- In Govt. company the share of Central Govt in paid up capital must be at least:
(a) 51%
(b) 49%
(c) 50%
(d) 75% - Which of the following is foreign company ?
(a) A company Incorporated outside India and also has a place of business outside India.
(b) A company Incorporated in India and has place of business in India.
(c) A company Incorporated outside India and has a place of business in India.
(d) A company Incorporated in India and has a place of business outside India. - The Excess price received over par value of share should be credited to________
(a) Reserve Capital a/c
(b) Capital Reserve a/c
(c) Securities Premium a/c
(d) Call in advance a/c - X Ltd forfeited 2000 shares of Rs 10 each called up Rs 8 per share due to Non payment of call money of RS 3 per share, share forfeiture a/c will be credited by
(a) 10,000/
(b) 16,000/
(c) 6,000/
(d) 20,000/ - While granting approval to any scheme of capital Reduction, Court may direct to company to add following
words to its name for such period as it thinks fit.
(a) And reduced
(b) Unlimited and Reduced
(c) Liquidated
(d) Limited and Reduced - For capital Reduction under Internal Reconstruction approval is required from
(a) Share holders
(b) Court
(c) Articles of Association
(d) All of these - Which of the following should be deducted from the called up share capital to find out paid up capital.
(a) Calls in advance Amount
(b) Share forfeities Amount
(c) Calls in Arrears Amount
(d) Discount on Issue of Shares Amount. - Maximum Amount that can be collected as premium as percentage of face value.
(a) Unlimited
(b) 80%
(c) 50%
(d) 10% - The Securities Premium amount may be used by company for_________
(a) Write off any Loss on sales of Fixed Assets.
(b) Write off expenses, discount on the Issue of Debenture
(c) Payment of Dividend
(d) Write of any loss of Revenue Nature - A company can not issue redeemable preference shares for a period more than____
(a) 5 Years
(b) 10 Years
(c) 15 Years
(d) 20 Years - Which of the following can not be used for the purpose of creation of capital redemption Reserve account
(a) Credit balance of Profit Loss a/c
(b) General Reserve a/c
(c) Unclaimed Dividend a/c
(d) All of these - Which of the following account can be used for transfer of capital redemption Reserve Account ?
(a) General Reserve Account
(b) Profit prior to Incorporation
(c) Share forfeited Account
(d) Securities Premium Account - The Present Value of the future contribution of employees is related with
(a) Human Resource Accounting
(b) Inflation Accounting
(c) Social Accounting
(d) Responsibility Accounting - Which of the following statement is true.
(a) Debenture holder is owner of a company
(b) A Debenture holder can get his money back only on Liquidation of the Company.
(C) A Debenture Issued at discount can be redeemed at Premium.
(d) A Debenture holder will receive Interest from company only if company makes Profit. - Value Added statement is prepared from
(a) Profit and Loss Statement
(b) Balance Sheet
(c) Cash Flow Statement
(d) Fund Flow Statement - Cost of control means
(a) Goodwill
(b) Capital Reserve
(c) Goodwill or Capital Reserve
(d) None of these - Which of the following is false ?
(a) A company can Issue Redeemable Debenture
(b) A company can buy its own debenture.
(c) A company can buy its own share
(d) A company can Issue Debenture with voting Right. - According to Table F of Schedule I of Company Act the maximum rate of interest on Calls in Arrear can be
(a) 5% P.A.
(b) 6% P.A.
(c) 10% P.A.
(d) 15% P.A. - When Debentures are Issued as collateral Securities against any loan then holder of such Debenture is entitiled to Interest.
(a) On amount of Loan
(b) At Amount of Debenture
(c) Both (On amount of Loan) and (At Amount of Debenture)
(d) None of these - How many companies are involved in Internal Reconstruction :
(a) One
(b) Two
(c) Four
(d) Unlimited - Methods of Accounting for Amalgamation of companies are/is
(a) The Pooling of Interest Methods
(b) The Purchase Method
(c) Both (The Pooling of Interest Methods) and (The Purchase Method)
(d) None of these - When two or more than two companies Liquidate to form a new company, it is called
(a) Amalgamation of Companies
(b) Absorption of Companies
(c) Internal Reconstruction of company
(d) Purchase of Business. - The Adjustment Entry is passed to eliminate the inter company owing is
(a) Debit Amalgamation Adjustment and credit Debtors a/c
(b) Debit Sundry Debtors a/c credit sundry creditors a/c
(c) Debit sundry creditors a/c, credit sundry Debtors a/c
(d) Debit sundry debtors account, credit statutory Reserve a/c - The buyback of equity shares in any financial year cannot exceed_____of its total paidup equity capital in that financial year.
(a) 15%
(b) 20%
(c) 25%
(d) None of these - Accounting Standard 25 relates to_____
(a) Interim financial Reporting
(b) Intangible Assets
(c) Valuation of Goodwill
(d) Valuation of Inventory - Accounting standard 4 relates to
(a) Lease
(b) Accounting of fixed Assets
(c) Valuation of shares
(d) Contingencies and Events occuring after the balance sheet date. - The prime function of accounting is to
(a) Record economic data
(b) provide the informational basis for action
(c) Classify and record business transaction.
(d) Attain noneconomic goals. - In the final accounts of a joint stock company, the item ‘Deferred Tax’ apprears on the
(a) Statement of Profit and Loss
(b) Profit and Loss Appropriation Statement
(c) Cash Flow Statement
(d) None of these - Conditions to be fulfilled for the appointment of a managing or whole time director or a manager without the approval of the central Government have been prescribed by the Indian Companies Act in its
(a) Schedule V, Part I
(b) Schedule VI, Part I
(c) Schedule VIII, Part I
(d) Schedule XIV - Accounting Standard 2 is related to_______
(a) Cash flow Statement
(b) Depreciation Accounting
(c) Valuation of Inventories
(d) Accounting for Fixed Assets. - AS 14 is related to
(a) Accounting for Amalgamation
(b) Accounting for Investments
(c) Accounting for Govt. Grants
(d) Borrowing costs - AS 12 is related to
(a) Employee benefits
(b) Accounting for Govt. Grants.
(c) Borrowing Cost
(d) None of these - Meaning of Compound Entry is :
(a) Different Transactions of different dates are entered as a single entry
(b) Different Transactions of same date are entered as a single entry
(c) Different Transactions of different dates are entered as a single entry and Different Transactions of same date are entered as a single entry
(d) None of these - Green/Environmental Balance sheet shows
(a) Environmental Assets
(b) Environmental Liabilities
(c) Environmental Capital
(d) All of these - The National Environmental Protection Act was passed in India in which year.
(a) 1974
(b) 1981
(c) 1986
(d) 1995 - The balance of Capital Reduction a/c is generally transferred to
(a) General Reserve Account
(b) Capital Reserve Account
(c) Profit & Loss Statement
(d) Security Premium Account - Which of the following statement is true ?
(a) Post acquisition Profit of subsidiary company is always capital profit.
(b) Every holding company is not required to prepare consolidated balance sheet and Profit & Loss a/c under company Act
(c) Holding company means the company which holds the entire share of another company.
(d) A company is subsidiary company of a holding company when the latter company controls the composition of BOD of former company. - Balance of Debenture sinking Fund A/C is transferred to
(a) General Reserve
(b) Capital Reserve
(c) Dividend Equalisation Reserve
(d) None of these - The time interval between date of preparing balance sheet of holding company and subsidiary company
(a) Upto 1 year
(b) Not more than 6 Months
(c) More than 6 months
(d) More than 1 year - When the amount of Investment in subsidiary company is more than Nominal Value of share capital acquired by holding company difference is
(a) Goodwill
(b) Capital Reserve
(c) Capital Income
(d) Revenue Profit - The Basic concept related to Balance Sheet are
(a) Cost Concept (Purchase Price)
(b) Business Entity Concept
(c) Accounting Period Concept
(d) Both Cost Concept (Purchase Price) and Business Entity Concept - The Basic concept related to profit & loss account
(a) Realization Concept (b) Matching Concept
(c) Cost Concept
(d) Both Realization Concept and Matching Concept - Accounting does not record nonfinancial transactions because of
(a) Entity Concept
(b) Accrual Concept
(c) Cost Concept
(d) Money Measurement Concept - Capital is shown under Liabilities because of the
(a) Conservative concept
(b) Accrual Concept
(c) Entity Concept
(d) All of these - Which of the follwing is not a deferred revenue Expenditure.
(a) Preliminary expenses
(b) Preoperative expenses
(c) Heavy advertising expenses to introduce a New product
(d) Legal expenses for Breach of Contract - Cash Profit is
(a) Gross Profit Operational Expenses
(b) Net Profit (Non Trading Profits + Depreciation and Provisions)
(c) Gross Profits Non trading Profits + Depreciatio & Provisions
(d) Net Profits + Depreciation and Provisions. - The Amount of capital which can be called up only at the time of widing up of the company is called
(a) Authorized capital
(b) Issued capital
(c) Called up capital
(d) Reserve capital - Minority Interest Consists of
(a) Face value of shares held by outsiders
(b) Proportionate share of capital Profit
(c) Proportionate share of Revenue Profit
(d) All of these - The Creditors of H Ltd include Rs. 6000 for the purchases from S Ltd. The Adjustment Entry made during the proportion of consolidated Balance Sheet will be
(a) Reduce Debtor by 6000.
(b) Reduce Creditor by 6000.
(c) Increase Debtors by 6000
(d) Both Reduce Debtor by 6000 and Reduce Creditor by 6000 - The existing 1000 shares of RS 100 each are altered to 10,000 shares of 10 each. This is known as
(a) Consolidation
(b) Sub division
(c) Coversion into stock
(d) Surrender - What is the effect of Increase in fixed cost in Break Even Point Analysis
(a) Reduce Profit Volume Ratio
(b) Increase in Break even Point
(c) Increase Margin of Safety
(d) Reduces the Contribution - The Breakeven Point in units is calculated by
(a) Fixed cost/Profit Volume Ratio
(b) Fixed Cost/ Contribution per Unit
(c) Variable Cost/ Contribution per Unit
(d) Sales/ Contribution per Unit - The basic difference between Marginal costing and absorption costing is the treatment of
(a) Direct Material
(b) Variable Cost
(c) Fixed Cost
(d) Sales Cost - Why cash Budget is prepared ?
(a) It helps in cash Management
(b) It helps in preparing Balace Sheet
(c) It is legally compulsory
(d) To calculate Profit & Loss - Activity based costing is method of
(a) Costing
(b) Allocation
(c) Analysis
(d) All of these - In activity based costing an activity which generate cost is a
(a) Cost Sheet
(b) Cost driver
(c) Cost Tools
(d) Cost Method - Cost drives for Inspection are
(a) Number of Machine hours
(b) Number of Inspectors
(c) Number of Inspections
(d) Number of Methods - Ram Ltd used 4538 Kg of material at a standard cost Rs. 2.50 per Kg. The material usages variance was 280 (favourable). The Standard usage of Material for the period is
(a) 4700 Kg
(b) 4650 Kg
(c) 4600 Kg
(d) 4588 Kg - During a period 17500 labour hours were worked at a standard cost of Rs. 6.50 per hour. If labour efficiency variance is 7800 (favourable). The standard Labour hours are
(a) 20,000 hours
(b) 18700 hours
(c) 19200 hours
(d) 18500 hours - he main object of cost accounting is
(a) To minimise the waste
(b) Help in Inventory Valuation
(c) To control and to reduce the cost
(d) Help in fixation of price - Conversion cost is equal to
(a) Material cost and Direct Wages
(b) Material cost and Indirect Wages
(c) Direct wages and factory overhead
(d) Material cost and factory overhea - If cost of 1000 units is Rs. 1000 and 1500 units is Rs. 1500, then Fixed cost is
1) 2000
2) 1000
3) 500
4) Zero - The most suitable cost system where the Product is different by type of Material and work performance
(s) Job Costing
(b) Operating Costing
(c) Process Costing
(d) None of these - A Budget that gives a summary of all the functional Budgets and projected profit & Loss A/c is known as
(a) Capital Budget
(b) Flexible Budget
(c) Master Budget
(d) None of these - When preparing a Production Budget, the quantity to be produced is equal to
(a) Sales + Opening Stock + Closing Stock
(b) Sales Opening Stock + Closing Stock
(c) Sales Opening Stock Closing Stock
(d) Sales + Opening Stock Closing Stock - X requires 2400 Actual labour hours to complete works, 20% is Idle time, wages Rate is Rs. 10 per hour. Calculate Labour cost.
(a) Rs. 19200
(b) Rs. 24000
(c) Rs. 28800
(d) Rs. 30000 - Which of the following is excluded from Cash Budget ?
(a) Depreciation on Fixed Assets
(b) Office Salaries
(c) Commission Paid to Agent
(d) Capital Cost of New Assets - Selling Price of X Product is Rs. 20 per unit, fixed cost Rs. 60,000. Contribution to sales ratio is 40%.Calculate Break even Point in Units
(a) 7000 Units
(b) 7400 Units
(c) 7500 Units
(d) 8000 Units - If selling price of product is Rs. 9 per unit, variable cost Rs. 6 per unit, Fixed cost Rs. 54000 per year, when Actual sales is Rs. 1,80,000. Calculate Margin of safety in units
(a) 2000 units
(b) 4000 units
(c) 6000 units
(d) 8000 Units - Contribution Ratio is 30%, Fixed Cost Rs 75000 per month. Calculate Sales per month to get Rs. 15000 as profit per month
(a) Rs. 2,00,000
(b) Rs. 3,00,000
(c) Rs. 2,76,000
(d) Rs. 2,50,000 - If sales is Rs. 50,00,000, profit volume Ratio is 50% and Margin of safety is 40%. Calculate Profit.
(a) Rs. 25,00,000
(b) Rs. 20,00,000
(c) Rs.10,00,000
(d) None of these - An increase in selling price will effect
(a) Increase in Breakevenpoint
(b) Decrease in Breakevenpoint
(c) Does not effect Break even Point
(d) None of these - If fixed cost decreases while variable cost is remained unchanged new Break Even Point in relation to old Break even point will be
(a) Lower
(b) Higher
(c) No change
(d) None of these - Which of the following is an irrelevant cost ?
(a) Sunk cost
(b) Opportunity cost
(c) Replacement cost
(d) All of these - When margin of safety is 28% Profit Volume Ratio is 60% Profit will be
(a) 80%
(b) 33.33%
(c) 66.67%
(d) 16.8% - An export order is generally accepted at
(a) Below Marginal cost
(b) Below Fixed cost
(c) Below total cost but above marginal cost
(d) Below total cost but above fixed cost - A company has an idle plant capacity. It gets a bulk order which will not affect prices of company products in the market. Such a bulk order may be accepted at a price which is more than its
(a)Fixed cost
(b) Variable cost
(c) Variable cost plus any opportunity cost of idle capacity
(d) Total cost - Basic standard is established for
(a) Short Period
(b) Long Period
(c) Short and long period both
(d) Indefinite Period - The logical development of Budgetary control is
(a) Marginal Costing
(b) Standard Costing
(c) Differential Costing
(d) Absorption Costing - A system where manufacturer ascertain the cost after incurring expenses is known as
(a) Standard costing
(b) Marginal costing
(c) Operating costing
(d) Historical costing - The difference between standard output and Actual output Multiplied by Standard Variable overhead rate is equal to
(a) Variable overhead cost Variance
(b) Variable overhead efficiency Variance
(c) Variable overhead Budget Variance
(d) Variable overhead Volume Variance - The Difference between Actual Fixed overhead and Budgeted Fixed overhead is known as
(a)Fixed overhead cost Variance
(b) Fixed overhead Expenditure Variance
(c) Fixed overhead Volume Variance
(d) Fixed overhead capacity Variance - In contract costing Payment of cash to the contractor is made on the basis of
(a) Uncertified work
(b) Certified work
(c) Works in progress
(d) Retension Money - Retension Money is equal to
(a) Work certified less work uncertified
(b) Contract Price Less work certified
(c) Work certified Less payment received by contractor
(d) Work certified plus cash Received - Cost unit for Paper Industry is
(a) Per Rim
(b) Per Paper
(c) Per Kg
(d) Per quintal - Total Inventory Cost is :
(a) Carrying Cost
(b) Ordering Cost
(c) Carrying Cost + Ordering Cost
(d) Purchase Cost + Carrying Cost + Ordering Cost - When work certified is less than 25% of contract Price, Profit to be transderred to Profit & Loss Account
(a) Nil
(b) 100% of Notional Profit
(c) 1/3 of Notional profit
(d) 2/3 of Notional Profit - Which Accounting Standard relates with the accounting for costruction contract
(a) Accounting Standard 5
(b) Accounting Standard 6
(c) Accounting Standard 7
(d) Accounting Standard 8 - The technique of Profit Planning is :
(a)Marginal Costing
(b) Standard Costing
(c) Budgetary Control
(d) None of these - Variable Cost is :
(a)Direct Cost
(b) Direct Cost + Variable overheads
(c) Absorption Cost
(d) None of these - Contract Price Rs. 3,00,000 , Estimated Profit Rs. 60,000 Retention money 20% of certified work, works certified 60% of contract Price. Calculate amount of Profit transfer to Profit & Loss a/c
(a) Rs. 60,000
(b) Rs. 28,800
(c) Rs. 32,000
(d) Rs. 48,000 - When two or more than two products are produced which have equal value known as
(a) Joint Product
(b) ByProduct
(c) CoProduct
(d) Scrap - Workin progress in contract costing is :
(a) Value of work certified + cost of work uncertified
(b) Cost of work certified + Cost of work uncertified
(c) Value of work certified + Cost of work uncertified Profit kept as reserve
(d) None of these - Which of the following does not use Process costing
(a) Oil Refinery
(b) Chemical works
(c) Sugar works
(d) Aircraft manufacturing - Input 12000 Kg, Normal loss 10% of input. If output is 10920 Kg. What is abnormal Loss/Gain
(a) Abnormal Gain 120 Kg
(b) Abnormal Loss 120 Kg
(c) Abnormal Gain 1080 Kg
(d) Abnormal Loss 1080 Kg - Wastage of Raw material during Process is 20% of Input. What quantity of Raw material is required per Kg
of output ?
(a) 0.8 Kg
(b) 1.2 Kg
(c) 1.25 Kg
(d) 1.33 Kg - Cost unit for Water supply Industry is
(a) Per 100 gallons
(b) Per 1000 gallons
(c) Per 10000 gallons
(d) Per gallon - The Expenses which are not related to operations process but related to time (period) are known as
(a) Variable Expenses
(b) Semi Variable Expenses
(c) Semi Fixed Expenses
(d) Fixed Expenses - The cost unit in operating costing is a
(a) Simple Cost unit
(b) Composite Cost unit
(c) Simple or Composite Cost unit
(d) None of these - When the detail related with cost of production presented in the form of Account is known as
(a)Trading & Profit & Loss Account
(b) Production Account
(c) Cost sheet
(d) Statement of cost - Which activity is not the part of Financial Activity in Cash Flow Statement ?
(a) Issue of Share
(b) Buy back of share
(c) Purchase of Buliding
(d) Payment of dividend - Which one of the following item is a Non Cash transaction ?
(a) Redemption of preference share
(b) Redemption of Debentures
(c) Conversion of Debentures into shares
(d) Purchases of Asset - Which activity is an investment activity in cash flow statement from the following :
(a) Redemption of Debentures
(b) Dividend Paid
(c) Interest Paid
(d) Purchase of Plant & Machinery - Cash flow statement is presented to state
(a) Opening balance of cash or cash Equivalents.
(b) Sources and application of Cash and Cash Equivalents
(c) Sources and application of working capital
(d) All of these - The Methods of cash flow statement described in Revised As 3
(a) Direct Method
(b) Indirect Method
(c) Direct and Indirect Method
(d) None of these - Isssue of Equity shares for consideration of Purchase of land is
(a) Cash out flow
(b) Cash inflow
(c) Cash Inflow & Outflow both
(d) Neither Cash Inflow nor Cash outflow - Ram Ltd has a current Ratio 4.5:1 and Quick Ratio 3:1. If its inventory is Rs. 72000. Calculate Current Liabilities
(a) Rs. 2,16,000
(b) Rs. 73000
(c) Rs. 48,000
(d) Rs. 84,000 - A company has share holder’s equity of Rs. 2,00,000/Total Assets are 60% of share holder’s equity assets,turn over Ratio 4 times, Inventory Turnover is 6 times. Calculate amount of Inventory.
(a) Rs. 4,80,000
(b) Rs. 8,00,000
(c) Rs. 80,000
(d) Rs. 6,00,000 - Calculate opening Debtor Total sales Rs. 3,00,000, cash sales 60% , closing Debtors Rs. 25,000 and average collection period is 2 months
(a) Rs. 25,000
(b) Rs. 20,000
(c) Rs. 15,000
(d) Rs. 40,000 - Capital Rs. 15,00,000 , Capital turn over 4 times and profit on sales is 10%. Calculate Return on Capital ?
(a) 20%
(b) 30%
(c) 40%
(d) 25% - Financial Structure means :
(a) Equity share capital + Preference Share Capital + Long term Loan
(b) Equity share capital + Preference Share Capital + Long term Loan + Retained Earnings
(c) Equity share Capital + Preference share capital + Long term Loan + Retained Earnings + Current liabilities
(d) None of these - Average stock 73000, Debtors 45000, Stock turn over 6 times, Gross profit Margin 20% of sales and credit sales 40% of Total sales. Calculate Average collection period.
(a) 146 days
(b) 75 days
(c) 73 days
(d) 90 days - The monthly cash requirements of a company are Rs. 60000; fixed cost per transaction Rs. 10 and interest rate on marketable securities is 6% p.a. The optimum cash balance will be
(a) Rs. 15,000
(b) Rs. 20,000
(c) Rs. 25,000
(d) Rs. 30,000 - Difference in capital Gearing Ratio and debts to Equity ratio is due to
(a) Preference share capital
(b) Equity share capital
(c) Prefernce share capital + Equity share capital
(d) None of these - Acid Test Ratio means
(a) Liquidity
(b) Profitability
(c) Efficiency
(d) Long term Solvency - Capital turn over Ratio is 12 and net profit Ratio is 30%. The overall profitiability is
(a) 40%
(b) 3.6%
(c) 2.5%
(d) 18% - On which factor Dupoint control Chart depends :
(a) Profit
(b) Investment
(c) Profit and Investment
(d) Sales - Net Profit for year ending 3132016 is Rs. 3,00,000. This figure of the N.P. Has been arrived after taking into following items:Depreciation on Fixed Assets Rs. 65,000, Preliminary Expenses written off Rs. 7,000 and Profit on sale of long term Investments Rs. 5,000. Fund from operation will be :
(a) Rs. 3,77,000
(b) Rs. 4,33,000
(c) Rs. 4,38,000
(d) Rs. 3,67,000 - The Source of fund is :
(a) Receipt of Bonus shares from subsidiary company
(b) Receipt of licence to Import goods
(c) Receipt of Dividend on Investment in shares of subsidiary company
(d) None of these - There is a flow in funds when there is a transaction between
(a) Non current a/c with current a/c
(b) Current a/c with current a/c
(c) Non current account with Non current a/c
(d) All of these - The application of fund is
(a) Acceptance of supplier’s Billls of exchange
(b) Deposit of cash into bank
(c) Endorsement of B/R in favour of creditors.
(d) None of these - Received a Dividend on investment Rs. 50,000 out of which Rs. 30,000 is related to preacquisition profit.Sources of fund will be
(a) Rs. 30,000
(b) Rs. 50,000
(c) Rs. 20,000
(d) None of these - In current year, current Liabilities has decreased in comparison to Last year then working capital will :
(a) Decrease
(b) Increase
(c) Constant
(d) None of these - In which year, The Institute of Chartered Accountants of India issued Revised Accounting Standard 3
(a) June 1981
(b) March 1997
(c) June 1998
(d) March 2000 
- Cash budget is prepared by
(a) Receipts and Payment Method
(b) Adjusted Profit and Loss Method
(c) Projected Balance Sheet method
(d) All of these - The method of cost control under which the control of centre point will be responsible person for cost, not cost
(a) Social Accounting
(b) Responsibility Accounting
(c) Cost Accounting
(d) Financial Accounting - The Variance of Standard Costing remains always Adverse in Business called as :
(a) Material Yield Variance
(b) Idle Time Variance
(c) Labour Yield Variance
(d) None of these - Debt Service Ratio is :
(a) EBIT/Interest Payable
(b) EAT/ Interest Payable
(c) Net profit/ Interest Payable
(d) Gross Profit/ Interest Payable - Trading on Thick Equity means :
(a) Equity and Debts are equal
(b) Equity is Less than Debts
(c) Equity is more than Debts
(d) None of these - Earnings per share of X Ltd. Are Rs. 9 and the market price of a share of face value of Rs. 100 is Rs. 150.Cost of Equity share capital will be
(a) 9%
(b) 15%
(c) 6%
(d) None of these - The components of Gross Period of operating cycle is
(a) Raw Material Storage period
(b) Finished Stock Storage Period
(c) Conversion Period (Semi finished goods)
(d) All of these - The cost of retained earnings will be :Dividend per share Rs. 9, Personal Income Tax 25%, Personal Capital Gain tax rate 10%. Market Price per share Rs. 100
(a) 10%
(b) 25%
(c) 35%
(d) 7.5% - “The Cost of Capital is the minimum required rate of earnings or the cut off rate for capital expenditure.”Definition given by
(a) Milton H. Spencer
(b) M J GORDON
(c) Soloman Ezra
(d) Hunt, William and Donaldson - Factor does not Influence the size of working capital
(a) Business fluctuations
(b) Dividend Policy
(c) Availability of Labour
(d) Availability of Raw Material - Calculate working capital when operating period is 44 days, operating cost is Rs. 10,50,000, minimum cash required Rs. 50,000, No. Of days 365 in a year
(a) 1,76,575
(b) 1,56,757
(c) 2,00,000
(d) 1,76,755 - Calculate working capital when current Assets Rs. 40,00,000 Current Liabilities Rs. 13,00,000 Provision for contingency is 10% of Total working Capital
(a) Rs. 29,70,000
(b) Rs. 30,00,000
(c) Rs. 44,00,000
(d) Rs. 14,30,000 - X Ltd earns Rs 5 per share is capitalised at the rate of 10% and has a rate of Return on Investment of 18%.According to Walter’s formula. What should be price for share at 25%. Dividend Pay out Ratio ?
(a) Rs. 25
(b) Rs. 80
(c) Rs. 125
(d) Rs. 90 - Vivek Ltd has 10% actual capitalisation rate, a dividend pay out of 50% , and declares a dividend of Rs. 2 per share. The normal apitalisation rate in the Industry is 12 %. Calculate value of equity share by Gardon Model.
(a) 58.28
(b) 85.28
(c) 28.58
(d) None of these - Current Market Price of Rs. 10 each Equity share is Rs. 15, Dividend per share is Rs. 1.5. if Growth rate is 5% per year. Calculate cost of Equity share capital.
(a) 10%
(b) 22%
(c) 15%
(d) 17% - The Cost under which to accept the specific Investing project, forgo the alternative options, called as :
(a) Explicit Cost
(b) Future Cost
(c) Historical Cost
(d) Opportunity Cost - Price Earning Ratio is useful for
(a) Short term creditors
(b) Long term creditors
(c) Share holders
(d) Both Short term and Long term creditors - Stock Turn over Ratio is :
(a) Sales/ Closing Stock
(b) Sales/ Average Stock
(c) Cost of goods sold/ Average Stock
(d) Cost of goods sold/ Closing Stock - “Equity capital is cost free” Is this statement true ?
(a) True
(b) False
(c) Partly True and Partly False
(d) None of these - Overall Solvency Ratio is :
(a) Total Liabilities / Total Assets
(b)Total Outside Liabilities / Total Assets
(c)Total Internal Liabilities / Total Assets
4) None of these - Management Accounting involves
(a) Preparation of Financial Statements
(b) Analysis and interpretation of data
(c) Recording of transactions
(d) None of these - When evaluating capital investment proposals. Time value of Money is used in the Technique.
(a) Internal Rate of Return
(b) Average Rate of Return
(c) Pay back period
(d) None of these - Profitability Index is the ratio of
(a) Initial Investment to present value of cash inflow
(b) Present value of cash inflow to Initial Investment
(c) Average Income to Initial Investment
(d) None of these - Cash Inflow After Tax means
(a) Cash Revenue Cash Expense
(b) Total Revenue Total Expenses
(c) Cash Inflow before Tax Expenses
(d) Operating Profit + Depreciation Tax - What is the basic assumption of dividend yield plus growth method of cost of capital
(a) Constant growth of firm
(b) Costant dividend pay out
(c) Both Constant growth of firm and Constant dividend pay out
(d) None of theseAnswer Key
1 (a) 2 (c) 3 (c) 4 (a) 5 (a) 6 (d) 7 (c) 8 (a) 9 (b) 10 (d) 11 (c) 12 (a) 13 (a) 14 (c) 15 (a) 16 (a) 17 (d) 18 (c) 19 (a) 20 (a) 21 (c) 22 (a) 23 (c) 24 (c) 25 (a) 26 (d) 27 (c) 28 (a) 29 (a) 30 (c) 31 (a) 32 (b) 33 (b) 34 (d) 35 (c) 36 (b) 37 (d) 38 (a) 39 (b) 40 (a) 41 (d) 42 (d) 43 (d) 44 (c) 45 (d) 46 (d) 47 (d) 48 (d) 49 (d) 50 (b) 51 (b) 52 (b) 53 (c) 54 (a) 55 (d) 56 (b) 57 (c) 58 (b) 59 (b) 60 (c) 61 (c) 62 (d) 63 (a) 64 (c) 65 (b) 66 (d) 67 (a) 68 (c) 69 (a) 70 (b) 71 (c) 72 (b) 73 (a) 74 (a) 75 (d) 76 (c) 77 (c) 78 (*) 79 (b) 80 (d) 81 (b) 82 (b) 83 (b) 84 (c) 85 (a) 86 (d) 87 (a) 88 (c) 89 (a) 90 (b) 91 (b) 92 (a) 93 (c) 94 (d) 95 (a) 96 (c) 97 (b) 98 (d) 99 (c) 100 (b)101 (c) 102 (c) 103 (d) 104 (b) 105 (c) 106 (d) 107 (c) 108 (c) 109 (c) 110 (c) 111 (c) 112 (b) 113 (*) 114 (a) 115 (a) 116 (b) 117 (c) 118 (d) 119 (c) 120 (a)121 (d) 122 (b) 123 (b) 124 (b) 125 (d) 126 (d) 127 (b) 128 (b) 129 (a) 130 (c) 131 (c) 132 (d) 133 (d) 134 (c) 135 (b) 136 (a) 137 (b) 138 (b) 139 (c) 140 (c) 141 (d)142 (c) 143 (c) 144 (b) 145 (b) 146 (b) 147 (a) 148 (b) 149 (d) 150 (c)