Question

The minimum rate of return is a function of a company’s

Multiple Choice

• all of the above.

• available bank interest rates.

• corporate or industry return on investment.

• cost of capital.

Performance measures used in balanced scorecards typically fall into all of the following categories except:

Multiple Choice

• Financial.

• Internal business processes.

• Sustainability measures.

• Customer.

Which of the following is a characteristic of management accounting?

Multiple Choice

• Management accounting must observe both financial accounting standards and cost accounting standards if it is to be useful to the organization’s management.

• Management accounting is concerned primarily with reporting past performance.

• Management accounting provides reports that are future-oriented.

• Management accounting exists primarily for the benefit of people outside the company.

Answer 1

1)

The minimum rate of return is a function of company's Cost of Capital.

MInimum rate of return is the return which company expect from any proposed investment. In other words, the cost of capital is the minimum rate of return which a company expect in order to cover its cost of capital involve in the proposed investment.

The correct option is Cost of Capital.

2)

The correct option is Sustainability measure.

Performance measures used in balance scorecards typically fall all of the following financial, customer, internal business process, learning and growth.

Hence, Performance measures used in balanced scorecards typically fall into all of the following categories except sustainability measure.

3)

Management accounting describes the accounting for management and decision making. This provides the information to managers, employees and owners i.e. inside the business.

And observe both financial as well as cost accounting standard.

Hence the correct option is Management accounting must observe both financial accounting standards and cost accounting standards if it is to be useful to the organization’s management.

Hope the above calculations, working and explanations are clear to you and help you to understand the concept of question.... please rate my answer...in case any doubt, post a comment and I will try to resolve the doubt ASAP…thank you