Correct Answer:
C. Actual cost is lower than standard cost
A favorable variance increases profit relative to standard; it does not automatically mean good performance.
November 13, 2026 · Accounting and Finance MCQs, Cost & Management Accounting MCQs
A favorable cost variance means that:
Related MCQs
In double-entry bookkeeping, every transaction:
A.
Affects only one account
B.
Is recorded only as a debit
C.
Is recorded only in the cash book
D.
Affects at least two accounts with total debits equal to total credits
Correct answer is:
D. Affects at least two accounts with total debits equal to total credits
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The Public Account of the Federation under Article 78(2) includes:
A.
Only tax revenue
B.
Only foreign loans
C.
Only provincial taxes
D.
All other moneys received by or on behalf of the Federal Government that are not part of the Federal Consolidated Fund
Correct answer is:
D. All other moneys received by or on behalf of the Federal Government that are not part of the Federal Consolidated Fund
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An impairment loss arises when:
A.
The asset's market price rises
B.
Depreciation is charged
C.
The carrying amount of an asset exceeds its recoverable amount
D.
An asset is fully depreciated
Correct answer is:
C. The carrying amount of an asset exceeds its recoverable amount
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The indirect method of preparing the cash flow from operating activities starts with:
A.
Cash received from customers
B.
Cash paid to suppliers
C.
Closing cash balance
D.
Profit before tax or net profit adjusted for non-cash items and working capital changes
Correct answer is:
D. Profit before tax or net profit adjusted for non-cash items and working capital changes
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Using the Gordon growth model, next year's dividend is Rs. 6, the required return is 12% and growth is 4%. The share price is:
A.
Rs. 50
B.
Rs. 75
C.
Rs. 37.5
D.
Rs. 150
Correct answer is:
B. Rs. 75
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IPSAS (International Public Sector Accounting Standards) are issued by:
A.
International Accounting Standards Board (IASB)
B.
International Monetary Fund (IMF)
C.
International Public Sector Accounting Standards Board (IPSASB)
D.
World Bank
Correct answer is:
C. International Public Sector Accounting Standards Board (IPSASB)
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