MCQOPTIONS
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MCQOPTIONS
This section includes 2081 Mcqs, each offering curated multiple-choice questions to sharpen your Finance & Accounting knowledge and support exam preparation. Choose a topic below to get started.
| 801. |
Amount sacrificed by shareholders are credited to …. |
| A. | capital reserve |
| B. | general reserve |
| C. | capital reduction |
| D. | none of these |
| Answer» D. none of these | |
| 802. |
Capital reduction account is used to … |
| A. | write off losses |
| B. | transfer to capital |
| C. | issue bonus shares |
| D. | none of these |
| Answer» B. transfer to capital | |
| 803. |
Any increase in the value of assets is…. to capital reduction |
| A. | debited |
| B. | credited |
| C. | Ignored |
| D. | None of these |
| Answer» C. Ignored | |
| 804. |
--------- is the account created in connection with internal reconstruction. |
| A. | realization a/c |
| B. | capital reduction a/c |
| C. | adjustment a/c |
| D. | CRR a/c |
| Answer» C. adjustment a/c | |
| 805. |
Which of the following does not involve liquidation of any company? |
| A. | internal reconstruction |
| B. | amalgamation |
| C. | absorption |
| D. | external reconstruction |
| Answer» B. amalgamation | |
| 806. |
Alteration of shares of larger denominations into smaller denominations is called -------- of shares. |
| A. | consolidation |
| B. | surrender |
| C. | sub-division |
| D. | valuation |
| Answer» D. valuation | |
| 807. |
Under which of the following circumstances can a company resort to internalreconstruction? |
| A. | accumulated huge losses |
| B. | shortage of capital |
| C. | over valued assets |
| D. | all of these |
| Answer» E. | |
| 808. |
Internal reconstruction can be done by ---------- |
| A. | Alteration of share capital |
| B. | reduction of share capital |
| C. | issue of share capital |
| D. | all of these |
| Answer» E. | |
| 809. |
The balance in capital reduction a/c after writing off all accumulated loss, fictitiousassets and overvalued assets are transferred to ------------- |
| A. | capital reserve |
| B. | general reserve |
| C. | reserve capital |
| D. | good will |
| Answer» B. general reserve | |
| 810. |
Which of the following result in reduction of capital? |
| A. | Reducing share capital |
| B. | reducing the amount payable to creditors |
| C. | appreciation in the value of assets |
| D. | all of these |
| Answer» E. | |
| 811. |
Which of the following is not an alteration of capital? |
| A. | consolidation of shares |
| B. | sub- division of shares |
| C. | conversion of shares in to stock |
| D. | paid off paid up capital in excess of needs of the company. |
| Answer» E. | |
| 812. |
Which of the following is not a case of combination? |
| A. | external reconstruction |
| B. | internal reconstruction |
| C. | amalgamation |
| D. | absorption |
| Answer» C. amalgamation | |
| 813. |
Sources of finance of the redemption of debentures are: |
| A. | redemption out of profits |
| B. | redemption out of capital |
| C. | the proceeds from fresh issue of shares/debentures |
| D. | all the above |
| Answer» E. | |
| 814. |
Debentures cannot be redeemed at |
| A. | par |
| B. | premium |
| C. | discount |
| D. | more than 10% premium |
| Answer» D. more than 10% premium | |
| 815. |
Premium on redemption of debentures is a |
| A. | personal a/c |
| B. | real a/c |
| C. | nominal a/c |
| D. | suspense a/c |
| Answer» B. real a/c | |
| 816. |
According to SEBI guidelines, a Company will have to create debenture redemption reserveequivalent to the amount of the following percentage of debenture issued: |
| A. | 50% |
| B. | 25% |
| C. | 70% |
| D. | 100% |
| Answer» C. 70% | |
| 817. |
When all debentures are redeemed, balance in the Debenture Redemption Fund Account istransferred to: |
| A. | capital reserve |
| B. | general reserve |
| C. | profit & loss appropriation a/c |
| D. | none of these |
| Answer» C. profit & loss appropriation a/c | |
| 818. |
Market price per share divided by earnings per share is ________. |
| A. | price earning ratio |
| B. | return on equity |
| C. | market test ratio |
| D. | book value per share |
| Answer» B. return on equity | |
| 819. |
Lower stock turnover ratio indicates ________. |
| A. | solvency position |
| B. | monopoly situation |
| C. | over investment in inventory |
| D. | none of these |
| Answer» D. none of these | |
| 820. |
The ratio which indicates how quickly debtors are converted into cash is ________. |
| A. | receivable turnover ratio |
| B. | inventory turnover ratio |
| C. | working capital turnover ratio |
| D. | creditors turnover ratio |
| Answer» B. inventory turnover ratio | |
| 821. |
Net capital employed is equal to ______. |
| A. | total assets minus liabilities |
| B. | fixed asset plus net working capital |
| C. | total asset minus long-term liabilities |
| D. | total assets |
| Answer» C. total asset minus long-term liabilities | |
| 822. |
Satisfactory level of debt equity ratio is _________. |
| A. | 1:1 |
| B. | 3:1 |
| C. | 2:1 |
| D. | 1:2 |
| Answer» D. 1:2 | |
| 823. |
The ideal current ratio is |
| A. | 2:1 |
| B. | 1:1 |
| C. | 1:2 |
| D. | 1:3 |
| Answer» B. 1:1 | |
| 824. |
In a sound business, acid test ratio ________ is considered satisfactory |
| A. | 1:2 |
| B. | 2:1 |
| C. | 1:1 |
| D. | 0.5:1 |
| Answer» D. 0.5:1 | |
| 825. |
The ratio that highlight the end result of business activities are known as ________ ratios |
| A. | liquidity |
| B. | leverage |
| C. | activity |
| D. | profitability |
| Answer» E. | |
| 826. |
The ratios that shows the capacity of the business unit to meet its short term obligation out ofits short term resources is known as ______ |
| A. | solvency ratio |
| B. | leverage ratio |
| C. | liquidity ratio |
| D. | trend ratio |
| Answer» D. trend ratio | |
| 827. |
Leverage ratios are also known as _______ ratios |
| A. | short term solvency ratios |
| B. | long term solvency ratios |
| C. | solvency ratio |
| D. | liquidity ratio |
| Answer» C. solvency ratio | |
| 828. |
Income statement ratios are also called |
| A. | operating ratio |
| B. | liquidity ratio |
| C. | activity ratio |
| D. | trend ratio |
| Answer» B. liquidity ratio | |
| 829. |
An example of Balance Sheet ratio is _______ |
| A. | net profit ratio |
| B. | inventory turnover ratio |
| C. | current ratio |
| D. | fixed asset turnover ratio |
| Answer» D. fixed asset turnover ratio | |
| 830. |
Ratios may be used as a measure of ________ |
| A. | efficiency |
| B. | solvency |
| C. | profitability |
| D. | none of the above |
| Answer» B. solvency | |
| 831. |
Ratios help the management in evolving market strategies through ________ |
| A. | inter firm comparison |
| B. | intra firm comparison |
| C. | ratios |
| D. | none of the above |
| Answer» B. intra firm comparison | |
| 832. |
The ratio that includes whether investment in inventory is efficiently used or not |
| A. | inventory turnover ratio |
| B. | working capital turnover ratio |
| C. | fixed asset turnover ratio |
| D. | activity ratio |
| Answer» B. working capital turnover ratio | |
| 833. |
Ratios indicate trends in important items and this helps in _________ |
| A. | forecasting |
| B. | reporting |
| C. | analyzing |
| D. | interpreting |
| Answer» B. reporting | |
| 834. |
The main aim of the ratio analysis is to help the ______ of the firm |
| A. | owners |
| B. | officials |
| C. | departments |
| D. | management |
| Answer» E. | |
| 835. |
The index of efficiency and profitability of the business |
| A. | operating ratio |
| B. | operating profit ratio |
| C. | expense ratio |
| D. | net profit ratio |
| Answer» E. | |
| 836. |
The ratio which shows the relationship b/w shareholder’s fund and total assets |
| A. | debit equity ratio |
| B. | proprietary ratio |
| C. | solvency ratio |
| D. | fixed asset |
| Answer» C. solvency ratio | |
| 837. |
The ratio that shows the relationship between fixed asset to shareholders fund |
| A. | fixed asset to net worth |
| B. | fixed asset ratio |
| C. | fixed assets turnover ratio |
| D. | net worth ratio |
| Answer» B. fixed asset ratio | |
| 838. |
Long term solvency of a firm can be measured by |
| A. | current ratio |
| B. | net profit ratio |
| C. | gross profit ratio |
| D. | debt equity ratio |
| Answer» E. | |
| 839. |
The ratio which depicts the relationship between two items, one of which is drawn from theBalance Sheet and the other from the revenue account |
| A. | current ratio |
| B. | equity ratio |
| C. | net profit ratio |
| D. | debtors turnover ratio |
| Answer» E. | |
| 840. |
The ratio of liquid asset to current liabilities |
| A. | quick ratio |
| B. | current ratio |
| C. | absolute liquid ratio |
| D. | combined ratio |
| Answer» B. current ratio | |
| 841. |
The technique of converting figures into percentage in some common base is called _____. |
| A. | ratio analysis |
| B. | common size statement analysis |
| C. | trend percentages |
| D. | none of these |
| Answer» B. common size statement analysis | |
| 842. |
Which of the following accounts can be transferred to capital redemption reserve account? |
| A. | general reserve account |
| B. | forfeited shares account |
| C. | profit prior to incorporation |
| D. | securities premium account |
| Answer» B. forfeited shares account | |
| 843. |
The Capital Redemption reserve is created for the following reasons: |
| A. | to maintain the capital intact |
| B. | to safeguard the interest company’s creditors |
| C. | both of the above |
| D. | none of the above |
| Answer» D. none of the above | |
| 844. |
Which of the following cannot be used for the purpose of creation of capital redemptionreserve account? |
| A. | profit and loss account (credit balance) |
| B. | general reserve account |
| C. | dividend equalization reserve account |
| D. | unclaimed dividends account |
| Answer» E. | |
| 845. |
A company cannot issue redeemable preference shares for a period exceeding _________. |
| A. | 6 years |
| B. | 7 years |
| C. | 8 years |
| D. | 20 years |
| Answer» E. | |
| 846. |
Which of the following cannot be utilized for the redemption of preference shares of acompany |
| A. | securities premium on fresh issue of shares |
| B. | general reserve |
| C. | profit and loss account |
| D. | dividend equalization reserve |
| Answer» B. general reserve | |
| 847. |
Which of the following can be utilized for the redemption of preference shares of a companyout of profit: |
| A. | shares forfeited account |
| B. | development rebate reserve account |
| C. | capital redemption reserve account |
| D. | dividend equalization reserve |
| Answer» E. | |
| 848. |
When Redeemable Preference shares are due for redemption, the entry passed is |
| A. | debit redeemable preference share capital a/c; credit cash a/c |
| B. | debit redeemable preference share capital a/c; credit preference shareholders a/c |
| C. | debit preference shareholders a/c; credit cash a/c |
| D. | debit preference shareholders a/c; credit capital reduction a/c |
| Answer» C. debit preference shareholders a/c; credit cash a/c | |
| 849. |
A provision is |
| A. | a liability of uncertain timing or amount |
| B. | a possible obligation as a result of past events that is of uncertain timing or amount |
| C. | an adjustment to the carrying amount of assets |
| D. | none of these |
| Answer» B. a possible obligation as a result of past events that is of uncertain timing or amount | |
| 850. |
Total Number of IFRIC Interpretations which are notified as of date? |
| A. | 23 |
| B. | 24 |
| C. | 25 |
| D. | 26 |
| Answer» B. 24 | |