CA Inter P4 · Chapter 7 · Question 8 of 8
A major advantage of an integrated accounting system over a non-integrated system is that:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) There is no need to reconcile cost and financial profits
Explanation
In integrated accounts a single set of books serves both costing and financial purposes, so there is only one profit figure and no reconciliation is required. It still uses control accounts and cost analysis; notional costs are normally excluded so that the books remain consistent with financial reporting.
More Cost Accounting Systems MCQs
- Q2Profit as per cost accounts is ₹4,20,000. The following differences are noted: (i) factory overheads over-absorbed in cost accounts…
- Q3If closing stock is valued at a higher figure in cost accounts than in financial accounts, then (other things being equal):
- Q4Under an integrated accounting system, the journal entry for direct material issued to production is:
- Q5The entry to record factory overheads absorbed into production in the cost ledger is:
- Q6Which of the following items appears only in the financial accounts and not in the cost accounts?