Management Accounting MCQs and Notes
A
Q 21. Cash from Operations is equal to:
G
Q 22. The labour engaged in the making of a product is known as _______
G
Q 23. The process of budgeting includes
R
Q 24. Which of the following statement is correct ?
G
Q 25. An annual report is issued by company to its :
R
Q 26. The Moore Corporation is considering the acquisition of a new machine. The machine can be purchased for $90000; it will cost $6000 to transport to Moore’s plant and $9,000 to install. It is estimated that the machine will last 10 years, and it is expected to have an estimated salvage value of $5,000. Over its 10-year life, the machine is expected to produce 2,000 units per year, each with a selling price of $500 and combined material and labour costs of $450 per unit. Federal tax regulations permit machines of this type to be depreciated using the straight-line method over 5 years with no estimated salvage value. Moore has a marginal tax rate of 40%. What is the net cash flow for the tenth year of the project that Moore Corporation should use in a capital budgeting analysis?
V
Q 27. Regal Industries is replacing a grinder purchased 5 years ago for $15,000 with a new one costing $25,000 cash. The original grinder is being depreciated on a straight-line basis over 15 years to a zero-salvage value. Regal will sell this old equipment to a third party for $6,000 cash. The new equipment will be depreciated on a straight-line basis over 10 years to a zero-salvage value. Assuming a 40% marginal tax rate, Regal’s net cash investment at the time of purchase if the old grinder is sold and the new one purchased is
S
Q 28. Overhead Cost is the total of
V
Q 29. Batch Costing is useful in determining:
V