Multiple Choice Rebecca McFarlan. Thoreau – Multiple Choice.
SAMPLE MULTIPLE CHOICE QUESTIONS CLASS: TYBAF - …
Transcript of SAMPLE MULTIPLE CHOICE QUESTIONS CLASS: TYBAF - …
SAMPLE MULTIPLE CHOICE QUESTIONS
CLASS: TYBAF - SEMESTER: VI
SUBJECT: FINANCIAL ACCOUNTING – VII
1. Electricity tariffs are fixed ___________. a. By appropriate commissions b. Under Electricity (Supply) Act, 1948 c. Under Electricity Act, 1910 d. Under Electricity Regulatory Commission Act, 1998
2. Balance of Accrued Interest on Security Deposit from Electricity Consumers ___________.
a. Is written off b. Is shown as current liability c. Is shown as non-current liability d. Is shown as current assets
3. Select appropriate Journal Entries in the books of Electricity Company for Security Deposit Received
a. Bank A/c Dr. To Security Deposit A/c
b. Securities Deposit A/c Dr. To Bank A/c
c. Bank A/c Dr. To Reserves and Surplus A/c
d. Bank A/c Dr To Interest A/c 4. An Electricity company has acquired Plant & Machinery costing Rs. 80 lakhs having useful life of 10 years. Consider Salvage value as 10% as per Regulation Amount of Depreciation __________. a. Rs. 8,00,000 b. Rs. 4,00,000 c. Rs. 80,000 d. Rs. 7,20,000 5. Debentures are shown under __________ in Balance sheet of an Electricity company a. Share Capital b. Reserve & Surplus c. Non-Current Liabilities d. Current Liabilities
6. A Co-operative Society is furnishing the following information related to its yearly expenses:
Property taxes – Rs. 15,000
Water charges – Rs. 12,000
Audit Fees – Rs. 7,50
Repairs & maintenance – Rs. 5,000
Printing & Stationery – Rs. 2,000
Insurance charges – Rs. 1,000
The total amount under the head of Property Expenses in Income & Expenditure account shall be _________.
a. Rs. 33,000 b. Rs. 35,750 c. Rs. 15,000 d. Rs. 27,000
7. Advance from members is shown in balance sheet of Co-op Hsg. Society accounts in _________.
a. Deposits b. Current Liabilities and provisions c. Current Assets d. Other items
8. A cooperative form of Organisation is based on the principle of _________.
a. Autocracy b. Democracy c. Unity d. Team spirit
9. Register of members should be maintained in _________.
a. Form N
b. Form A c. Form I d. Form D
10. Outstanding expenses are added in concerned expenses in Income & expenditure account & second effect is shown under balance sheet _________.
a. Current Assets b. Other items c. Other liabilities
d. Current Liabilities & Provisions
11. All the following are fixed income bearing securities except
a. Debentures b. Equity Shares c. Govt. Bonds d. Preference shares
12. Short term investments are carried at
a. Market Value
b. Cost Price
c. Cost or Market Value whichever is less
d. Realisable cost
13. Mr. X buys Debentures of nominal value of Rs.100 each of Sun Ltd. At Rs.98
(ex-interest) on 1-3-2012 from Mr. A. Interest of 400 has accrued from the last due
date till the date of purchase. In the entry for recording this investment in the
books of XYZ
a. Rs.400 will be credited to Interest A/c
b. Rs.400 will be debited to Interest A/c
c. Rs.400 will be debited to Investment A/c
d. Rs.400 will be credited to Investment A/c
14. On 1st July, 2019; Jayshree Ltd. purchased 100 of its own 12% Debentures (FV
Rs. 100) for a price of Rs.9,900 which is cum interest price. Interest is paid on 30th
September and 31st March every year, the acquisition cost of 100 debentures is
__________
a. Rs.9,600
b. Rs.9,700
c. Rs.10,300
d. Rs.10,000
15. Mr. Ganpat holds 30,000 equity shares of X Ltd. and company declared bonus
shares to its existing equity shareholders at the rate of one equity share for every
five shares held. So what is the total number of bonus shares?
a. 5,000 Shares
b. 6,000 Shares
c. 7,000 Shares
d. 8,000 Shares
16. Issuing and redeeming units of a mutual fund is the role of _______
a. Custodian
b. Banker
c. Transfer agent
d. Trustees
17. Interest on interest bearing investment is recognised on _________. a. Hybrid basis b. Cash basis c. Accrual basis d. Historical basis
18. A closed end fund has a _______________. a. Fixed maturity period b. Fluctuating maturity period c. Stipulated maturity period d. Decline maturity period
19. The amount required to buy 100 units of a scheme having an entry load of 1.5% and NAV of Rs. 20 is _______, a. Rs. 1980 b. Rs. 2000 c. Rs. 2030 d. Rs.2500
20. Shares of a closed end fund are trading at a 4% premium over NAV. If NAV of Rs. 10 per share, what is the current market price of the fund’s shares? a. Rs. 14 b. Rs. 9.96 c. Rs. 10.40 d. Rs. 9.60
21. As per GAAP financial statements are presented at______ a. Market Value b. Historical Cost c. Fair Value d. Replacement Cost
22. In India __________ has the responsibility of formulating Accounting standards
based on IFRS. a. Accounting Standards Board (ASB) of ICAI b. Accounting Standards Committee c. Indian Accounting Association Ministry of Corporate Affairs
23. ABC Ltd is required to implement Ind AS for Accounting Period beginning 1st April, 2016. Its Holding company XYZ Ltd must implement Ind AS for accounting period beginning on __________. a. 1st April, 2017 b. 1st April, 2015 c. Not required to implement
d. 1st April, 2016 24. The Objective of IFRS is to _______________. a. Ensure preparation of financial statements b. Ensure that the financial statements contain high quality information c. Ensure uniformity in financial statements at national level d. Ensure connectivity in financial statements
25. Companies having a net worth of Rs. 250 crore and who are in process of listing their debt securities on any stock exchange outside India must implement Ind AS for accounting period beginning on or after _______. a. 1st April 2018 b. 1st April 2017
c. 1st April 2015 d. 1st April 2014
TYBAF – SEM VI
SUBJECT: COSTING ACCOUNTING - IV
1. _________ is a document which sets outstanding instructions governing the responsibilities of persons and the procedures.
a. Budget period
b. Budget control
c. Budget manual
d. Budget center
2. __________ budgeting is a revolutionary concept of planning the future activities and there is a sharp contradiction from conventional budgeting activities.
a. Concept budgeting
b. Zero base budgeting
c. Performance budgeting
d. Cash Budget
3. Budget defines _________ of a concerned manager.
a. Responsibility
b. Budgeted cost of production
c. Budgeted cost of sales
d. Authority
4. __________ Budget is dynamic in nature.
a. Production
b. Cash
c. Flexible
d. Fixed
5. If April Purchase is Rs. 5, 00,000 and 30% purchase are cash basis for remaining credit period allowed is Three month. Amount payable to creditors will be
a. 350000 in April
b. 350000 in may
c. 350000 in June
d. 350000 in July
6. An increase in sales price ___________.
a. Does not affect the break even point
b. lower the net profit
c. increase the break even point
d. lower the breakeven point
7. Fixed cost per unit decreases when __________.
a. Production volume increases
b. Production volume decreases
c. variable cost per unit decreases
d. prime cost per unit decreases
8. IF a company sale are Rs. 300000 , Direct cost are Rs. 170000 ,the Profit is 20% on sales, The Fixed cost will be _________.
Rs.60,000
Rs.70,000
Rs.80,000
Rs. 95,000
9. IF sale price are 1000 unit @ Rs. 100 per unit ,Variable cost Rs. 60,000 and Fixed cost are Rs. 28000 ,the Breakeven point will be_____________
a. 500 units
b. 700 units
c. 1000 units
d. 1200 units
10. IF a company sale are Rs. 100000 , Variable cost are Rs. 70000 ,the Fixed cost is Rs. 15000 , The P/V ratio will be ___________.
a. 0.3
b. 0.2
c. 0.35
d. 0.25
11. IF Profit volume ratio is 40% and Break Even point is Rs. 2,50,000 what will be fixed cost
a. Rs. 10,00,000
b. Rs. 15,00,000
c. Rs. 20,00,000
d. Rs. 40,00,000
12. Find out Profit if Fixed cost is Rs. 90,000 and Sales is Rs. 5,00,000 and Profit volume ratio is 30%
a. Rs. 80,000
b. Rs. 1,50,000
c. Rs. 60,000
d. Rs. 4,500
13. Margin of safety equals
a. Sales X PV ratio
b. Fixed cost +Profit
c. Profit / PV Ratio
d. Profit X PV Ratio
14. Find out Break Even point in Rupees if Fixed cost is Rs. 90,000 and Sales is Rs. 12 per unit and Direct materials Rs. 5 per unit, Direct labour Rs.2 per unit ,and Direct Expense Rs. 2 per unit
a. Rs. 4,00,000
b. Rs. 3,60,000
c. Rs.4,60,000
d. Rs. 4,50,000
15. Break Even Sales recover
a. Total Cost
b. Fixed cost
c. Variable cost
d. Profit
16. The costs that are unavoidable and remain unchanged no matter what done are classified as __________
a. Sunk costs
b. Bunked costs
c. Unrecorded costs
d. Recorded costs
17. Vijaya Chemical Ltd. has two factories with similar plant and machineries for the manufacture of chemical liquid. The Board of Directors of the company had expressed the desire to merge them and run them as one integrated unit. Following data are available in respect of these two factories:
Profit of Merged Plant at 100% Capacity
Particulars Factory A Rs. Factory B Rs. Total Rs.
Sales 20,00,000 30,00,000 50,00,000
Less: Variable Cost 15,00,000 22,00,000 37,00,000
Contribution 5,00,000 8,00,000 13,00,000
Less: Fixed Cost 2,50,000 4,00,000 6,50,000
Profits 2,50,000 4,00,000 6,50,000
You are required to calculate Profit earned at working 80% of the integrated capacity?
a. Rs.3,00,000
b. Rs.3,90,000
c. Rs.4,00,000
d. Rs.4,90,000
18. __________ cost is a pre-determined cost based on a technical estimate for materials, labour and overheads for a selected period of time and for a prescribed set of working conditions"
a. Standard
b. Marginal
c. Direct
d. Actual
19. The term which can be defined as the difference between a predetermined cost and
actual cost.
a. Variance analysis
b. Differential costing
c. Marginal Costing
d. Incremental Costing
20. If standard cost is lower than the actual cost, the difference is ______
a. Favorable
b. Positive
c. Adverse
d. ZERO 21. Standard Quantity of Materials is 1,000 kg, Actual Quantity is 900kg, Standard Price is Rs. 12 per kg, Actual Price is Rs.16 per kg; find material usage variance a. Rs.2,400(A) b. Rs.3,600(A) c. Rs. 1,200(F) d. Rs.2,100(F)
22. (Standard Quantity - Revised Standard Quantity) x Standard Price =
a. Material Mix Variance b. Material Cost Variance
c. Material Cost Variance d. Material Yield Variance
23. A favorable labor variance combined with an adverse wage rate variance could be caused by? a. Higher unemployment in local economy b. Introduction of performance related pay c. Cheaper raw materials imported due to exchange rate depreciation d. Cost cutting exercises implement by management
24. Calculate standard efficiency variance if, standard rate is Rs.1, standard time is 4000 hours and actual time is 3,960 hours a. 60 (F)
b. 50(F) c. 40(F) d. 30(F)
25. (Budgeted Quantity - Actual Quantity) x Budgeted Price =
a. Sales Value Variance b. Sales Volume Variance
c. Sales Price Variance d. Sales Quantity Variance
TYBAF – SEM VI
SUBJECT: FINANCIAL MANAGEMENT
No Question
1 Accounting record value of assets that is shown in the balance sheet is called as:
a. Book value
b. Market value
c. Fair value
d. Salvage value
2 Company can evaluate the project performance and make decision related selection of
project using which value?
a. Intrinsic value
b. Fundamental value
c. Economic value added
d. Salvage value
3 The accounting record value of assets and liabilities that is shown in balance sheet is
termed as
a. Book value
b. Market value
c. Present value
d. Liquidation value
4 _______ value represents the price at which each individual asset can be sold in the
event of liquidation of business
a. Book
b. Market
c. Present
d. Liquidation
5 Under net asset value method value of shares are depends on ____________
a. Net assets available to equity shareholder
b. Net assets available to debenture holder
c. Net assets available to preference shareholders
d. Amount due to employees
6 Goodwill has __________ value
a. Zero
b. Realizable Value
c. Fictitious
d. Exceptional
7 Goodwill has __________ value
a. Zero
b. Realizable Value
c. Fictitious
d. Exceptional
8 Goodwill is calculated usually during the
a. Start of business
b. Liquidation of business
c. Transfer of business
d. Declaration of bonus to employee
9 Compute EVA from the following information:(i) average operating profit after tax =
50,00,000 p.a. for last three years (ii) total assets = 1,50,00,000 (iii) average current
liability = 30,00,000 (iv) weighted average cost of capital = 10%
a. 16,00,000
b. 38,00,000
c. 38,00,000
d. 16,00,000
10 While calculating net assets for the goodwill, which assets should be ignored?
a. Machinery
b. Goodwill
c. Debtors
d. Bank
11 If future maintainable of X ltd is 10,00,000 and the capital employed is 50,00,000 and
normal rate of return is 15%. The number of years of purchase is 4 years. The value
of goodwill based on purchase of super profit will be
a. 10,00,000
b. 2,50,000
c. 7,50,000
d. 40,00,000
12 EBIT of an organization is ₹ 20,00,000. The debt of the organization consists of 12%
debentures of ₹ 2,00,000 and 15% Bank loan of ₹ 1,00,000. Equity Shares and
reserves and surplus amounted to ₹ 5,00,000. The tax rate is 40% and the weighted
average cost of capital is 18%. What will be NOPAT?
a. 11,76,400
b. 11,85,600
c. 11,91,000
d. 12,00,000
13 In ______, the firm which acquires another firm is known as acquiring company while
the company which is being acquired is known as target company.
a. Merger
b. Acquisition
c. Amalgamation
d. Internal Reconstruction
14 A situation where the combined firm is more valuable than the sum of the individual
combine firm is ______
a. Synergy
b. Energy
c. Strength
d. Power
15 In _______ the firm which acquires another firm is known as acquiring company while
the company acquired is known as target company
a. Merger
b. Acquisition
c. Synergies
d. Concentric merger
16 A Motor Cycle manufacturer acquires a furniture manufacturer is an example of
_______ merger
a. Horizontal
b. Vertical
c. Forward
d. Reverse
17 Justification for M & A’s do not include:
a. to gain economies of scales
b. to enter new markets
c. to increase risk
d. to achieve synergy
18 _________ is considered as one of the reasons for M & A failure
a. High leverage
b. Synergy
c. Diversification
d. Rapid growth
19 Exchange ratio based on EPS before merger = __________
a. 5:6
b. 6:5
c. 3:2
d. 2:3
Pandu Ltd. Is considering to takeover Bindu Ltd. The particulars of two
companies are given below:
Pandu Ltd. Bindu Ltd.
EAT (₹) 20,00,000 10,00,000
Equity Share
Outstanding 10,00,000 10,00,000
EPS (₹) 4 2
20 Pre-merger value of share of Pandu Ltd. = ________
a. ₹20 Lakhs
b. ₹80 Lakhs
c. ₹24 Lakhs
d. ₹48 Lakhs
21 _________ merger is a merger between firms that are involved in totally unrelated
business activities
a) Horizontal
b) Vertical
c) Bailout
d) Conglomerate
22 ____________ a process of measuring the performance of a company's products,
services, or processes against those of another business considered to be the best in
the industry, aka “best in class.”
a) Benchmarking
b) Downsizing
c) Flattening of layer
d) Core competency
23 _________types of reverse takeover
a) Horizontal, Vertical, Conglomerate
b) Bailout, Friendly, Hostile
c) Bailout, Horizontal, Vertical
d) Conglomerate, Friendly, Hostile
24 A scheme of Reconstruction approved by the court where a 12% Debenture appeared
in balance sheet worth ₹ 7,50,000 and Plant and Machinery appeared in balance
sheet worth ₹ 6,00,000; and
The Debenture holders to take over plant and machinery at ₹ 6, 50,000/- in part
satisfaction of their claim. The remaining claim should be converted into 14%
debentures. Due to this
a) There is a Credit of 50,000 to Capital Reduction A/c
b) There is a Debit of ₹ 50,000 to Capital Reduction A/c
c) There is a Credit of ₹1,00,000 to Capital Reduction A/c
d) There is a Debit of ₹ 1,00,000 to Capital Reduction A/c
25 10% Preference share of ₹ 10 each ₹ 5,00,000;
Each existing 10% preference share to be written down from ₹ 10 to ₹ 8 of which ₹ 4
will be represented by 12% Preference share and ₹ 4 by equity share. The Equity
share capital issued to 10% Preference share capital will be __________
a) ₹ 2,00,000
b) ₹ 4,00,000
c) ₹ 1,00,000
d) . ₹ 2,20,000
TYBAF – SEM VI
SUBJECT: Security Analysis and Portfolio Management
No Question
1 Higher the__________ higher is the return.
a. Income
b. Risk
c. Profit
d. Tax
2 Select the correct statement for your answer in the Question above.
a. Security A is more risky and generate less income as compared to Security B
b. Security B is more risky and generate less income as compared to Security A
c. Security B is more risky but security A generates more income as compared to B
d. Security A is more risky but security B generates more income as compared to A
3 Mr. A wishes to earn regular returns which of the following investment option should he prefer?
a. Shares
b. Debentures
c. Gold
d. Insurance
4 The greater the beta, the _________ of the security involved:
a. Greater the unavoidable risk
b. Greater the avoidable risk
c. Less the unavoidable risk
d. Less the avoidable risk
5 __________ Risk is risk arising from external factors which are macro in nature.
a. Unsystematic
b. Systematic
c. Business Risk
d. Management Risk
6 Probability 0.15 0.3 0.4 0.15
Return 15 7 10 5
From the above data compute expected return of the investment.
a. 8%
b. 9%
c. 9.1%
d. 8.1%
7 _____________ is the first phase of portfolio management.
a. Portfolio Evaluation
b. Portfolio Revision
c. Determination of Investment Objectives
d. Asset Allocation
8 ABC Ltd. has a Current Ratio of 1.5: 1 and Working capital of ₹ 5,00,000. What are the Current Assets?
a. ₹ 5,00,000
b. ₹ 10,00,000
c. ₹. 15,00,000
d. ₹ 25,00,000
9 The shareholders’ funds consist of…
a. Preference shares + Equity shares +Debenture
b. Preference shares + Equity shares + Creditors
c. Preference shares + Equity shares + Reserves and surplus
d. Preference shares + Equity shares + Reserves and surplus –Fictitious Assets
10 Cost of Goods Sold is ₹ 12,00,000 and Gross profit Ratio is 20% What will be sale Amount
a. ₹ 2,40,000
b. ₹ 12,00,000
c. ₹ 60,00,000
d. ₹ 24,00,000
11 Calculate Debtors from the following data: -Gross profit is ₹ 4,00,000 which is 25% of Sales and Debtors turnover ratio is 3 months
a. ₹ 5,00,000
b. ₹ 4,00,000
c. ₹ 3,50,000
d. ₹ 6,00,000
12 Sale ₹ 10,00,000 and Cost of sales ₹ 7,50,000
a. 30%
b. 40%
c. 25%
d. 15%
13 Ratio analysis is part of __________ analysis
a. Business
b. Environmental
c. Economical
d. Fundamental and Technical
14 Turnover ratio is denoted in ________
a. Percentages
b. Time
c. Months
d. Days
15 Combined leverage can be used to measure the relationship between:
a. EBIT and EPS
b. PAT and EPS
c. Sales and EPS,
d. Sales and EBIT
16 Business risk can be measured by:
a. Only by Financial leverage,
b. Operating leverage and combined leverage
c. Financial leverage and combined leverage
d. Only operating leverage
17 Higher FL is related the use of:
a. Higher Equity
b. Higher Debt
c. Lower Debt
d. Zero Debt
18 If the sales of the firm are ₹ 20, 00,000 and Variable cost is 40% and Fixed
cost is 20% and 10% Loan of ₹ 20, 00,000. Combined leverage will be a. 5:1
b. 2:1
c. 3:1
d. 4:1
19 Earnings per share ₹ 12, Equity share capital of ₹100 each ₹ 25,00,000, Tax
rate is 50%, 5% Debenture of ₹ 40,00,000 and Fixed cost is ₹ 2,00,000.What will be Financial leverage?
a. 2:1
b. 1.33:1
c. 1.50:1
d. 2.10:1
20 Sales are ₹33,984, sales return ₹380, opening stock ₹1,378, closing stock
₹1,814 G.P. ₹8,068. Stock turnover ratio will be
a. 10 times
b. 15 times
c. 12 time
d. 16 time
21 Increase in odd-lot selling as compared to odd-lot buying, is _____ indicator.
a. bullish
b. regular
c. technology
d. neutral
22 Candlestick charts are the ________ version of bar charting
a. Indian
b. Chinese
c. Japanese
d. American
23 Uptrends occur where prices are making:
a. Higher highs and higher lows.
b. Lower highs and lower lows
c. Higher highs and lower lows
d. Lower highs and Higher lows
24 The phase where the trend moves in the opposite direction of the original trend is known as
a. Continuation
b. Reversal
c. Sideways
d. Random
25 When the market moves down it is denoted by technical term called ________
a. Bear
b. Bull
c. Cow
d. Star
TYBAF SEMESTER VI
SUBJECT: MANAGEMENT CONTROL SYSTEM (MCS)
MULTIPLE CHOICE QUESTIONS
1. Global consumer confidence index was created by __________.
a. Fayol b. Neilson c. Johnson d. Taylor
2. Computers are used to control manufacturing processes such as __________.
a. Chemical processing b. Data Processing c. Computer Processing d. Manual Processing 3. Strategic cost management is to improve ___________.
a. Strategic position of a firm b. Profitability position of a firm c. Financial position of a firm d. Team spirit 4. Strategic cost management involves use of cost data for development of
__________
a. Superior cost strategies b. Inferior cost strategies c. Better cost strategies d. Good cost strategies 5. Kaizen costing __________
a. Changes job profile of employees
b. Changes nature of employees
c. Changes value of employees
d. Changes attitudes of employees
6. Sales = Rs. 750,000. COGS = Rs. 350,000, Operating expenses = Rs 150,000.
Investments = Rs. 25,00,000. ROI =___________.
a) 5%
b) 10% c) 20%
d) 30% 7. As per responsibility accounting, manager’s performance is evaluated by
considering ___________.
a) Controllable cost
b) Not controllable cost c) Common firm wide costs
d) Total Cost 8. Flexible budgets _____________.
a) Accommodates changes in inflation rate b) Are fixed in nature c) Are budgets that have been revised due to changes in price d) Are a series of budgets prepared for various level of operational activity.
9. Top management can preserve the autonomy of division managers and
encourage an optimal level of internal transactions by ____________.
a) Selecting performance evaluation measures that are consistent with achievement of overall corporate goals.
b) Selecting divisional managers who are most concerned about their individual performance.
c) Prescribing transfer prices between segments. d) Setting up all organizational units as revenue centres
10. Z division of AB Corp has following information:
Operating assets Rs 18,00,000
Target rate of return 10%
Residual income is Rs 2,70,000
Hence, Z division’s return on investment is _____________
a) 10% b) 15% c) 20% d) 25%
11. In cost plus pricing the selling unit is allowed to recover cost plus ___________.
a. Profit b. Revenue c. Market Price d. Opportunity Cost 12. A ______________ method of transfer pricing is based on assumption that if
goods cannot be bought from a division within the company, same will have to be
purchased from open market at Prevailing price.
a. Negotiated price b. Cost plus c. Market price d. Dual price
13. A Company provides you the following particulars for division X who will sale
its products to Division Y at cost plus 10%
Production – 15,000 units
Fixed cost – Rs. 60,000
Variable cost – Rs. 6 per unit
Transfer price under cost plus method shall be _____________ per unit
a. Rs. 10 b. Rs. 20 c. Rs. 11 d. Rs. 15 14. Under Negotiated transfer pricing method, ___________.
a. Price is decided As per market price of the goods available b. Only variable cost of goods is calculated and charged as price c. Price is bargained as every unit of business considered as independent unit d. Only fixed cost is calculated and charged as price 15. For a product, variable cost is Rs. 20 p.u. and Fixed cost is Rs 10 p.u. Expected profit is 10% on cost. So under Cost- Plus method, price charged shall be Rs. ___________.
a. 20
b. 22
c. 33
d. 30
16. Sales = Rs. 850,000. Total cost = Rs. 200,000. Cost of capital invested Rs.
1,50,000 (calculated as Investment X cost of capital % )
Then Residual Income = Rs.____________
A. 8.50,000
B. 6,50,000
C. 5,00,000
D. 4,50,000
17. Strategic decisions are taken by _____________.
a) Top Level managers b) Middle Level managers c) Medium Level managers d) Lower Level managers
18. If sales and expenses both rise by Rs 100,000 then
a) Residual income will increase b) Return on investment will increase c) Return on investments will remain unchanged
d) Asset turnover will decrease 19. Controllable contribution margin is __________
a) Excess of sales over costs b) Excess of sales over variable costs c) Excess of sales over prime cost d) Excess of sales over controllable variable costs
20. DuPont co gives following information of D division:
Target rate of return 15%
Return on Investments 20%
Residual income Rs 10,000
Hence, divisional investment_____________
a) Rs 200,000 b) Rs 150,000 c) Rs 66,667 d) Rs 50,000
21. ___________ Adjusted accounts will reflect current values of assets and liabilities in balance sheet which will in turn show true & fair current value of the firm’s financial position.
a. IFRS implemented
b. Inflation adjusted
c. GAAP
d. Historical
22. A company gives you the following information
Inventory on 1st January Rs. 11,000
Purchases during the year Rs. 64,000
Inventory on 31st December Rs. 20,000
General Price Index
1st January - 100
Average – 140
31st December – 125
Cost of sales under Current Purchasing Power Method as per LIFO method ___________.
a. Rs. 49,107
b. Rs. 55,000
c. Rs. 53,036
d. Rs. 68,750
23. Average general price index is used for valuation of __________ under CPP method.
a. Salary expenses
b. Debenture
c. Fixed assets
d. Bills receivable
24. A company gives you the following information
Sundry Creditors as on 1st April 2019 – Rs. 15,000
Sundry Creditors as on 31st March 2020 – Rs. 18,000
General Price index as follow
1st April 2019 – 100
31st March 2020 – 140
Average during the year – 125
Monetary result shall be __________.
a. Purchasing power loss Rs. 6,580
b. Purchasing power gain Rs. 6,360
c. Purchasing power loss Rs. 6,360
d. Purchasing power gain Rs. 6,580
24. Price index for the year 2014 is 125. Price index on the date of revaluation is 150.
Asset of the business valued Rs. 1,00,000 was purchased in 2014. So, the converted value of asset as per inflation accounting shall be Rs. ___________.
a. 2,00,000
b. 1,20,000
c. 1,00,000
d. 66,667
25. When converted value of monetary Assets is more than actual historical cost of assets, there is ___________.
a. Purchasing power gain
b. Purchasing power loss
c. No gain No loss
d. Extra loss occurred