McqMate
| 101. |
Examination of accounting records undertaken for a special purpose is called |
| A. | Auditing |
| B. | Internal check |
| C. | Investigation |
| D. | Internal control |
| Answer» C. Investigation | |
| 102. |
The prime importance of investigation on behalf of an individual or firm intending to purchase an existing business is to |
| A. | Ascertain value of asset |
| B. | Ascertain the earning capacity of the concern |
| C. | Estimation of value of good will |
| D. | Extend of liabilities |
| Answer» B. Ascertain the earning capacity of the concern | |
| 103. |
Inflation of closing stock results is :- |
| A. | Inflation of loss |
| B. | Deflation of loss |
| C. | Inflation of profit |
| D. | Deflation of profit |
| Answer» C. Inflation of profit | |
| 104. |
Inflation of profit is possible due to : |
| A. | Overvaluation of closing stock |
| B. | Overstating purchase |
| C. | Overstating opening stock |
| D. | Overstating expenses |
| Answer» A. Overvaluation of closing stock | |
| 105. |
Charging excessive provision for depreciation results in |
| A. | Less profit |
| B. | More profit |
| C. | No change in profit |
| D. | No change in loss |
| Answer» A. Less profit | |
| 106. |
The main purpose of management audit is to |
| A. | Review the management operations |
| B. | Check arithmetical accuracy |
| C. | Prevent travel |
| D. | Prevent error |
| Answer» A. Review the management operations | |
| 107. |
Management audit is |
| A. | Compulsory |
| B. | Not compulsory |
| C. | Compulsory under Income Tax Act |
| D. | Compulsory under Indian Contract Act. |
| Answer» B. Not compulsory | |
| 108. |
Special resolution means ------------------- |
| A. | 1/3 majority |
| B. | 2/3 majority |
| C. | ½ majority |
| D. | none |
| Answer» B. 2/3 majority | |
| 109. |
Ordinary resolution means ----------------------- |
| A. | 1/3 majority |
| B. | 2/3 majority |
| C. | More than 1/2 |
| D. | none |
| Answer» C. More than 1/2 | |
| 110. |
The chartered Accountants Act is in ----------------- |
| A. | 1956 |
| B. | 1959 |
| C. | 1949 |
| D. | none |
| Answer» B. 1959 | |
| 111. |
Section 633 of the companies Act deals with |
| A. | Liability of auditor |
| B. | Relief to the auditor |
| C. | Punishment to the auditor |
| D. | none |
| Answer» B. Relief to the auditor | |
| 112. |
Auditor is an --------------- of a shareholder |
| A. | Owner |
| B. | Agent |
| C. | Employer |
| D. | none |
| Answer» B. Agent | |
| 113. |
Cost audit means audit of --------------- records |
| A. | Financial |
| B. | Cost |
| C. | Tax |
| D. | none |
| Answer» B. Cost | |
| 114. |
Financial auditor submits reports to the ---------------- |
| A. | Shareholder |
| B. | Board of director |
| C. | Employees |
| D. | none |
| Answer» A. Shareholder | |
| 115. |
Cost auditor submits reports to the --------------- |
| A. | Share holder |
| B. | Board of directors |
| C. | Employees |
| D. | none |
| Answer» B. Board of directors | |
| 116. |
--------------- audit is forward looking - |
| A. | Financial |
| B. | Cost |
| C. | Tax |
| D. | none |
| Answer» B. Cost | |
| 117. |
Cost auditor of a company is ----------- |
| A. | Chartered Accountant |
| B. | Cost Accountant |
| C. | Tax Accountant |
| D. | none |
| Answer» B. Cost Accountant | |
| 118. |
Auditor finds that there is change in the method of valuation of stock whether he should |
| A. | Allow it |
| B. | Disallow it |
| C. | Allow it with a note to this effect |
| D. | none |
| Answer» C. Allow it with a note to this effect | |
| 119. |
Audit under any statute in a country is called ------------------ |
| A. | Final audit |
| B. | Internal audit |
| C. | Statutory audit |
| D. | none |
| Answer» C. Statutory audit | |
| 120. |
Books of Accounts are prepared and audited as per the provisions of the --------------- |
| A. | Income Tax Act,1961 |
| B. | Companies Act 1956 |
| C. | Chartered Accountants Act 1949 |
| D. | none |
| Answer» B. Companies Act 1956 | |
| 121. |
CAATTS is also known as ----------- |
| A. | Cost And Accounts Treatments |
| B. | Computer Assisted Audit Tools and Techniques |
| C. | Classification and Accounting of Tax Tools |
| D. | none |
| Answer» B. Computer Assisted Audit Tools and Techniques | |
| 122. |
Auditor has got no lien on ------------- |
| A. | Audit Note Nook |
| B. | Audit working papers |
| C. | Books to Accounts of Client |
| D. | none |
| Answer» C. Books to Accounts of Client | |
| 123. |
Statutory Report should be sent to registrar before ------------------- days of statutory meeting |
| A. | 30 days |
| B. | 14 days |
| C. | 21 days |
| D. | none |
| Answer» C. 21 days | |
| 124. |
The meeting held by the company with in a period of not less than one month and not more than 6 months is called ------------- |
| A. | Statutory |
| B. | Annual |
| C. | General |
| D. | none |
| Answer» A. Statutory | |
| 125. |
-------------------- audit is not a statuary requirement |
| A. | Management |
| B. | Financial |
| C. | Tax Audit |
| D. | none |
| Answer» A. Management | |
| 126. |
----------------- audit refers to the evaluation of company’s performance against planned goals in the areas of social responsibility. |
| A. | Cost audit |
| B. | Social audit |
| C. | Management audit |
| D. | none |
| Answer» B. Social audit | |
| 127. |
Bonus shares are issued to ---------------- |
| A. | New members |
| B. | Existing share holders |
| C. | Employees |
| D. | none |
| Answer» B. Existing share holders | |
| 128. |
-------- Section of the Companies Act deals with Appointment of Company auditor. |
| A. | Sec-226 |
| B. | Sec-224 |
| C. | Sec-227 |
| D. | none |
| Answer» B. Sec-224 | |
| 129. |
-------- Section of the Companies Act deals with qualification of Company auditor. |
| A. | Sec-226 |
| B. | Sec-224 |
| C. | Sec-227 |
| D. | none |
| Answer» A. Sec-226 | |
| 130. |
Amount of Share premium may be utilized for |
| A. | Payment of dividend |
| B. | Writing of preliminary expenses |
| C. | Routine expense |
| D. | none |
| Answer» B. Writing of preliminary expenses | |
| 131. |
Share Premium Account should be shown in Balance sheet under |
| A. | Paid-up capital |
| B. | Subscribed capital |
| C. | Reserves and surpluses |
| D. | none |
| Answer» C. Reserves and surpluses | |
| 132. |
Auditor should see that amount received for premium on issue of shares should be shown in |
| A. | Subscribed capital |
| B. | Capital Reserve Account |
| C. | Share Premium Account |
| D. | none |
| Answer» C. Share Premium Account | |
| 133. |
A company can issue redeemable preference shares if authorized by |
| A. | Memorandum of Association |
| B. | Articles of Association |
| C. | Companies Act-1956 |
| D. | none |
| Answer» B. Articles of Association | |
| 134. |
A company can issue bonus shares if authorized by |
| A. | Memorandum of Association |
| B. | Articles of Association |
| C. | Companies Act-1956 |
| D. | none |
| Answer» B. Articles of Association | |
| 135. |
Interest on calls paid in advance according to table A, should not exceed |
| A. | 6% |
| B. | 5% |
| C. | 10% |
| D. | none |
| Answer» A. 6% | |
| 136. |
For the forfeiture of shares, the auditor should check that it is permitted |
| A. | Memorandum of Association |
| B. | By articles of association |
| C. | Under Companies Act 1956 |
| D. | none |
| Answer» B. By articles of association | |
| 137. |
Profits on reissue of forfeited Shares should be transferred to |
| A. | Share forfeited Account |
| B. | Capital Reserve Account |
| C. | Profit and Loss Account |
| D. | none |
| Answer» B. Capital Reserve Account | |
| 138. |
Shares issued for consideration other than cash should be vouched with the help of |
| A. | Director’s minute Book |
| B. | Shareholder’s minute Book |
| C. | Contact with the party concerned |
| D. | none |
| Answer» C. Contact with the party concerned | |
| 139. |
While checking the allotment of shares, the auditor should see that it is made within |
| A. | 100 days of issue of prospectus |
| B. | 120 days of issue of prospectus |
| C. | 150 days of issue of prospectus |
| D. | none |
| Answer» B. 120 days of issue of prospectus | |
| 140. |
Which of the following percentage of nominal amount of shares should be received with application |
| A. | 10 |
| B. | 15 |
| C. | 5 |
| D. | none |
| Answer» C. 5 | |
| 141. |
Accounting standards are prepared by |
| A. | SEBI |
| B. | RBI |
| C. | ICAI |
| D. | ITA |
| Answer» C. ICAI | |
| 142. |
Which of the following is referred to confirm the allotment of shares to the vendor |
| A. | Cash book |
| B. | Pass book |
| C. | Director’s minute |
| D. | none |
| Answer» C. Director’s minute | |
| 143. |
Share premium Account is shown on the _______________ |
| A. | Asset side of Balance sheet |
| B. | Liability side of Balance sheet |
| C. | Credit side of profit and loss Account |
| D. | none |
| Answer» B. Liability side of Balance sheet | |
| 144. |
Issue of shares at discount should be sanctioned by the ________________ |
| A. | Board of directors |
| B. | Share holders |
| C. | Company Law Board |
| D. | none |
| Answer» C. Company Law Board | |
| 145. |
The maximum rate of discount on shares shall not exceed________________ |
| A. | 20% |
| B. | 15% |
| C. | 10% |
| D. | none |
| Answer» C. 10% | |
| 146. |
Discount on issue of shares not written of is shown separately in Balance sheet under the head_____________ |
| A. | Miscellaneous expenditure |
| B. | Preliminary expanses |
| C. | Current assets |
| D. | none |
| Answer» A. Miscellaneous expenditure | |
| 147. |
__________________section of Companies Act deals with share Capital |
| A. | 69 |
| B. | 60 |
| C. | 50 |
| D. | none |
| Answer» A. 69 | |
| 148. |
Which among the following is not a function of the author |
| A. | Checking errors and frauds |
| B. | Vouching with original documents |
| C. | Preparing final Accounts |
| D. | none |
| Answer» C. Preparing final Accounts | |
| 149. |
Audit conducted as per the provisions of law is _____________ |
| A. | Statutory Audit |
| B. | Continuous Audit |
| C. | Social Audit |
| D. | none |
| Answer» A. Statutory Audit | |
| 150. |
The scope of auditing does not cover. |
| A. | Vouching |
| B. | Checking arithmetical accuracy |
| C. | Ledger posting |
| D. | none |
| Answer» C. Ledger posting | |
| 151. |
Internal audit is conducted |
| A. | Periodically |
| B. | Throughout the year |
| C. | Once in a year |
| D. | none |
| Answer» B. Throughout the year | |
| 152. |
The amount of application money received shall be deposited in a scheduled bank until________ |
| A. | Annual general meeting |
| B. | General meeting |
| C. | Certificate to commencement obtained |
| D. | none |
| Answer» C. Certificate to commencement obtained | |
| 153. |
Amount received as premium can be used to ___________ |
| A. | Purchase Assets |
| B. | Pay of liabilities |
| C. | Issue bonus shares |
| D. | none |
| Answer» C. Issue bonus shares | |
| 154. |
The auditors are liable under |
| A. | Companies Act Only |
| B. | Income Tax Act Only |
| C. | All above |
| D. | none |
| Answer» C. All above | |
| 155. |
The maximum number of audit assignment an auditor can accept is limited to -------------- companies |
| A. | 10 |
| B. | 15 |
| C. | 20 |
| D. | none |
| Answer» C. 20 | |
| 156. |
Auditors can be appointed by -------------- when the shareholders fail to appoint auditors at the general meeting |
| A. | Board of directors |
| B. | Central government |
| C. | Company Low board |
| D. | none |
| Answer» B. Central government | |
| 157. |
The examinations of financial transactions with supporting evidences is called |
| A. | Verification |
| B. | Vouching |
| C. | Auditing |
| D. | none |
| Answer» B. Vouching | |
| 158. |
Which among the following is an example of intangible asset? |
| A. | Goodwill |
| B. | Patents |
| C. | All of these |
| D. | none |
| Answer» C. All of these | |
| 159. |
Which of the following is not an item current asset? |
| A. | Stock |
| B. | Sundry debtors |
| C. | Furniture |
| D. | none |
| Answer» C. Furniture | |
| 160. |
The term inventories stands for |
| A. | Raw materials |
| B. | Work in progress |
| C. | All of these |
| D. | none |
| Answer» C. All of these | |
| 161. |
Sales day book is used for recording |
| A. | Credit sales |
| B. | Cash sales |
| C. | All sales |
| D. | none |
| Answer» A. Credit sales | |
| 162. |
--------------- audit is more suitable for small business houses |
| A. | Continuous |
| B. | Annual |
| C. | Partial |
| D. | none |
| Answer» B. Annual | |
| 163. |
Vouching is an examination of ----------- to ascertain the accuracy and authenticity of transactions in the book of accounts |
| A. | Audit files |
| B. | Audit note book |
| C. | Documents |
| D. | none |
| Answer» C. Documents | |
| 164. |
--------------- is a written plan containing details with regard to the conduct of a particular audit |
| A. | Audit Note book |
| B. | Audit programme |
| C. | Audit files |
| D. | none |
| Answer» B. Audit programme | |
| 165. |
--------------- is the verification of books of accounts from Income tax point of view |
| A. | Cost audit |
| B. | Tax audit |
| C. | Management audit |
| D. | none |
| Answer» B. Tax audit | |
| 166. |
Investigation is conducted |
| A. | Regularly |
| B. | Quarterly |
| C. | As and when required |
| D. | none |
| Answer» C. As and when required | |
| 167. |
Investigation is required when |
| A. | Fraud is suspected in business |
| B. | On acquisition of running business |
| C. | All of them |
| D. | none |
| Answer» C. All of them | |
| 168. |
Which among the following is not a right of company auditors |
| A. | Right to access the book accounts |
| B. | Right to seek explanations |
| C. | Right to lies on books of accounts |
| D. | none |
| Answer» C. Right to lies on books of accounts | |
| 169. |
Test checking is done when there is an effective system of -------------- |
| A. | Internal control |
| B. | Internal audit |
| C. | Internal check |
| D. | none |
| Answer» C. Internal check | |
| 170. |
Test checking means |
| A. | Checking of all transactions |
| B. | Checking of half of the transactions |
| C. | Checking of selected items |
| D. | none |
| Answer» C. Checking of selected items | |
| 171. |
Audit working papers are -------------------------- |
| A. | Important information about audit |
| B. | Appointment letters regarding audit |
| C. | Letter of notice |
| D. | none |
| Answer» A. Important information about audit | |
| 172. |
Current audit file consists of |
| A. | Matters of future importance |
| B. | Matters relations to post years |
| C. | Matters relating to the year of audit |
| D. | none |
| Answer» C. Matters relating to the year of audit | |
| 173. |
------------------- begins where accounting ends |
| A. | Bookkeeping |
| B. | Auditing |
| C. | Internal check |
| D. | none |
| Answer» B. Auditing | |
| 174. |
---------------- audit is compulsory for joint stock companies |
| A. | Statutory |
| B. | Final |
| C. | Continuous |
| D. | none |
| Answer» A. Statutory | |
| 175. |
Treating revenue expenditure as capital expenditure is an example of error of ------------------- |
| A. | Principle |
| B. | Compensating |
| C. | Clerical |
| D. | none |
| Answer» A. Principle | |
| 176. |
Financial statements are prepared by |
| A. | The accountant |
| B. | The auditor |
| C. | Managing director |
| D. | none |
| Answer» A. The accountant | |
| 177. |
Preliminary expanses not written off are treated as |
| A. | Fixed assets |
| B. | Intangible assets |
| C. | Fictitious assets |
| D. | none |
| Answer» C. Fictitious assets | |
| 178. |
Verification of assets involves a critical examination of |
| A. | Ownership |
| B. | Existence |
| C. | All of these |
| D. | none |
| Answer» C. All of these | |
| 179. |
Finished goods are valued for a balance sheet purpose |
| A. | At cost price |
| B. | At market price |
| C. | At lower of cost or market price |
| D. | none |
| Answer» C. At lower of cost or market price | |
| 180. |
---------------- includes financial and non-financial control |
| A. | Internal check |
| B. | Internal control |
| C. | Internal audit |
| D. | none |
| Answer» B. Internal control | |
| 181. |
---------------- is concerned with the allocation of work among employees |
| A. | Internal control |
| B. | Internal check |
| C. | Internal audit |
| D. | none |
| Answer» B. Internal check | |
| 182. |
The duties of internal auditor is prescribed by |
| A. | Companies act |
| B. | Company law board |
| C. | Management |
| D. | none |
| Answer» C. Management | |
| 183. |
Internal audit is considered as a service to ------------------- |
| A. | Share holders |
| B. | Board of directories |
| C. | Management |
| D. | none |
| Answer» C. Management | |
| 184. |
Pre-arranging and coordinating the audit work is called ------------------ |
| A. | Audit planning |
| B. | Vouching |
| C. | Verification |
| D. | none |
| Answer» A. Audit planning | |
| 185. |
A fixed audit programme is also called a --------- programme |
| A. | Tailor made |
| B. | Man made |
| C. | Auditor made |
| D. | none |
| Answer» A. Tailor made | |
| 186. |
Share holders minute book should be vouched for |
| A. | Payment to vendors |
| B. | Payment to promoters |
| C. | Issue of bonus shares |
| D. | none |
| Answer» C. Issue of bonus shares | |
| 187. |
---------------- is deducted from called up capital to get paid up capital |
| A. | Subscribed capital |
| B. | Issued capital |
| C. | Calls in arrears |
| D. | none |
| Answer» C. Calls in arrears | |
| 188. |
Discount on issue of shares is shown under the --------------- lead |
| A. | Current asset |
| B. | Preliminary expanses |
| C. | Miscellaneous expanses |
| D. | none |
| Answer» C. Miscellaneous expanses | |
| 189. |
To forfeit shares --------------- days notice to the share holder’s given |
| A. | 40 |
| B. | 14 |
| C. | 24 |
| D. | none |
| Answer» B. 14 | |
| 190. |
-------------- of the companies Act 1956 prescribes the duty of preparing a report by an auditor |
| A. | Sec-227(2) |
| B. | Sec-273(1) |
| C. | Sec-224(2) |
| D. | none |
| Answer» A. Sec-227(2) | |
| 191. |
A --------------- report is one which contains the opinion of the auditor subject to certain conditions |
| A. | Unqualified |
| B. | Qualified |
| C. | Clean |
| D. | none |
| Answer» B. Qualified | |
| 192. |
--------------- is made out of reserves or share premium |
| A. | Preference shares |
| B. | Bonus shares |
| C. | Debentures |
| D. | none |
| Answer» B. Bonus shares | |
| 193. |
---------------- shares cannot be issued if the company makes any default in the payment of its obligation |
| A. | Preference |
| B. | Equity |
| C. | Bonus |
| D. | none |
| Answer» C. Bonus | |
| 194. |
Capitalization of reserves means ------------------------- |
| A. | Creation of provision |
| B. | Declaration of dividend |
| C. | Issue of bonus shares |
| D. | none |
| Answer» C. Issue of bonus shares | |
| 195. |
Provisions regarding bonus issue should be given in -------------------- document |
| A. | Memorandum of association |
| B. | Articles of association |
| C. | Prospectus |
| D. | none |
| Answer» B. Articles of association | |
| 196. |
Balance remaining in the forfeited Account after reissue is transferred to --------------- account |
| A. | General reserve |
| B. | Capital reserve |
| C. | Premium account |
| D. | none |
| Answer» B. Capital reserve | |
| 197. |
If reissue of shares are more than face value of shares, the excess amount is transferred to ---------- account. |
| A. | General reserve |
| B. | Capital reserve |
| C. | Premium account |
| D. | none |
| Answer» C. Premium account | |
| 198. |
Share call amount due is credited to ------------------ account |
| A. | Share application account |
| B. | Share allotment account |
| C. | Share capital account |
| D. | none |
| Answer» C. Share capital account | |
| 199. |
When excess applications money is refunded to applicants it is vouched with cash book and ------- |
| A. | Letter of allotment |
| B. | Letter of call |
| C. | Letter of regreat |
| D. | none |
| Answer» C. Letter of regreat | |
| 200. |
Partial auditing is usually done by |
| A. | Sole trading concern |
| B. | Joint stock company |
| C. | Govt. department |
| D. | none |
| Answer» A. Sole trading concern | |
Done Reading?