Classical

Financial and Management Accounting - Financial and Management Accounting Multiple Choice Questions

36:  
Assertion (A). Companies are required to use Written Down Value (WDV) method and the rates specified in Schedule XIV to the Companies Act.
Reason (R). A change from WDV method of providing depreciation to Straight Line Method (SLM) should be made if it is considered that the change would result in a more appropriate preparation or presentation of the financial statements of the company.
A.
Both A and R are true and R is the correct explanation of A.
B.
Both A and R are true but R is not a correct explanation of A.
C.

A is true but R is false

D.

A is false but R is true.

 
 

Option: B

Explanation :


37:  

Which of the following is a branch of Accounting?

A.

Financial Accounting

B.

Cost Accounting

C.

Management Accounting

D.

All of the above

 
 

Option: D

Explanation :


38:  
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 account are to disclose a true and fair view.
A.
Both A and R are true and R is the correct explanation of A.
B.
Both A and R are true but R is not a correct explanation of A.
C.

A is true but R is false

D.

A is false but R is true.

 
 

Option: A

Explanation :


39:  
Which of the following statements are appropriate in respect of partnership accounts?
1. In the absence of any provision in the partnership agreement to the contrary, partners can charge interest as 6% per annum on loans given by them to the partnership firm.
2. An ordinary partnership firm can have not more than 50 partners.
3. A banking partnership firm cannot have more than 10 partnership.
4. In the absence of any provision in the partnership agreement to the contrary, profits and losses are shared by the partners in the ratio of their capitals.
Select the correct answer using the codes given below:
A.

1 and 2

B.

2,3 and 4

C.

1 and 3

D.

1,3 and 4

 
 

Option: C

Explanation :


40:  
Assertion (A). Performance ratios show where we are going.
Reason (R). Balance sheet ratios show where we stand.
A.
Both A and R are true and R is the correct explanation of A.
B.
Both A and R are true but R is not a correct explanation of A. 
C.

A is true but R is false

D.

A is false but R is true.

 
 

Option: B

Explanation :




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