Financial Accounts Solved MCQs

1.

In order to find out additional capital of any partner as per surplus capital method of a particular partner whose proportional capital compared to other partner's capital is

A. More
B. Zero
C. Less
D. None of the above
Answer» C. Less
2.

Before distributing cash amongst partners whatever profit or loss and reserves as per the balance sheet

A. Will not be distributed amongst partners
B. Will be distributed amongst partners as per their P/L sharing ratio
C. Will be distributed amongst partners in context to each partner's capital
D. Will be distributed equally amongst partners
Answer» B. Will be distributed amongst partners as per their P/L sharing ratio
3.

If there is Debit balance of any one partner's capital account the same will be distributed amongst the remaining partners

A. As per the ratio of capital
B. As per their Profit and Loss sharing ratio
C. Nil (will not be distributed)
D. None of the above
Answer» B. As per their Profit and Loss sharing ratio
4.

In piecemeal Distribution according to Surplus capital method, final deficit of each partner

A. Will not be in ratio of capital
B. Will be in ratio of profit and loss
C. Will not be in ratio of profit and loss
D. None of the above
Answer» B. Will be in ratio of profit and loss
5.

Salesmen's salary is divided between two periods in

A. Time Ratio
B. Turnover ratio
C. Purchase ratio
D. None of the above
Answer» B. Turnover ratio
6.

Preliminary expenses are apportioned between two periods in

A. Time Ratio
B. Turnover ratio
C. Prior to Inc. Period
D. Post Inc. Period
Answer» D. Post Inc. Period
7.

Profit of post-incorporation period is called

A. Revenue Profit
B. Capital Profit
C. Gross Profit
D. None of the above
Answer» A. Revenue Profit
8.

The profit earned from the date of purchase till incorporation is considered as

A. Revenue Profit
B. Capital Profit
C. Gross Profit
D. None of the above
Answer» B. Capital Profit
9.

Director's salary is divided between prior period and post incorporation period in

A. Turnover ratio
B. Time Ratio
C. Revenue Ratio
D. None of the above
Answer» D. None of the above
10.

Depreciation is calculated on the asset purchased by company in

A. Time Ratio
B. Turnover ratio
C. Post Incorporation Period
D. Pre Incorporation Period
Answer» C. Post Incorporation Period
11.

If there is a loss prior to incorporation, it will be debited to

A. Profit and Loss Account
B. Goodwill Account
C. Capital Reserve Account
D. None of the above
Answer» B. Goodwill Account
12.

The Companies Act provides that minimum amount of             of the face value of shares must be paid along with the application

A. 0.05
B. 0.1
C. 0.07
D. 0.02
Answer» A. 0.05
13.

According to Table 'A', a company can charge annual interest on calls-in-arrears at

A. 0.1
B. 0.05
C. 0.075
D. 0.12
Answer» B. 0.05
14.

According to Table 'A', annual interest on calls-in-advance should be

A. Not more than 2.5%
B. Not more than 5%
C. Not more than 6%
D. Not more than 10%
Answer» C. Not more than 6%
15.

When a company pays remuneration to its promoters by issuing shares to them, then

A. Goodwill Account is debited
B. Share Capital Account is debited
C. Promoter Account is debited
D. None of the above
Answer» A. Goodwill Account is debited
16.

When shares are Forfeited, then the amount called up on Forfeited shares is debited to

A. Share Capital Account
B. Share Call Account
C. Share Forfeiture Account
D. None of the above
Answer» A. Share Capital Account
17.

When Forfeited shares are reissued, then the discount allowed should be             the amount received from old share holders

A. Not Less than
B. Equal to
C. Not more than
D. None of the above
Answer» C. Not more than
18.

When all the Forfeited shares are not reissued, then the proportionate amount in             must be kept in that account

A. Share Capital Account
B. Forfeiture Share Account
C. Capital Reserve Account
D. None of the above
Answer» B. Forfeiture Share Account
19.

When the amount of premium on forfeited shares has not been received, then with the proportionate amount of premium

A. Security Premium Account is debited
B. Security Premium Account is credited
C. Share Capital Account is debited
D. None of the above
Answer» A. Security Premium Account is debited
20.

When shares have been issued at discount, then the proportionate amount of discount on forfeited shares should be

A. Debited to Shares Discount Account
B. Credited to Shares Discount Account
C. Credited to Forfeited shares Account
D. None of the above
Answer» B. Credited to Shares Discount Account
21.

The maximum rate of interest paid by a company on Calls- in-advance as per Table 'A' is

A. 0.05
B. 0.06
C. 0.1
D. 0.025
Answer» B. 0.06
22.

The maximum rate of interest received by a company on Calls-in-arrears as per Table 'A' is

A. 0.06
B. 0.18
C. 0.12
D. 0.05
Answer» D. 0.05
23.

A company can issue bonus share out of the following

A. credit balance of profie and loss acoount
B. securities premium account
C. capital reserve account
D. all of these
Answer» D. all of these
24.

When shares are to be redeemed out of profits, a sum equal to nominal amount of shares redeemed is to be transferred to

A. Capital Reserve
B. Capital Redeemption Reserve
C. General Reserve
D. Trading Account
Answer» B. Capital Redeemption Reserve
25.

when company issues bonus share then its share price immediately

A. increase
B. decrease
C. as not effect
D. none of tese
Answer» B. decrease
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