Competitive Exams: Commerce MCQs (Practice-Test 56 of 99)

  1. Under the head ‘provisions’ in the balance sheet of a limited company. The following provisions made for, are to be disclosed

    1. Proposed dividend

    2. PF schemes

    3. Pension and other staff-benefit schemes

    4. Taxation

    The correct chronological order of their disclosure is

    1. 4, 2, 1, 3

    2. 3, 2, 1, 4

    3. 4, 1, 2, 3

    4. 3, 1, 2, 4

  2. Under the head ‘current’ liabilitieS'the following are disclosed:

    1. Unclaimed dividend

    2. Sundry creditors

    3. Unexpired discounts

    4. Bills payable

    The correct chronological order of their disclosure is

    1. 4, 3.2, 1

    2. 1, 3, 2, 4

    3. 4, 2, 3, 1

    4. 1, 2, 3, 4

  3. A company can forfeit shares if the

    1. shareholder fails to pay the amount of

    2. the call during the stipulated time

    3. shareholder pays calls in advance

    4. shareholder does not pay the application money

    5. shares have been issued at par

  4. The balance appearing the books of a company at the end of the financial year were as follows: Capital Redemption Reserve Account Rs. 50000; Share Premium Account Rs. 10, 000: General Reserve Account Rs. 5.000; Revaluation Reserve Rs. 2, 000; Profit & Loss Account (Debit) Rs. 10, 000 Maximum amount available for distribution as; Bonus Shares'will be

    1. Rs. 50, 000

    2. Rs. 55, 000

    3. Rs. 45, 000

    4. Rs. 57, 000

  5. A company forfeited 30 equity shares of Rs. 10 each fully called-up, for nonpayment of allotment money of Rs. 3 and call-money of Rs. 4 per share, If these shares are reissued at Rs. 8 per share fully paid, the amount transferable to capital reserve will be

    1. Rs. 300

    2. Rs. 60

    3. Rs. 90

    4. Rs. 30

  6. Match List I with List II and select the correct answer

    List-I List-II
    1. Nominal share capital

    2. Right shares

    3. Bonus shares

    4. Preference shares

    1. Capitalization of reserve

    2. Fixed dividend

    3. Maximum amount of share capital of a company

    4. First offered to the existing shareholders

    • A
    • B
    • C
    • D
      • 3
      • 4
      • 1
      • 2
      • 2
      • 1
      • 4
      • 3
      • 2
      • 4
      • 1
      • 3
      • 3
      • 1
      • 4
      • 2
  7. The current ratio is 3: 2 and the amount of current liabilities is Rs. 40.000. What is the amount of current assets?

    1. Rs. 60, 000

    2. Rs. 70, 000

    3. Rs. 80, 000

    4. Rs. 1, 00, 000

  8. Which one the following ratios is likely to be of affected the most on account of price level changes?

    1. Current Ratio

    2. Inventory Turnover Ratio

    3. Debtors Turnover Ratio

    4. Fixed Assets Turnover Ratio

  9. Consider the following statements: The current ratio would reduce by

    1. collection of book debts

    2. payment to trade creditors

    3. purchase of machinery for cash

    4. cash deposited into bank

    Which of the above statements are correct?

    1. 1 and 3

    2. 2 and 3

    3. 2 and 4

    4. 1, 3 and 4

  10. The return on capital employed shows the combined effect of

    1. net profit ratio and inventory turnover ratio

    2. operating ratio and net profit ratio

    3. net profit ratio and capital turnover ratio

    4. gross profit ratio and capital turnover ratio

  11. With regard to the rate of return on investment (ROI), which one of the following statements is NOT valid?

    1. It is an overall indicator of the profitability of an enterprise

    2. It is a triangular relationship in he sense that ROI = Profit margin x Asset turnover

    3. It is a superior measure compared to the cash flow generated per share

    4. It was first developed by du Pont, USA

  12. Alfa Company Limited acquired the business of M/s Bharat Traders. The valuation of the items acquired wasbuildings Rs. 1, 20, 000; machinery Rs. 80, 000 and stock-in-trade Rs. 30, 000. The company issued in lieu of the above items 800, 10% debentures of Rs. 100 each at par and 15000 equity spares of Rs. 10 each. How much was the flow of funds in the above transaction?

    1. Rs. 2, 30, 000

    2. Rs. 1, 00, 000

    3. Rs. 50, 000

    4. Rs. 30, 000

  13. Which among the following is the societal obligation of accounting?

    1. To ascertain profit correctly

    2. To maintain the records of the assets and liabilities of organization

    3. To establish effective organizational control

    4. To be helpful in correct tax assessment

  14. When audit is carried out during the accounting period with some interval, it is called

    1. periodic audit

    2. partial audit

    3. continuous audit

    4. interim audit

  15. Analytical review by an auditor mainly includes

    1. examining vouchers and other documents

    2. physical verification of assets

    3. examining day books with ledgers

    4. study of ratios and trends