Management Accounting Questions and Answers Part-1

1. Quantity of produced output is divided with cost of all used inputs to calculate
a) engineered productivity
b) targeted productivity
c) partial productivity
d) total factor productivity

Answer: d

2. In operating income strategic analysis, a component which measures change in operating income attributed to change in output quantity is classified as
a) internal process component
b) growth component
c) price recovery component
d) productivity component

Answer: b

3. An example of financial perspective in balanced scorecard is
a) employee turnover rates
b) operating capabilities and number of patents
c) operating income and revenue growth
d) customer satisfaction and market share

Answer: c

4. An ability of an organization, to offer its services or products that must be perceived by customers as unique and superior, in comparison to its competitors is called
a) inelastic demand
b) product differentiation
c) cost leadership
d) elastic demand

Answer: b

5. If quantity of manufactured jackets is 2250000 units and leather used to produce output is 3500000 sq.m, then direct materials' partial productivity will be
a) 0.642 unit of jacket per sq.m of leather
b) 0.342 unit of jacket per sq.m of leather
c) 0.442 unit of jacket per sq.m of leather
d) 0.542 unit of jacket per sq.m of leather

Answer: a

6. If net initial investment is $6850000 and uniform increases yearly cash flows is $2050000, then payback period will be
a) 3.34 years
b) 4.34 years
c) 5.34 years
d) 6.34 years

Answer: a

7. Net initial investment is divided by uniform increasing in future cash flows to calculate
a) discounting period
b) investment period
c) payback period
d) earning period

Answer: c

8. If nominal rate is 26% and inflation rate is 12%, then real rate can be
a) 13.75%
b) 11.65%
c) 12.50%
d) 13.50%

Answer: c

9. A concept which explains a received money in present time, is more valuable than money received in future is called
a) lead value of money
b) storage value of money
c) time value of money
d) cash value of money

Answer: c

10. If payback period is 4 years and uniform increases in cash flows per year is $2750000, then net initial investment can be
a) $10,511,000
b) $12,105,000
c) $1,100,000
d) $11,000,000

Answer: d