Competitive Exams: Commerce MCQs (Practice-Test 86 of 99)

  1. A Secretary's duties under the Companies Act are

    1. purely ministerial

    2. either ministerial or administrative

    3. Managerial

    4. supervisory

  2. The Secretary of a company is generally appointed by

    1. Registrar of Companies

    2. Central Government

    3. Board of Directors

    4. Board of Directors with the consent of the Institute of Company Secretaries of India

  3. A person can act as Secretary for NOT more than

    1. 2 companies

    2. 3 companies

    3. 5 companies

    4. None of the above

    • Assertion (A): A common projectionist argument has been that nurse the baby, protect the child, guide the boy and free the adult.
    • Reason (R): Protection given in most cases creates vested interests, which are averse for the removal of the protection.
    1. Both A and R are true and R is the correct explanation of A

    2. Both A and R are true but R is NOT the correct explanation or A

    3. A is true but R is false

    4. A is false but R is true

    • Assertion (A): The matching concept requires that costs be recognized as expenses in the period in which revenue is realised.
    • Reason (R): There may not be a match between expenditure and expense over a short period.
    1. Both A and R are true and R is the correct explanation of A

    2. Both A and R are true but R is NOT the correct explanation or A

    3. A is true but R is false

    4. A is false but R is true

    • Assertion (A): According to Inter-national Accounting Standards Committee, fixed production expenses should be included in inventory valuation on the basis of normal capacity. According to the Institute of Chartered Accountants of India, it is for the management to decide the Question.
    • Reason (R): The Question to be decided is whether the fixed production expenses be excluded from inventory valuation and charged wholly to the revenue of that year or whether these expenses. Are includes on the basis of normal level of production. The former method IS called marginal costing ‘and the latter’ absorption costing'.
    1. Both A and R are true and R is the correct explanation of A

    2. Both A and R are true but R is NOT the correct explanation or A

    3. A is true but R is false

    4. A is false but R is true

    • Assertion (A): The fixed assets in the balance sheet of a limited company are required to be shown at cost less depreciation.
    • Reason (R): The balance sheet and profit and loss accounts are to disclose a true and fair view.
    1. Both A and R are true and R is the correct explanation of A

    2. Both A and R are true but R is NOT the correct explanation or A

    3. A is true but R is false

    4. A is false but R is true

    • Assertion (A): Share premium amount can be re-funded in cash to equity shareholders.
    • Reason (R): Share premium is usually collected when the market price of shares is higher than the face value of the share.
    1. Both A and R are true and R is the correct explanation of A

    2. Both A and R are true but R is NOT the correct explanation or A

    3. A is true but R is false

    4. A is false but R is true

    • Assertion (A): Conventionally, a newly started comp-any should adopt.
    • Reason (R): A low-geared capital structure where the share of equity capital and reserves is higher than the share of fixed interest-bearing securities.
    1. Both A and R are true and R is the correct explanation of A

    2. Both A and R are true but R is NOT the correct explanation or A

    3. A is true but R is false

    4. A is false but R is true. Reason (R): During initial years, the profit is low and the company tries to strengthen its financial position.

    • Assertion (A): A new firm can be profitable and yet not be able to pay its debts as they become due.
    • Reason (R): New firms often have problem of having increased investments in inventory and fixed assets at an amount which exceeds cash generated from operations.
    1. Both A and R are true and R is the correct explanation of A

    2. Both A and R are true but R is NOT the correct explanation or A

    3. A is true but R is false

    4. A is false but R is true

    • Assertion (A): A company is accountable to the society since it makes use of community owned assets and other infrastructure facilities and concessions provided by the State from the tax payers'money.
    • Reason (R): The best way of social responsibility reporting is to prepare a Value Added Statement (VAS) which shows the income earned by shareholders.
    1. Both A and R are true and R is the correct explanation of A

    2. Both A and R are true but R is NOT the correct explanation or A

    3. A is true but R is false

    4. A is false but R is true

    • Assertion (A): Audit procedure and audit techniques are two different aspects of auditing but are complementary to each other.
    • Reason (R): Audit procedure is concerned with deter-mining the existence of documentary evidence and audit techniques are concerned with examination of those evidences.
    1. Both A and R are true and R is the correct explanation of A

    2. Both A and R are true but R is NOT the correct explanation or A

    3. A is true but R is false

    4. A is false but R is true

    • Assertion (A): The auditor of a partnership firm is appointed under a contract with firm but not under any statut.
    • Reason (R): The firm can also appoint him to act as an accountant for preparation of accounts.
    1. Both A and R are true and R is the correct explanation of A

    2. Both A and R are true but R is NOT the correct explanation or A

    3. A is true but R is false

    4. A is false but R is true

  4. The author of the book Suma de Arithmetical is

    1. H A Castle

    2. Luca Paciolli

    3. Adam Smith

    4. Batliboi

  5. When prices show a rising trend, which one of the following methods of inventory valuation will result in lower income and lower valuation. Of inventory?

    1. FIFO

    2. LIFO

    3. Simple average method

    4. Weighted average method