Financial english - 2nd Term - Module B

What is the main purpose of management accounting?

• To comply with tax regulations

• To provide information to external stakeholders

• To help managers make informed decisions

• To audit financial records

Which of the following is typically not included in management accounting?

• Budget forecasts

• Cost analysis

• Tax statements

• Break-even calculations

A fixed cost is one that:

• Increases with the volume of production

• Varies with production per unit

• Remains constant regardless of production

• Changes seasonally

Which of the following is an example of a variable cost?

• Factory rent

• Salaries of permanent staff

• Raw materials

• Insurance premiums

The break-even analysis helps a company:

• To present tax returns

• To determine its market value

• To know how much to sell to cover costs

• To avoid hiring more workers

Direct costs can be best described as:

• Costs that are shared between departments

• Costs not directly attributable to a product

• Costs assigned to a specific product or department

• Monthly subscription fees

Indirect costs are also known as:

• Fixed costs

• Operating costs

• Overhead costs

• Break-even costs

A budget is:

• An estimate of tax statements

• A legal financial statement

• A financial plan for a future period

• A list of debts and credits

The difference between actual figures and budgeted figures is called:

• Break-even point

• Margin of safety

• Variance

• Depreciation

A main difference between financial accounting and management accounting is:

• Financial accounting focuses on the future; management accounting is historical

• Financial accounting is for external users; management accounting is for internal users

• Management accounting requires legal audits; financial accounting does not

• Management accounting uses only fixed costs