Classical

Financial and Management Accounting - Financial and Management Accounting Objective Type Questions

36:  
For piecemeal distribution of cash for return of capital among the partners on dissolution, the method adopted should ensure that the amount finally left unpaid i.e., the loss to be borne by the partners is in
A.

Profit-sharing ratio

B.
Proportion to closing capital at the time of dissolution
C.

Equal proportion

D.

Proportion to assets realised.

 
 

Option: A

Explanation :


37:  
The current ratio of a company is 2 : 1. Which of the following suggestions would not change it?
A.
To borrow money for a short time on an interest bearing promissory note
B.

To discount accounts receivable

C.

Purchase of fixed assets

D.

Bills receivable dishonoured.

 
 

Option: C

Explanation :


38:  
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. Provident Fund schemes
3. Pension and other staff-benefit schemes
4. Taxation
The correct chronological order of their disclosure is
A.

4,2,1,3

B.

3,2,1,4

C.

4,1,2,3

D.

3,1,2,4

 
 

Option: C

Explanation :


39:  
Which accounting standard deals with Earning per share?
A.

AS-14

B.

AS-26

C.

AS-9

D.

AS-20

 
 

Option: D

Explanation :


40:  
A low stock turnover ratio is not desirable because it reveals the
1. Accumulation of obsolete stock
2. Carrying of too much stock
3. High cost of goods sold
Select the correct answer using the codes given pelow :
A.

1 and 2

B.

2 and 3

C.

1 and 3

D.

1, 2 and 3

 
 

Option: C

Explanation :




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