Test marks : 24

Subject: F2
Prepared by:
Ejaz khan

1)

Which of the following statements best describes the above graph

a) A salesman earns a basic pay plus a commission on each unit sold

b) Total material cost where company gets discount on each unit above a certain
quantity
c) It shows a telephone bill where there is monthly line rent plus a variable charge per
minute
d) None of above

1)

Which of the following statements is consistent with the above graph.

a) A company’s material cost where any purchase beyond certain quantity are
charged at lower prices
b) A company charging higher rates for sales beyond certain quantity
 c) A swimming pool family member ship package in which there is a fixed member
ship fees and no entrance fees where a certain number of members are entered,
but each extra member is charged
d) None of the above

1) A cellular phone company has announced a package which it has named as “ talky
shalky”. Any one who activates this package is subject to a call connection charge of
$6/call, and call charges of $2/minute. Where a costumer talks for more than 10
minutes in a single call he will not be charged for any additional minute.
Which of the following graphs best describes this package

a) c)

b) d)

1) Following is the different type of costs at two different type of activity levels

Cost type cost($) cost($)

1000units 2000 units

P 4500 9000
Q 5500 7000
R 10000 10000

Which of the following statements true regarding above costs:

a) P=Fixed cost, Q=semi Variable cost, R=Fixed cost

 b) P=variable cost, Q=semi variable cost, R= fixed cost
c) P=Semi Variable, Q=Variable cost, R= Fixed cost
d) None of above

1) A Company has a storage capacity of 10000units in its store room. If at any time the
raw material exceeds
10000 units the company has to have another store for which it has to pay rent. Where
the raw material exceeds 20000 units it has have 3rd store room for it. Which type of
cost the rent expense would be?

a) Semi variable cost

b) Variable cost
c) Fixed cost
d) Step up cost

1) A company has reorder level of 3000 units. During the period from ordering of stock
And receiving of stock the consumption was 300units per day. Goods were received
after 7 days of ordering. The order size quantity was 1500 units. How many units did
the company have after it received the goods

a) 3000 units
b) 900 units
c) 2400 units
d) 2100 units
1) A company has maximum daily usage of 500kgs and minimum usage of 250kgs. The
supplier takes 6 to 10 days to deliver the goods. The minimum inventory of the
company should be?

a) 2000 units
b) 5000 units
c) 2500 units
d) 3500 units

1) The maximum consumption of the company’s inventory is 200 units per day and
minimum is 100 units. The supplier takes 8 to 12 days to deliver the goods. At what
level of stock should the company place a purchase
Order so that it avoids stock out

a) 1200 units
b) 900 units
c) 800 units
d) 2400 units
1) The company currently has 2000 units in its stock at the moment. 1000 units of raw
material has been requisitioned by the production dept but not delivered yet. What is
the free stock of the company if the company has 1500 units on order?

a) 2500 units
b) 1500 units
c) 2000 units
d) None of above

1) The point at which the total cost line intercepts y-axis represents _____________?
2) Which of the following statements regarding cost behavior are true

i) The slope of total cost line represents variable cost per unit
ii) The total cost line which has fixed cost in it starts above the origin
iii) The total variable cost line always starts from the origin
iv) Where there is a change in the variable cost per unit there is a change in slope
of total cost line

a) i) only
b) ii) and iii) only
c) none
d) all of above

1) At a certain level of output a company has total cost of $60000. If variable cost is
$4/unit and fixed cost
Is $20000 what is the level of such output

a) 5000 units
b) 15000 units
c) 10000 units
d) 12000units