Tag: Financial Accounting Mcqs

(A) It is a broader concept than variable cost as it takes into account additional fixed costs caused by management decisions
(B) With the passage of time and change in situation, differential costs will vary
(C) The difference in cost between buying them from outside or make them in the company is differential cost, irrelevant for decisions
(D) They are extra or incremental costs caused by a particular decision

(A) Heuristics method
(B) Decision making
(C) The Delphi technique
(D) Systematic error

(A) Occurs where its revenue equals its expenses
(B) Shows entrepreneurs‘ minimum level of activity required to keep the company in operation
(C) Is the point at which a company neither earns a profit nor incurs a loss
(D) Total contribution margin equals total variable expenses

(A) Cannot determined with given statement
(B) It will Increase the profit
(C) It will decrease the profit
(D) No effect on profit

(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 is maximum

(A) Lead time
(B) Re-order level
(C) Maximum consumption
(D) Danger level

(A) Direct labor cost
(B) Indirect labor cost
(C) Conversion cost
(D) Prime cost

(A) Under this method of remuneration a worker is paid on the basis of time taken by him to perform the work
(B) Under this method of remuneration a worker is paid on the basis of production
(C) The rate is expressed in terms of certain sum of money for total production
(D) The rate is not expressed in terms of certain sum of money for total production