Free Accounting MCQs Mock Test Online with Answers

Q1 : 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

Q2 : 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

Q3 : 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

Q4 : 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

Q5 : 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

Q6 : The flexible budget amount is added in to fixed overhead flexible budget variance to calculate _____________?

A: incurred manufacturing B: incurred production cost C: actual incurred cost D: incurred labor cost

Q7 : 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

Q8 : 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

Q9 : 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

Q10 : The degree to which the freedom is given to lower level managers for decision making is classified as ___________?

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

Q11 : The residual material which results from manufacturing products is called ___________?

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

Q12 : The merchandising sector companies include _____________?

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

Q13 : 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

Q14 : 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

Q15 : 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

Q16 : The minimum freedom for managers and maximum constraints are the main features of ____________? 0

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

Q17 : The continuous budget is also known as ________?

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

Q18 : The concession received on the price of defective goods is called:

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

Q19 : A desire of an individual to give good performance for self-satisfaction is known as ___________? 0

A: intrinsic motivation B: extrinsic motivation C: monetary motivation D: bounded motivation

Q20 : The what-if technique, which examines changes in results, if original prediction would not be achieved is called _____________?

A: change analysis B: original analysis C: sensitivity analysis D: predicted analysis

Q21 : The person to whom goods are sold on credit is called___________?

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

Q22 : 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

Q23 : The standardized technique that is performed repetitively on different kind of materials to convert them into different finished products is known as __________? 0

A: conversion process B: operation C: hybridization D: both a and b

Q24 : 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

Q25 : A desire to achieve a particular goal with pursuit of that goal is called _____________?

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

Q26 : In an accounting system, the document which supports journal entries is classified as _____________?

A: cost document B: priced document C: source document D: direct document

Q27 : 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

Q28 : The philosophy, in which the management works to improve value chain of the products, to exceed customer expectations is classified as ____________?

A: quality B: management chain C: customer chain D: cost chain

Q29 : 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

Q30 : The third 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

Q31 : The service sector companies include _____________?

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

Q32 : 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

Q33 : An amount of spoilage that is natural in any particular production process is classified as ___________?

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

Q34 : 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

Q35 : 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

Q36 : 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

Q37 : 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

Q38 : 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

Q39 : 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

Q40 : 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

Q41 : A group of individual indirect cost item is defined as ___________?

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

Q42 : 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

Q43 : Buying of goods or materials for production in a way that they are delivered directly on the manufacturing facility of company is called ____________?

A: economic order quantity purchasing B: annual purchasing C: just in time purchasing D: both a and b

Q44 : The purpose of financial accounting is ___________?

A: communicating company position to investors B: helping managers make decisions C: future oriented D: single person orientation

Q45 : 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

Q46 : 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

Q47 : 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

Q48 : The costing technique, which traces direct costs by multiplying price rate for producing actual outputs is known as ______________? 0

A: constant costing B: standard costing C: unit costing D: batch costing

Q49 : 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

Q50 : 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

Q51 : 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

Q52 : If the relevant opportunity cost of capital is $2950 and the relevant carrying cost of inventory is $6700, then the relevant incremental cost will be _____________?

A: $9,650 B: $2,350 C: $3,750 D: $2,750

Q53 : 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

Q54 : A document which contains information about the materials of specific product, in specific department comes under __________?

A: costing method B: selling method C: material acquisition method D: none of above

Q55 : 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

Q56 : If the required rate of return is 13%, operating income is $375000 and the total investment is $2650000, then the residual income would be ____________?

A: $30,500 B: $20,500 C: $25,500 D: $32,500

Q57 : 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

Q58 : 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

Q59 : 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

Q60 : 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

Q61 : 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

Q62 : The cost allocation base used by an operating manager is classified as ____________?

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

Q63 : The time that a company takes to create and produce a new product is classified as _________?

A: management factor B: time factor C: customer factor D: chain factor

Q64 : 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

Q65 : 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

Q66 : Modern system of book keeping is called______________?

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

Q67 : 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

Q68 : 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

Q69 : 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

Q70 : 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

Q71 : The decision making methods, used for subunits of company are highly interdependent on each other is called _____________?

A: incongruent decision making B: functional decision making C: congruent decision making D: duplication decision making

Q72 : 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

Q73 : 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

Q74 : The cost of previous department is a part of ____________?

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

Q75 : 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

Q76 : Some of the methods used for determining transfer prices are ___________?

A: market-based transfer prices B: cost-based transfer prices C: negotiated transfer prices D: all of above

Q77 : The budgeting method, which incorporates an improvement anticipated in budgeting period into budget numbers, can be classified as ___________? 0

A: anticipated budgeting B: number budgeting C: predict budgeting D: kaizen budgeting

Q78 : The fourth step in development of operating budget is to __________?

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

Q79 : The second step in processing 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

Q80 : If the transferred out total cost is $1850000 and the number of good units (produced), then the cost per good unit transferred out and completed can be __________?

A: 245.1724 B: 255.1724 C: 278.1724 D: 268.1724

Q81 : 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

Q82 : If after-tax operating income is $185000, weighted average cost of capital is 11%, total assets are $485000 and total liabilities are $367000, then economic value added would be __________?

A: $142,020 B: $172,020 C: $162,020 D: $152,020

Q83 : 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

Q84 : 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

Q85 : 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

Q86 : The practice, which makes target more achievable by underestimating revenues or overestimating cost is called _____________?

A: cost slack B: target slack C: budgetary slack D: revenue slack

Q87 : The required rate of return, is multiplied per unit cost of purchased units to calculate __________?

A: irrelevant inventory carrying costs B: relevant opportunity cost of capital C: relevant purchase order costs D: relevant inventory carrying costs

Q88 : Cash brought by the owner to start business is called__________?

A: Capital B: Loan C: Drawing D: None of these

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 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

Q91 : 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

Q92 : If the budget sales units are 5000, the ending inventory is 4000 units and the beginning inventory is 1000, then the budget production will be __________?

A: 4000 units B: 5000 units C: 8000 units D: 10000 units

Q93 : Total cost of producing similar products divided by number of units produced is a technique known as ____________?

A: sale costing system B: job costing system C: price costing system D: process costing system

Q94 : 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

Q95 : 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

Q96 : The cash management, investments, long and short term financing are included in ___________?

A: proprietorship B: functional line C: treasury D: controllership

Q97 : 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

Q98 : In management accounting, an emphasis and focus must be __________?

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

Q99 : Sales return is also known as____________?

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

Q100 : 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

Free Accounting MCQs Mock Test Online with Answers

Time to prove what you know!

LAT Test

GAT Test

Contact Info

Free Accounting MCQs Mock Test Online with Answers

Subscribe our Newsletter

LAT Test

GAT Test

Contact Info