Questions
Which of the following is not a part of Capital Budgeting?
- External Rate of Return
- Net Present Value
- Internal Rate of Return
- Pay back period
- Profitability Index
A limited company is under a legal duty to disclose information to parties external to the company.
To which of the following groups does this requirement mainly apply?
- Shareholders
- Bank
- Customers
- Suppliers
- None of these
In ratio analysis, Du-Pont Control Chart shows the relationship of _______________ and ______________ for calculation of return on total investment ratio (ROI).
- Liquid Assets and Current Liabilities
- Current asset and current liabilities
- Net profit margin ratio and total investment turnover ratio
- Cash flow from operations and Net Profit of Company
- None of these
Which of the following is the correct formula for Absolute Acid Test Ratio?
- Liquid Assets/Current Liabilities
- Absolute liquid assets/current assets
- Current assets/current liabilities
- Absolute liquid assets/current liabilities
- None of these
If a company uses predetermined overhead recovery rates and at the end of a period finds that there has been an under-recovery of overhead, which of the following best explains how the under recovery has occurred?
- Actual overhead cost has exceeded the amount used as a basis for the establishment of the predetermined rate.
- Actual overhead cost has been less than the amount used as a basis for the establishment of the predetermined rate.
- Actual activity levels were higher than planned, due to an increase in demand.
- An expected price increase in the overhead costs, which was built into the overhead recovery rate did not take place.
- All of these
Managerial accounting does not encompass
- Calculating product cost
- Calculating earning pershare
- Determing cost behaviour
- Profit planning
- None of these
Management accounting reports can be described as
- General-purpose
- Macro-reports
- Special-purpose
- Classified financial statements
- None of these
Who will not be considered as an internal user of management information?
- Creditor
- Department manager
- Controller
- Treasurer
- All the above are correct
What is high low method?
- High Low Method is the method, which is used to divide total cost into average cost and marginal cost.
- High Low Method is the method, which is used to divide total fixed cost into average fixed cost and marginal fixed cost.
- High Low Method is the method, which is used to divide total variable cost into average variable cost and marginal variable cost.
- High Low Method is the method, which is used to divide total cost into variable cost and fixed cost.
- None of these
What does Aging of Accounts means?
- It is to classify the transactions.
- It is to classify the accounts on the basis of nature of company.
- It is to classify the accounts on the basis of different ledgers.
- It is to classify the accounts on the basis of billing or due date.
- None of these
What will be the effect of bonus issue in cash flow statement?
- It will be included in cash flow from investing activities.
- It will be included in cash flow from financing activities.
- It will not appear as no cash flow occurs as a result of a bonus issue.
- It will be included as part of cash flow from operations.
- None of these
Which of the following correctly explains about adjunct account?
- It increases book value of liability account.
- It increases book value of asset account.
- It increases book value of expense account.
- It increases book value of income account.
- It decreases book value of liability account.