Accounting For Managers IMP Questions

Q.no Question Options

.
a b c d Correct Answer
1 Choose the correct branch of Accounting that generates Financial Cost Accounting Management Tax Accounting c. Management Accounting
reports and financial information for the internal use of the Accounting Accounting
management of the business.
2 Choose the correct branch of Accounting that will provide Management Cost Accounting Book-keeping Financial Accounting d. Financial Accounting
data that is used for raising finance from external sources. Accounting
3 Identify Accounting’ is which type of system? Management Operating System Information System Analytical System c. Information System
System
4 Identify the option that does not include in the external users Employees Suppliers Customers Government a. Employees
of Accounting information.
5 Which of the following should not be the characteristics of Relevant Non-Objective Consistent Reliable b. Non-Objective
the Accounting information?
6 Which of the following option does not require in the Making provision Valuing stocks at Creating provision for Making provision for an c. Creating provision for
Conservatism concept? for doubtful debts lower of cost or discount on creditors unfavourable legal suit discount on creditors
net realizable
value
7 Idenfiy correct option states that "Income earned for a Cost Concept Money Realisation Concept Matching Concept d. Matching Concept
particular accounting period should be matched against the Measurement
expenses incurred during that period to earn the revenue." Concept

8 Which one of the following could not be classified as Goods sold for Sales on credit Fees from the sale of Income from the sale of d. Income from the sale of Fixed
revenue from operations? cash services Fixed Assets Assets
9 Identify the correct option that should be included in the list All assets and All the All the debit and All the income and c. All the debit and credit
of Trial Balance? liabilities of the transactions of credit balances of the expenses of the business balances of the accounts
business the business accounts
10 If a trial balance totals do not agree, the difference must be The Profit and A Nominal The Capital Account A Suspense Account d. A Suspense Account
entered in which of the following account? Loss Account Account
11 Choose the correct option for the starting point of Journal Cash Book Ledger Trial Balance d. Trial Balance
preparation of ‘Financial Statements’?
12 All the following can be classified as ‘Investing Activities’ of Dividend received Interest received Machinery purchased Dividend paid d. Dividend paid
the business for preparation of cash flow statements. Which by paying cash
of the following can be exception for this?
13 ‘Capital Work-in- Progress’ stands for which of the following Non Current Asset Investment Current Asset Non Current liability a. Non Current Asset
option ?
14 Profits not distributed as dividends are known as Profit after tax ( Gross Profit Retained Earnings Earnings before Interest c. Retained Earnings
PAT) and Tax (EBIT)
15 If Higher the Interest coverage ratio, then which of the Lower Higher Lesser No relation between b. Higher
following will be the flexibility to borrow more in form external interest coverage ratio and
debt ? flexibility to borrow
16 What exactly will result if an increase in sales price? Does not affect Lowers the net Increases the break Lowers the break even d. Lowers the break even point
the break-even profit even point point
point
17 Which of the following option will result if fixed cost per unit Production Production Variable costs per Prime Costs per unit b. Production volume decreases
decreases ? volume increases volume unit decreases decreases
decreases
18 Each of the following would affect the break-even point Number of units Variable cost per Total Fixed costs Sales price per unit a. Number of units sold
except a change in the sold unit
19 To obtain the break-even point in rupees, total fixed costs Variable cost per Fixed cost per Variable cost to sales Profit-Volume ( P/V) ratio d. Profit-Volume ( P/V) ratio
are divided by which of the following options? unit unit ratio
20 Choose the correct option that occurs at Break even point? Contribution Sales equals Variable costs equals Profit equals Fixed Costs a. Contribution equals Fixed
equals Fixed Fixed Costs Fixed Costs Costs
Costs
21 Financial Accounting’ majorly caters to the needs of which of External Government Internal Stakeholders Only General Public a. External Stakeholders
the following option? Stakeholders
22 ‘Accounting’ involves all except which of the following Recording Classifying Summarising Analysing d. Analysing
option?
23 What is the ‘Advance paid to supplier'? Long term Liability Expense Income Current Asset d. Current Asset

24 Choose the correct option that indicates the Financial Return on Capital Debt Equity ratio Net profit margin and Price Earning ratio and b. Debt Equity ratio and Debt
flexibility available with the business ? employed and and Debt service Total Asset turnover Dividend yield ratio service coverage ratio
Total Asset coverage ratio ratio
turnover
25 Identify correct option at Break even point indicates that There is profit There is loss There is no profit no There could be profit or c. There is no profit no loss
point of sales in value/volume? loss loss