ICAR AICE-JRF/SRF (PhD admission and fellowship) · India · National Testing Agency for ICAR
Original practice questions written to the published syllabus · not past papersRecording, reporting and reading business accounts, then using cost and budget information to control an agribusiness.
In the exams: agribusiness management PhD entrance and fellowship examinations, accounting and financial management (heavy); agricultural scientist eligibility tests, business accounting (heavy)
How our questions for ICAR AICE-JRF/SRF spread across the units of Financial & Managerial Accounting. Difficulty: 1 easy, 24 medium, 15 hard.
| Accounting concepts and conventions | 4 | |
| Accounting standards | 4 | |
| Cost classification | 4 | |
| Marginal costing and cost-volume-profit analysis | 4 | |
| Double entry, journal, ledger and trial balance | 3 | |
| Final accounts | 3 | |
| Introduction to company accounts | 3 | |
| Tools of management accounting | 3 | |
| Ratio analysis, common-size statements and the Du Pont chart | 3 | |
| Material, labour and overhead costing | 3 | |
| Accounting software | 2 | |
| Cash-flow and fund-flow statements | 2 | |
| Budgets: sales, purchase, production, cash, flexible, master and zero-based | 2 |
Choose an answer, then open the working. Each explanation says why the right answer is right and why the others are not.
Which reporting framework still permits the LIFO (last-in, first-out) cost formula for inventories?
A. US GAAP
LIFO is prohibited under IAS 2, and therefore under IFRS as adopted in the EU, national standards converged with IFRS and the IFRS for SMEs, but US GAAP continues to permit it.
A grain dryer bought for 500,000 currency units is depreciated on the straight-line method at 10% of cost a year with no residual value. It is sold after exactly 2 years for 430,000. What is the result on sale?
C. Profit of 30,000
Book value after 2 years = 500,000 − 2 × 50,000 = 400,000; proceeds 430,000 exceed it by 30,000, a profit. Comparing with cost gives a false loss of 70,000; charging only one year's depreciation gives a loss of 20,000.
XBRL, used for filing financial statements with some regulators, is best described as:
A. A tagging language that makes each item in financial statements machine-readable
eXtensible Business Reporting Language tags items so regulators and analysts can process filings electronically.
A pack house's standard is 2 labour hours per crate at 90 currency units an hour. It packed 1,000 crates. Workers were paid for 2,150 hours at 85 an hour, of which 50 hours were idle because of a power cut. What is the labour efficiency variance?
B. 9,000 adverse
Efficiency variance = (standard hours − actual hours worked) × standard rate = (2,000 − 2,100) × 90 = −9,000, adverse. Idle time (50 h × 90 = 4,500) is a separate variance; using hours paid gives 13,500. Rate variance = (90 − 85) × 2,150 = 10,750 favourable. Valuing the 100 hours at the actual rate gives 8,500.
A company sells a delivery vehicle with a book value of 300,000 currency units for 340,000 in cash. Under the indirect method, how does this appear in the cash-flow statement?
A. 40,000 deducted from profit in operating activities; 340,000 inflow in investing activities
The 40,000 gain is already inside profit, so it is removed from operating cash flow to avoid double counting; the full cash proceeds of 340,000 are an investing inflow.
An owner-operator growing paddy has paid-out costs (Cost A1) of 38,000 currency units per hectare, no leased-in land, interest on owned fixed capital (excluding land) of 2,500, rental value of owned land of 12,000 and imputed family labour of 6,500. What is Cost C2 per hectare?
A. 59,000
B1 = 38,000 + 2,500 = 40,500; B2 = B1 + 12,000 = 52,500; C2 = B2 + 6,500 = 59,000. C1 (B1 + family labour) is 47,000; B2 alone is 52,500. 44,500 adds only family labour to A1.
A cattle-feed plant uses a mineral mixture at a maximum rate of 400 bags a week and a normal rate of 300 bags a week. Lead time is at most 3 weeks and normally 2 weeks. What is the minimum stock level?
C. 600 bags
Re-order level = maximum usage × maximum lead time = 400 × 3 = 1,200. Minimum level = ROL − (normal usage × normal lead time) = 1,200 − 600 = 600 bags. Adding normal consumption instead of deducting it gives 1,800; normal usage × maximum lead time gives 900.
A grading job has a time allowance of 12 hours. A worker completes it in 8 hours; the time rate is 75 currency units an hour. What are the worker's total earnings under the Rowan plan?
B. 800
Rowan: time wages 8 × 75 = 600 plus bonus (time saved ÷ time allowed) × time taken × rate = (4/12) × 8 × 75 = 200; total 800. Halsey (50% of time saved) would give 750. 900 pays the full time allowance (12 × 75).
A cold-storage operator has idle capacity in the lean season. A trader offers a one-off contract at a price below full cost but above variable cost, with no effect on regular customers' prices. On a marginal costing view the operator should:
A. Accept, because the contract adds contribution toward fixed costs
With spare capacity, fixed costs are incurred anyway; any price above variable cost increases total profit. The key conditions are spare capacity and no damage to regular pricing.
Zero-based budgeting (ZBB) requires managers to:
D. Justify every activity from zero each period, using ranked decision packages
ZBB, associated with Peter Pyhrr around 1970, ranks decision packages so resources go to the most valuable activities. Adding a percentage is incremental budgeting; adding a month is a rolling budget.
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