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1817. Unsystematic risk is______.

the risk associated with movements in security prices

reduced through diversification

higher when interest rates rise

the risk of loss of purchasing power

✅ The correct answer is B.
Unsystematic risk is reduced through diversification. Unsystematic risk is the risk that is inherent in a specific company or industry. By investing in a range of companies and industries, unsystematic risk can be drastically reduced through diversification.

1818. Third step in process costing system is to

summarize flow of output

compute output in units

summarize total costs

compute cost for each equivalent unit

✅ The correct answer is C.
Third step in process costing system is to summarize total costs. Process costing is a method of assigning production costs to units of output.

1819. The focal point of financial management in a firm is _________.

the number and types of products or services provided by the firm

the minimization of the amount of taxes paid by the firm

the creation of value for shareholders

the dollars profits earned by the firm

✅ The correct answer is C.
The focal point of financial management in a firm is the creation of value for shareholders.

1820. To decide whether cost is variable cost or fixed cost with respect to some specific activity depends upon

units of labour

unit of production

time horizon

units of inventory

✅ The correct answer is C.
To decide whether cost is variable cost or fixed cost with respect to some specific activity depends upon time horizon. Time horizon is the length of time over which an investment is made or held before it is liquidated. Time horizons can range from seconds in the case of a day trader, all the way up to decades for a buy-and-hold investor or an individual who is investing in a retirement plan.

1825. Finance company providing loans at 12% with 2 compounding periods per year, periodic rate is classified as

3% per quarter

6% per quarter

6% per year

0.1667 % per year

✅ The correct answer is C.
Finance company providing loans at 12% with 2 compounding periods per year, periodic rate is classified as 6% per year.

167. Introduction of capital by owner of business is recorded on which side of a cash book?

Receipts

Payments

Incomes

Expenditures

✅ The correct answer is A.
Introduction of capital by owner of business is recorded on Receipts side of a cash book.

1827. Which of the following is not a characteristic of a ‘price taker’?

TR = P x Q

AR = Price

Negatively sloped demand

Marginal Revenue = Price

✅ The correct answer is C.
Negatively sloped demand is not a characteristic of a ‘price taker’. A price taker lacks enough market power. The objective of market to influence the prices of goods or services.

1808. Conversion cost is subtracted from direct manufacturing labour cost is to calculate the

direct overheads

overhead costs

factory overhead

manufacturing overhead cost

✅ The correct answer is D.
Conversion cost is subtracted from direct manufacturing labour cost is to calculate the manufacturing overhead cost. Conversion costs is a term used in cost accounting that represents the combination of direct labor costs and manufacturing overhead costs.

1810. In accounting, cost which is predicted to be incurred or future cost is known as

past cost

incurred cost

actual cost

budgeted cost

✅ The correct answer is D.
In accounting, cost which is predicted to be incurred or future cost is known as budgeted cost. A budgeted cost is a forecasted future expense that the company is expected to incur in the future.

1812. Graph which is plotted for projected net present value and capital rates is called

net loss profile

net gain profile

net future value profile

net present value profile

✅ The correct answer is D.
Graph which is plotted for projected net present value and capital rates is called net present value profile. The net present value mainly measures the net increase in the company’s equity by working on a project. It is essentially the difference between the present value of cash flows and the initial investment based on the discount rate.

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