MANAGEMENT ACCOUNTING (F2) MID-TERM TEST

Class code: Questions: 15 MCQs

Exam day: Time: 35 minutes

FULL NAME: Score:

Question 1. A retailer has opening balance for inventory of 600 units valued at $50 per unit
at the beginning of December. The receipts and sales below have happened during
December.

Date Receipts Issues

1 Dec 500

10 Dec 800

20 Dec 400

30 Dec 150

The purchase price of receipts is $51.5 per unit.

By the weighted average method of valuation, compute the closing inventory at the end
of December.
A. $46,200
B. $17,967
C. $16,768
D. $38,200

Question 2. The data shown below is of the component A:

Ordering costs $200 per order
Inventory holding costs $32 per unit per year
Annual demand 2,450 units
What will the economic order quantity be (to the nearest whole number)?
A. 175 units
B. 62 units
C. 44 units
D. 124 units

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Question 3. Which of the data set below have the widest spread?

A B C D

Mean 300 350 400 500

Standard deviation 50 40 50 60

A. Data A
B. Data B
C. Data C
D. Data D

Question 4. Which TWO statements below about qualities of good information are
correct?
A. It is relevant to its purposes.
B. It is communicated to the right person.
C. Its accuracy is completely 100%.
D. It is provided no matter how much it costs.

Question 5. Engineering Co's profit in the last month is $4,000, computed by the absorption
costing. If marginal costing has been used, a loss of $6,000 might have occurred. Engineering
Co's fixed cost is $2 per unit. Sales within the same equals 20,000 units.
What is the number of units produced in the last month?
A. 15,000
B. 19,000
C. 21,000
D. 25,000

Question 6. John is in a three-person team of the production department. A group bonus

scheme is used to reward the team and if there is any bonus, the team leader will receive
40% first while the remaining will be shared evenly between John and the other member.
Detailed output for a specific week is given below.

Number of hours worked by team 32 hours

Production output achieved by team 160 units

Standard time to produce one unit 18 minutes

Group bonus being paid at $12 per hour 70% of time being

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 saved

What is the John’s bonus for this week?

A. $40.32
B. $57.60
C. $80.64
D. $134.40

Question 7. The information below for marketing and sales has been recorded over the last
six months.
With the high-low method, which option is the true equation to link marketing expense
and sales?

Sales revenue Marketing expense

Month
($’000) ($’000)

1 310 6

2 250 5

3 400 12

4 350 11

5 300 9

6 450 13

A. Sales revenue = 125,000 + (25 x Marketing expense)

B. Marketing expense = -5,000 + (0.04 x Sales revenue)
C. Sales revenue = 190,000 + (20 x Marketing expense)
D. Marketing expense = -9,500 + (0.05 x Sales revenue)

Question 8. Engineering Co had 60 direct assembly employees at the start of last year and
40 direct assembly employees at the year end. During the year, 30 direct assembly
employees left the Engineering Co to work for a competitor.
What is the last year’s labour turnover rate?
A. 16.7%
B. 20%
C. 25%
D. 60%
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Question 9. The below data displays a time series:
X 72 Y 82 68 76 84
A 3-point moving average series generated from this data gives the first two values as 76
and 78.
What are the (X, Y) values within the time series?
A. (76, 78)
B. (76, 80)
C. (80, 76)
D. (78, 76)

Question 10. A nation calculates the inflation rate by a base weighted index, with 20X0 as
the base year. Three distinct goods are used in the index. The unit prices and the quantities
bought (units of each goods) are depicted below.
Which is the weighted average price rise between 20X0 and 20X1, using the country's base
weighted index?

Quantity Quantity
Types of goods bought in 20X0 Price in 20X0 ($) bought in 20X1 Price in 20X1 ($)
(millions) (millions)

Butter 600 2 620 2.2

Coke 300 4 240 5

Mobiles 100 160 150 200

A. 20%
B. 24%
C. 24.3%
D. 77.2%

Question 11. The materials control account for Engineering Co for January looks like this.

Materials control account

$ $

Balance b/d 12,000 Work-in-progress 30,000

Suppliers 50,000 Overhead control 10,000

Work-in-progress 20,000 Balance c/d 42,000

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 82,000 82,000

Balance b/d 42,000

Which of the statements below are true?

(i) Issues of direct materials in January is $20,000
(ii) Issues of direct materials in January is $30,000
(iii) Issues of indirect materials in January is $10,000
(iv) Purchases of materials in January is $50,000
A. (i) only
B. (ii) and (iv) only
C. (ii), (iii) and (iv) only
D. All the statements

Question 12. The information below is available regarding 4 cost centres of Engineering Co.

Production cost centres Service

cost centre
Machinery Assembly Finishing
Canteen

Number of direct employees 14 12 4 0

Number of indirect employees 6 4 2 8

Overhead allocated and apportioned $57,000 $36,600 $17,920 $16,800

The overhead cost of the canteen is re-apportioned to each production cost centres based
on the number of employees in each production cost centre.
After being re-apportioned, what is the total overhead cost of the finishing department?
A. $2,400
B. $19,936
C. $20,160
D. $20,320

Question 13. Which TWO of the below is the manager of a profit centre can control?
A. Selling prices.
B. Administrable costs.
C. Apportioned headquarter costs.
D. Capitals invested in the centre.

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Question 14. This table presents Engineering Co's revenues for the last 6 months.
What kind of graph or chart should be used to show the fluctuations of total monthly
revenues across the 6 months?

Jul Aug Sep Oct Nov Dec Total

Service $’000 $’000 $’000 $’000 $’000 $’000 $’000

X 1,600 1,450 1,450 800 830 810 6,940

Y 420 420 360 300 350 320 2,170

Z 50 100 120 190 250 280 990

Total 2,070 1,970 1,930 1,290 1,430 1,410 10,100

A. Percentage component bar chart

B. Scatter diagram
C. Line graph
D. Pie chart

Question 15. The regression equation Y = 3 + 2X is computed from 6 pairs of values, with X
spreading over from 1 to 10. The correlation coefficient equals 0.8. It is approximated that Y
= 43 when X = 20.
Which TWO of the below are true?
A. The estimation is unreliable since X is not within the data range.
B. The estimation is unreliable due to the low correlation.
C. The estimation is reliable.
D. The estimation is unreliable as the sample size is small.