Competitive Exams: Commerce MCQs (Practice-Test 20 of 99)

  1. Match List I (Items) with List II (Headings) and select the correct answer using the codes given below

    List-I List-II
    1. Provision for income tax

    2. Share premium

    3. Unclaimed dividend

    4. Discount oh issue of shares

    1. Miscellaneous expenses not written off

    2. Current liabilities

    3. Reserves and surplus

    4. Profit and Loss account

    • A
    • B
    • C
    • D
      • 4
      • 3
      • 2
      • 1
      • 2
      • 3
      • 4
      • 1
      • 4
      • 1
      • 2
      • 3
      • 2
      • 1
      • 4
      • 3
  2. Match List I (Item of Balance Sheet) with List II (Head in the Balance Sheet) and select the correct answer using the codes given below:

    List-I List-II
    1. Govt. Securities

    2. Stock in trade

    3. Unclaimed dividend

    4. Proposed dividend

    1. Current liabilities

    2. Provisions

    3. Liquid assets

    4. Current assets

    • A
    • B
    • C
    • D
      • 3
      • 1
      • 4
      • 2
      • 2
      • 4
      • 1
      • 3
      • 3
      • 4
      • 1
      • 2
      • 2
      • 1
      • 4
      • 3
  3. Continuous audit is used

    1. where volume of the transactions is not very large

    2. where it is desired to present the accounts just after the close of the financial year and where the statement of accounts is to be presented to the management after every month or quarter

    3. where satisfactory system of internal check is not in operation

    4. where interim audit is not in operation

  4. Which one of the following is a conclusive proof of the existence of a company?

    1. Certificate of incorporation

    2. Certificate of commencement of business

    3. Filing of registration papers duly stamped with the Registrar of the Companies

    4. Share certificate

  5. Secret reserves are created by means of

    1. transfer to general reserve

    2. providing excessive depreciation

    3. overvaluation of inventories

    4. undervaluation of liabilities

  6. Match List I with List II and select the correct answer using the codes given below:

    List-I List-II
    1. Inventory of material

    2. Retained earnings

    3. Listing fees of shares in a stock exchange

    4. Plant and machinery

    1. Shareholders equity

    2. Fixed asset

    3. Current asset

    4. Fictitious asset

    5. Intangible asset

    • A
    • B
    • C
    • D
      • 1
      • 2
      • 3
      • 4
      • 2
      • 3
      • 4
      • 1
      • 3
      • 2
      • 4
      • 1
      • 4
      • 3
      • 2
      • 1
  7. A company purchased the following assets and paid through 1, 00, 000 fully paid equity shares of Rs. 10 at a premium of Rs. 2: Building: Rs. 5, 00, 000 Machinery: Rs. 4, 00, 000 Stock in trade: Rs. 1, 00, 000 In the context of funds flow statement, this transaction will result in

    1. Funds inflow of Rs. 10, 00, 000

    2. Funds outflow of Rs. 12, 00, 000

    3. Funds inflow of Rs. 1, 00, 000

    4. Funds inflow of Rs. 9, 00, 000

  8. Call option is

    1. A contract to buy a certain number of shares at a stated price within a specified period of time

    2. A contract to sell a certain number of shares at a stated price within a specified period of time

    3. The option of the issuing company to demand the shareholders to pay for the partly paid shares

    4. The option available to the convertible debenture holders to demand equity shares in conversion of debentures

  9. Following is the summarized balance sheet of a company earning profit (before tax) of Rs. 3, 00, 000 during the previous financial year The rate of return on investment of the company during the relevant financial year is

    1. 25%

    2. 20%

    3. 21.5%

    4. 23%

  10. An audit in which the auditor examines the financial statements of an enterprise to express an opinion as to whether or not they reflect a true and fair view of its state of affairs and working results is known as

    1. Management audit

    2. Cost audit

    3. Financial audit

    4. Periodical audit

  11. Which of the following are statutory audits?

    1. Financial audit of insurance companies

    2. Financial audit of partnership firms

    3. Financial audit of proprietorship firms

    4. Financial audit of manufacturing companies

    Select the correct answer using the codes given below:

    1. 1 and 4

    2. 1 and 2

    3. 1 and 3

    4. 3 and 4

  12. Is management by exception one of the important principles of control?

    1. Yes; because only the unusual deviations from standards should be brought to the notice of the management

    2. No; because less significant deviations and the actual performance according to the standards are not brought to the notice of the management

    3. Yes; because exception principle saves time of the subordinate staff

    4. No; because the manager can attend to operative decisions and the strategic problems can be left to the technocrats.

  13. Consider the following statements

    1. in a computer, operating system acts as an interface between the user and the hardware

    2. Operating system takes care of the power supply and other hardware requirements

    3. CPU is the control centre for a computer

    Which of the statements given above is/are correct?

    1. 1 and 3

    2. 2 and 3

    3. 1 only

    4. 2 only

  14. Job evaluation is used for

    1. Study of progress of production

    2. Study of job composition

    3. Determining wage-rate differentials

    4. Rating the merit of an employee

  15. The first step of the control process actually gets initiated in the managerial function of

    1. Staffing

    2. Planning

    3. Communication

    4. Coordination