All India Management Association (AIMA) 2007 M.B.A Marketing Management Accounting for ision Making - II - Question Paper
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(b) 33.33%
(c) 75.00%
(d) 30.00%
(e) 50.00%.
( 1 mark)
23. Richies Ltd. currently operates at 60% capacity level. The normal capacity is 3,00,000 units. The variable cost per unit is Rs.33 and the total fixed costs are Rs.18,60,000. If the company desires to earn a profit of Rs.3,00,000, the sale price of the product per unit is
(a) Rs.28.92
(b) Rs.32.40
(c) Rs.45.00
(d) Rs.20.40
(e) Rs.47.17.
( 1 mark)
24. Cute Toys Ltd. produces and sells 50,000 toys at Rs.20 every with a profit of Rs.5 every. The company has furnished the subsequent cost structure per unit for its product for the year 2008-09:
Particulars Rs.
Direct material & labor costs 8
Works overhead 5 (50% fixed)
Sales expenses 2 (25% variable)
The direct material & labor costs are likely to increase by 35% during the next financial year. There will not be any change in the selling price and other costs. The company receives an offer to supply additional 20,000 toys. The contribution for additional 20,000 toys will be
(a) Rs.4,00,000
(b) Rs.2,00,000
(c) Rs.2,50,000
(d) Rs.2,76,000
(e) Rs.1,24,000.
( 2 marks)
25. A profit making firm can increase its return on investment by
(a) Increasing sales revenue and operating expenses by the identical amount in rupees
(b) Increasing investment and operating expenses by the identical amount in rupees
(c) Decreasing sales revenue and operating expenses by the identical percentage
(d) Increasing sales revenue and operating expenses by the identical percentage
(e) Decreasing investment and sales by the identical percentage.
( 1 mark)
26. Which of the subsequent statements is false?
(a) Under full cost pricing, the normal mark-up is based on sales value
(b) Full cost pricing is designed to recover both fixed costs and variable costs
(c) Under full cost pricing, sellers do not take advantage of buyers when latter’s demand becomes acute
(d) Pricing decisions may be influenced by internal factors such as cost and profit objectives
(e) Contribution margin approach to pricing is concerned with cost, quantity and profit.
( 1 mark)
27. Notional rent charged on business premises owned by the proprietor is an example of
(a) Programmed cost
(b) Replacement cost
(c) Imputed cost
(d) Committed cost
(e) Discretionary cost.
( 1 mark)
28. Which of the subsequent statements is false with regard to value added?
(a) Gross value added is derived by deducting depreciation from the net value added
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