Management Accounting CIA - Section A

Contribution Margin is known as

• Marginal income

• Net Income

• Net Profit

• Gross Profit

Within a relevant range of activity, the amount of variable cost per unit

• Differs at each production level

• Remains constant at each production level

• Increases in direct proportion to the production

• Decreases as production increases.

A decrease in selling price

• Does not affect breakeven point

• Lowers the fixed cost

• Increases the breakeven point

• Lowers the breakeven point.

Margin of safety is

• Profit/(1- Variable cost to sales ratio)

• 1-C/S ratio

• Profit X (1- C/S ratio)

• All of the above

At BEP, C/S ratio equals

• Fixed cost/Sales

• EBIT/Sales

• Net Profit/Sales

• Gross profit/Sales

Cost reduction

• ends once the standards are achieved

• is a continuous process

• is a part of cost control

• All of the above

Where is management accounting applied?

• Small trading organisation

• NPOs

• Cooperative societies

• Large trading and industrial organisations.

Name

University Registration number

If the sales is 5000 units, Opening Stock of 450 units and Closing Stock to be maintained is 550 units, What is the Production Quantity?

• 4900

• 4000

• 5100

• 6000