Management Accounting MCQs
UKPSC Assistant Accountant Exam
Total Marks in this Section: 6 Marks
In this Post You will get Management Accounting MCQS for UKPSC Assistant Accountant Exam. This UKPSC Assistant Accountant exam is conducted every year by Uttarakhand Government.
This Exam is conducted into two medium – Hindi Medium and English Medium.
Hindi Medium exam is known as UKPSC Sahayak Accountant Exam and English Medium Exam is know as UKPSC Assistant Accountant Exam.
Question Paper Consists of Two Parts – Section A (Commerce and Management) and Section B – Hindi. Section A Consists of 80 Questions and Section B Consists of 20 Questions.
Management Accounting MCQs is the First Part of Section which covers 05 Marks. We preparing UKPSC Assistant Accountant Exam Notes. We keep our posts updated, so visit our webiste frequently.
Choose the correct answer to the following questions from the given alternatives:
1. Management accounting deals with what kind of information?
a) Qualitative.
b) Quantitative.
c) Both.
d) None of the above.
Ans: c) Both Qualitative and Quantitative information.
2. Management accounting provides valuable services to management in performing:
a) Coordinating.
b) Controlling.
c) Planning.
d) All managerial functions.
Ans: d) All managerial functions.
3. Which of the following are tools of management accounting?
a) Standard Costing.
b) Marginal Costing.
c) Budget and Budgetary control.
d) All of the above.
Ans: d) All of the above.
4. Which of the following are not the tools of management accounting?
a) Funds flow statement.
b) Cash Flow Statement.
c) Ratio analysis.
d) Process costing.
Ans: d) Process costing.
5. Which of the following are tools of management accounting?
a) Financial Planning.
b) Analysis of financial statements.
c) Historical cost accounting.
d) All of the above.
Ans: d) All of the above.
6. Management accounting is suitable for:
a) Small trading organisation.
b) Large industrial and trading organisation.
c) NPOs.
d) Co-operative societies.
Ans: b) large industrial and trading organisation.
7. Management accounting is a structure for:
a) Cost Accounting.
b) Financial accounting.
c) Decision making.
d) Budgeting.
Ans: c) Decision making.
8. Management accounting and cost accounting are:
a) Contradictory in nature.
b) Complementary in nature.
c) Neutral in effect.
d) None of the above.
Ans: b) Complementary in nature.
9. Who coined the concept of management accounting?
a) James H. Bliss.
b) R. N. Carter.
c) Philip Cotler.
d) F. W. Taylor.
Ans: a) James H. Bliss.
10. Management accounting provides invaluable services to management in performing:
a) all management functions.
b) interpret the financial data.
c) controlling functions.
d) none of the above.
Ans: a) all management functions.
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11. Management accounting is the branch of accounting concerned with reporting to:
a) internal managers.
b) shareholders.
c) the government.
d) bankers.
Ans: a) internal managers.
12. Which of the following is not an objective of managerial accounting?
a) To help in planning and decision making.
b)Â To provide data about the latest position of the firm.
c) To help in policy formulation.
d) To find profit or loss of the firm.
Ans: d) To find profit or loss of the firm.
13. Which of the following statement is true about management accounting?
a) Management accounting is mainly concerned with future.Â
b) The use of management accounting is compulsory.Â
c) Management accounting is objective in nature.        Â
d) Management Accounting and Cost Accounting are Synonymous.    Â
Ans: a) Management accounting is mainly concerned with future.  Â
14. The branch of accounting which primarily deals with processing and presenting accounting data for internal use in a concern is:
a) management accounting.
b) financial accounting.
c) cost accounting.
d) inflation accounting.
Ans: a) management accounting.
15. Management accounting provides valuable services to management in performing:
a) planning function.
b) controlling function.
c) co-coordinating functions.
d) all managerial functions.
Ans: d) all managerial functions.
16. Funds flow statement is also known as:
a) Statement of sources and applications of funds.
b) Statement of flow of funds.
c) Statement of changes in financial position.
d) All of the above.
Ans: d) All of the above.
17. Which of the following will result into application of funds?
a) Sale of plant.
b) Payment of dividend.
c) Purchase of land.
d) Issue of share capital.
e) Payment of creditors.
Ans: b) Payment of dividend. c) Purchase of land.
18. Which statement is prepared in the process of funds flow analysis?
a) Schedule of changes in working capital.
b) Funds Flow statement.
c) Calculation of funds from operations.
f) All of the above.
Ans: f) All of the above.
19. In funds flow statement, the term funds mean:
a) Current assets.
b) Fixed assets.
c) Working Capital.
d) Cash in hand.
Ans: c) Working Capital.
20. Cash flow statement according to AS 3 is mandatory to:
a) All listed companies.
b) One Person Company.
c) Small company.
d) Dormant company.
Ans: a) all listed companies.
21. Ratio analysis:
a) Is an arithmetical relationship between two accounting variables?
b) Provide quantitative relationship between two variables.
c) It is one of the mean of financial analysis.
d) All of the above.
Ans: d) All of the above.
22. Which of the following is not true about ratio analysis?
a) It is affected by price level changes.
b) It is difficult to evolve a standard ratio.
c) It can give false and misleading results.
d) It is not useful in inter-firm and intra firm comparison.
Ans: d) It is not useful in inter-firm and intra firm comparison.
23. Which of the following is not a limitation of ratio analysis?
a) False and Misleading results.
b) It ignores qualitative factors.
c) It is affected by personal judgement of the analyst.
d) It cannot be used in forecasting.
Ans: d) It cannot be used in forecasting.
24. Current ratio is also known as:
a) Quick ratio.
b) Acid-test ratio.
c) Working capital ratio.
d) Absolute liquid ratio.
Ans: c) Working capital ratio.
25. Liquid ratio is also known as:
a) Quick ratio.
b) Acid-test ratio.
c) Working capital ratio.
d) Absolute liquid ratio.
Ans: a) Quick ratio. b) Acid-test ratio.
26. Quick assets divided by current liabilities is:
a) Current ratio.
b) Liquid ratio.
c) Inventory turnover ratio.
d) ROI.
Ans: b) Liquid ratio.
27. Which of the following liabilities are taken into account for the quick ratio?
a) Trade Creditors.
b) Outstanding expenses.
c) Bank overdraft.
d) All of the above.
Ans: d) All of the above.
28. The ideal level of current ratio is:
a) 1:1.
b) 2:1.
c) 0.5:1.
d) 3.
Ans: b) 2:1.
29. The ideal level of liquid ratio is:
a) 1:1.
b) 2:1.
c) 0.5:1.
d) 3.
Ans: a) 1:1.
30. Accounting ratios are divided into four main categories. Which one of the following was not included in it?
a) Liquidity ratios.
b) Solvency ratios.
c) Activity ratios.
d) Control ratios.
e) Profitability ratios.
Ans: d) Control ratios.
31. Which of the following ratio measures short term solvency?
a) Liquidity ratios.
b) Solvency ratios.
c) Activity ratios.
d) Profitability ratios.
Ans: a) Liquidity ratios.
32. Liquidity ratios include:
a) Current ratio.
b) Quick or Liquid or acid test ratio.
c) Absolute liquid ratio.
d) All of the above.
Ans: d) All of the above.
33. Which of the following ratio measures short term solvency?
a) Liquidity ratios.
b) Solvency ratios.
c) Activity ratios.
d) Profitability ratios.
Ans: b) Solvency ratios.
34. Solvency ratios include:
a) Debt-equity ratio.
b) Proprietary ratio.
c) Total assets to debt ratio.
d) All of the above.
Ans: d) All of the above.
35. Activity ratios are also known as:
a) Performance ratios.
b) Turnover ratios.
c) Efficiency ratios.
d) All of the above.
Ans: d) All of the above.
36. Activity ratios include:
a) Stock turnover ratio.
b) Trade receivables turnover ratio.
c) Trade payable turnover ratio.
d) All of the above.
Ans: d) All of the above.
37. Profitability ratios include:
a) Gross profit ratio.
b) Net profit ratio.
c) Operating profit ratio.
d) All of the above.
Ans: d) All of the above.
38. Budgetary control helps in implementation of:
a) Standard Costing.
b) Marginal Costing.
c) Ratio Analysis.
d) Technical Analysis.
Ans: a) Standard Costing.
39. Budgetary control system facilitates centralized control with:
a) Decentralized activity.
b) Centralized activity.
c) Both a) and b).
d) None of the above.
Ans: c) Both a) and b).
40. Budgetary control system acts as a friend, philosopher and guide to the:
a) Management.
b) Shareholders.
c) Creditors.
d) Employees.
Ans: a) Management.
41. The process of budgeting helps in the control of:
a) Cost of Production.
b) Short term liquidity position.
c) Capital Expenditure.
d) All of the above.
Ans: d) All of the above.
42. The main objective of budgetary control is:
a) To define the goals of the organisation.
b) To co-ordinate different department or sub-units.
c) To establish a system of planning and control.
d) All of the above.
Ans: d) All of the above.
43. Summary budget may be regarded as:
a) Functional budgets.
b) Performance budget.
c) Master budget.
d) Sales budget.
Ans: c) Master Budget.
44. The budgets are classified on the basis of:
a) Capacity.
b) Time.
c) Functions.
d) All of the above.
Ans: d) All of the above.
45. Which budget is the first step of budgetary system and all other budgets depends on it?
a) Cash Budget.
b) Production Budget.
c) Sales Budget.
d) Master Budget.
Ans: c) Sales Budget.
46. The basic difference between a flexible budget and fixed budget is that a fixed budget:
a) Is concerned with fixed expenses whereas flexible budget is on different activity levels.
b) Cannot be changed whereas flexible budget can be easily changed.
c) Is a budget for single measure of activity whereas flexible budget is on different activity levels.
d) None of the above.
Ans: c) Is a budget for single measure of activity whereas flexible budget is on different activity levels.
47. A flexible budget requires careful study and classification of expenses into:
a) Past and current expenses.
b) Fixed, Semi-variable and variable expenses.
c) Administrative, selling and factory expenses.
d) None of the above.
Ans: b) Fixed, Semi-variable and variable expenses.
48. Which one of the following is a financial budget?
a) Cash Budget.
b) Working Capital Budget.
c) Capital budget.
d) All of the above.
Ans: d) All of the above.
49. Which one of the following is not a financial budget?
a) Cash budget.
b) Capital budget.
c) Budgeted funds flow statement.
d) Sales budget.
Ans: d) Sales budget.
50. Which one the following are functional budget?
a) Production and sales budget.
b) Raw material budget.
c) Labour budget.
d) All of the above.
Ans: d) All of the above.
51. Which one of the following is not a functional budget?
a) Sales budget.
b) Purchasing budget.
c) Production budget.
d) Budgeted balance sheet.
Ans: d) Budgeted balance sheet.
52. Responsibility areas are divided into three broad categories. Which one of the following is not included in it?
a) Cost/Expense centre.
b) Profit Centre.
c) Investment Centre.
d) Loan centre.
Ans: d) Loan centre.
53. Which from the options below is not a step from budgetary control?
a) Establishing a plan or target of performance.
b) Recording of actual performance.
c) Comparing the actual with budgeted figures to find out variances.
d) None of the above.
Ans: d) None of the above.
54. Long term budgets are prepared for:
a) Capital Expenditure.
b) Research and Development.
c) Long Term Finances.
d) All of the above.
Ans: d) All of the above.
55. Short term budget is prepared for:
a) Liquidity.
b) Working Capital Management.
c) To exercise control over day to day expenditure.
d) All of the above.
Ans: d) All of the above.
56. Which of the following is not a part (component) of master budget?
a) Sales budget.
b) Production budget.
c) Cash budget.
d) All of the above.
Ans: d) All of the above.
57. Cash flow statement is based upon:
a) Cash basis.
b) Accrual Basis.
c) Accounting Equation.
d) Both cash and accrual basis.
Ans: a) Cash basis.
58. The objectives of cash flow statements are:
a) Short term cash planning.
b) Analysis of cash position.
c) Comparison of operating performance.
d) All of the above.
Ans: d) All of the above.
59. Which of the following statement is true?
a) Cash flow is same as profit.
b) Profit is the result of subtracting expenses from sales.
c) Cash flow results from the difference between all cash available and cash payments.
d) Cash flows only when actual payments are not made but only received.
Ans: b) Profit is the result of subtracting expenses from sales.
60. Cash Flow statement is prepared for financial planning of:
a) Long Range.
b) Medium Range.
c) Short Range.
d) Very long Range.
Ans: c) Short Range.
61. Statement of cash flow includes:
a) Operating activities.
b) Investing activities.
c) Financing activities.
d) All of the above.
Ans: d) All of the above.
62. An example of cash flow investing activity is:
a) Issue of debentures.
b) Repayment of long-term loan.
c) Purchase of raw materials for cash.
d) Sale of investment by non – financial enterprise.
Ans: d) Sale of investment by non – financial enterprise.
63. Cash and cash equivalents include:
a) Bank balance.
b) Commercial paper.
c) Short term government bonds.
d) All of the above.
Ans: d) All of the above.
64. Marginal costing is a:
a) Method of costing.
b) Technique of costing.
c) Formula of costing.
d) System of costing.
Ans: b) Technique of costing.
65. Contribution margin is also known as:
a) Marginal income.
b) Marginal cost.
c) Gross profit.
d) Net income.
Ans: a) Marginal income.
66. The term contribution refers to:
a) Subscription towards raising capital.
b) Draft of an article for publication.
c) Difference between selling price and total cost.
d) Sales – Variable Cost.
Ans: d) Sales – Variable Cost.
67. If a factory operates at full capacity, ___________ becomes relevant for make or buy decisions:
a) Fixed cost.
b) Variable cost.
c) Total Cost.
d) Contribution.
Ans: a) Fixed cost.
68. Which of the following is true at break even point?
a) Contribution = Fixed Cost.
b) Sales = Total Cost.
c) Sales curve cuts total cost line.
d) All of the above.
Ans: d) All of the above.
69. Contribution is the difference between:
a) Sales and Variable cost.
b) Fixed cost and variable cost.
c) Total cost and fixed cost.
d) None of the above.
Ans: a) Sales and Variable cost.
70. The principles of marginal costing are based on the following equation?
a) Variable cost + Fixed cost + Profit = Sales
b) Contribution – Fixed cost = Profit.
c) Total cost + Profit = Sales.
d) All of the above.
Ans: d) All of the above.
71. Total cost + profit = …..?
a) Sales.
b) Contribution.
c) Break even point.
d) None of the above.
Ans: a) Sales.
72. Margin of safety can be improved by:
a) Increasing sales volume.
b) Lowering variable cost.
c) Lowering fixed cost.
d) All of the above.
Ans: d) All of the above.
73. PV ratio can be improved by:
a) Increasing Sale price.
b) Increasing variable cost.
c) Lowering fixed cost.
d) None of the above.
Ans: a) Increasing Sale price.
74. For decision marking purpose, which is more suitable to the management?
a) Standard costing.
b) Marginal costing.
c) Absorption costing.
d) Budget.
Ans: b) Marginal costing.
75. Increase in selling price:
a) Increases P/V ratio.
b) Decreases break-even point.
c) Increases margin of safety.
d) All of the above.
Ans: d) All of the above.
76. Decrease in selling price:
a) Decreases P/V ratio.
b) Increases break-even point.
c) Decreases margin of safety.
d) All of the above.
Ans: d) All of the above.
77. An increase in the variable cost leads to:
a) Increases P/V ratio.
b) Decreases break-even point.
c) Increases margin of safety.
d) None of the above.
Ans: d) None of the above.
78. Decrease in variable cost:
a) Increases P/V ratio.
b) Decreases break-even point.
c) Increases margin of safety.
d) All of the above.
Ans: d) All of the above.
79. Contribution/sales is equal to
a) P/V ratio.
b) Break even point.
c) Margin of safety.
d) None of the above.
Ans: a) P/V ratio.
80. Contribution / PV ratio is equal to:
a) Break even point.
b) Margin of safety.
c) Sales.
d) None of the above.
Ans: c) Sales.
81. Under marginal costing stock are valued at:
a) Fixed cost.
b) Variable cost.
c) Total cost.
d) None of the above.
Ans: b) Variable cost.
82. Contribution is the test of:
a) Solvency
b) Profitability.
c) Efficiency.
d) Liquidity.
Ans: b) Profitability.
83. Sales x PV ratio is equal to:
a) Fixed cost.
b) Variable cost.
c) Contribution.
d) Break even point.
Ans: c) Contribution.
84. With respect to variable costs per unit, which of the following statements is true?
a) Variable cost per unit will remain constant.
b) Variable cost per unit varies with change in output.
c) Variable cost per unit depends on sales.
d) Variable cost per unit includes fixed expenses also.
Ans: a) Variable cost per unit will remain constant.
85. Standard costing is a technique of:
a) Planning business activities.
b) Cost Control.
c) Staffing.
d) Motivating.
Ans: b) Cost Control.
86. Standard costing is a yard stick for:
a) Measuring efficiency.
b) Controlling prices.
c) Reducing losses of business.
d) Planning business activities.
Ans: a) Measuring efficiency.
87. The difference between actual cost and standard cost is known as:
a) Profit.
b) Loss.
c) Standard cost.
d) Variance.
Ans: d) Variance.
88. Standard costing involves:
a) Preparation and use of standard costs.
b) Comparison of standard with actual.
c) Analysis of variances.
d) All of the above.
Ans: d) All of the above.
89. Standard costing technique is unsuitable for:
a) Job order industries.
b) Non-standard product manufacturers.
c) Service industries.
d) All of the above.
Ans: d) All of the above.
90. Standard costing is suitable for industries which are:
a) Producing standard products.
b) Producing goods of repetitive nature.
c) Sugar, Textiles, Fertilizers, steel industries.
d) All of the above.
Ans: d) All of the above.
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