2. In the balance sheet of a company, debentures are shown under which heading
Correct : A. Secured loan
3. In the balance sheet of a company , the discount on issue of debentures is shown under which
heading
Correct : D. miscellaneous expenditure
4. Advance payment of tax is in the nature of
Correct : B. prepaid expenses
5. Debentures are shown in the balance sheet under head
Correct : C. secured loan
6. Preliminary expense Is an example of
Correct : D. fictitious asset
7. Divisible profit do not include
Correct : D. revaluation
8. The transfer of profit to reserve should not exceed
Correct : B. 10% of profit
9. Loose tools are shown in the balance sheet under
Correct : C. current asset
10. Discount on shares and debentures are shown in
Correct : B. asset side of the b/s
11. Calls in arrear Is
Correct : B. deducted from share capital
12. The amount set aside to meet the loss of bad debt is
Correct : A. Provision
13. When the proposed dividend exceeds 20% of the paid up capital, percentage of profit to be
transferred to reserve is
Correct : A. 10%
14. In the case of joint stock company, goodwill is sown on the asset side under the head
Correct : A. Fixed asset
15. Advance payment of tax should be shown on the
Correct : C. asset side of the B/S
16. Which of the following items will be taken in the P/L a/c below the line
Correct : C. contribution to PF
17. Scrip dividend means
Correct : C. dividend paid other than cash
18. Which of the following would not appear in a limited company’s appropriation a/c
Correct : B. proposed taxation
19. As per the rules framed under the companies Act, 1956, if the dividend proposed by a company is 12% of the paid up capital, the amount to be transferred to reserve must not be
less than
Correct : D. 2.5% of the current year profit.
20. Banks show the provision for income tax under the head
Correct : C. other liabilities and provisions
21. Rebate on bills discounted is
Correct : C. income received in advance
22. Which of the following does not include under the head “other asset”
Correct : C. gold
23. A non banking asset is
Correct : B. any asset required from the debtors in satisfaction of claim
24. In a bank balance sheet, unclaimed dividend will be shown under the head
Correct : B. other liabilities
25. With effect from 31/03/2005, a doubt full asset is none which has remained in the substandard category for
Correct : B. 12 month
26. Provision created for substandard is
Correct : A. 10%
27. Provision created for unsecured doubtful debt is
Correct : C. 100%
28. General insurance policies are taken
Correct : A. One year
29. When policy matures on the death of the insured, it is expressed as
Correct : A. With profit policy
30. In the revenue account bonus in reduction of premium is shown as
Correct : C. expense
31. The fixed assets of an insurance company are shown in
Correct : D. none of these
32. Insurance regulation and development authorities act came into effect in
Correct : A. 1938
33. Which of the following of an insurance company does not fall under income from investment
Correct : C. share transfer fee
34. Which of the following of an insurance company is included in other assets
Correct : B. agents balance
35. Reserve for unexpired risk is shown under
Correct : C. provision
36. Which of the following is not an advantage of having a conceptual framework of accounting ?
Correct : C. Considers the needs of all user
37. A conceptual framework for accounting is …
Correct : D. A set of principles underpinning financial reporting
38. Which of the following relate to financial position in a set of financial statements?
Correct : B. Assets, liabilities, income and equity
39. GAAP stands for
Correct : A. Generally accepted accounting principles
40. The global key professional accounting body is -----
Correct : A. Internal accounting standards board
41. The original cost at which an asset or liability is acquired is known as --------
Correct : C. Historical cost
42. The international accounting standards committee was set up in -------------
Correct : C. 1967
43. The process of converting foreign – subsidiary financial statements into the home currency is
known as------------
Correct : B. Translation
44. ……………… is an artificial person created by law
Correct : C. Company
45. The liability of shareholders of a company is ………………..
Correct : A. Limited
46. A company is managed by its…………….
Correct : C. Board of Directors
47. . ………….company Is a company created by a special Act in Parliament
Correct : D. Statutory
48. A company registered with Registrar of Companies under Indian Companies Act is called
as………..
Correct : B. Registered
49. The company in which the liability of members is liable to pay the agreed amount at the
time of winding up is called as …………..
Correct : C. Company limited by guarantee
50. A company in which the transferability of share is restricted is called as …………..
Correct : B. Private Company
51. . ……….is the first stage in the formation of a public company
Correct : A. Promotion
52. Authorised capital is called as……………
Correct : B. Nominal Capital
53. . …………..is that portion of capital which is called up only on winding up of the company.
Correct : D. Reserve capital
54. In case of ……………..preference shares, the arrears of dividend are carried forward
and paid out of the profits of the subsequent years.
Correct : C. Cumulative
55. . …………..shares are repayable after the expiry of the fixed period or at the option of the
company.
Correct : D. Redeemable
56. A bundle of fully paid shares is called……………..
Correct : A. Stock
57. IPO stands for ………………
Correct : C. Initial Public Offer
58. In …... the company offers the investors an opportunity to bid collectively.
Correct : C. Book building
59. As per the companies Act, the interest on calls in advance is …………..
Correct : B. 6%
60. The rate of interest on Calls in arrears as per Companies Act is …………
Correct : C. 5%
61. The shares of a company can be issued at …………..
Correct : D. All of these
62. Share application account is a ………..
Correct : D. Personal Account
63. The rate of discount on shares cannot exceed ……….
Correct : A. 10%
64. A newly established company cannot issue shares at ……
Correct : C. Discount
65. . ………..of total issued amount of capital is called minimum subscription.
Correct : B. 90%
66. The rate of discount should not exceed ……………. Of nominal vale of shares.
Correct : A. 10%
67. The minimum application money to be paid by an applicant must not be less than ……
as per Companies Act.
Correct : B. 5%
68. The excess price received on the par value of shares should be credited to ………….
Correct : C. Security Premium A/c
69. The profit on reissue of forfeited shares is transferred to ………
Correct : C. Capital reserve
70. Preference shareholders are…………
Correct : B. Creditors of the company
71. The shares firstly offered to the existing shareholders are called as ………….
Correct : A. Right shares
72. The security premium account is shown in the balance sheet under the head……….
Correct : B. Reserves & Surplus
73. ………..should be deducted from the share capital to determine the paid up capital.
Correct : C. Calls in arrears
74. The share capital account is debited with …………while forfeiting shares
Correct : C. Called capital
75. On an equity share of Rs. 20, the company has called up Rs. 16 but Rs.14 has been received
by the company, the share capital account should be credited by ……
Correct : B. Rs. 16
76. Balance of forfeited share is …….
Correct : B. Capital Reserve
77. When shares are issued at a price higher than their face value, it is called issue at…………..
Correct : B. Premium
78. The shares of a company only can be forfeited after giving a ………days notice
Correct : B. 14
79. The forfeited shares can be reissued at …………
Correct : D. All of these
80. Preference shares cannot be redeemed at ………..
Correct : C. Discount
81. Which of the following is an example for capital profit?
Correct : D. All of these.
82. The allotment of shares in case of oversubscription is called…..
Correct : A. Pro‐rata allotment
83. Security premium account can be utilized for ………….
Correct : D. All of these
84. . …………..is that portion of issued capital which is applied for by the public.
Correct : B. Subscribed capital
85. . ……………is an instrument of acknowledgment of debt.
Correct : C. Debenture
86. Debenture represents ………. Of a company
Correct : A. Borrowed capital
87. Debenture holders will get ……..
Correct : B. Interest
88. Debenture holders are the ……….of a company
Correct : C. Creditors
89. A charge created not on specific assets but generally on all assets is known as………….
Correct : B. Floating charge
90. . …………..debentures can be transferred only with the knowledge of the company.
Correct : C. Registered
91. . ………..debentures are transferable by mere delivery
Correct : D. Bearer
92. . …………debentures are secured by the assets of the company
Correct : B. Mortgage
93. . Unsecured debentures are called as ……………….debentures
Correct : A. Naked
94. FCD stands for ……………
Correct : C. Fully Convertible Debentures
95. Discount or loss on issue of debenture is a ………….
Correct : C. Capital Loss
96. Debentures can be redeemed out of ……….
Correct : D. All of these
97. Interest on debenture is ……….
Correct : C. Charge on profit
98. Debentures are shown in the balance sheet under the head ………..
Correct : A. Secured loans
99. After realizing all the investments, the balance in the sinking fund account is transferred to …………
Correct : D. Capital reserve
100. When own debentures are cancelled, any profit on cancellation is transferred to ……..