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WorksheetsMA (Ch-1 to Ch-4)
Total questions: 38
Worksheet time: 1hrs 17mins
Which TWO of the following statements about qualities of good information are true?
1. It should be relevant for its purposes
2. It should be communicated to the right person
3. It should be completely accurate
4. It should be provided whatever the cost
1 & 2
2 & 3
1 & 3
2 & 4
The sales manager has prepared a manpower plan to ensure that sales quotas for the forthcoming year are achieved. This is an example of what type of planning?
Strategic planning
Tactical planning
Operational planning
Corporate planning
Which TWO of the following statements about management accounting information are true?
1. They may include non-financial information
2. They are required by law to be produced
3. They are used to aid planning
4. They are for use by parties external to the organization
1 & 2
1 & 3
2 & 3
1 & 4
Which of the following statements is/are correct?
(i) A management control system is a term used to describe the hardware and software used to drivea database system which produces information outputs that are easily assimilated by management.
(ii) An objective is a course of action that an organisation might pursue in order to achieve its strategy
(iii) Information is data that has been processed into a form meaningful to the recipient.
(i), (ii) and (iii)
(i) and (iii)
(ii) and (iii)
(iii) only
Good information should have certain qualities.
Which TWO of the following are required as qualities of good management information?
1. Complete
2. Extensive
3. True and fair
4. Accurate
1 & 3
2 & 4
1 & 4
1 & 2
Monthly variance reports are an example of which one of the following types of management information?
Tactical
Strategic
Non-financial
Operational
Which of the following statements is/are correct?
(i) Information for decision-making should incorporate uncertainty in some way.
(ii) The data used to prepare financial accounts and management accounts are the same.
(i) is true and (ii) is false
(ii) is true and (i) is false
Both are true
Both are false
Which of the following statements is correct?
Management accounting systems provide information for use in fulfilling legal requirements.
Management accounting systems provide information for the use of decision-makers within an organisation
Management accounting systems provide information for use by shareholders
Management accounting systems provide information for use by tax authorities.
Which TWO of the following would be data rather than information?
1. Sales increase/decrease per product in last quarter
2. Total sales value per product
3. Total material usage
4. Sales staff commission as a percentage of total sales
1 & 3
2 & 3
1 & 2
2 & 4
Which of the following are primary sources of data -
Historical records of transport costs to be used to prepare forecasts for budgetary plannin
The Annual Abstract of Statistics, published by the Office for National Statistics in the United kingdom
Data collected by a bank in a telephone survey to monitor the effectiveness of the bank'customer services
None of the above
Which TWO of the following statements regarding different types of data are true?
1. Secondary data are data collected especially for a specific purpose.
2. Discrete data can take on any value.
3. Qualitative data are data that cannot be measured.
4. Population data are data arising as a result of investigating a group of people or object
1 & 3
2 & 3
1 & 4
3 & 4
Which of the following statements concerning Big Data analytics is correct?
Big Data analytics relies on digital information
Big Data analytics relies on written information
Big Data analytics relies on verbal information
Big Data analytics relies on confidential information
Which of the following statements are true?
1. Big data analytics allows businesses to analyse and reveal insights in data which they havepreviously been unable to analyse.
2. In order for organisations to analyse big data and to gain insights from it, the source data needs to be structured within a software package.
3. One of the key features of big data is the speed with which data flows into an organisation, and with which it is processed.
1 and 2 only .
1 and 3 only
2 and 3 only
1, 2 and 3
Which of the following statements are true?
1. One of the uses of exploiting big data analytics for profit making organisations is to lead to increased profit margins.
2. One of the uses of exploiting big data analytics in non profit-seeking organisations is to lead to reduced costs.
3. Big data analytics show correlation and causation between variables.
1 and 2 only
1 and 3 only
2 and 3 only
1, 2 and 3
The cost of materials for product A are as follows. Material W: $2,250
Material X: $3,000
Material Y: $3,600
Material Z: $150
If the material proportions were displayed on a pie chart, how many degrees would material Y represent?
1400 degrees
44 degrees
140 degrees
144 degrees
Which of the following statements is true?
Sales of mint choc chip rose steadily over the four months
Total sales fell in the month of July
In June, the gap between sales of strawberry and sales of chocolate reduced
Sales of blueberry rose in May and July
Which of the following would be best suited to represent the relationship between a company’s advertising expenditure and its sales revenue?
1. A pie chart
2. A bar chart
3. A scatter graph
1 only
2 only
3 only
2 and 3
Which TWO of the following would be classed as indirect labour?
1. Assembly workers in a company manufacturing televisions
2. A stores assistant in a factory store
3. Factory cleaning staff
4. Plasterers in a construction company
5. A consultant in a firm of management consultants
1 & 2
3 & 4
2 & 3
4 & 5
A manufacturing firm is very busy and overtime is being worked.
How would the amount of overtime premium contained in direct wages normally be classed?
Part of prime cost
Factory overheads
Direct labour costs
Administrative overheads
A company makes chairs and tables.
Which TWO of the following items would be treated as an indirect cost?
1. Wood used to make a chair
2. Metal used for the legs of a chair
3. Staple to attach fire retardant labels to chairs
4. Fabric to cover the seat of a chair
5. The salary of the sales director of the company
1 & 3
2 & 5
3 & 5
1 & 5
Which TWO of the following is the manager of a profit centre likely to have control?
1. Selling prices
2. Controllable costs
3. Apportioned head office costs
4. Capital investment in the center
1 & 3
2 & 4
1 & 2
3 & 4
Which of the following best describes a controllable cost?
A cost which arises from a decision already taken, which cannot, in the short run, be changed.
A cost for which the behavior pattern can be easily analyzed to facilitate valid budgetary control comparisons.
A cost which can be influenced by its budget holder.
A specific cost of an activity or business which would be avoided if the activity or business did not exist.
Which TWO of the following items might be a suitable cost unit within the credit control department of a company?
1. Stationery cost
2. Telephone bill
3. Customer account
4. Cheque received and processed
1 & 2
2 & 3
3 & 4
1 & 4
Which of the following best describes a period cost?
A cost that relates to a time period which is deducted as expenses for the period and is not included in the inventory valuation.
A cost that can be easily allocated to a particular period, without the need for arbitrary apportionment between periods.
A cost that is identified with a unit produced during the period, and is included in the value of inventory. The cost is treated as an expense for the period when the inventory is actually sold.
A cost that is incurred regularly every period, eg every month or quarter.
A company employs four supervisors to oversee the factory production of all its products.
How would the salaries paid to these supervisors be classified?
As a direct labour cost
As a direct production expense
As a production overhead
As an administration overhead
A company manufactures and sells toys.
Which TWO of these costs are classified as distribution costs?
1. Rental of the finished goods warehouse
2. Depreciation of its own fleet of delivery vehicles
3. Costs associated with a marketing campaign
4. Commission paid to sales staff
1 & 2
3 & 4
2 & 3
1 & 4
Which of the following describes a cost center?
A unit of output or service for which costs are ascertained
A function or location for which costs are ascertained
A segment of the organization for which budgets are prepared
An amount of expenditure attributable to a particular activity
Fixed costs are conventionally deemed to be which of the following?
Constant per unit of output
Constant in total when production volume changes
Outside the control of management
Easily controlled
The following data relate to the overhead expenditure of a contract cleaners at two activity levels.
Square metres cleaned - 13,500 15,950
Overheads - $84,865 $97,850
What is the estimate of the overheads if 18,300 square meters are to be cleaned?
$11,035
$11,305
$110,305
$10,305
A company has recorded the following data in the two most recent periods.
Total costs Volume of
of production production
$ Units
13,500 700
18,300 1,100
What is the best estimate of the company's fixed costs per period?
$5,400
$5,000
$4,800
$5,100
A production worker is paid a salary of $650 per month, plus an extra 5 cents for each unit produced during the month.
How is this type of labour cost best described?
A variable cost
A fixed cost
A step cost
A semi-variable cost
A total cost is described as staying the same over a certain activity range and then increasing but remaining stable over a revised activity range in the short term.
What type of cost is this?
A fixed cost
A variable cost
A semi-variable cost
A stepped fixed cost
A company incurs the following costs at various activity levels:
Total cost Activity level
$ Units
250,000 5,000
312,500 7,500
400,000 10,000
Using the high-low method what is the variable cost per unit (to the nearest whole number)?
$10
$20
$300
$30
An organisation manufactures a single product. The total cost of making 4,000 units is $20,000 and the total cost of making 20,000 units is $40,000. Within this range of activity the total fixed costs remain unchanged.
What is the variable cost per unit of the product (to 2 dp)?
$2.25
$1.75
$1.00
$1.25
The total cost of production for two levels of activity is as follows:
Level 1 Level 2
Production (units) 3,000 5,000
Total cost ($) 6,750 9,250
The variable production cost per unit and the total fixed production cost both remain constant in the range of activity shown.
What is the level of fixed costs (to the nearest whole number)?
$10,000
$20,000
$30,000
$3,000
The following shows the total overhead costs for given levels of a company's total output.
Cost Output
$ Units
4,000 1,000
7,000 2,000
10,000 3,000
9,500 4,000
A step up in fixed costs of $500 occurs at an output level of 3,500 units.
What would be the variable overhead cost per unit (to the nearest $0.01) using the high-low technique?
$1.67 per unit
$1.83 per unit
$2.75 per unit
$3.00 per unit
A company has prepared flexed budgets at two activity levels. The cost per unit of three costs is given below. All three costs behave in a linear manner with respect to activity.
Activity level (units)
10,000 15,000
Cost -
X - $3.0 per unit $2.0 per unit
Y - $1.0 per unit $1.0 per unit
Z - $3.5 per unit $3.0 per unit
Is each of the costs variable, semi-variable or fixed?
X - Variable, Y - Fixed, Z - Semi-variable
X - Variable, Y - Fixed, Z - Variable
X - Fixed, Y - Variable, Z- Semi-variable
X - Fixed, Y - Variable, Z - Fixed
The following observations of output and cost have been made:
Output Cost
Units $
8,000 39,400
20,000 68,000
It is known that at output levels above 15,000 units, variable cost per unit drops by $1 per unit for all subsequent units produced.
What is the variable cost for each unit of output above 15,000 units?
$1.80
$0.97
$2.80
$3.40
