1. Net worth refers to owner’s--------------------------
Correct : A. Equity
2. Ratio to assess the short term debt paying capacity of a firm is----------
Correct : C. Liquid ratio
3. The ratio which is used to ascertain the soundness of the long term financial position is------------
Correct : A. Debt equity ratio
4. If the current assets and working capital of a company are rs.80,000 and rs.50000 then current liability will be-------------
Correct : D. Rs.30000
5. The ratio which is a good indicator to maintain the correct selling price and efficiency of trading activity is------
Correct : B. Gross profit ratio
6. Return on investment is a----------------
Correct : C. Combined ratio
7. Debtors turnover ratio also known as----------
Correct : B. Receivable turnover ratio
8. The operating profit and net sale of a firm are rs.2,00,000 and rs.10,00,000 respectively then operating ratio will be
Correct : A. 20%
9. The ratio which indicates how quickly debtors are converted into cash is---------
Correct : A. Receivable turnover ratio
10. Net capital employed is equal to ---------------
Correct : B. Fixed asset plus net working capital
11. Ratio of net profit before interest and tax to sales is------------------------------
Correct : C. Operating profit ratio
12. Lower stock turnover ratio indicates-------------------------------
Correct : C. Over investment in inventory
13. Collection of book debts-----
Correct : A. Has no effect on current ratio
14. Debt equity ratio is a--------------------------------------
Correct : D. Long term solvency ratio
15. Market price per share divided by earnings per share is-------
Correct : A. Price earning ratio
16. Solvency ratio indicates-----------------
Correct : A. Credit worthiness
17. Current ratio shows-----
Correct : B. The working capital position
18. Current ratio is 4:1, the amount of current liabilities is Rs.12000 the amount of working capital is-----
Correct : A. Rs.48,000
19. Stock turnover ratio is used to determine -----------------------of an enterprise
Correct : C. Efficiency
20. Working capital is expressed as------
Correct : C. Current assets-current liabilities
21. Dividend yield is an example for------ratio
Correct : C. Market strength
22. Debtors turnover ratio is used to calculate------
Correct : A. efficiency
23. Rol measures-----
Correct : A. Profitability in relation to investment
24. Debtors turnover ratio measures----------
Correct : D. Credit policy
25. Fund flow refers to change in-----
Correct : A. Working capital
26. Depreciation is sometimes treated as -------of funds
Correct : C. Source
27. Salary outstanding is----- of funds
Correct : C. Application
28. Any gain on sale of non-current asset should be ----- from the net profit for determining funds from operation
Correct : A. Deducted
29. Asset sold on credit is---- of funds
Correct : C. Source
30. Furniture sold for cash -----funds flow
Correct : A. Increases
31. Goodwill is a ---------------------transaction
Correct : B. Noncurrent
32. When one account is current and another a non-current It results in--------------------
Correct : A. Flow of fund
33. To arrive at funds from operation ,non-cash expenses must be added to----------
Correct : A. Net profit
34. Fund flow statement is accompanied by a schedule of-----------------------------
Correct : A. Changes in working capital
35. Goods purchased on credit-----------inflow of funds
Correct : A. Does not result
36. ----------account is prepared to know funds from operation
Correct : D. Profit & Loss adjustment account
37. Increases in current liabilities --------------working capital
Correct : B. Decreases
38. Increase in current assets-------------working capital
Correct : A. Increases
39. Decrease in current liabilities --------------------working capital
Correct : A. Increases
40. Net increase in working capital results in----------------of funds
Correct : D. application
41. Net decrease in working capital results in --------------------of funds
Correct : B. Application
42. -------------------means transfer of economic value of firm from one asset or equity to another.
Correct : A. Flow of funds
43. Funds from operations are --------------of funds
Correct : C. Sources
44. In the fund flow statement, depreciation is----------------
Correct : B. Added to net profit
45. Which of the following is non-current asset
Correct : A. Goodwill
46. Which of the following will affect the flow of fund
Correct : A. a transaction affecting current and non-current accounts
47. Which of the following is an application of fund
Correct : C. Purchase of funds
48. Current assets are Rs.6,00,000 current liabilities are Rs.3,00,000 the debtors realized Rs.40,000, the impact on net working capital would be-------------------------
Correct : A. No change in working capital
49. Gross profit are Rs.50,000 and expenses not result in the application of funds are Rs.10000 funds from operation will be
Correct : A. Rs.60000
50. Which of the following is a non-current liability
Correct : A. Mortgage loan
51. Current liabilities are equals to-------------------------------
Correct : C. Current assets-working capital
52. Inflow of fund does not take place due to----------------
Correct : B. Increase in capital
53. Increase in working capital is-----------------------
Correct : B. Application of fund
54. Salaries Rs.20000,depreciation for the period is Rs.30000 other operating expenses are Rs.9000, net loss for the period is Rs.5000 fund generated from operation is------------------
Correct : A. Rs.25000
55. Stock at the end results in-----------------------
Correct : B. Source of fund
56. Depreciation is a source of fund-------------------
Correct : A. Yes
57. Stock in the beginning results in-----------
Correct : A. Application of funds
58. Which of the following does not affect the fund flow statement
Correct : D. Payment to creditors
59. Which of the following does not affect working capital---------
Correct : B. Debenture
60. Proposed dividend is a--------
Correct : A. Current liability
61. Cash flow statement is prepared by taking the ------------- balance of cash
Correct : A. Opening balance
62. Decrease in a creditor is a---------------- of cash
Correct : C. Outflow
63. Goodwill written off is-----------to the net profit made during the year for calculating the cash from operation
Correct : A. Added back
64. Provision for tax is shown as a part of-----------activity
Correct : C. operating
65. Purchase of fixed asset is classified as------activity
Correct : B. investing
66. Purchase of building by issue of debenture is a---------item and it is ignored in cash flow statement
Correct : B. non-cash
67. Cash flow statement is based on past records, so it is---------in nature
Correct : A. historical
68. Cash equivalent are usually of short term but highly -----------------investments
Correct : A. liquid
69. Cash flow statements (based on AS-3) should be prepared and presented under------------------method.
Correct : B. Indirect
70. Income tax paid should be shown separately as the cash flows from----------- activities.
Correct : C. Operating
71. Buy back of shares is shown under-----------------------
Correct : C. financing activities
72. Increase in prepaid expenses--------------------cash
Correct : C. Decreases
73. Dividend paid are classified under-------------------activities
Correct : A. Financing
74. Cash payment suppliers of goods and services are shown under-------------.
Correct : A. Operating
75. 20,000 equity shares of Rs.10 each issued at 10% premium , cash is Rs-------------------
Correct : D. Rs.2,20,000
76. Preliminary expenses written off is--------
Correct : B. Non-cash transaction
77. Investment costing Rs.50,000 at the loss of Rs.3,000 cash outflow in investing activity is --------
Correct : C. Rs.47,000
78. Cash from operations is equal to------------------
Correct : D. net profit plus non-cash expenses plus decrease in current assets.
79. Increase in the amount of bills receivable results in--------------
Correct : A. decrease in cash
80. Increase in the amount of bills payable results in----------
Correct : B. Increase in cash
81. Which of the following is not an inflow of cash
Correct : D. Acquisition of assets
82. Dividend paid under AS- 3 is----------
Correct : C. Cash flow from investing activity
83. Cash flows include
Correct : C. Cash receipts and payments
84. Cash flow statement is based on----------
Correct : A. Cash basis of accounting
85. Proposed dividend is classified as-----------
Correct : C. Operating activity
86. Profit on sale of machinery comes under------------
Correct : C. Operating activity
87. Sale of patent is classified under---------
Correct : A. Investing activity
88. Rent received by a company (whose main business is real estate) is classified as
Correct : C. Operating activity
89. AS-3 is related to
Correct : A. Cash flow statement
90. The information to prepare a flexible budget includes:
Correct : D. Total fixed cost, variable cost per unit, several levels of activity
91. The scarce factor of production is known as
Correct : A. Key factor
92. Which of the following is a budget designed to furnish budgeted costs for any level of activity attained
Correct : B. Flexible budget
93. Flexible budgets are useful for
Correct : B. Planning, performance evaluation and feedback control
94. The budget that summarize future plans for acquisition of plant facilities and equipment is the
Correct : C. Capital expenditure budget
95. A report comparing actual results with the budget figure is called a ___________
Correct : A. Budget report
96. Profit plan(or budget) is a
Correct : B. Short term financial plan
97. The objectives, procedures, organizational structure and authority and responsibility in writing about a budget is shown in
Correct : A. Budget manual
98. Which budget is prepared after the preparation of all functional budgets
Correct : C. Master budget
99. The overall responsibility for the functions of the budget committee lies on the _____________
Correct : C. Budget director or budget officer
100. For preparing an effective budget it needs accounting information which is
Correct : D. Structured around the planning and control needs of the management