MCQOPTIONS
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MCQOPTIONS
This section includes 50 Mcqs, each offering curated multiple-choice questions to sharpen your Cost Accounting knowledge and support exam preparation. Choose a topic below to get started.
| 1. |
The target operating income is multiplied to tax rate and then subtracted from target operating income to calculate |
| A. | target net cost |
| B. | target net income |
| C. | target net gain |
| D. | target net loss |
| Answer» C. target net gain | |
| 2. |
The gross margin is $7000 and the revenues are $16000, then the cost of goods sold would be |
| A. | $23,000 |
| B. | −$23000 |
| C. | −$9000 |
| D. | $9,000 |
| Answer» E. | |
| 3. |
The fixed cost is added to target operating income and then divided to contribute margin per unit to calculate |
| A. | quantity of units required to sold |
| B. | selling of units |
| C. | sold units |
| D. | contributed units |
| Answer» B. selling of units | |
| 4. |
The formula to calculate the contribution margin is |
| A. | revenue - all variable cost |
| B. | revenue + all variable cost |
| C. | cost + revenue |
| D. | revenue - breakeven units |
| Answer» B. revenue + all variable cost | |
| 5. |
If the gross margin is $2000 and the revenue is $5000, then the cost of goods sold would be |
| A. | −$8000 |
| B. | $3,000 |
| C. | −$3000 |
| D. | $8,000 |
| Answer» C. −$3000 | |
| 6. |
If the target net income is $36000 and the tax rate is 40%, then the target operating income will be |
| A. | $10,000 |
| B. | $20,000 |
| C. | $40,000 |
| D. | $60,000 |
| Answer» E. | |
| 7. |
If the breakeven revenue is $220000 and the revenue per bundle is $10000, then the number of bundles to be sold to breakeven will be |
| A. | 32 bundle |
| B. | 22 bundle |
| C. | 42 bundle |
| D. | 38 bundle |
| Answer» C. 42 bundle | |
| 8. |
The gross margin is added into cost of sold goods to calculate the |
| A. | revenues |
| B. | operating leverage |
| C. | contribution margin |
| D. | operating margin |
| Answer» B. operating leverage | |
| 9. |
The fixed cost, and the contribution margin percentage for the bundle are divided to calculate |
| A. | breakeven costs |
| B. | breakeven revenues |
| C. | breakeven units |
| D. | breakeven sales |
| Answer» C. breakeven units | |
| 10. |
In monetary terms, an expected value of the outcome is classified as |
| A. | expected value |
| B. | expected decision value |
| C. | expected outcome value |
| D. | expected monetary value |
| Answer» E. | |
| 11. |
The quantity or number of units of different products that together make up total sales of the company is called |
| A. | sales mix |
| B. | product mix |
| C. | unit mix |
| D. | quantity mix |
| Answer» B. product mix | |
| 12. |
The gross margin is divided by revenues to calculate the |
| A. | income margin percentage |
| B. | Gross margin percentage |
| C. | cost margin percentage |
| D. | sales margin percentage |
| Answer» C. cost margin percentage | |
| 13. |
In accounting, the possibility of deviation of actual amount from an expected amount is classified as |
| A. | contribution |
| B. | certainty |
| C. | uncertainty |
| D. | margin |
| Answer» D. margin | |
| 14. |
The revenue is $11000 and all the variable cost is $6000, then the contribution margin would be |
| A. | −$17000 |
| B. | $17,000 |
| C. | $5,000 |
| D. | −$5000 |
| Answer» D. −$5000 | |
| 15. |
If the budgeted revenue is $50000 and the breakeven revenue is $35000, then the margin of safety would be |
| A. | $12,000 |
| B. | $14,000 |
| C. | $15,000 |
| D. | $16,000 |
| Answer» D. $16,000 | |
| 16. |
If the contribution margin is $3000 and the revenues are $9000, then all the variable costs will be |
| A. | $12,000 |
| B. | $6,000 |
| C. | −$6000 |
| D. | −$12000 |
| Answer» C. −$6000 | |
| 17. |
If the margin of safety is $35000 and the budgeted revenue is $80000, then the margin of safety in percentage will be |
| A. | 32.75% |
| B. | 43.75% |
| C. | 53% |
| D. | 22% |
| Answer» C. 53% | |
| 18. |
The set of all the occurrences that may happen in near future or in any other fixed time are called |
| A. | events |
| B. | distribution |
| C. | outcome |
| D. | actions |
| Answer» B. distribution | |
| 19. |
If the fixed cost is $20000, the target operating income is $10000 and the contribution margin per unit is $1200 then required units to be sold will be |
| A. | 55 units |
| B. | 45 units |
| C. | 35 units |
| D. | 25 units |
| Answer» E. | |
| 20. |
In cost accounting, the financial way of charging price for product above the cost, of acquiring or producing the goods is known as |
| A. | sales margin |
| B. | cost margin |
| C. | Gross margin |
| D. | income margin |
| Answer» D. income margin | |
| 21. |
The economic results that are predicted for possible combinations of events are classified as |
| A. | margin |
| B. | distribution |
| C. | collection |
| D. | outcome |
| Answer» E. | |
| 22. |
All the choices for decision that are easily available to managers are classified as |
| A. | outcome |
| B. | actions |
| C. | events |
| D. | distribution |
| Answer» C. events | |
| 23. |
If the fixed cost is $15000 and the breakeven revenue is $45000 then the contribution margin will be |
| A. | 33.34% |
| B. | 43.34% |
| C. | 23% |
| D. | 25% |
| Answer» B. 43.34% | |
| 24. |
If the contribution margin of bundle is $45000 and the revenue of the bundle is $15000, then the contribution margin percentage for bundle will be |
| A. | 6% |
| B. | 3% |
| C. | 9% |
| D. | 12% |
| Answer» C. 9% | |
| 25. |
The fixed cost is $25000 and the breakeven revenue is $95000, then the contribution margin will be |
| A. | $32 |
| B. | $30 |
| C. | $25 |
| D. | $26.31 |
| Answer» C. $25 | |
| 26. |
If the target net income is $9600 and the tax rate is 40%, then the target operating income would be |
| A. | $10,000 |
| B. | $12,000 |
| C. | $16,000 |
| D. | $14,000 |
| Answer» D. $14,000 | |
| 27. |
If the breakeven revenue is $360000 and the revenue per bundle is $12000, then the number of bundles to be sold to breakeven can be |
| A. | 52 bundles |
| B. | 48 bundles |
| C. | 45 bundles |
| D. | 30 bundles |
| Answer» E. | |
| 28. |
The contribution margin is divided to operate income to calculate |
| A. | degree of operating leverage |
| B. | degree of change |
| C. | degree of change in margin |
| D. | degree of change in income |
| Answer» B. degree of change | |
| 29. |
If the contribution margin of bundle is $4000 and the revenue of the bundle is $16000, then the contribution margin percentage for bundle will be |
| A. | 10% |
| B. | 15% |
| C. | 25% |
| D. | 35% |
| Answer» D. 35% | |
| 30. |
If the total units of product A, B and C are as 200,300 and 400 respectively then the sales mix would be |
| A. | 100 units |
| B. | 900 units |
| C. | 400 units |
| D. | 500 units |
| Answer» C. 400 units | |
| 31. |
If the budgeted revenue is $20000 and the breakeven revenue is $15000, then the margin of safety will be |
| A. | $35,000 |
| B. | $13,000 |
| C. | $5,000 |
| D. | $10,000 |
| Answer» D. $10,000 | |
| 32. |
If the margin of safety is $25000 and the budgeted revenue is $45000, then the margin of safety in percentage will be |
| A. | 55.56% |
| B. | 25.50% |
| C. | 28% |
| D. | 45.00% |
| Answer» B. 25.50% | |
| 33. |
The graph, which shows the change in sold quantity and its effect on operating income is called |
| A. | PV graph |
| B. | CV graph |
| C. | SO graph |
| D. | QI graph |
| Answer» B. CV graph | |
| 34. |
If the sales quantity is 7000 units and the breakeven quantity is 1500 units, then the margin of safety would be |
| A. | 4500 units |
| B. | 5500 units |
| C. | 8500 units |
| D. | 9500 units |
| Answer» C. 8500 units | |
| 35. |
The contribution margin is $34000 and the operating income is $12000, then the degree of operating leverage will be |
| A. | 4.84 |
| B. | 2.84 |
| C. | 3.84 |
| D. | 5.84 |
| Answer» C. 3.84 | |
| 36. |
If the contribution margin is $25000 and the revenues are $60000, then all the variable costs will be |
| A. | −$85000 |
| B. | −$35000 |
| C. | $85,000 |
| D. | $35,000 |
| Answer» E. | |
| 37. |
If the fixed cost is $65000 and the contribution margin percentage for the bundle is 0.575, then the breakeven revenue will be |
| A. | $113,043.48 |
| B. | $1,200,000 |
| C. | $130,000 |
| D. | $140,000 |
| Answer» B. $1,200,000 | |
| 38. |
If the budgeted sales in unit is 50 and the breakeven sales in unit is 12, then the margin of safety in units will be |
| A. | 62 |
| B. | 38 |
| C. | 48 |
| D. | 58 |
| Answer» C. 48 | |
| 39. |
If the gross margin is $9000 and the cost of goods sold is $8000 then the revenue will be |
| A. | $1,000 |
| B. | −$1000 |
| C. | $17,000 |
| D. | −$17000 |
| Answer» D. −$17000 | |
| 40. |
If the contribution margin is $72000 and the operating income is $12000, then the degree of operating leverage would be |
| A. | 8 |
| B. | 7 |
| C. | 6 |
| D. | 5 |
| Answer» D. 5 | |
| 41. |
If the fixed cost is $10000, the target operating income is $8000 and the contribution margin per unit is $900, then required units to be sold will be |
| A. | 45 units |
| B. | 30 units |
| C. | 20 units |
| D. | 52 units |
| Answer» D. 52 units | |
| 42. |
If the gross margin is $6000 and the total revenue is $26000, then the gross margin percentage will be |
| A. | 23.08% |
| B. | 24.08% |
| C. | 25.08% |
| D. | 26.08% |
| Answer» B. 24.08% | |
| 43. |
The type of distribution, which consists of alternative outcomes and probabilities of events is classified as |
| A. | event table |
| B. | outcome table |
| C. | decision table |
| D. | probability table |
| Answer» D. probability table | |
| 44. |
The amount of money by which the total revenues exceed the breakeven revenues is classified as |
| A. | margin of safety |
| B. | margin of profit |
| C. | margin of loss |
| D. | margin of income |
| Answer» B. margin of profit | |
| 45. |
An effect of fixed cost to change in operating income is classified as |
| A. | uncertain margin |
| B. | certain margin |
| C. | operating margin |
| D. | operating leverage |
| Answer» E. | |
| 46. |
The fixed cost is divided by break-even revenues to calculate |
| A. | cost margin |
| B. | fixed margin |
| C. | revenue margin |
| D. | contribution margin |
| Answer» E. | |
| 47. |
If the cost of goods sold is $8000, the gross margin is $5000 then the revenue will be |
| A. | $13,000 |
| B. | −$13000 |
| C. | $3,000 |
| D. | −$3000 |
| Answer» B. −$13000 | |
| 48. |
Competitiveness can be best measured by |
| A. | Gross margin |
| B. | income margin |
| C. | sales margin |
| D. | cost margin |
| Answer» B. income margin | |
| 49. |
The type of distribution, which describes whether events to be occurred are mutually exclusive or collectively exhaustive can be classified as |
| A. | mutual distribution |
| B. | probability distribution |
| C. | collective distribution |
| D. | marginal distribution |
| Answer» C. collective distribution | |
| 50. |
The gross margin is added to the cost of sold goods to calculate |
| A. | revenues |
| B. | selling price |
| C. | unit price |
| D. | bundle price |
| Answer» B. selling price | |