Classical

Financial and Management Accounting - Financial and Management Accounting Practice Questions

11:  
Which of the following provisions held for various assets should be transferred to the realisation account upon dissolution of the firm?
1. Provision for Discounts
2. Provision for Depreciation
3. Joint Life Policy Reserve
4. Contingency Reserve
5. Investment Fluctuation Fund
Select the correct answer using the codes given below
A.

1 and 2

B.

1,2 and 3

C.

1,2,3 and 4

D.

1,2,3,4 and 5

 
 

Option: D

Explanation :


12:  
Consider the following statements:
1. A private company can commence business after getting the certificate of incorporation from the Registrar of Companies.
2. The quorum for a meeting of a private company is three
3. Private limited company cannot pay managerial remuneration in any financial year more than 11 % of the net profits of the company.
Which of the above statements are correct?
A.

Only 1

B.

2 and 3

C.

1 and 2

D.

1,2 and 3

 
 

Option: A

Explanation :


13:  
Which of the following statements distinguishing between a company's balance sheet and a firm's balance sheet is correct?
A.
A company's balance sheet is prepared in the order of permanence whereas a partnership firm's balance sheet is usually, prepared in order of liquidity.
B.
For a company's balance sheet, there are two standard forms prescribed under the Companies Act, 1956 whereas, there is no standard form prescribed under the Indian Partnership Act. 1932 for a partnership firm's balance sheet.
C.
In case of a company's balance sheet, previous year's figures are required to be given, whereas, it is not so in the case of a partnership firm's balance sheet.
D.

All of the above

 
 

Option: D

Explanation :


14:  
Indicate the item that appears below the line in the Profit and Loss Account
A.

Proposed Dividend

B.

Provision for Taxation

C.

Contribution to Provident Fund

D.

Miscellaneous expenditure written off

 
 

Option: A

Explanation :


15:  
Which of the following reserves can be utilised only for issuing fully paid bonus shares and not for making partly paid shares fully paid shares?
l. Dividend equalisation reserve
2. Capital reserve arising from profit on sale of fixed assets received in cash
3. Capital redemption reserve account created at the time of redemption of redeemable preference shares out of the profits.
4. Securities premium collected in cash only.
Select the correct answer using the codes given below:
A.

1,3 and 4

B.

1,2 and 3

C.

2 and 4

D.

3 and 4

 
 

Option: D

Explanation :




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