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780+ Corporate Accounting Solved MCQs

These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Business Administration (BBA) , Bachelor of Commerce (B Com) .

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More MCQs
351.

Which of the following is not a long term borrowing of a company?

A. Debentures
B. term loans
C. loans repayable on demand from banks
D. long- term finance lease obligations
Answer» C. loans repayable on demand from banks
352.

Calls in advance is shown in the balance sheet as -------------

A. Current liabilities
B. added to called-up capital
C. current assets
D. deduction from called -up capital
Answer» A. Current liabilities
353.

The difference between gross dividend receivable and dividend received is debited to - --------

A. Interim dividend
B. tax deducted at source
C. net dividend
D. difference adjustment
Answer» B. tax deducted at source
354.

Pooling of interest method is applicable for amalgamation in the nature of….

A. merger
B. consolidation
C. reconstruction
D. realization
Answer» A. merger
355.

For amalgamation in the nature of merger, the shareholders holding at least or more of the equity shares of the transferor company becomes the equity shareholders of the transferee company.

A. 90%
B. 80%
C. 100%
D. none of these
Answer» A. 90%
356.

Realization loss is transferred to …..

A. Preference shareholders a/c
B. equity shareholders a/c
C. creditors a/c
D. none of these
Answer» B. equity shareholders a/c
357.

When an existing company takes over the business of one or more existing companies, it is called….

A. amalgamation
B. absorption
C. internal reconstruction
D. none of these
Answer» B. absorption
358.

Accounting for amalgamation is given in….

A. AS 14
B. AS 16
C. AS 20
D. None of these
Answer» A. AS 14
359.

Liquidation expenses paid by the transferee company is debited to …

A. General reserve account
B. P/L Account
C. goodwill account
D. none of these
Answer» C. goodwill account
360.

Which of the following fictitious assets is not taken over by the transferee company?

A. Preliminary expenses
B. underwriting commission
C. discount on issue of shares
D. all of these
Answer» D. all of these
361.

Which of the following is considered as an asset while calculating purchase consideration?

A. goodwill
B. patent
C. trade mark
D. all of these
Answer» D. all of these
362.

The accumulated losses and fictitious assets of the transferor company are transferred to -------- a/c.

A. equity share holders
B. transferee company
C. equity capital
D. realization
Answer» A. equity share holders
363.

Which of the following a/c is debited when statutory reserve of the transferor company is taken over by the transferee company?

A. goodwill a/c
B. amalgamation adjustment a/c
C. capital reserve a/c
D. statutory reserve
Answer» B. amalgamation adjustment a/c
364.

Under purchase method of amalgamation, --------- of the transferor company continues to appear in the balance sheet of the transferee company.

A. capital reserve
B. general reserve
C. statutory reserve
D. specific reserve
Answer» C. statutory reserve
365.

While preparing the transferee company’s financial statement under amalgamation in the nature of merger, the assets and liabilities taken over from the transferor company should be incorporated at ----------

A. cost
B. book value
C. revised value
D. none
Answer» B. book value
366.

While preparing the transferee company’s financial statement under amalgamation in the nature of purchase, the assets and liabilities taken over from the transferor company should be incorporated at --------

A. Cost
B. book value
C. revised value
D. none
Answer» C. revised value
367.

Which of the following should not be considered as a part of purchase consideration?

A. Payment to equity share holders
B. payment to preference share holders
C. payment to debenture holders
D. cash payment to share holders
Answer» C. payment to debenture holders
368.

Which of the following is considered while calculating purchase consideration under Net asset method?

A. Assets taken over
B. liabilities taken over
C. good will taken over
D. all of the above
Answer» D. all of the above
369.

Under net payment method, purchase consideration includes all payments made to the share holders in the form of ---------

A. Equity share
B. preference share
C. cash
D. all of these
Answer» D. all of these
370.

Which of the following is a statutory reserve?

A. Development Allowance Reserve
B. Capital Reserve
C. Workmen’s Compensation Fund
D. CRR
Answer» A. Development Allowance Reserve
371.

Any excess amount paid to preference share holders is debited to ------ --- account

A. realisation
B. preference share holders
C. P&L
D. preference share capital
Answer» A. realisation
372.

While preparing the books of the transferee company in purchase method, the difference between purchase consideration and share capital of the transferor company should be adjusted in -------------

A. Share capital
B. reserves
C. assets
D. liabilities
Answer» B. reserves
373.

The excess of purchase consideration over net assets of the transferor company acquired by the transferee company should be recognized as -------- in purchase method

A. Capital reserve
B. general reserve
C. good will
D. P&L
Answer» C. good will
374.

In purchase method, the excess of net asset of the transferor company acquired by the transferee company over the purchase consideration should be recognized as ------------

A. P&L
B. good will
C. general reserve
D. capital reserve
Answer» D. capital reserve
375.

Alteration of shares of smaller amounts into shares of larger amount is called…..of share capital

A. surrender
B. subdivision
C. consolidation
D. none of these
Answer» C. consolidation
376.

The amount of surrendered shares is credited to …

A. CRR
B. sinking fund
C. capital reduction account
D. reserve
Answer» C. capital reduction account
377.

Amount sacrificed by shareholders are credited to ….

A. capital reserve
B. general reserve
C. capital reduction
D. none of these
Answer» C. capital reduction
378.

Capital reduction account is used to …

A. write off losses
B. transfer to capital
C. issue bonus shares
D. none of these
Answer» A. write off losses
379.

Any increase in the value of assets is…. to capital reduction

A. debited
B. credited
C. Ignored
D. None of these
Answer» B. credited
380.

--------- 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» B. capital reduction a/c
381.

Alteration of shares of larger denominations into smaller denominations is called -------- of shares.

A. consolidation
B. surrender
C. sub-division
D. valuation
Answer» C. sub-division
382.

Which of the following does not involve liquidation of any company?

A. internal reconstruction
B. amalgamation
C. absorption
D. external reconstruction
Answer» A. internal reconstruction
383.

Under which of the following circumstances can a company resort to internal reconstruction?

A. accumulated huge losses
B. shortage of capital
C. over valued assets
D. all of these
Answer» D. all of these
384.

The balance in capital reduction a/c after writing off all accumulated loss, fictitious assets and overvalued assets are transferred to -------------

A. capital reserve
B. general reserve
C. reserve capital
D. good will
Answer» A. capital reserve
385.

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» D. all of these
386.

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» D. paid off paid up capital in excess of needs of the company.
387.

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» D. all of these
388.

Which of the following is not a case of combination?

A. external reconstruction
B. internal reconstruction
C. amalgamation
D. absorption
Answer» B. internal reconstruction
389.

The term banking is defined in section ….

A. section 5 of banking regulation Act
B. section 4
C. section 7
D. none of these
Answer» A. section 5 of banking regulation Act
390.

A bank can open a branch only at the permission of the…

A. SBI
B. RBI
C. Government.
D. none of these
Answer» B. RBI
391.

Schedule 16 relates to….

A. interest earned
B. interest expended
C. operating expenses
D. none of these
Answer» C. operating expenses
392.

Schedule 9 relates to….

A. fixed assets
B. borrowings
C. advances
D. capital
Answer» C. advances
393.

Banks are required to transfer ….. of their profits to statutory reserve

A. 20%
B. 25%
C. 10%
D. none of these
Answer» B. 25%
394.

Assets acquired by a bank in satisfaction of a claim are known as…

A. non-banking assets
B. performing assets
C. standard assets
D. none of these
Answer» A. non-banking assets
395.

Assets which do not carry more than normal credit risk is known as….

A. loss asset
B. risk asset
C. standard asset
D. none of these
Answer» C. standard asset
396.

On standard asset a minimum provision of….is required

A. .25%
B. .10%
C. .40%
D. none of these
Answer» C. .40%
397.

------ represents that part of discount received during the year by a bank which relates to the next accounting year.

A. trade discount
B. normal discount
C. unexpired discount
D. cash discount
Answer» C. unexpired discount
398.

A scheduled bank is required to maintain with RBI --------- at a prescribed percentage of their total time and demand deposit.

A. SLR
B. CRR
C. statutory reserve
D. branch adjustment
Answer» B. CRR
399.

Every bank is required to maintain ----- with RBI in the form of cash, gold and securities an amount not less than 25% of their demand and time liabilities.

A. CRR
B. SLR
C. statutory reserve
D. branch adjustment
Answer» B. SLR
400.

Which of the following is not an advance given by a bank?

A. loan
B. overdraft
C. deposit
D. cash credit
Answer» C. deposit

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