Question 1

If the remuneration to liquidator is payable as a percentage of collection_______________&#10;A)exclude opening cash & bank balance&#10;B)exclude opening cash & bank balance.&#10;C)includes opening cash & bank balance&#10;D)exclude both opening & closing cash & bank balance

Accepted Answer

The remuneration to a liquidator, when calculated as a percentage of collections, typically excludes the opening cash and bank balance. This is because the liquidator's fee is based on the assets they actively collect or liquidate, not on the pre-existing cash balances.

Question 2

If a part of the issue of share or debenrues is underwritten, it is termed as__________________-&#10;A)firm underwriting&#10;B)complete underwriting&#10;C)sole underwriting&#10;D)partial underwriting

Accepted Answer

When only a portion of the issue of shares or debentures is underwritten, it is referred to as partial underwriting. This means that the underwriter commits to subscribing to only a part of the issue, not the entire issue.

Question 3

The Balance in exchange difference on transaction of export sale is transferred to _________________&#10;A)trading a/c&#10;B)debtors&#10;C)sales a/c&#10;D)profit & loss a/c

Accepted Answer

The balance in exchange difference on a transaction of export sale is typically transferred to the Profit & Loss Account. This is because exchange differences are considered financial gains or losses and are accounted for in the income statement, where the Profit & Loss Account is located.

Question 4

'Pooling of interest' is a method of_____________________&#10;A)accounting of amalgamtion&#10;B)charging depreciation&#10;C)account of absorption&#10;D)calculation of purchase consideration

Accepted Answer

Pooling of interest is a method used in accounting for amalgamations, where the assets and liabilities of the combining entities are pooled together at their book values.

Question 5

rights/ Duties of partners are governed by_______________&#10;A)article of association&#10;B)llp agreement&#10;C)partnership deed&#10;D)byelaws

Accepted Answer

The answer of rights/ Duties of partners are governed by_______________&#10;A)article...

Question 6

The proceeds of assets not specifically pledged & nthe surplus of the assets specifically pledged is first available for_________________&#10;A)legal charges, liquidators remuneration & expenses&#10;B)unsecured creditors&#10;C)preferential creditors&#10;D)preferential shareholders

Accepted Answer

The proceeds of assets not specifically pledged and the surplus of the assets specifically pledged are first used to cover legal charges, liquidators' remuneration, and expenses before being distributed to other creditors or shareholders.

Question 7

Out Of The following, Direct Expense Is&#10;A)Salaries&#10;B)carriage outward&#10;C)rent of office building&#10;D)carriage inward

Accepted Answer

Carriage inward is a direct expense because it is directly associated with the purchase or production of goods. It refers to the cost of transporting goods into a factory or warehouse, which is directly attributable to the cost of goods sold.

Question 8

Goodwill is a&#10;A)Fixed asset&#10;B)current asset&#10;C)intangible asset&#10;D)fictitious asset

Accepted Answer

Goodwill is considered an intangible asset because it represents non-physical assets such as brand reputation, customer loyalty, and other factors that improve a company's value.

Question 9

Income received in advance is&#10;A)An income&#10;B)a liability&#10;C)an asset&#10;D)a loss

Accepted Answer

Income received in advance is considered a liability because it represents an obligation to provide goods or services in the future.

Question 10

Sales are equal to&#10;A)Cost of goods sold plus profit&#10;B)cost of goods sold minus gross profit&#10;C)gross profit minus cost of goods sold&#10;D)none of these

Accepted Answer

Sales are equal to the cost of goods sold plus the profit. This is because the cost of goods sold (COGS) represents the direct costs attributable to the production of the goods sold by a company. When you add the profit earned on those goods, you get the total sales revenue.

Question 11

Interest on drawings is&#10;A)An expenditure for the business&#10;B)an expense for the business&#10;C)a gain for the business&#10;D)a loss for the business

Accepted Answer

The answer of Interest on drawings is&#10;A)An expenditure for the...

Question 12

Which of the following is a current liability&#10;A)A five year bank loan&#10;B)workmen compensation fund&#10;C)bank overdraft&#10;D)dividend equalization

Accepted Answer

The answer of Which of the following is a current...

Question 13

In the case of net worth method of single entry system, the net profit is ascertained by&#10;A)Preparing trading and profit and loss account&#10;B)comparing opening and closing capital&#10;C)preparing&#10;D)none of these

Accepted Answer

The answer of In the case of net worth method...

Question 14

Capital at the beginning of the year is ascertained by preparing&#10;A)Cash account&#10;B)opening statement of affairs&#10;C)total creditors account&#10;D)total debtors account.

Accepted Answer

The answer of Capital at the beginning of the year...

Question 15

The amount of opening stock can be ascertained by preparing&#10;A)Memorandum trading account&#10;B)total creditors account&#10;C)total debtors account&#10;D)opening statement of affairs.

Accepted Answer

The answer of The amount of opening stock can be...

Question 16

The closing balance in the creditors account can be ascertained from the&#10;A)Cash account&#10;B)total creditors account&#10;C)closing statement of affairs&#10;D)none of these.

Accepted Answer

The answer of The closing balance in the creditors account...

Question 17

the depreciation charged on an asset is debited to&#10;A)asset account&#10;B)depreciation account&#10;C)cash account&#10;D)none of these

Accepted Answer

The answer of the depreciation charged on an asset is...

Question 18

in case of straight line method, the amount of deprecation&#10;A)fluctuate every year,&#10;B)decreases every year&#10;C)increases every year&#10;D)remains same every year

Accepted Answer

The answer of in case of straight line method, the...

Question 19

amortization is related to&#10;A)Tangible fixed asset&#10;B)intangible assets&#10;C)any fixed asset&#10;D)none of these.

Accepted Answer

The answer of amortization is related to&#10;A)Tangible fixed asset&#10;B)intangible assets&#10;C)any...

Question 20

Depletion method is more suitable for&#10;A)Service industry&#10;B)mining industry&#10;C)intangible assets&#10;D)all of these

Accepted Answer

The answer of Depletion method is more suitable for&#10;A)Service industry&#10;B)mining...

Question 21

The main objective of providing depreciation is&#10;A)To calculate true profit&#10;B)to show the true financial position&#10;C)to reduce tax burden&#10;D)to provide fund for replacement of assets.

Accepted Answer

The answer of The main objective of providing depreciation is&#10;A)To...

Question 22

Under diminishing balance method, depreciation is calculated on&#10;A)Original cost&#10;B)written down value&#10;C)scrap value&#10;D)market value

Accepted Answer

The answer of Under diminishing balance method, depreciation is calculated...

Deck 11: Accounting and Finance