Match List I with List II

List I

List II

A.

Standard Costing

I.

Financial forecasting and planning

B.

Margin of Safety

II.

Sales minus break-even sales

C.

Ratio Analysis

III.

Control of inventory

D.

JIT System

IV.

Management by exception

Choose the correct answer from the options given below:

Question

Question

This question was previously asked in

UGC Paper 2: Commerce_17th Oct 2020 Shift 1

Answer 1

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List I	List II
A. Standard Costing	Standard cost specifies how much quantity and cost should be paid for each unit of input, and then actual cost and quantities are compared with it and if there are any deviations then managers investigate it. The aim is to find the problem and eliminate it, this process is known as Management by Exception.
B. Margin of Safety	It is a principle of investing in which an investor only purchases security when its market price is below its intrinsic value. In accounting, a margin of safety refers to the difference between Sales and Break-even sales.
C. Ratio Analysis	Ratio analysis is an important tool that can improve the understanding of financial trends and ratios over time and provide key indicators too. In other words, it helps in financial forecasting and planning.
D. JIT System	The Just-In-Time system is a strategy that minimizes inventory and increases efficiency. It is useful for the control of inventory.

Therefore, it is clear from the above explanation that option 1) is the correct answer.

	List I		List II
A.	Standard Costing	I.	Financial forecasting and planning
B.	Margin of Safety	II.	Sales minus break-even sales
C.	Ratio Analysis	III.	Control of inventory
D.	JIT System	IV.	Management by exception