MGT402 Final Term Solved Mega File

FINALTERM EXAMINATION · Fall 2009 · GT402- Cost & Management Accounting (Session - 3)

Q1. All of the following are a part of Planning Process EXCEPT: (1 marks)

1. Identifying the objectives
2. Search for alternative actions
3. Data gathering for alternatives
4. Selection of a fixed action

Q2. All of the following indicate the problems in traditional budget EXCEPT: (1 marks)

1. Programmes and activities involving wasteful expenditure are identified, resulting in unavoidable financial and other costs
2. Inefficiencies of a prior year are carried forward in determining subsequent years’ levels of performance
3. Managers are not encouraged to identify and evaluate alternate means of accomplishing the same objective
4. Decision-making is irrational in the absence of rigorous analysis of all proposed costs and benefits

Q3. The chief financial officer is also known as the: (1 marks)

1. Controller
2. Staff accountant
3. Auditor
4. Finance director

Q4. When purchases are added to raw material opening Inventory, we get the value (1 marks)

1. Material consumed.
2. Material available for use.
3. Material needed.
4. Raw material ending inventory.

Q5. For manufacturing entities inventories are classified into ---------- categories? (1 marks)

1. One
2. Two
3. Three
4. Four

Q6. When prices are rising over time, which of the following inventory costing methods will result in the lowest gross margin? (1 marks)

1. FIFO
2. LIFO
3. Weighted Average
4. Cannot be determined

Q7. All of the following are unavoidable causes of labor turnover EXCEPT: (1 marks)

1. Retirement and death leading to labor turnover
2. Domestic responsibilities—to look after old parents
3. Accident or illness rendering workers permanently incapable to work
4. Unfair methods of promotion and lack of promotions avenues

Q8. The term cost allocation is described as: (1 marks)

1. The costs that can be identified with specific cost centers.
2. The costs that can not be identified with specific cost centers.
3. The total cost of factory overhead needs to be distributed among specific cost centers.
4. None of the given options

Q9. Which of the following statement is true ragarding Repeated distribution method? (1 marks)

1. The re-allocation continues until the numbers being dealt with become very small
2. The re-allocation continues until the numbers being dealt with become very Large
3. The re-allocation continues until the numbers being dealt with become small
4. None of the given options

Q10. Which of the following is TRUE regarding the use of blanket rate? (1 marks)

1. The use of a single blanket rate makes the apportionment of overhead costs unnecessary
2. The use of a single blanket rate makes the apportionment of overhead costs necessary
3. The use of a single blanket rate makes the apportionment of overhead costs uniform
4. None of the given options

Q11. Which of the following is/are reported in production cost report? (1 marks)

1. The costs charged to the department
2. How the costs were assigned to the output?
3. The equivalent units of production by the department
4. All of the given options

Q12. In the process costing when labor is charged to production department no 1. What would be the journal entry Passed? (1 marks)

1. Payroll a/c

To W.I.P (Dept-I)

1. Payroll a/c

To W.I.P (Dept-II)

1. W.I.P (Dept-I)

To Payroll a/c

1. W.I.P (Dept-II)

To Payroll a/c

Q13. Materials Costs (Rs.) Conversion Costs (Rs.) (1 marks)

Work-in-process, May 1 46,000 78,000 Current costs (May) 92,000 124,000 Total cost 138,000 202,000

If the equivalent units of production under weighted average costing were 40,000 and 50,000 for materials and conversion costs, respectively, what are the costs per equivalent unit?

1. Rs. 1.15, Rs.1.56
2. Rs.1.76, Rs.1.94
3. Rs. 2.30, Rs. 2.48
4. Rs. 3.45, Rs. 4.04

Q14. In comparing common cost and joint cost: (1 marks)

1. The terms can be correctly used interchangeably
2. Both have the same objective of assigning production cost to cost center
3. They differ since common cost products or services have been obtained separately
4. Common cost is sometime used as Joint cost