference between actual quantity and budgeted quantity is termed as _____________?

A: actual cost budget B: flexible budget variance C: inflexible budget D: hourly budget

Q99 : 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

Q100 : The schedule of expected disbursements and cash receipts is considered as __________?

A: planned schedule B: cash budget C: market budget D: price schedule

Free Accounting MCQs Mock Test Online with Answers

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