McqMate
Chapters
| 1. |
How many IFRS are in force as of now? |
| A. | 65 |
| B. | 36 |
| C. | 37 |
| D. | 38 |
| Answer» A. 65 | |
| 2. |
Total no of interpretations applicable till date? |
| A. | 24 |
| B. | 26 |
| C. | 28 |
| D. | 30 |
| Answer» C. 28 | |
| 3. |
What is the transition date of IFRS in India? |
| A. | april 1, 2010 |
| B. | april 1, 2011 |
| C. | april 1, 2012 |
| D. | april 1, 2008 |
| Answer» B. april 1, 2011 | |
| 4. |
As per IAS 1, Presentation of financial statement, ______ no of items would constitute complete set of financial statements. |
| A. | atleast 5 |
| B. | atleast 6 |
| C. | 5 |
| D. | 6 |
| Answer» D. 6 | |
| 5. |
GAAP stands for |
| A. | generally accepted accounting principles |
| B. | globally accepted accounting practice |
| C. | generally allowable accounting principles |
| D. | generally allowable accounting practice |
| Answer» A. generally accepted accounting principles | |
| 6. |
Whether financial reviews by management, environment reports and value added financial statements are outside the scope of international financial reporting standards (IFRSs)? |
| A. | yes |
| B. | no |
| C. | not mentioned in ifrs |
| D. | still in consideration |
| Answer» A. yes | |
| 7. |
What is the term used to describe the time between the acquisition of assets for processing and their realization in cash or cash equivalents? |
| A. | processing cycle |
| B. | turnover |
| C. | operating cycle |
| D. | turnaround |
| Answer» C. operating cycle | |
| 8. |
Which sections of an annual report do IFRSs apply to? |
| A. | management report |
| B. | financial statements |
| C. | auditors report |
| D. | entire annual report |
| Answer» B. financial statements | |
| 9. |
How many formats are permitted for income and expense items under Ind AS 1? |
| A. | one |
| B. | two |
| C. | three |
| D. | four |
| Answer» B. two | |
| 10. |
Where should extraordinary items appear in an entity’s Statement of Comprehensive Income? |
| A. | other comprehensive income |
| B. | income statement |
| C. | notes |
| D. | nowhere |
| Answer» D. nowhere | |
| 11. |
When is offsetting permitted under Ind AS 1? |
| A. | always |
| B. | never |
| C. | when required or permitted under an ifrs |
| D. | when approved by the board of directors |
| Answer» C. when required or permitted under an ifrs | |
| 12. |
Which of the following is not a component of a Statement of Financial Position? |
| A. | non-current assets |
| B. | retained earnings |
| C. | cost of goods sold |
| D. | deferred tax |
| Answer» C. cost of goods sold | |
| 13. |
Which of the following is not a requirement in the financial statements under Ind AS 1? |
| A. | name of the entity |
| B. | chairman’s commentary on performance |
| C. | the accounting period |
| D. | presentation currency |
| Answer» B. chairman’s commentary on performance | |
| 14. |
Under Ind AS 1 how often should financial statements be prepared? |
| A. | at least annually |
| B. | no more than annually |
| C. | as often as the company requires |
| D. | monthly |
| Answer» A. at least annually | |
| 15. |
Correcting the recognition measurement and disclosure of amounts in financial statements as if a prior period error had never occurred. This is: |
| A. | retrospective restatement |
| B. | retrospective application |
| C. | changes in accounting estimate |
| D. | delayed application |
| Answer» A. retrospective restatement | |
| 16. |
Under Ind AS 16 how often the useful life of an asset should be reviewed? |
| A. | at least at each financial year end |
| B. | every six months |
| C. | at management’s discretion |
| D. | never |
| Answer» A. at least at each financial year end | |
| 17. |
Under Ind AS 16 if an asset is idle |
| A. | depreciation is paused |
| B. | depreciation for the entire period does not apply |
| C. | depreciation is ignored |
| D. | depreciation continues |
| Answer» D. depreciation continues | |
| 18. |
Which of these is an allowable cost of an asset under Ind AS 16? |
| A. | general overheads |
| B. | professional fees |
| C. | administration expenses |
| Answer» B. professional fees | |
| 19. |
What is the net amount an entity expects to obtain for an asset at the end of its useful life? |
| A. | depreciated value |
| B. | residual value |
| C. | present value |
| D. | fair value |
| Answer» B. residual value | |
| 20. |
Under Ind AS 16, which of the following is not allowable as a directly attributable cost of a machine? |
| A. | delivery |
| B. | site preparation |
| C. | estimated dismantling costs |
| D. | initial test batches |
| Answer» D. initial test batches | |
| 21. |
What is the amount an asset could achieve if sold between knowledgeable, willing parties in an arm’s length transaction? |
| A. | current value |
| B. | net present value |
| C. | written down value |
| D. | fair value |
| Answer» D. fair value | |
| 22. |
Which of the following is covered by Ind AS 16 Property, Plant and Equipment? |
| A. | office buildings |
| B. | assets held for sale |
| C. | exploration assets |
| D. | biological assets related to agricultural activity |
| Answer» A. office buildings | |
| 23. |
Which of the following disclosures is not required when an asset is revalued? |
| A. | name of valuer |
| B. | revaluation surplus |
| C. | effective date of revaluation |
| D. | whether valuer was independent |
| Answer» A. name of valuer | |
| 24. |
Under Ind AS 16, which two subsequent accounting treatments are allowed subsequently to initial recognition? |
| A. | cost model and present value model |
| B. | cost model and revaluation model |
| C. | fair value model and revaluation model |
| D. | fair value model and cost model |
| Answer» B. cost model and revaluation model | |
| 25. |
When an asset is sold or disposed of, where is the gain or loss recognised? |
| A. | asset disposal account |
| B. | profit and loss |
| C. | revaluation reserve |
| D. | depreciation |
| Answer» B. profit and loss | |
| 26. |
Which of the following is not a component of cost of an asset? |
| A. | purchase price |
| B. | refundable sales tax |
| C. | import duties |
| D. | estimate of compulsory future dismantling costs |
| Answer» B. refundable sales tax | |
| 27. |
When an item of property, plant and equipment is revalued, what should be revalued? |
| A. | a selection of assets decided by management |
| B. | a selection of assets picked at random |
| C. | the whole class of assets to which it belongs |
| D. | the individual asset |
| Answer» C. the whole class of assets to which it belongs | |
| 28. |
Which of the following is not an asset that falls under the scope of Ind AS 16? |
| A. | assets held for sale in the normal course of business |
| B. | tangible assets |
| C. | assets expected to be used for more than one period |
| D. | assets held for the production or supply of goods or services |
| Answer» A. assets held for sale in the normal course of business | |
| 29. |
How should an asset be initially recognised in the financial statements? |
| A. | measure at market value |
| B. | measure at cost |
| C. | measure at net realisable value |
| D. | measure at fair value |
| Answer» B. measure at cost | |
| 30. |
Where is the amortisation of an intangible asset recognised? |
| A. | equity |
| B. | profit or loss |
| C. | statement of financial position |
| D. | statement of cash flows |
| Answer» B. profit or loss | |
| 31. |
Which of the following is not a requirement to capitalise development costs under Ind AS 38 Intangible Assets? |
| A. | the commercial feasibility for the asset may be uncertain |
| B. | it must be technically feasible |
| C. | the entity intends to sell the completed intangible asset |
| D. | the entity can demonstrate how the asset will generate future economic benefits |
| Answer» A. the commercial feasibility for the asset may be uncertain | |
| 32. |
An intangible asset with a finite useful life should be amortised over |
| A. | a period determined by management |
| B. | five years |
| C. | its expected useful life |
| D. | no foreseeable limit |
| Answer» C. its expected useful life | |
| 33. |
What are intangible assets? |
| A. | nonmonetary assets without physical substance |
| B. | monetary assets without physical substance |
| C. | monetary assets with physical substance |
| D. | nonmonetary assets with physical substance |
| Answer» A. nonmonetary assets without physical substance | |
| 34. |
Which of the following is an intangible asset under Ind AS 38? |
| A. | patent rights |
| B. | market share |
| C. | customer loyalty |
| D. | technical knowledge training |
| Answer» A. patent rights | |
| 35. |
Which of the following measurement models is not permitted for the subsequent measurement of intangible assets under Ind AS 38? |
| A. | revaluation model |
| B. | fair value model |
| C. | cost model |
| D. | capital assets pricing model |
| Answer» D. capital assets pricing model | |
| 36. |
What is the correct treatment for all eligible borrowing costs under Ind AS 23? |
| A. | expensed |
| B. | capitalised |
| C. | invested |
| D. | none of the above |
| Answer» B. capitalised | |
| 37. |
Which of the following is not a qualifying asset under Ind AS 23 Borrowing Costs? |
| A. | manufacturing plants |
| B. | made to order inventory |
| C. | mass produced inventory |
| D. | investment property |
| Answer» C. mass produced inventory | |
| 38. |
Which of the following items should be disclosed as per the requirements of Ind AS 2? |
| A. | carrying amount of inventories pledged as security for liabilities |
| B. | average lead time of procurement for major classes of inventories |
| C. | list of major customers to whom the inventories were sold during the reporting period |
| D. | average holding period of inventories of the entity as at the end of the reporting period |
| Answer» A. carrying amount of inventories pledged as security for liabilities | |
| 39. |
Which of the following items are excluded from the scope of Ind AS 2 Inventories? |
| A. | inventories that are stated at net realisable value |
| B. | assets held for sale in the ordinary course of business |
| C. | inventories whose fair value is more than the cost |
| D. | agricultural produce at the point of harvest |
| Answer» D. agricultural produce at the point of harvest | |
| 40. |
Under Ind AS 2, fixed production overheads should be allocated to items of inventory on the basis of ____ production capacity. |
| A. | actual |
| B. | abnormal |
| C. | normal |
| D. | estimated |
| Answer» C. normal | |
| 41. |
Which of the following cost models is not permitted under Ind AS 2? |
| A. | fifo |
| B. | lifo |
| C. | actual cost |
| D. | simple average |
| Answer» B. lifo | |
| 42. |
Which of the below mentioned formula are covered by Ind AS 2? (i) FIFO, (ii) LIFO, (iii) Weighted Average. |
| A. | i, ii |
| B. | i, iii |
| C. | ii, iii |
| D. | all |
| Answer» B. i, iii | |
| 43. |
Which of the following costs must be expensed under Ind AS 2? |
| A. | selling and distribution overheads incurred in the ordinary course of business |
| B. | variable production overheads that are allocated to each unit based on actual usage |
| C. | import duties on raw materials that are paid to the authorities |
| D. | costs of purchase that are paid to the suppliers of raw materials |
| Answer» A. selling and distribution overheads incurred in the ordinary course of business | |
| 44. |
How are unallocated overheads treated as per Ind AS 2? |
| A. | recognise as an expense in the period in which they are incurred |
| B. | recognise as an expense so long as there is a profit in the current period |
| C. | treated as deferred expenditure |
| D. | capitalised with the cost of inventories |
| Answer» A. recognise as an expense in the period in which they are incurred | |
| 45. |
After convergence of Indian accounting standards with IFRS, new standard issued for preparing the cash flow statement is: |
| A. | ind as 10 |
| B. | ind as 3 |
| C. | ind as 7 |
| D. | ind as 12 |
| Answer» C. ind as 7 | |
| 46. |
Under Ind AS 12 a temporary difference is defined as |
| A. | the difference between the tax base of an item and that items carrying amount in the balance sheet |
| B. | the difference between the carrying amount of an item and that items fair value less costs to sell |
| C. | the difference between the carrying amount of an item and that items revalued amount |
| D. | a difference which will reverse in the next accounting period |
| Answer» C. the difference between the carrying amount of an item and that items revalued amount | |
| 47. |
Activities that result in changes in the size and composition of the equity capital and borrowings of an entity are called |
| A. | financing activities |
| B. | operating activities |
| C. | investing activities |
| D. | none of these |
| Answer» A. financing activities | |
| 48. |
The principal revenue-producing activities of an entity are called |
| A. | investing activities |
| B. | operating activities |
| C. | financing activities |
| D. | none of these |
| Answer» B. operating activities | |
| 49. |
Cash payments to and on behalf of employees is an example of cash flows from |
| A. | operating activities |
| B. | financing activities |
| C. | investing activities |
| D. | none of these |
| Answer» A. operating activities | |
| 50. |
Which of the following is not a heading for cash flows under Ind AS 7? |
| A. | cash flows from normal activities |
| B. | cash flows from operating activities |
| C. | cash flows from investing activities |
| D. | cash flows from financing activities |
| Answer» A. cash flows from normal activities | |
| 51. |
Activities that result in changes in the size and composition of the equity capital and borrowings of an entity are called: |
| A. | operating activities |
| B. | investing activities |
| C. | financing activities |
| D. | none of these |
| Answer» C. financing activities | |
| 52. |
Increase in share capital of a firm in the current year as compared to previous year should be recorded in the final cash flow statement under |
| A. | investing activities |
| B. | financing activities |
| C. | operating activities |
| D. | all of the above |
| Answer» B. financing activities | |
| 53. |
When presenting discontinued operations in the cash flow statement |
| A. | they are pooled with other current assets |
| B. | they are added to non-cash items |
| C. | they are ignored |
| D. | they are shown separately |
| Answer» D. they are shown separately | |
| 54. |
An entity shall explain how the transition from previous GAAP to IFRSs __________ its reported financial position, financial performance and cash flows. |
| A. | adjusted |
| B. | corroborated |
| C. | affected |
| D. | benefited |
| Answer» C. affected | |
| 55. |
How does an entity adopt IFRSs for the first time? |
| A. | by reporting on its financial position, financial performance and cash flows in accordance with ifrss |
| B. | by issuing its first financial statements in which the entity adopts ifrss, by an explicit and unreserved statement of compliance with ifrss |
| C. | by reporting on its financial position, financial performance and cash flows in accordance with national requirements, which do not contradict ifrss |
| D. | by issuing its first financial statements in accordance with national requirements, which contain explicit and unreserved statement of compliance with ifrss |
| Answer» B. by issuing its first financial statements in which the entity adopts ifrss, by an explicit and unreserved statement of compliance with ifrss | |
| 56. |
Which of the following is the starting point for an entity accounting in accordance with IFRSs? |
| A. | the date when the decision about adopting ifrs has been made |
| B. | the date of issuance of the first financial statement in accordance with ifrs |
| C. | the date of transition to ifrss |
| D. | the date when the explicit and unreserved statement of compliance with ifrss has been made |
| Answer» C. the date of transition to ifrss | |
| 57. |
Accounting in India is governed by the |
| A. | rbi |
| B. | company law board |
| C. | income tax department |
| D. | icai |
| Answer» D. icai | |
| 58. |
The convergence of the Indian Accounting Standards with IFRS began in |
| A. | april 2010 |
| B. | april 2012 |
| C. | april 2015 |
| D. | april 2000 |
| Answer» C. april 2015 | |
| 59. |
Ind AS will apply to |
| A. | both consolidated as well as standalone financials of the company |
| B. | only consolidated financials |
| C. | only standalone financials |
| D. | optional |
| Answer» A. both consolidated as well as standalone financials of the company | |
| 60. |
Total Number of Ind AS which are notified as of date? |
| A. | 40 |
| B. | 41 |
| C. | 42 |
| D. | 43 |
| Answer» C. 42 | |
| 61. |
Total Number of IFRSs which are notified as of date? |
| A. | 16 |
| B. | 17 |
| C. | 18 |
| D. | 19 |
| Answer» A. 16 | |
| 62. |
Total Number of IFRIC Interpretations which are notified as of date? |
| A. | 23 |
| B. | 24 |
| C. | 25 |
| D. | 26 |
| Answer» A. 23 | |
| 63. |
Total Number of SIC Interpretations which are notified as of date? |
| A. | 30 |
| B. | 31 |
| C. | 32 |
| D. | 33 |
| Answer» D. 33 | |
| 64. |
What items of inventories are outside the scope of Ind AS 2? |
| A. | work in progress arising under construction contracts |
| B. | raw materials including maintenance supplies |
| C. | share, debentures held as stock-in-trade |
| D. | machinery spares exclusively used with fixed assets |
| Answer» A. work in progress arising under construction contracts | |
| 65. |
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» A. a liability of uncertain timing or amount | |
| 66. |
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» B. debit redeemable preference share capital a/c; credit preference shareholders a/c | |
| 67. |
Which of the following can be utilized for the redemption of preference shares of a company out of profit: |
| A. | shares forfeited account |
| B. | development rebate reserve account |
| C. | capital redemption reserve account |
| D. | dividend equalization reserve |
| Answer» D. dividend equalization reserve | |
| 68. |
Which of the following cannot be utilized for the redemption of preference shares of a company |
| A. | securities premium on fresh issue of shares |
| B. | general reserve |
| C. | profit and loss account |
| D. | dividend equalization reserve |
| Answer» A. securities premium on fresh issue of shares | |
| 69. |
A company cannot issue redeemable preference shares for a period exceeding _________. |
| A. | 6 years |
| B. | 7 years |
| C. | 8 years |
| D. | 20 years |
| Answer» D. 20 years | |
| 70. |
Which of the following cannot be used for the purpose of creation of capital redemption reserve account? |
| A. | profit and loss account (credit balance) |
| B. | general reserve account |
| C. | dividend equalization reserve account |
| D. | unclaimed dividends account |
| Answer» D. unclaimed dividends account | |
| 71. |
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» C. both of the above | |
| 72. |
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» A. general reserve account | |
| 73. |
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» A. ratio analysis | |
| 74. |
The ratio which depicts the relationship between two items, one of which is drawn from the Balance Sheet and the other from the revenue account |
| A. | current ratio |
| B. | equity ratio |
| C. | net profit ratio |
| D. | debtors turnover ratio |
| Answer» D. debtors turnover ratio | |
| 75. |
The ratio of liquid asset to current liabilities |
| A. | quick ratio |
| B. | current ratio |
| C. | absolute liquid ratio |
| D. | combined ratio |
| Answer» A. quick ratio | |
| 76. |
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» B. proprietary ratio | |
| 77. |
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» D. debt equity ratio | |
| 78. |
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» A. fixed asset to net worth | |
| 79. |
The index of efficiency and profitability of the business |
| A. | operating ratio |
| B. | operating profit ratio |
| C. | expense ratio |
| D. | net profit ratio |
| Answer» D. net profit ratio | |
| 80. |
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» A. inventory turnover ratio | |
| 81. |
The main aim of the ratio analysis is to help the ______ of the firm |
| A. | owners |
| B. | officials |
| C. | departments |
| D. | management |
| Answer» D. management | |
| 82. |
Ratios indicate trends in important items and this helps in _________ |
| A. | forecasting |
| B. | reporting |
| C. | analyzing |
| D. | interpreting |
| Answer» A. forecasting | |
| 83. |
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» A. inter firm comparison | |
| 84. |
Ratios may be used as a measure of ________ |
| A. | efficiency |
| B. | solvency |
| C. | profitability |
| D. | none of the above |
| Answer» A. efficiency | |
| 85. |
An example of Balance Sheet ratio is _______ |
| A. | net profit ratio |
| B. | inventory turnover ratio |
| C. | current ratio |
| D. | fixed asset turnover ratio |
| Answer» C. current ratio | |
| 86. |
Income statement ratios are also called |
| A. | operating ratio |
| B. | liquidity ratio |
| C. | activity ratio |
| D. | trend ratio |
| Answer» A. operating ratio | |
| 87. |
Leverage ratios are also known as _______ ratios |
| A. | short term solvency ratios |
| B. | long term solvency ratios |
| C. | solvency ratio |
| D. | liquidity ratio |
| Answer» B. long term solvency ratios | |
| 88. |
The ratios that shows the capacity of the business unit to meet its short term obligation out of its short term resources is known as ______ |
| A. | solvency ratio |
| B. | leverage ratio |
| C. | liquidity ratio |
| D. | trend ratio |
| Answer» C. liquidity ratio | |
| 89. |
The ratio that highlight the end result of business activities are known as ________ ratios |
| A. | liquidity |
| B. | leverage |
| C. | activity |
| D. | profitability |
| Answer» D. profitability | |
| 90. |
The ideal current ratio is |
| A. | 2:1 |
| B. | 1:1 |
| C. | 1:2 |
| D. | 1:3 |
| Answer» A. 2:1 | |
| 91. |
In a sound business, acid test ratio ________ is considered satisfactory |
| A. | 1:2 |
| B. | 2:1 |
| C. | 1:1 |
| D. | 0.5:1 |
| Answer» C. 1:1 | |
| 92. |
Satisfactory level of debt equity ratio is _________. |
| A. | 1:1 |
| B. | 3:1 |
| C. | 2:1 |
| D. | 1:2 |
| Answer» C. 2:1 | |
| 93. |
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» A. receivable turnover ratio | |
| 94. |
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» B. fixed asset plus net working capital | |
| 95. |
Lower stock turnover ratio indicates ________. |
| A. | solvency position |
| B. | monopoly situation |
| C. | over investment in inventory |
| D. | none of these |
| Answer» C. over investment in inventory | |
| 96. |
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» A. price earning ratio | |
| 97. |
When all debentures are redeemed, balance in the Debenture Redemption Fund Account is transferred to: |
| A. | capital reserve |
| B. | general reserve |
| C. | profit & loss appropriation a/c |
| D. | none of these |
| Answer» B. general reserve | |
| 98. |
According to SEBI guidelines, a Company will have to create debenture redemption reserve equivalent to the amount of the following percentage of debenture issued: |
| A. | 50% |
| B. | 25% |
| C. | 70% |
| D. | 100% |
| Answer» B. 25% | |
| 99. |
Premium on redemption of debentures is a |
| A. | personal a/c |
| B. | real a/c |
| C. | nominal a/c |
| D. | suspense a/c |
| Answer» A. personal a/c | |
| 100. |
Debentures cannot be redeemed at |
| A. | par |
| B. | premium |
| C. | discount |
| D. | more than 10% premium |
| Answer» C. discount | |
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