Which of the following is true for the direct labor cost budget?

• A) The first line of the direct labor budget is total direct labor cost
• B) In the direct labor budget, ending inventory is subtracted and beginning inventory is added
• C) It is prepared from the sales budget
• D) It is prepared from the production budget

Which of the following is the formula used for calculating the selling expense budget?

• A) Variable incomes per month + (Incomes in Rs. x Fixed expense rate %)
• B) Fixed expenses per month + (Sales in Rs. x Variable expense rate %)
• C) Variable expenses per month + (Purchases in Rs. x Variable income rate %)
• D) Fixed incomes per month + (Expenses in Rs. x Fixed income rate %)

Management will make what kind of decision when there will be surplus cash in hand for a certain period?

• A) Operational decisions
• B) Investment decisions
• C) Financing decision
• D) All of the given options

Which of the following is not a cash outflow?

• A) New equipment
• B) Commission paid
• C) Cash drawings
• D) Depreciation

Which of the following is true of the manufacturing overhead budget?

• A) Includes both variable and fixed costs associated with overhead
• B) All of the given options
• C) Provides a schedule of all costs of production other than direct materials and direct labor
• D) Depreciation has to be deducted as a non-cash expense in order to determine the level of cash required for overhead

While constructing a Break even chart, the gap between sales line and variable cost line shows which of the following?

• A) Contribution margin
• B) Variable cost
• C) Break even point
• D) Fixed cost

Which of the following is not an appropriate activity base for developing a flexible budget?

• A) Number of invoices processed
• B) Machine hours
• C) Direct labor cost
• D) Direct labor-hours

All of the following are assumptions in constructing a Break even chart EXCEPT:

• A) Price of cost factors remains constant
• B) Cost is effected by volume
• C) Long term period will be considered
• D) There is no change of time value of money

Cash budget is based on which of the following concept?

• A) accrual concept
• B) Cash concept
• C) Cost concept
• D) Both cash and accrual concept

Which of the following is true about flexible budget?

• A) A budget that is prepared using spreadsheet model
• B) Variable costs per unit will remain unchanged
• C) A budget in which total variable cost remains unchanged
• D) A budget that always based on actual capacity

The point at which the cost line intersects the sales line will be called:

• A) Break Even sales
• B) Margin of safety
• C) Contribution margin
• D) Budgeted sales

Which of the following is not an activity used by the management to expand the surplus cash?

• A) Business expansion
• B) Establishment of new project
• C) Introduction of new product in new area
• D) Investment in bank account

All of the following compose cost of goods sold except:

• A) Plant & Machinery
• B) Raw material
• C) FOH
• D) Direct Labor

Cost of Goods sold budget include(s) all of the following EXCEPT:

• A) Selling & distribution expenses budget
• B) General & Administrative expenses budget
• C) Production cost budget
• D) Cash budget

Information concerning Label Corporation’s Product A is as follows: Sales price Rs. 300,000,Variable cost Rs. 240, 000, Fixed Cost is Rs. 40,000.If Label increased sale price of Product A by 20%, the profit of the product A would be which of the following?

• A) Rs. 20,000
• B) Rs. 32,000
• C) Rs. 80,000
• D) Rs. 24,000

Which of the following factor should be considered while constructing an administrative selling expense budget?

• A) Promotional activities
• B) Past experience
• C) All of the given options
• D) Fixed and variable expenses

A master budget in a service organization will typically include a

• A) Merchandise purchases budget
• B) labor cost budget
• C) Direct materials budget
• D) Production budget

Consider the following data for the month of April:
Closing stock 80 units,Production 280 units,Sales 330 units
Based on the data, the opening stock for April will have to be:

• A) 50 units
• B) 410 units
• C) 130 units
• D) 70 units

The master budget begins with a:

• A) Production budget
• B) Direct labor budget
• C) Sales budget
• D) Direct materials budget

Which of the following is the main objective of direct material budget?

• A) All of the given options
• B) Developing purchasing requirements
• C) Financial Arrangements
• D) Determination of minimum and maximum stock level