Symbiosis International Education Centre 2008 M.B.A Business Administration Management accounting - Question Paper

(a) It motivates divisional managers to make good economic decisions
(b) It is useful for evaluating performance of the divisional managers
(c) It is a selling price established for goods or services sold by 1 division to a different under the
identical organization
(d) It does not help in measuring divisional performances
(e) Cost based transfer pricing can be used when market price does not exist. (1 mark)

43.The data, equipment and computer programs that are used to develop info for managerial use is
known as
(a) Management by exception
(b) Management by objective
(c) Management control
(d) Management info system
(e) Value chain analysis. (1 mark)
(e) Value chain analysis. (1 mark)

44.Do-Little Ltd., produces oak desks. The company uses the standard direct material of 28 square feet of
oak lumber at a rate of Rs.5.35 per square foot for 1 oak desk. The company produced 2,300 desks at
a total material price of Rs.3,23,232 for 62,400 square feet of oak lumber. The material price variance
was
(a) Rs. 9,500 (Adverse)
(b) Rs.10,948 (Favorable)
(c) Rs.10,948 (Adverse)
(d) Rs.10,608 (Favorable)
(e) Rs.10,608 (Adverse). (2marks)

45.Fardeen Ltd., has furnished the subsequent info pertaining to product X for a period:
If the company produces 9,870 units, the fixed manufacturing overhead quantity variance would be
Budgeted fixed overhead costs Rs.32,400
Budgeted production 10,800 units
true fixed overhead costs Rs.33,000
(a) Rs. 600 (Adverse)
(b) Rs.1,100 (Adverse)
(c) Rs.1,100 (Favorable)
(d) Rs.2,790 (Favorable)
(e) Rs.2,790 (Adverse). (2marks)

46.Which of the subsequent best identifies the decision-making relationship ranging from cost drivers, cost
objects and accumulated cost?
(a) Cost objects are used to allocate estimated accumulated cost to cost drivers
(b) Cost objects are used to allocate true accumulated cost to cost drivers
(c) Cost drivers are used to allocate estimated accumulated cost to cost objects
(d) Cost drivers are used to allocate true accumulated cost to cost objects
(e) Cost objects are used to apportion true accumulated cost to cost drivers. (1 mark)

Earning:   Approval pending.