Mirchawala’s Hub Of Accountancy:

MA1:Management Information:
Mock Exam:3
Question#1:
Which of the following describes a file in computerised accounting?
A. A group of fields
B. A record of similar items of data
C. A collection of similar records
D. An item of data about a particular record
Question#2:
Which of the following can be categorised as aspects of centralisation or decentralisation of an office
function?
(1)Specialised staff
(2)Duplication of activities
(3)Economies of scale
(4)Standardisation of systems
A. Centralisation: 2 and 3 Decentralisation: 1 and 4
B. Centralisation: 1, 3 and 4 Decentralisation: 2
C. Centralisation: 4 Decentralisation: 1, 2 and 3
D. Centralisation: 1 and 4 Decentralisation: 2 and 3
Question#3:
In spreadsheet formulae, which signs represent multiplication and division?
A. x and /
B. * and /
C. * and ÷
D. ÷ and x
Question#4:
Zed Co uses process costing for product Alpha. Production began on 1 September and there is no
wastage in the process. It was estimated initially that the percentage completion of work in progress
(WIP) was 80%. Subsequent checking found that this was incorrect and the percentage completion of
WIP had been overstated.
When the error is corrected, how will the total value of WIP and cost per unit of finished output be
affected?
A. Total Value of WIP: Increase Cost per unit: Increase
B. Total Value of WIP: Increase Cost per unit: Decrease
C. Total Value of WIP: Decrease Cost per unit: Increase
D. Total Value of WIP: Decrease Cost per unit: Decrease
Question#5:
Helen is offering a 5% discount on sales of more than $200. She is creating a spreadsheet to show the
discount that each customer should get:

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Which of the following formulae correctly calculates the discount that James is entitled to?
A. =IF(B2>200,B2*0.05,0)
B. =IF(B2>200,0,B2*0.05)
C. =IF(B2<200,B2*0.5,0)
D. =IF(B2<200,0,B2*0.05)
Question#6:
Which of the following would NOT be a service cost centre in a manufacturing business?
A. Materials store
B. Marketing
C. Machining
D. Dispatch
Question#7:
What formula calculates the production volume ratio?
A. Budgeted hours / Standard hours of actual output
B. Standard hours of actual output / Budgeted hours
C. Standard hours of actual output / Actual hours
D. Actual hours / Budgeted hours
Question#8:
The prime cost of a product is $8.60 per unit. Overheads attributed to the product are as follows:
$
Variable overhead 1.90 per unit
Fixed overhead 39,000 per period
Output in the period is 5,600 units.
What are the total costs of the product in the period?
A. $49,640
B. $87,160
C. $58,800
D. $97,800
Question#9:
The following statements are about filtering in spreadsheets:
(1)A filtered range displays only the rows that meet the criteria you specify for a column
(2)Filtering reorders the rows
Which of the statements about filtering in spreadsheets is/are TRUE?
A. Neither statement 1 nor statement 2
B. Both statement 1 and statement 2
C. Statement 2 only
D. Statement 1 only

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Question#10:
An accountant is reviewing the following spreadsheet which shows the discounts which a company
offers a customer on some of its products:

The accountant accidentally deletes the discount rates column (column B) in the spreadsheet.
The discounts given (in column E) are calculated as a function of gross revenue (column D) and the rates
(column B).
What error value will be showing in the 'Discounts' column (currently column E) after the accountant's
mistake?
A. #REF!
B. #NULL
C. #VALUE!
D. #DIV/0!
Question#11:
In a large organisation, which of the following personnel would MOST likely be responsible for
following up overdue payments from customers?
A. Trainee accountant
B. Credit controller
C. Purchasing manager
D. Management accountant
Question#12:
There is an error in cell J3 of this spreadsheet:

Which of the following formulae could have caused this error?

A. =I3/H3
B. =I3/H4
C. =I3/I3
D. =I3/H2
Question#13:
Which of the following is the CORRECT double entry for the purchase of materials on credit?
A. Dr Purchases Cr Receivables
B. Dr Receivables Cr Purchases
C. Dr Payables Cr Purchases
D. Dr Purchases Cr Payables

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Question#14:
You are trying to find the total of a column of figures on a spreadsheet, but the relevant cell only
displays a series of hashes as below:
Total ####
What has caused this error?
A. Some of the entries in the column are alphabetic (words) rather than numeric (numbers)
B. The cell width is too narrow to display the total fully
C. There is a circular reference within the cells being totalled up
D. One of the entries in the column has accidentally been divided by '0'
Question#15:
When considering spreadsheets, graphs and charts which of the following is CORRECT?
A. The graph or chart should always be presented using landscape rather than portrait orientation
B. Gridlines should always be used when presenting spreadsheets
C. The graph or chart should always be clearly labelled so the user understands what is being shown
D. Spreadsheets should always contain cross references to other spreadsheets
Question#16:
Ryan has created a spreadsheet which has different worksheets for December and January. He wants to
link the contents of cell A3 on the January worksheet to cell B3 on the December worksheet (so that the
January A3 cell shows the contents of the December B3 cell).
What should Ryan do to achieve this link?
A. Select cell B3 on the December worksheet, type = and then select cell A3 in the January worksheet
B. Select cell B3 on the December worksheet, type =A3 and then select cell A3 in the January
worksheet
C. Select cell A3 on the January worksheet, type = and then select cell B3 in the December worksheet
D. Select cell A3 on the January worksheet, type =B3 and then select cell B3 in the December
worksheet
Question#17:
The following information was available for process X during April:
Number of units entering the process at 1 April: 3,500
Number of units leaving the process at 30 April: 2,000
Non-completed units are all 75% complete at 30 April for direct materials, direct labour and overhead.
What is the number of equivalent units produced in April?
A. 1,500
B. 3,500
C. 3,125
D. 1,125
Question#18:
The following information relates to the production department of Bind Co for the month of March:
Material X (kg) Material Y (kg)
Opening inventory 0 0
Closing inventory 25 15
Purchases 100 kg = $12,500 75 kg = $15,000
Product A was produced using 20 kg of material X and 15 kg of material Y.
Product B was produced using the remaining amounts of material X and Y.

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What is the direct material cost of product B for March?

A. $22,000
B. $21,375
C. $15,875
D. $6,875
Question#19:
Which of the following correctly describes work-in-progress?
A. Materials which are ready to enter the production process
B. Intermediate stage between a manufacturer acquiring materials and the production process being
completed
C. Goods acquired from a supplier for incorporation into goods for sale
D. Raw materials which have been subject to all elements of the production process
Question#20:
What calculation will be carried out by the formula =100+C8/(D2+40) in a spreadsheet cell?
A. The sum of 100 and the contents of cell C8 will be divided by the sum of the contents of cell D2 and
40
B. The contents of cell C8 will be divided by the sum of the contents of cell D2 and 40 and then 100 will
be added
C. The contents of cell C8 will be divided by the contents of cell D2 and then 140 will be added
D. The sum of 100 and the contents of cell C8 will be divided by the contents of cell D2 and then 40 will
be added
Question#21:
For which of the following is residual income an appropriate performance measure?
A. A cost unit
B. A cost centre
C. An investment centre
D. A profit centre
Question#22:
Overheads in production cost centre X are absorbed on the basis of machine hours using a
predetermined rate. Budget and actual data for the cost centre for a period are:
Budget ($) Actual ($)
Overheads 72,000 74,400
Machine hours 5,000 4,800
What is the amount of overheads absorbed in the period?
A. $69,120
B. $74,400
C. $77,500
D. $71,424
Question#23:
Differential piecework remuneration operates in an assembly department. Details of the payment
scheme are as follows:
Units assembled per week Piecework rate per unit ($)
up to 100 3.50
between 101 and 150 4.00

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over 150 4.50

Only extra units assembled, over the previous threshold, qualify for the higher rate.
How much would be paid to a worker who assembled 160 units in a particular week?
A. $720
B. $570
C. $595
D. $645
Question#24:
Employee X is paid $3.60 for each unit produced up to and including 100 units per week and then $4.00
per unit for any additional production in each week. Employee X has a guaranteed minimum wage of
$300 per week. Employee X's production over a three-week period was as follows:
Units
Week 1 95
Week 2 104
Week 3 80
What was employee X's total wage for the three-week period?
A. $1,006.00
B. $1,016.40
C. $1,018.00
D. $1,046.00
Question#25:
What is the cost accounting double entry to record the issue of indirect production materials from
stores?
A. Dr Work-in-progress Cr Materials
B. Dr Materials Cr Work-in-progress
C. Dr Materials Cr Production overheads
D. Dr Production overheads Cr Materials
Question#26:
Which of the following statement(s) about data and information is/are true?
(1)Completed questionnaires as part of a market research survey are examples of data
(2)Monthly management accounting reports resulting from the processing of financial transactions are
examples of information
A. Both statement 1 and statement 2
B. Neither statement 1 nor statement 2
C. Statement 1 only
D. Statement 2 only
Question#27:
A company employs three chefs in its factory canteen.
How would the wages of the chefs be classified?
A. Variable production overhead
B. Indirect labour
C. Direct labour
D. Direct expense

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Question#28:
A particular cost has been classified as a stepped-fixed cost.
What type of cost classification is being used?
A. Controllable / uncontrollable costs
B. Costs by behavior
C. Costs by function
D. Direct / indirect costs
Question#29:
How is the amount of free inventory calculated?
A. Inventory on hand - Inventory already requisitioned for use
B. Inventory on hand + Inventory on order - Inventory already requisitioned for use
C. Inventory on hand + Inventory on order
D. Inventory on order - Inventory already requisitioned for use
Question#30:
Which of the following are features of all useful management information?
(1)Completeness
(2)Reliability
(3)Timeliness
A. 1 and 2 only
B. 2 and 3 only
C. 1, 2 and 3
D. 1 and 3 only
Question#31:
What is the function of the sales day book?
A. To describe features of products
B. To list the value of sales invoices
C. To record cash received from customers
D. To record transactions grouped by customer
Question#32:
Margo is compiling a report based on sales data.

What formula should she enter into cell C15 in order to calculate average sales between 20X0 and
20X9?
A. =MEAN(C4:C13)
B. =AVE(C4:C13)
C. =AVERAGE(C4:C13)

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D. =SUM(C4:C13)
Question#33:
The following is an extract from a company's sales report:

Which of the following correctly describes information presented in the graph?

A. There is a general trend for falling sales
B. Sales in all products increased steadily over the four years
C. Product B had the lowest units sold in each of the four years
D. Units sold in all products increased between 20X8 and 20X9
Question#34:
The following statements are about timesheets:
(1)A timesheet is likely to contain entries relating to numerous employees
(2)Timesheet information can be used to provide a basis for billing clients for services provided
Which of the following statement(s) about timesheets is/are TRUE?
A. Statement 2 only
B. Statement 1 only
C. Both statement 1 and statement 2
D. Neither statement 1 nor statement 2
Question#35:
Sales representatives in a company are each paid a salary of $2,000 per month. They also earn
commission of 1% of the value of their sales.
What cost behavioural classification describes the sales representatives' earnings?
A. Variable
B. Fixed
C. Semi-variable
D. Stepped-fixed
Question#36:
Which of the following are disadvantages of using spreadsheets?
(1)Large spreadsheet models may contain errors
(2)Spreadsheet data may become corrupted
(3)Performing complex analysis using spreadsheets can be a slow and unreliable process
(4)Spreadsheets are not suitable for management accounting
A. 1 and 4
B. 1, 2 and 3
C. 3 and 4
D. 1 and 2 only

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Question#37:
Which of the following information is needed in order to calculate the unit cost under batch costing?
(1)Product mark up
(2)Production cost
(3)Number of units in a batch
(4)Total budgeted sales
A. 1 and 4 only
B. 2, 3, and 4 only
C. 1, 2, 3 and 4
D. 2 and 3 only
Question#38:
Which statement correctly describes the LIFO method of pricing issues of stores items from inventory?
A. All items of inventory are valued at the current price
B. It uses the price of the newest items before older items
C. It is based on the average cost of the items
D. It uses the price of the oldest items before newer items
Question#39:
A company plans to use the following coding system to record the details of its company vehicles:
1111 Company van, white, diesel engine, located in London
1221 Company van, red, petrol engine, located in London
2122 Company car, white, petrol engine, located in Birmingham
Which type of coding system is being considered?
A. Mnemonic
B. Faceted
C. Sequential
D. Hierarchical
Question#40:
James has submitted a CV containing personal information and employment history to apply for a job
with Int Co.
Dab Co is a regular customer of Int Co and Int Co stores a large amount of information on Dab Co such as
its bank details and transaction history.
Jenny works for Dab Co's HR department. Her role involves collecting and reading job applications for
positions within her company and advising other departments during the recruitment process.
Which of the following are classified as personal data users?
(1)Int Co
(2)James
(3)Dab Co
(4)Jenny
A. 2 and 3
B. 1 and 3
C. 1 and 2
D. 1 and 4

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Question#41:
Each unit of product X requires 1.2 kg of material A. In May the company plans to make 500 units of
product X. There will be 200 kg of material A in inventory at the end of April, and the company wishes to
increase this inventory level by 50% by the end of May. Material A is not used for any other product.
How many kg of material A should be ordered for delivery in May?
A. 500 kg
B. 400 kg
C. 600 kg
D. 700 kg
Question#42:
A firm currently produces 4,500 units per week at 90% efficiency. The direct labour cost is $9,000.
What will be the direct labour cost per unit (to two decimal places of $) if efficiency can be increased
to 100%?
A. $2.22
B. $2.20
C. $1.82
D. $1.80
Question#43:
20 direct workers and five indirect workers, who all work a basic week of 38 hours, are employed in a
factory cost centre. Overtime, paid at 40% above the basic rates, is worked as necessary to meet the
general output requirements of the factory.
Basic rates of pay are as follows:
$ per hour
Direct workers 12.00
Indirect workers 9.50
During Week 6, the direct workers were paid for 810 hours and the indirect workers for 210 hours.
What amount is charged as indirect labour cost in week six?
A. $1,995
B. $2,071
C. $2,235
D. $2,311
Question#44:
Product X requires 1.2 litres of material Y for each unit manufactured. Inventory of material Y is 1,260
litres at the beginning of a period. 3,300 units of product X are to be manufactured during the period.
What is the purchase requirement for material Y in the period if inventory of 1,350 litres is to remain
at the end of the period?
A. 3,210 litres
B. 3,390 litres
C. 3,870 litres
D. 4,050 litres
Question#45:
Summary financial results for Q Co for the last two years have been as follows:
Year 1 ($) Year 2 ($)
Sales revenue 100,000 140,000

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Net profit 4,500 6,100

Capital employed 27,300 34,800
What was the effect on net profit margin and return on capital employed (ROCE) from year 1 to year
2?
A. Net profit margin: Increased ROCE: Decreased
B. Net profit margin: Decreased ROCE: Increased
C. Net profit margin: Increased ROCE: Increased
D. Net profit margin: Decreased ROCE: Decreased
Question#46:
A company has calculated the following ratios for a period:
Asset turnover 3.6 times
Profit margin 5.0%
What is the return on capital employed (ROCE)?
A. 13.90%
B. 1.80%
C. 18.00%
D. 1.40%
Question#47:
Which of the following is a characteristic of the production operation whenever job costing is applied?
A. There may be joint products from a single operation
B. Production is a continuous operation
C. The cost unit is continuously identifiable throughout production
D. Each cost unit will be produced on dedicated machinery
Question#48:
Which of the following are main purposes of cost coding?
(1)To enable a logical and systematic arrangement of costing records
(2)To facilitate electronic data processing
(3)To provide confidentiality
(4)To share production costs between products
A. 2 and 3 only
B. 1 and 2 only
C. 1, 2, 3 and 4
D. 3 and 4 only
Question#49:
Documents used in the process of purchasing and using a consignment of raw materials include
materials requisition, purchase order, goods received note and delivery note.
What is the correct sequence in which the documents will be prepared?
A. Purchase order, delivery note, goods received note, materials requisition
B. Materials requisition, purchase order, delivery note, goods received note
C. Purchase order, goods received note, delivery note, materials requisition
D. Delivery note, materials requisition, purchase order, goods received note
Question#50:
Which of the following is an example of external information for an organisation?
A. Report of cost

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B. Organisation structure
C. Financial reporting standards
D. Sales ledger records

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