Accounting Paper

International Islamic University Islamabad

( Objective Part)

Paper of Management Accounting

NAME:

REG#:

Time Allowed 30 minutes

Question # 1 10 Marks

Listed below are several costs typically found in organizations:

1. Costs of shipping finished goods to customers.

2. Wood used in furniture manufacturing.

3. Sales manager’s salary.

4. Secretary to the company president.

5. Lubricants to machines.

6. Sales commissions.

7. Advertising cost.

8. Paper used in textbook production.

9. Rent on a factory building.

10. Fringe benefits, assembly-line workers.

REQUIRED:

1. Classify each cost as being either (VARIABLE OR FIXED),

(DIRECT OR IN-DIRECT), (SELLING OR ADMINISTRIVE) cost.

Question # 2 10 Marks

MULTIPLE CHOICE QUESTIONS:

1) Which of the following is the correct description of the break-even point?

A) Where total revenue equals total fixed and variable costs.

B) Where total revenue equals total variable costs.

C) Where total revenue equals total fixed costs.

D) Where total revenue equals total contribution.

2) When a manufacturing business prepares budgets for a period, which is normally the first budget to be prepared?

A) Production budget.

B) Sales budget.

C) Capital expenditure budget.

D) Cash budget.

3) Which one of the following best describes the margin of safety?

A) The extent to which the total sales exceeds the total fixed costs.

B) The extent to which the total sales exceeds the total variable...