Free Accounting MCQs Mock Test Online with Answers

Q1 : Modern system of book keeping is called______________?

A: Double entry system B: American system C: Single entry system D: Italic system

Q2 : The costs that are incurred in last department, where the product has been processed and will be carried to next department for further processing are called __________?

A: partial work costs B: transferred-in costs C: transferred-out costs D: weighted average costs

Q3 : If the budgeted total direct labor hours are 5500 and budgeted direct labor cost is $755000, then the budgeted direct labor cost rate is _________?

A: $138 per labor hour B: $137.27 per hour C: $140 per labor hour D: $142 per labor hour

Q4 : The second step in developing operating budget is to ___________?

A: plan coordination B: plan accounts C: obtain information D: coverage information

Q5 : The type of accounting which measures, reports and analysis of the non-financial and financial information to help in decision making is called _____________?

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

Q6 : 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

Q7 : 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

Q8 : The costs that are not incorporated in accounting records, but are recognized in different situations are classified as ___________?

A: congruent costs B: imputed costs C: operating costs D: transfer costs

Q9 : In normal costing, the situation in which the allocated amount of indirect cost is greater than the incurred cost, is considered as _____________?

A: incurred indirect cost B: over allocated indirect cost C: applied indirect cost D: applied direct cost

Q10 : 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

Q11 : The types of spoilage include ___________?

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

Q12 : 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

Q13 : 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

Q14 : 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

Q15 : The costs of goods acquired from suppliers are classified as ___________?

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

Q16 : 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

Q17 : 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

Q18 : The degree of influence that a manager would have on the revenues, cost, profit and investment is known as __________?

A: controllability B: influential power C: responsibility D: all of above

Q19 : In management accounting, an emphasis and focus must be __________?

A: future oriented B: past oriented C: past oriented D: communication oriented

Q20 : The system in an organization, which defines behavior standards and code of conduct is known as ___________?

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

Q21 : 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

Q22 : 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

Q23 : 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

Q24 : If the cost per unit is $70 and the total number of units manufactured in company are 6000, then the total manufacturing cost would be _____________?

A: $240,000.00 B: $320,000 C: $210,000 D: $420,000

Q25 : 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

Q26 : The after-tax average cost of the funds used by company in long run is equal to __________?

A: weighted average cost of capital B: economic value added C: after-tax operating income D: net income

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

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

Q29 : Total transferred-out cost plus normal spoilage is divided by number of goods units produced, to calculate ___________?

A: cost per good units transferred out B: cost per good units transferred in C: revenue per good units transferred out D: revenue per good units transferred in

Q30 : 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

Q31 : The residual material which results from manufacturing products is called ___________?

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

Q32 : 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

Q33 : The budget which specifies an operating and financial plan, usually for a fiscal year or any specific period of time is classified as ___________? 0

A: annual budget B: operating budget C: specific budget D: master budget

Q34 : 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

Q35 : 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

Q36 : An Art of reading, classifying & Summarizing of accounts in a systematic way is called__________?

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

Q37 : The last step in developing operating budget is ____________?

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

Q38 : The normal spoilage is subtracted from total spoilage to calculate _____________?

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

Q39 : 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

Q40 : 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

Q41 : 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

Q42 : 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

Q43 : The machine budgeted time standards are set too tight, is the possible cause for ____________?

A: priced budget B: exceeding budget C: fixed budget D: variable budget

Q44 : 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

Q45 : An approach in which the managers use the resources to increase customer value is classified as __________?

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

Q46 : The type of accounting, which focuses on whom should be asked for information and whom not, will be categorized as ____________?

A: focused accounting B: responsibility accounting C: information accounting D: blame accounting

Q47 : Goods Return by the customer are termed as :

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

Q48 : The costs of issuing purchase orders, making of delivery records for tracking payments and costs of inspection of items are classified as _____________?

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

Q49 : 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

Q50 : A group of individual indirect cost item is defined as ___________?

A: direct pool B: cost pool C: indirect pool D: item pool

Q51 : The term which describes the assigning of indirect cost, to any cost object is classified as ___________?

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

Q52 : 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

Q53 : 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

Q54 : 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

Q55 : The revenues and expenses of a company are displayed in which statement?

A: Balance Sheet B: Cash Flow Statement C: Income Statement D: None of the above

Q56 : If the required rate of return is 12% and the per unit cost of units purchased is $35, then the relevant opportunity cost of capital will be ____________?

A: $6.20 B: $7.20 C: $4.20 D: $5.20

Q57 : A systematic way to maintain the books of accounts is called_________?

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

Q58 : 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

Q59 : 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

Q60 : A company must eliminate all those activities that do not add value to all the products or services in planning of ___________?

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

Q61 : The service sector companies include _____________?

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

Q62 : The maintenance of accounts in a systematic way is called__________?

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

Q63 : If the current assets are $856000 and the working capital is $654500, then the current liabilities will be ___________?

A: $501,500 B: $401,500 C: $201,500 D: $301,500

Q64 : The budgeted annual indirect costs are divided to budgeted annual quantity of cost allocation base, to calculate ___________?

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

Q65 : The factor which provides hedge to managers in adverse and unexpected circumstances is known as __________?

A: budgetary slack B: costly slack C: influential slack D: target slack

Q66 : The sum of all the resources used to generate income is classified as _____________?

A: DuPont investment B: return on investment C: investment D: investment turnover

Q67 : 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

Q68 : If an allocated indirect cost is $1500 and the actual incurred indirect cost is $1200, then this is classified as __________?

A: applied indirect cost B: applied direct cost C: incurred indirect cost D: over allocated indirect cost

Q69 : 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

Q70 : Discount received is a/an:

A: Asset B: Expense C: Liability D: Revenue

Q71 : The normal activity range in which there is relationship between activity and costs is classified as _____________?

A: relevant range B: irrelevant range C: cause range D: effective range

Q72 : The direct labor, salary outlays and direct material purchases are classified as ___________?

A: price disbursements B: cash disbursements C: budget disbursements D: goods disbursements

Q73 : The cost of product failure, error prevention and appraisals can be classified under ___________?

A: stocking costs B: stock-out costs C: costs of quality D: shrinkage costs

Q74 : 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

Q75 : 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

Q76 : The budget, which predicts the effect of given level of operations on a cash position is classified as __________?

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

Q77 : The function of management accountant, who works as business partner comes under the category of ____________?

A: asset function B: investment function C: line function D: staff function

Q78 : 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

Q79 : 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

Q80 : An act of making sure, that all the employees must understand the goals is classified as ___________?

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

Q81 : The sum of working capital and current liabilities is equal to _____________?

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

Q82 : The total costs incur in a production process, is divided by total number of output units, to calculate the ____________?

A: cost of indirect labor B: cost of direct labor C: cost of direct material D: unit costs

Q83 : In normal costing, the budgeted rate is multiplied to an actual quantity, which have been used as the allocation base to calculate ___________?

A: budget overhead applied B: manufacturing overhead applied C: labor overhead applied D: none of above

Q84 : 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

Q85 : In support of business transaction, any written evidence is called ___________?

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

Q86 : The document, which contains the information about the used material sequence, detail and quantity of raw material is classified as __________?

A: bill of materials B: bill of sequence C: bill of detail D: bill of raw materials

Q87 : If the total incurred cost in a production process are $30000 and the number of output units are 5000 units, then the units cost will be __________?

A: $16 B: $60 C: $6 D: $26

Q88 : Sales return is also known as____________?

A: Return received B: Return Payed C: Return inward D: Return outward

Q89 : 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

Q90 : The flow of goods and services, from the start of gathering materials until the delivery of products, is known as __________?

A: flow chart analysis B: supply chain analysis C: resource chain analysis D: acquiring analysis

Q91 : 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

Q92 : The costing and allocating situation, in which the indirect cost allocated amount is less than actually incurred amount is known as ___________?

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

Q93 : An example of shrinkage costs is _____________?

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

Q94 : The concession received on the price of defective goods is called:

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

Q95 : 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

Q96 : The schedule of expected disbursements and cash receipts is considered as __________?

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

Q97 : The type of accounting, which reports financial and non-financial data about the cost of material and acquiring of resources is classified as ____________?

A: material accounting B: cost accounting C: supplies accounting D: business accounting

Q98 : The systematic way of linking group of indirect cost to a cost object is classified as ___________?

A: linked allocation base B: direct allocation base C: indirect allocation base D: cost allocation base

Q99 : If the budget sales units are 2000, an ending inventory is 3000 units and the beginning inventory is 1000, then the budget production would be ______________?

A: 6000 units B: 4000 units C: no units D: 8000 units

Q100 : The merchandising sector companies include _____________?

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

Free Accounting MCQs Mock Test Online with Answers

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