Costing

21. Match the following. List-I List-II a. Leverage ratio 1. Short-term solvency b. Liquidity ratio 2. Earning capacity c. Turnover ratio 3. Relationship between debt and equity d. Profitability ratio 4. Efficiency of asset management

a-2, b-1, c-4, d-3
a-3, b-2, c-1, d-4
a-4, b-3, c-1, d-2
a-3, b-1, c-4, d-2

Detailed SolutionMatch the following. List-I List-II a. Leverage ratio 1. Short-term solvency b. Liquidity ratio 2. Earning capacity c. Turnover ratio 3. Relationship between debt and equity d. Profitability ratio 4. Efficiency of asset management

22. In Kaizen budgeting, costs are based on all improvements which is

to be implemented
based on current practice
based on past prices
based on sold quantity

Detailed SolutionIn Kaizen budgeting, costs are based on all improvements which is

23. Responsibility accounting aims to

Ensure the manager is punished if things go wrong
Ensure costs become the responsibility of a specific manager
Allocate costs to all areas of a business
Reduce the costs a department incurs

Detailed SolutionResponsibility accounting aims to

24. If provision for taxation is treated as a current liability, then payment of tax is

an application of funds
a sources of funds
no flow of funds
None of these

Detailed SolutionIf provision for taxation is treated as a current liability, then payment of tax is

25. When is the net present value negative,

the present value of cash outflows is greater than the future value of cash outflows
the future value of cash inflows is greater than the present value of cash outflows
the present value of cash outflows is greater than the present value of cash inflows
the present value of cash inflows is greater than the present value of cash outflows

Detailed SolutionWhen is the net present value negative,

26. . . . . . . . . arises where the actual process loss is less than the normal predetermined process loss.

Normal loss
Abnormal loss
Abnormal gain
None of these

Detailed Solution. . . . . . . . arises where the actual process loss is less than the normal predetermined process loss.

27. Reorder level = ________.

maximum level - minimum level
maximum consumption X maximum reorder period
minimum consumption x minimum reorder period
normal consumption X normal reorder period

Detailed SolutionReorder level = ________.

28. Within relevant range, cost function which cost does not change in narrow ranges of activity is called

fixed cost function
variable cost function
step variable cost function
step fixed cost function

Detailed SolutionWithin relevant range, cost function which cost does not change in narrow ranges of activity is called

29. Which of the following items would be specifically included in the statement of cash flows constructed in compliance with AS-3?

Conversion of debt to equity
Acquiring an asset through a lease
Operating and non-operating cash flow information
Purchasing a building by giving a mortgage to the seller

Detailed SolutionWhich of the following items would be specifically included in the statement of cash flows constructed in compliance with AS-3?

30. Match the following. List-I List-II a. Performance budgeting 1. Fixed budget b. Zero base budgeting 2. Production oriented c. Summary of all functional budgets 3. Jimmy Carter d. Remain unchanged irrespective of level of activity actually attained 4. Master budget

a-3, b-4, c-1, d-2
a-3, b-4, c-2, d-1
a-2, b-4, c-1, d-3
a-2, b-3, c-4, d-1

Detailed SolutionMatch the following. List-I List-II a. Performance budgeting 1. Fixed budget b. Zero base budgeting 2. Production oriented c. Summary of all functional budgets 3. Jimmy Carter d. Remain unchanged irrespective of level of activity actually attained 4. Master budget

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