Which of the following statement is true in reference to Financial & Management Accounting? Please choose the correct answer. Financial accounting is for internal management whereas Management accounting is for external management like stockholders, financial institutions, government & tax authorities. Management accounting is made on the line of standard & legal requirement whereas Financial accounting is made as per the internal requirement of the organization. Financial accounting is standard as per legal requirement whereas Management accounting is flexible & as per the requirement of the management. Financial accounting reflects the revenue, cost involved in different area whereas Management accounting reflects the profitability of the business.
Which of the following are not part of Management accounting? General Ledger (GL accounts) Chart of Accounts Cost Center Internal Order.
What is used to monitor & allocate overhead costs in an organization? Profitability Analysis Product Cost Controlling Cost Center Accounting Cost Element Accounting.
Which of the following statement are correct in context of Cost Center accounting in an organization? Determining the cost incurred within an organization. Measuring the cost efficiency at various area of organization. Valuate semi finished, finished goods realistically. Revenues can be posted directly to Cost Center.
Which of the following statements are not correct? The Controlling Area can contain only one Company Code. The Company Codes can include more than one currency. The Company Codes assigned to Controlling Area can have different operational chart of accounts. We cannot allocate costs outside of Controlling Areas.
Which of the following statements are correct? We can assign more than one Controlling Area to a given Operating Concern. We can only assign one Company Code to a given Controlling Area. The Plant must be assigned to a Company Code. We can change the assignment of Controlling Area, Operating Concern, Company Code, and Plant etc. even if the master data and transaction data has been created.
How many currencies can be used in Management accounting to perform evaluation in the information system? 1 2 3 4 Unlimited.
Suppose FI and CO has same number of posting period, but in FI four special periods have been setup but in CO two special periods have been setup.
The posting in FI are done for third & fourth special period then what will be the posting in CO? The posting will be done in last CO posting period. The posting will be done in the first special period in CO. The posting will be done in the second special period in CO. No posting will be done in CO.
A Controlling Area has been created for more than one Company Code. Which of the following statement are not correct? The operating Chart of Accounts for Company Codes and Controlling Area has to be identical. The Profit Center covers more than one Company Code. The closing in management accounting is independent of final closing in financial accounting. Group costing is required for goods manufactured across the Company Code.
The assignment of organization units, Company Code, Business Area or Profit Center of a Cost Center can be changed during the financial year only if following criteria is met: The currency of new and old Company Code is same. The planning data has only been posted in the Fiscal Year. The Cost Center has not been assigned to a fixed asset, HR master record, or work center. The transaction data has been posted in the Fiscal Year.
Which of the following statements are correct regarding Primary Cost Element? It can be created without the respective general ledger existing in Operational Chart of Accounts. The posting of primary cost element doesn't require an object in the management accounting to identify the origin of costs. You need to create expense accounts in financial accounting with corresponding primary cost elements in controlling. An example of primary cost is depreciation of fixed assets, telephone expenses, repair and maintenance expenses in a manufacturing organization.
When can we use planned price manually for an activity type? Where the prices required for rates are determined within the organization. It depends on internally produced activities. The rate doesn't depend on the prices of external suppliers. It is dependent on the cost of cost center.
Which of the following statement is not correct? Statistical Key Figures are tracing factor for reposting and allocation of the cost relating to cost center, profit center, or overheads. We can post both planned as well as actual statistical key figures. The fixed value statistical key figure is posted in the period in which it is entered. We can use statistical key figures both as basis for periodic transactions and for analysis of key figures.
If you have created time dependent master data in management accounting, which of the following statement is correct? We have made actual posting in master data in the current fiscal year, now we can reduce the time dependency of master data. When we change the master data fields for a particular timeframe, the system creates a new master record containing the new master record for this period. The cost center assignment to the standard hierarchy area is time dependent field. We can extend the validity period of a master data record.
The main difference between reposting and allocation is that, for reposting, the original debit amount is always reduced on the sender, whereas, for allocation, the original debit amount is not changed; rather, a separate credit amount is written to the sender. True False.
Which of the following statements are not correct in reference to real and statistical postings? Real postings can be processed and subsequently settled or allocated with other controlling objects. We can only make real postings for a cost center. We always make statistical postings to the profit center. The combination of real and statistical postings can be made in management accounting.
Which of the following statements are correct for default or automatic account assignment? We can define automatic or default account assignment for posting of the primary cost element type. For automatically generated postings automatic or default account assignments are not required. We maintain default account assignment in customizing, whereas we maintain automatic account assignments in the cost element master record. The assignment objects for default account assignment takes priority over the automatic account assignment.
We can increase the accuracy of the management accounting data by using validation and substitution. Which of the statements are incorrect? The system checks whether the data entered meets one or more of the conditions defined by user during the time of entry. We create validation and substitutions for the controlling area and for a particular event. We use validation to carry out validity checks on objects such as cost elements or cost center. Substitution is stronger than validation.
Which of the following statements are correct? Direct activity allocation deals with the measurement, posting, and allocation of an organizational activity. We need to create an activity type to directly allocate activity. More than one cost center can be the sender of an internal activity allocation and the receiver can be any real management accounting object. During direct activity the sender cost center is debited and the receiving cost object is credited.
Which of the following statements are correct? Accrued costs have a corresponding expense in financial accounting. Valuation difference doesn't have a corresponding expense. Additional costs have corresponding expenses. Accrual calculation is used to distribute irregular expenses to the relevant periods.
Which of the following statements are not correct? For accrual cost calculation using the percentage method, you need not create an overhead structure. For accrual calculation using the target=actual or the plan=actual methods, you must create the corresponding accrual cost element. For accrual cost calculation using the percentage methods we create overhead structure with the following keys: 1) Calculation bases, 2) Overhead percentage rates, 3) Credit objects. The advantage of percentage method over using a recurring entry in the FI component is that accrual is based on the actual costs posted.
Which of the following are correct regarding periodic reposting? Allocate the cost to corresponding management accounting object. We can post primary as well as secondary costs. The original cost element remains the same during the periodic reposting. Periodic repostings cannot be reversed.
Which of the following are correct regarding difference between periodic reposting and distributions? For periodic reposting, separate credit record is written in the sender cost center whereas, for distribution, no separate credit record is written in the sender cost center. In periodic reposting, no partner is updated whereas, for distribution, the system also updates the partner in the total record for the sender. The distribution is used to transfer primary as well as secondary costs whereas periodic posting is used to transfer primary costs. The performance of periodic reposting is better than distribution.
Which of the following statements is not correct regarding manual cost allocation? Allows posting of primary and secondary costs. Cannot be used for all cost element categories. Can only be used for actual data only. Creates a separate credit record to the sender.
The primary cost element is one type of master data in Controlling. Before you can create a new primary cost element, certain prerequisites need to be fulfilled. Which of the following conditions must be fulfilled before you can create primary cost elements? The controlling area must be defined. The cost center must be defined. The general ledger account must be defined. The plant must be in the system.
Which of the following statement is not correct in reference to statistical orders? Statistical order is used to evaluate costs that cannot be itemized in details in cost element or cost center accounting. In statistical order master data we can assign cost center to be posted. If the statistical order has to be posted cross-company code or cross-business area, we do not assign assign a company code or business area. We can settle statistical orders and apply overhead to them.
Which of the following statement is correct with reference to orders with revenue? Costs can be settled to any receiver. Revenues can be settled to cost center. Revenues cannot be settled to general ledger accounts. Order can be created like any other overhead order type.
Which of the following Events-based postings update Orders? General ledger account postings. Creation of material reservations. Goods receipt. Goods issue.
We want to use commitment information on an order, so where do we have to activate the commitment management? Controlling Area Charts of Account Order Type General Ledger Account.
The settlement type PER has been used to settle overhead order. What does PER mean? It settles all the cost right up until the settlement period. It settles only the costs for the period specified. It settles the cost based on the percentage specified. None of the above.
When creating an Overhead Cost Order, the first order information which must be entered is: Order status Order type Settlement type Classification code.
What are the typical sequences for planning activities?
i. Plan cost automatically
ii. Plan primary cost manually
iii. Period lock
iv. Plan activity outputs and prices
v. Plan statistical key figures v, iii, iv, ii, i i, iii, iv, ii, v iii, v, iv, ii, i v, iv, ii, i, iii.
What can be sender and receiver in distribution? Sender: Cost center, Project, Business process. Receiver: Cost center, Internal order, WBS element, Cost object, Business process. Sender: Cost center, Internal order, Project, Business process. Receiver: Cost center, Internal order, WBS element, Cost object, Business process. Sender: Cost center, Cost object, Project, Business process. Receiver: Cost center, Internal order, WBS element, Cost object, Business process. Sender: Cost center, Business process. Receiver: Cost center, Internal order, WBS element, Cost object, Business process.
What should you do if you want to carry forward unused funds for an order which has commitment and budget to fiscal year? Change the status or order as closed and create a new order in the next fiscal year. Carry forward the commitment against the order, the budget will automatically be carried forward. Carry forward the budget against the order, the commitment will automatically be carried forward. Carry forward the commitment first against the order, and then carry forward the budget.
Which of the following statement are correct? Cost element category controls FI posting only. Cost element is a must for all GL accounts. All profit and loss general ledger accounts except tax accounts should be cost element. All cost elements are linked to Activity type.
What is the difference between distribution and assessments? Distribution can be made for both planned and actual figures, while assessment cannot. Distribution can be made using statistical key figures, while assessment cannot. Distributions are used when the original cost information is necessary on the receiver; assessments are used when this information is not necessary on the receiver. Distributions are made using the original primary cost elements; assessments are made using secondary cost elements.
Report writer library is a collection of: Characteristics Basic key figures Key figures Report groups.
Which of the following statements are correct? Cost center can be defaulted in all FI line items in all GL accounts. Internal order can be defaulted in all FI line items in all GL accounts. Cost center can be defaulted in GL accounts provided it is assigned to Company Code. Cost center is linked to Company Code as Chart of accounts is linked to the same Company Code.
Which of the following order types are internal order? Capital investment orders for creating assets. Maintenance orders. Sales orders for make-to-order function. CO production orders.
Which of the statement are correct regarding internal orders? Once an order has been released, only closing entries can be made. Transactions can be allowed or disallowed depending in the order status. Additional order status categories can be created in the order master. Planning transactions are allowed under any status.
Which are the material master views relevant to costing? Basic view Forecasting view Accounting view Costing view MRP view.