Solved MCQ's Of Final Term Course code MGT402 Cost & Management Accounting

                                                                  MGT402

                                           Cost & Management Accounting

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1. If computational and record-keeping costs are about the same under both FIFO

and weighted average, which of the following method will generally be

preferred?

A. Weighted Average

B. FIFO

C. They offer the same degree of information

D. Cannot be determined with so little information

2. Which of the following System applies when standardized goods are produced

under a series of inter-connected operations?

A. Job Order Costing

B. Process Costing

C. Standard Costing

D. All of the given options

3. The cost of material that is not completely processed, would be found in which

of the following inventory account on the Balance Sheet?

A. Direct material inventory

B. Work-in-process inventory

C. Finished goods inventory

D. Supplies inventory

4. A complete set of Financial Statements for Nestle Company at December 31,

2008 would include each of the followings, EXCEPT:

A. Balance Sheet as of December 31, 2008

B. Statement of Projected Cash flows for 2009

C. Income Statement for the year ended December 31, 2008

D. Notes containing additional information that is useful in interpreting the Financial

Statements

5. Total Fixed cost _______ with the increase in production.

A. Remains constant

B. Decreases

C. Increases

D. There is no relation between fixed cost and activity level

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6. The following data is available for the Bricks Company:

Particulars Rs.

Freight in 20,000

Purchases return and allowances 80,000

Marketing expenses 200,000

Finished goods Inventory, ending 90,000

Cost of goods sold 700% of marketing expenses

You are required to calculate the cost of goods available for sales if Gross Profit is

50% of cost of goods sold.

A. Rs. 1,490,000

B. Rs. 1,390,000

C. Rs. 1,500,000

D. Rs. 1,590,000

7. Consider the following:

Beginning work in process inventory Rs. 20,000

Direct material used Rs. 50,000

Direct labor used Rs. 80,000

Manufacturing overhead Rs. 120,000

Ending work in process inventory Rs. 10,000

Cost of finished goods manufactured Rs. 260,000

The total manufacturing costs would be:

A. Rs. 250,000

B. Rs. 260,000

C. Rs. 270,000

D. Rs. 280,000

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8. Job 210 was unfinished at the end of the accounting period. The total cost

assigned to the job was Rs. 12,000 of which Rs. 3,000 was direct material cost.

Factory overheads were allocated to goods in process at 150% of direct labor

cost. What was the amount of direct labor cost charged to Job 210?

A. Rs. 3,600

B. Rs. 3,000

C. Rs. 5,400

D. Rs. 9,000

9. Job 210 was unfinished at the end of the accounting period. The total cost

assigned to the job was Rs. 12,000 of which Rs. 3,000 was direct material cost.

Factory overheads were allocated to goods in process at 150% of direct labor

cost. What was the amount of Factory over head cost charged to Job 210?

A. Rs. 3,600

B. Rs. 3,000

C. Rs. 5,400

D. Rs. 9,000

10. The over applied balance of the Factory Overhead ledger account is Rs. 36,000,

a significant amount. The ending balances of Goods in Process Inventory,

Finished Goods Inventory and Cost of Goods Sold accounts are Rs. 12,000, Rs.

8,000, and Rs. 60,000, respectively. On the basis of ending balances, how much

of the over applied balance of overhead should be allocated to each of these

accounts?

A. Rs.5, 400, Rs.27, 600, Rs.3, 000

B. Rs.27,400, Rs. 3,600, Rs. 5,000

C. Rs. 5,400, Rs. 3,600, Rs. 27,000

D. None of the given options

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11. PEL Limited has been using an overhead rate of Rs. 5.60 per machine hour.

During the year, overheads of Rs. 275,000 were incurred and 48,000 machine

hours worked. Therefore, overheads were:

A. Under-applied by Rs.7,600

B. Over-applied by Rs. 6,200

C. Under-applied by Rs. 6,200

D. Over-applied by Rs. 7,600

12. Factory overhead should be allocated on the basis of:

A. Direct labor hours

B. Direct labor costs

C. An activity basis which relates to cost incurrence

D. Machine hours

13. If a company uses a predetermined rate for the application of factory overhead,

the idle capacity variance is the:

A. Over or under applied variable cost element of overheads

B. Difference in budgeted costs and actual costs of fixed overheads items

C. Difference in budgeted cost and actual costs of variable overheads items

D. Over or under applied fixed cost element of overheads

14. Which of the following manufacturing operations, which is best, suited to the

utilization of a job order system?

A. Soft drink bottling operation

B. Crude oil refining

C. Plastic molding operation

D. Helicopter manufacturing

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15. Which of the following is a characteristic of process cost accounting system?

A. Material, Labor and Overheads are accumulated by orders

B. Companies use this system if they process custom orders

C. Only Closing stock of work in process is restated in terms of completed units

D. Opening and Closing stock of work in process are related in terms of completed

units

16. Which cost accumulation procedure is best suited to a continuous mass

production process of similar units?

A. Job order costing

B. Standard costing

C. Actual costing

D. Process costing

17. Which of the following is an objective of cost accounting?

A. Provide information to management for decision making

B. Computation of cost per unit

C. Preparation of Financial Statement

D. Computation of relevant costs

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18. Which of the following would be considered an external user of the firm's

accounting information?

A. President

B. Stockholder

C. Sales manager

D. Controller

19. Cost accounting concepts include all of the following EXCEPT:

A. Planning

B. Controlling

C. Sharing

D. Costing

20. The chief financial officer is also known as the:

A. Controller

B. Staff accountant

C. Auditor

D. Finance director

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MGT402 Cost & Management Accounting Solved Final Term MCQ's

                       MGT402

Cost & Management Accounting

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1. An example of an inventoriable cost would be:

a) Shipping fees

b) Advertising flyers

c) Sales commissions

d) Direct materials

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2. Direct materials cost is Rs. 80,000. Direct labor cost is Rs. 60,000. Factory

overhead is Rs. 90,000. Beginning goods in process were Rs. 15,000. The cost

of goods manufactured is Rs. 245,000. What is the cost assigned to the ending

goods in process?

a) Rs. 45,000

b) Rs. 15,000

c) Rs. 30,000

d) There will be no ending Inventory

3. The FIFO inventory costing method (when using under perpetual inventory

system) assumes that the cost of the earliest units purchased is allocated in

which of the following ways?

a) First to be allocated to the ending inventory

b) Last to be allocated to the cost of goods sold

c) Last to be allocated to the ending inventory

d) First to be allocated to the cost of good sold

4. Heavenly Interiors had beginning merchandise inventory of Rs. 75,000. It made

purchases of Rs. 160,000 and recorded sales of Rs. 220,000 during November.

Its estimated gross profit on sales was 30%. On November 30, the store was

destroyed by fire. What was the value of the merchandise inventory loss?

a) Rs. 154,000

b) Rs. 160,000

c) Rs. 235,000

d) Rs. 81,000

5. Inventory control aims at:

a) Achieving optimization

b) Ensuring against market fluctuations

c) Acceptable customer service at low capital investment

d) Discounts allowed in bulk purchase

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6. Which of the following is a factor that should be taken into account for fixing

re-order level?

a) Average consumption

b) Economic Order Quantity

c) Emergency lead time

d) Danger level

7. EOQ is a point where:

a) Ordering cost is equal to carrying cost

b) Ordering cost is higher than carrying cost

c) Ordering cost is lesser than the carrying cost

d) Total cost should be maximum

8. Grumpy & Dopey Ltd estimated that during the year 75,000 machine hours

would be used and it has been using an overhead absorption rate of Rs. 6.40

per machine hour in its machining department. During the year the overhead

expenditure amounted to Rs. 472,560 and 72,600 machine hours were used.

Which one of the following statements is correct?

a) Overhead was under-absorbed by Rs.7,440

b) Overhead was under-absorbed by Rs.7,920

c) Overhead was over-absorbed by Rs.7,440

d) Overhead was over-absorbed by Rs.7,920

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9. A business always absorbs its overheads on labor hours. In the 8th period,

18,000 hours were worked, actual overheads were Rs. 279,000 and there was

Rs. 36,000 over-absorption. The overhead absorption rate per hours was:

a) Rs. 15.50

b) Rs. 17.50

c) Rs. 18.00

d) Rs. 13.50

10. The main purpose of cost accounting is to:

a) Maximize profits

b) Help in inventory valuation

c) Provide information to management for decision making

d) Aid in the fixation of selling price

11. In which of the following would there be a difference between financial and

managerial accounting?

a) Users of the information

b) Purpose of the information

c) Flexibility of practices

d) All of the given options

12. Which of the following is a cost that changes in proportion to changes in

volume?

a) Fixed cost

b) Sunk cost

c) Opportunity cost

d) None of the given options

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13. Cost accounting information can be used for all EXCEPT:

a) Budget control and evaluation

b) Determining standard costs and variances

c) Pricing and inventory valuation decisions

d) Analyzing the data

14. Which of the following is not an element of factory overhead?

a) Depreciation on the maintenance equipment

b) Salary of the plant supervisor

c) Property taxes on the plant buildings

d) Salary of a marketing manager

15. The main difference between the profit center and investment center is:

a) Decision making

b) Revenue generation

c) Cost incurrence

d) All of the given options

16. Opportunity cost is the best example of:

a) Sunk Cost

b) Standard Cost

c) Relevant Cost

d) Irrelevant cost

17- If, Sales = Rs. 800,000, Markup = 25% of cost, what would be the value of Gross

profit?

a) Rs. 200,000

b) Rs. 160,000

c) Rs. 480,000

d) Rs. 640,000

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18- Which of the following is correct?

a) Opening finished goods units + Units produced – Closing finished goods units =

Units sold

b) Units Sold = Units produced + Closing finished goods units - Opening finished goods

units

c) Sales + Average units of finished goods inventory

d) None of the given options

19- Loss by fire is an example of:

a) Normal Loss

b) Abnormal Loss

c) Both normal loss and abnormal loss

d) Can not be determined

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20- In cost Accounting, abnormal loss is charged to:

a) Factory overhead control account

b) Work in process account

c) Income Statement

d) All of the given options

MGT301- Principles of Marketing Solved Final Term Paper 2008

MIDTERM  EXAMINATION

Fall 2008

MGT301- Principles of Marketing (Session - 2)

    

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Question No: 1    ( Marks: 1 )    - Please choose one

 If the company’s sales are slow down, and profits level off or decline. At which stage the company has reached?

       ► Introduction

       ► Decline

       ► Growth

       ► Maturity

   

Question No: 2    ( Marks: 1 )    - Please choose one

 A period of rapid market acceptance and increasing profits refers to which of the following stages of the product life cycle?

       ► Decline

       ► Maturity

       ► Introduction

       ► Growth

   

Question No: 3    ( Marks: 1 )    - Please choose one

 In which of the following product life cycle stages, sales are zero and the company’s investment costs mount?

       ► Product development

       ► Introduction

       ► Growth

       ► Maturity

   

Question No: 4    ( Marks: 1 )    - Please choose one

 Which one of the following groups is skeptical and adopts innovations only after most of the market has accepted the product?

       ► Innovators

       ► Late majority

       ► Early Adopter

       ► Early Majority

   

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Question No: 5    ( Marks: 1 )    - Please choose one

 A review of the sales, costs and profit projections for a new product to find out whether they satisfy the company’s objectives refers to which one of the following concepts?

       ► Business feasibility

       ► Feasibility study

       ► Business analysis

       ► Product acceptance

   

Question No: 6    ( Marks: 1 )    - Please choose one

 After concept testing, a firm would engage in which stage for developing and marketing a new product?

       ► Marketing strategy development

       ► Business analysis

       ► Product development

       ► Test marketing

   

Question No: 7    ( Marks: 1 )    - Please choose one

 Which one of the following categories refers to a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same type of outlets, or fall within given price ranges?

       ► Product line

       ► Line extension

       ► Private brand

       ► Product bandwidth

   

Question No: 8    ( Marks: 1 )    - Please choose one

 Marketers need to position their brands clearly in target customers’ minds. The strongest brands go beyond attributes or benefit positioning. On which of the following basis the products are positioned?

       ► Desirable benefit

       ► Good packaging

       ► Strong beliefs and values

       ► Customer image

   

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Question No: 9    ( Marks: 1 )    - Please choose one

 Which one of the following attribute may grab attention and produce pleasing aesthetics, but it does not necessarily make the product perform better?

       ► Design

       ► Style

       ► Variable

       ► Packaging

   

Question No: 10    ( Marks: 1 )    - Please choose one

 You have an upset stomach. Your spouse rushes to the corner convenience store for a medicine. This product falls under which of the following categories?

       ► Unsought

       ► Convenience

       ► Shopping

       ► Specialty

   

Question No: 11    ( Marks: 1 )    - Please choose one

 Product planners need to think about products and services on three levels. Each level adds more customer value. Which one of the following is the most basic level that addresses the question, “What is the buyer really buying?”

       ► Actual product

       ► Augmented product

       ► Core benefit

       ► Co-branding

   

Question No: 12    ( Marks: 1 )    - Please choose one

 Mass marketers, such as Target and Venture Stores, ignore market segment differences and target the whole market with one offer. What is their approach to segmenting?

       ► Undifferentiated marketing

       ► Differentiated marketing

       ► Target marketing

       ► Intelligent marketing

   

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Question No: 13    ( Marks: 1 )    - Please choose one

 A marketer has brought same products in the market for all segments without considering the needs and wants of the customers. Which one of the following strategy is being practiced by the marketer?

       ► Undifferentiated marketing strategy

       ► Differentiated marketing strategy

       ► Concentrated marketing strategy

       ► Custom marketing strategy

   

Question No: 14    ( Marks: 1 )    - Please choose one

 Demographic segmentation divides the market into groups based on which of the following variables?

       ► Size, location, industry, customer

       ► Size, company, industry, technology

       ► Location, size, occupation, race

       ► Customer, technology, company, industry

   

Question No: 15    ( Marks: 1 )    - Please choose one

 Income segmentation is used to target which of the following groups?

       ► Affluent

       ► Middle class

       ► Lower income class

       ► All of the given options

   

Question No: 16    ( Marks: 1 )    - Please choose one

 When a company identifies the parts of the market it can serve best and most profitably. Which one of the following factor is in the practice of a company?

       ► Concentrated marketing

       ► Mass marketing

       ► Targeted marketing

       ► Market segmentation

   

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Question No: 17    ( Marks: 1 )    - Please choose one

 Which of the following demands that business markets have more?

       ► Derived demands

       ► Steady demands

       ► Fluctuating

       ► Competitive

   

Question No: 18    ( Marks: 1 )    - Please choose one

 The mental act, condition or habit of placing trust or confidence in another shows which of the following options?

       ► Motive

       ► Belief

       ► Behavior

       ► Attitude

   

Question No: 19    ( Marks: 1 )    - Please choose one

 People are expected to perform activities according to the persons around them. These activities reflect which one of the following concept?

       ► Motive

       ► Role

       ► Lifestyle

       ► Tradition

   

Question No: 20    ( Marks: 1 )    - Please choose one

 How do consumers respond to various marketing efforts the company might use? What is a starting point of a buyer’s behavior?

       ► Belief

       ► Subculture

       ► Post purchase feeling

       ► Stimulus-response Model

   

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Question No: 21    ( Marks: 1 )    - Please choose one

 A person on the University Book Shop's survey asks respondents to tell the shop, in their own words, what they like least about textbook shopping. What is a type of this question?

       ► An open-ended

       ► A dichotomous

       ► A multiple choice

       ► A scale

   

Question No: 22    ( Marks: 1 )    - Please choose one

 General Motors need to assess the company's image relative to a new competitor. The time schedule is flexible, the research budget is very limited and a low response rate will not be a major problem. Which one of the following survey would be used by General Motors?

       ► Mail

       ► Telephone

       ► Personal interview

       ► Population

   

Question No: 23    ( Marks: 1 )    - Please choose one

 If Proctor and Gamble need to know what percentage of customers examines product labels before making a product selection in the supermarket? By which method this study would be accomplished?

       ► Focus groups

       ► Mail surveys

       ► Personal interviews      

       ► Observations

   

Question No: 24    ( Marks: 1 )    - Please choose one

 The objective of which of the following research is to gather preliminary information that will help define the problem and suggest hypotheses?

       ► Descriptive

       ► Exploratory

       ► Causal

       ► Corrective

   

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Question No: 25    ( Marks: 1 )    - Please choose one

 Harvard University is using the systematic design, collection, analysis, and reporting of data relevant to marketing its programs to minority students. What do we call this?

       ► Promotion

       ► Self-study

       ► Marketing research

       ► Cost-benefit analysis

   

Question No: 26    ( Marks: 1 )    - Please choose one

 Marketing information from which of the following databases can be accessed more quickly and cheaply?

       ► External

       ► Internal & External

       ► Internal

       ► Representatives

   

Question No: 27    ( Marks: 1 )    - Please choose one

 The marketing information system is not limited to use by the company. It may also provide information to which of the following?

       ► The government

       ► External partners

       ► Various publics

       ► Competitors

   

Question No: 28    ( Marks: 1 )    - Please choose one

 Beliefs and values that are passed on from parents to children and are reinforced by schools, churches, business and government refer to which of the following beliefs and values?

       ► Crucial

       ► Core

       ► Secondary

       ► Primary

   

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Question No: 29    ( Marks: 1 )    - Please choose one

 Which of the following forces shows the marketing macro environment?

       ► Demographic, economic, natural, technological, political, and social

       ► Demographic, natural, economic, political, social, and cultural

       ► Demographic, economic, natural, technological, political, and cultural

       ► Demographic, economic, natural, social, political, and legal

   

Question No: 30    ( Marks: 1 )    - Please choose one

 Finance, research and development, purchasing and manufacturing are all activities of which element of the microenvironment?

       ► The suppliers

       ► The competitors

       ► The companies

       ► The publics

   

Question No: 31    ( Marks: 1 )    - Please choose one

 Which one of the following is NOT a content of marketing plan?

       ► Objectives

       ► Control

       ► Budget

       ► Production

   

Question No: 32    ( Marks: 1 )    - Please choose one

 Some banks have increased their market share by offering accounts especially for children in another city. This example illustrates which of the following growth strategies?

       ► Market penetration

       ► Market development

       ► Horizontal diversification

       ► Conglomerate diversification

   

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Question No: 33    ( Marks: 1 )    - Please choose one

 Three main strategies for intensive growth are market penetration, product development and the other one?

       ► Product improvement

       ► Market saturation

       ► Market growth

       ► Market development

   

Question No: 34    ( Marks: 1 )    - Please choose one

 “Planning that involves developing a strategy to meet competition and ensure long-term survival and growth” represents which one of the following planning type?

       ► Long-range planning

       ► Short-range planning

       ► Annual planning

       ► Strategic planning

   

Question No: 35    ( Marks: 1 )    - Please choose one

 In case of an intense competition there are a number of manufacturers and buyers who have more options for product switching. Which one of the following forces represents it?

       ► Threat of new entrants

       ► Bargaining power of buyers

       ► Bargaining power of suppliers

       ► Rivalry among competing firms

   

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Question No: 36    ( Marks: 1 )    - Please choose one

 Which one of the following concepts is a useful philosophy in a situation when the product’s cost is too high and marketers look for ways to bring it down?

       ► Selling concept

       ► Product concept

       ► Production concept

       ► Marketing concept

   

Question No: 37    ( Marks: 1 )    - Please choose one

 When a church targets different demographic groups to increase attendance, it is an example of which of the following options?

       ► Mindless marketing

       ► Ethics in marketing

       ► Societal marketing

       ► Not-for-profit marketing

   

Question No: 38    ( Marks: 1 )    - Please choose one

 If a food company gives 5 percent discount in particular burger to increase sales, it is altering which one of the following elements of the marketing mix?

       ► Promotion

       ► Price

       ► Product

       ► Place

   

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Question No: 39    ( Marks: 1 )    - Please choose one

 An automobile manufacturing company places steel beams in the doors of its cars for which of the following purposes?

       ► Increase short run customer satisfaction

       ► Increase long run customer satisfaction

       ► Add style to its cars

       ► Reduce the possibility of accidents

   

Question No: 40    ( Marks: 1 )    - Please choose one

 Identify the name for the recent technology advances including wide use of the Internet?

       ► An old economy

       ► Transformation

       ► A new world.

       ► The digital age

   

Question No: 41    ( Marks: 10 )

 A marketer plays an important role in increasing the sales of an organization. What guiding principles did he follow to become a successful marketer and which skills he needed?

ANSWER:

• He should satisfy the customers' need with quality product, competitive price and satisfaction on the company's brand.
• He should meet the market demand by supplying sufficient quantity of his products as, when and where demanded.
• He should use the modern techniques of promotion of his product or service to convince the mind of customers.
• He should provide good after sale services to further satisfy the customers. Feedback from the market and take remedial measures to improve the quality of product, packaging and labeling should also be improved.
• He will have good market survey to ensure the improvement of his product and competitive price.    

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