The capacity utilization ratio for is 85% and efficiency ratio for the month is 120%

Question 150. : A budget in which a responsibility centre manager must justify each planned activity and its budgeted total cost is called – (A) Traditional budget (B) Zero based budget (C) Master budget (D) Functional budget Answer: (B) Zero based budget

Question 158

Question 151. : To produce one unit of ‘A’, two ingredients, ie., 2 kg of X and 3 kg of Y are required:

What will be the quantity of consumption of ingredients X and Y, if 20,000 units of A are sold – (A) 46,000 kg 69,000 kg respectively (B) 49,000 kg 72,000 kg respectively (C) 40,000 kg 60,000 kg respectively (D) 43,000 kg 63,000 kg respectively Answer: (A) 46,000 kg 69,000 kg respectively

Question 152. : Which one of the following would not form part of master budget – (A) Cash budget (B) Statement of profit and loss (C) Statement of financial position (D) None of the above Answer: (D) None of the above

Question 153. : Which one of the following is not advantage of budgetary control? (A) Maximization of profit through effective planning (B) Planned approach for expenditure (C) Create necessary conditions for setting-up of standard costs (D) Based on quantitative data and represent only an impersonal appraisal to the conduct of business activity Answer: (B) Planned approach for expenditure

20% of the sales are on cash basis and balance on credit basis. The amount to be collected from debtors in the month of February and March will be – (A) Zero and ? 8,000 respectively (B) ? 8,000 ? 16,000 respectively (C) ? 8,000 ? 24,000 respectively (D) ? 16,000 ? 36,000 respectively Answer: (C) ? 8,000 ? 24,000 respectively

Question 155. : For a department, the standard overheads rate is ? 2.50 per hour and the overheads allowances are as follows:

Calculate the normal capacity level on the basis of which the standard overheads rate has been worked out – (A) 8,000 Hours (B) 7,000 Hours (C) 6,000 Hours (D) 9,000 Hours Answer: (A) 8,000 Hours

Question 156. : The budget which usually takes the form of budgeted profit and loss account and balance sheet is known as – (A) Cash budget (B) Master budget (C) Flexible budget (D) Sales budget Answer: (B) Master budget

Question 157. : While preparing cash budget, which of the following items would not be included (A) Interest paid to debenture holders (B) Salaries and wages (C) Bonus shares issued (D) Income-tax paid Answer: (C) Bonus shares issued

Question 160

: Budgeted standard hours of a factory are 15,000. The standard hours for actual production in the month will be – (A) 12,750 (B) 18,000 (C) 15,300 (D) 18,000 Answer: (C) 15,300

Question 159. : A plant produces a product in the quantity of 10,000 units at a cost of ? 3 per unit. If 20,000 units are produced, the cost per unit will be ? 2.50. Selling price per unit is ? 4. The variable cost per unit will be: (A) ? 2 (B) ? 3 (C) ? 4 (D) ? 1 Answer: (A) ? 2

: When demand forecasting is difficult, budget which is prepared: (A) Sales Budget (B) Production online payday loans Nebraska Budget (C) Financial Budget (D) Flexible Budget Answer: (D) Flexible Budget

Question 161. : The budget which usually takes the form of profit and loss account and balance sheet is known as: (A) Cash budget (B) Master budget (C) Flexible budget (D) Labour budget Answer: (B) Master budget

Question 162. : A fixed budget is one which: (A) is a plan for capital expenditure in monetary terms (B) is designed to remain unchanged irrespective of the volume of output or turnover attained (C) deals with income and expenditure applicable to a particular function (D) deals with none of these Answer: (B) is designed to remain unchanged irrespective of the volume of output or turnover attained