The 'Throughput Accounting' emphasises: MCQ with Answer and Explanation

The 'Throughput Accounting' emphasises:
A. Maximising production volume
B. Increasing fixed cost
C. Reducing labour cost
D. Maximising throughput (sales minus material cost) while minimising operating expenses and inventory
Answer: Option D
Solution (By JKSSB Mock Tests)
Throughput accounting is based on the Theory of Constraints.

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Practice More Accountancy and Book Keeping Questions

Question #1
The primary objective of management accounting is to:
A. Provide information to external stakeholders
B. Assist management in planning and decision-making
C. Calculate tax liability
D. Ensure compliance with accounting standards

Correct Answer: Option B


Explanation:
Management accounting focuses on providing internal management with the financial and non-financial information needed for planning, controlling, and decision-making.

Question #2
S1: Direct taxes are progressive in nature. S2: Indirect taxes are regressive in nature. Which statement(s) is/are correct?
A. S1 only
B. S2 only
C. Neither S1 nor S2
D. Both S1 and S2

Correct Answer: Option D


Explanation:
Direct taxes (like Income Tax) are progressive, meaning the tax rate increases as income increases. Indirect taxes (like GST) are regressive, as they take a larger percentage of income from low-income earners than high-income earners. Both are correct.

Question #3
In cost accounting, the 'Economic Batch Quantity' (EBQ) formula is identical to the EOQ formula. If the setup cost per batch is ₹500, annual demand is 10,000 units, and carrying cost is ₹10 per unit per annum, what is the EBQ?
A. 2,000 units
B. 1,000 units
C. 1,414 units
D. 500 units

Correct Answer: Option B


Explanation:
EBQ = Square root of (2 * Annual Demand * Setup Cost) / Carrying Cost per unit. EBQ = sqrt((2 * 10,000 * 500) / 10) = sqrt(1,000,000) = 1,000 units.