COMMERCE PAGE 8
Commerce Page 8- MCQs
1. A method for achieving maximum market response from limited marketing resources by reorganising differences in the response characteristics of various parts of the market is known as
(A) Market targeting
(B) Market positioning
(C) Market segmentation
(D) Market strategy
Ans: C
2. Who plays their significant role in distribution of goods when they do not sell to ultimate users or consumers?
(A) Retailer
(B) Wholeseller
(C) Mediator
(D) Commission agent
Ans: B
3. In Marketing Mix, which four P’s are covered?
(A) Product, Price, Place, promotion
(B) Product, Price, Power, Promotion
(C) Product, Price, Penetration, Promotion
(D) Product, Price, Positioning, Promotion
Ans: A
4. Which research includes all types of researches into human motives when it refers to qualitative research designed to uncover the consumer’s sub consciousness or hidden motivations?
(A) Motivational Research
(B) Marketing Research
(C) Managerial Research
(D) Price Research
Ans: A
5. False and misleading claims and vulgarity in advertisements do not match with
(A) Aggressive advertising
(B) Ethics in advertising
(C) Mass level of advertising
(D) Sales promotion
Ans: B
6. Arrange the following steps involved in capital budgeting in order of their occurrence:
i. Project selection
ii. Project appraisal
iii. Follow up
iv. Project execution
(A) ii, iii, i, v, iv
(B) iii, ii, i, v, iv
(C) i, iii, ii, v, iv
(D) i, ii, iii, v, iv
Ans: B
7. Which method does not consider the time value of money?
(A) Net Present Value
(B) Internal Rate of Return
(C) Average Rate of Return
(D) Profitability
Ans: C
8. Which formula is used measure the degree of Operating leverage?
(A) EBIT/sales
(B) C/EBIT
(C) EBIT/EBT
(D) EBIT/C
Ans: B
9. Which one is more appropriate for cost of retained earnings?
(A) Weighted Average Cost of Capital
(B) Opportunity cost to the firm
(C) Expected rate of return by the investor
(D) None of the above
Ans: B
8. Match the following with the most suitable options.
List-I List-II
a. Modigliani-miller approach 1. Commercial paper
b. Net Operating income approach 2. Working capital
c. Short term money market instrument 3. Capital structure
d. Factoring 4. Arbitrage
Codes:
a b c d
(A) 4 3 1 2
(B) 3 4 1 2
(C) 3 2 1 4
(D) 4 2 3 1
Ans: A
9. During which plan was the National Apprenticeship Training Scheme introduced?
(A) 1st Five Year Plan
(B) 2nd Five Year Plan
(C) 4th Five Year Plan
(D) Annual Plans
Ans: B
10. Match the following:
List-I List-II
a. An ordinary person does not want to work on his own 1. Hierarchy Theory
b. An individual is willing to work on his own 2. Hygiene Theory
c. Motivational Factors 3. X-Theory
d. Esteem Needs 4. Y-Theory
Codes:
a b c d
(A) 1 2 3 4
(B) 3 4 1 2
(C) 1 4 2 3
(D) 3 4 2 1
Ans: D
11. Arrange the following staffing procedures in the correct sequences:
i. Determining sources of Personnel supply
ii. Preparing personal specifications.
iii. Selection of personnel.
iv. Determining personnel characteristics
(A) ii, i, iv, iii
(B) i, ii, iii, iv
(C) ii, i, iii, iv
(D) ii, iii, i, iv
Ans: A
12. Which among the following is not a voluntary method for prevention and settlement of disputes?
(A) Collective Bargaining
(B) Standing orders
(C) Joint Consultation
(D) Works Committee
Ans: D
13. Statement-I: It is no better to pay employees for little than to pay too much.
Statement-II: Competent employees will remain competent forever.
(A) Statement I is true, but II is false.
(B) Statement II is true, but I is false.
(C) Both Statements I and II are true.
(D) Both Statements I and II are false.
Ans: A
14. Match the following:
a. Credit Control 1. MCA
b. Corporate Control 2. SEBI
c. IPO Control 3. IRDA
d. ULIP Control 4. RBI
Codes:
a b c d
(A) 4 2 3 1
(B) 4 1 2 3
(C) 2 3 4 1
(D) 4 1 3 2
Ans: D
15. Which one among the following has not started Commercial Banking?
(A) SIDBI
(B) IDBI
(C) ICICI
(D) UTI
Ans: A
16. What is OTP in credit card transactions?
(A) Odd Transaction Password
(B) Owner’s Trading Password
(C) One Time Password
(D) One Time Pin code
Ans: C
17. The powers of Controller of Capital Issues of India is now shifted to
(A) Ministry of Finance
(B) SEBI
(C) AMFI
(D) Ministry of Corporate Affairs
Ans: B
18. The success of E-banking depends upon:
i. Multi-layer Security System
ii. Risk and Surveillance Management
iii. Updated Flawless Softwares
iv. Stringent Legal Frame-work
(A) i and ii
(B) i,ii, and iii
(C) ii, iii, and iv
(D) i, ii, iii and iv
Ans: B
19. International liquidity comprises which four of the following?
i. Gold held by Central Banks.
ii. Gold held by families.
iii. Forex Reserve held by Commercial Banks.
iv. Mineral wealth.
v. SDRs.
vi. Borrowing facilities.
vii. NRIs FDRs
viii. Credit facilities available under SWAP.
(A) i, ii, iii, iv
(B) ii, iii, iv, viii
(C) i,iii, v, viii
(D) iii, iv, vii, viii
Ans: C
20. Which among the following are important bodies of WTO?
i. Dispute Settlement Body. ii. NAFTA
iii. Trade Policy Review Body. iv. ASEAN
v. Council for Trade in Goods vi. IBRD
vii. Council for Trade related aspects of Intellectual Property Rights. viii. GATT
An appropriate combination is
(A) i, ii, iii, iv
(B) ii, iii, iv, v
(C) i, iii, v, vii
(D) iv, v, vi, viii
Ans: C
21. Which one is not the source of External Finance?
(A) WTO Funds
(B) World Bank Group
(C) Export Credit
(D) Foreign Direct Investment
Ans: A
22. Which one is called Bretton-Wood Twins?
(A) IBRD and IDA
(B) IMF and IFC
(C) IMF and IBRD
(D) IDA and IFC
Ans: C
23. UNCTAD stands for
(A) United Nations Committee on Tariff and Development.
(B) United Nations Conference on Trade and Deficit.
(C) United Nations Conference on Trade and Development.
(D) Union of Nations Cause for Trade and Development.
Ans: C
24. The idea that a manager tends to be promoted to the level of his incompetence is referred to as
(A) The advancement principle
(B) The Parkinson’s law
(C) The Peter principle
(D) The job design principle
Ans: C
25. Assertion (A): The emphasis in industrial psychology has shifted from the studies of the isolated individual and the physical environment to the consideration of motivation and morale.
Reason (R): A motivated employee with a high morale will always give high productivity.
Codes:
(A) Both (A) and (R) are correct, and (R) is the right explanation of (A).
(B) (A) is correct, but (R) is not correct.
(C) Both (A) and (R) are incorrect.
(D) Both (A) and (R) are correct, but (R) is not the right explanation of (A).
Ans: B
26. Match the following items of List – I and List – II in terms of functions of commercial banks:
List – I List – II
(a) Letter of reference (i) Advancing loans
(b) Sale of gold coins (ii) Receiving deposits
(c) Recurring Account (iii) Non-banking function
(d) Overdrafts (iv) Agency function
Codes:
(a) (b) (c) (d)
(A) (i) (ii) (iii) (iv)
(B) (iv) (iii) (ii) (i)
(C) (iv) (ii) (iii) (i)
(D) (i) (iii) (ii) (iv)
Ans: B
27. Which of the following are included under representation functions of a bank?
(i) Payment of cheques and bills
(ii) Providing remittance facilities
(iii) Underwriting of securities
(iv) Advancing clean credit
(v) Allowing overdrafts on current account
(vi) Purchase and sale of securities
Codes:
(A) (i), (ii), (iii) and (iv)
(B) (iii), (iv), (v) and (vi)
(C) (i), (ii), (iii) and (vi)
(D) (ii), (iii), (v) and (vi)
Ans: C
28. Call money rate is applicable for a very short period to
(A) Inter bank advances
(B) Bank to Reserve Bank advances
(C) Reserve Bank to Bank advances
(D) Commercial Banks to Industrial Banks advances
Ans: A
29. Match the following List – I with List – II:
List – I (Name of Securities) List – II (Type of Securities)
(a) Bonds of Land Development Banks (i) Semi-Government Securities
(b) Treasury Bills (ii) First Order Securities
(c) Shares of a Public Ltd. Co. (iii) Personal Securities
Codes:
(a) (b) (c)
(A) (i) (ii) (iii)
(B) (ii) (i) (iii)
(C) (iii) (ii) (i)
(D) (i) (iii) (ii)
Ans: A
30. Who is called the Father of Scientific Management ?
(a) Henry Fayol (b) F.W. Taylor (c) Peter F. Drucker (d) None of the above
Ans: B
31. Who propounded the Fourteen Principles of Management ?
(a) Henry Fayol (b) F.W. Taylor (c) Peter F. Drucker (d) None of the above
Ans: A
32. The policy of Liberalisation, Privatisation and Globalisation was introduced in the year
(a) 1956 (b) 1975 (c) 1991 (d) 2014
Ans: C
33. Which of the pairs of managerial functions are most closely related ?
(a) Planning and Organising (b) Planning and Control (c) Organising and Staffing (d) Leading and Control
Ans: B
34. If the value of money increases in terms of some foreign currency, such market mechanism is called
(a) Appreciation (b) Depreciation (c) Devaluation (d) Dumping
Ans: A
35. Export surplus is desirable where there is
(a) Excess demand (b) No demand (c) Deficit demand (d) All of the above
Ans: C
36. Which among the following is the most volatile flow of foreign exchange ?
(a) F.D.I. (b) Foreign Portfolio Investment (c) External Commercial Borrowings (d) Foreign aid from IMF
Ans: B
37. WTO came into existence on
(a) 1-1-1990 (b) 1-1-1991 (c) 1-1-1992 (d) 1-1-1995
Ans: D
38. CRR is a special instrument of
(a) Monetary policy (b) Fiscal policy (c) Both (a) and (b) (d) None of the above
Ans: A
39. NPA is a loan or advance for which the principal or interest payment remains overdue for a period of atleast
(a) 60 days (b) 90 days (c) 120 days (d) 180 days
Ans: B
40. The Foreign Exchange Management Act was implemented in
(a) 1974 (b) 1996 (c) 1998 (d) 1999
Ans: D
41. Which of the following agencies is most closely associated with the world trade ?
(a) ADB (b) IMF (c) UNO (d) UNCTAD
Ans: B
42. What is the full form of CBS ?
(a) Core Banking Solution (b) Core Baking Software (c) Core Banking System (d) Core Banking Services
Ans: A
43. The Headquarters of the IBRD is located at
(a) Brussels (b) Paris (c) London (d) Washington, DC
Ans: D
44. The Head office of SIDBI is located at
(a) Delhi (b) Lucknow (c) Mumbai (d) Chennai
Ans: B
45. Credit Control is the main function of
(a) Commercial Banks (b) EXIM Bank (c) R.B.I. (d) None of the above
Ans: C
46. The first five Regional Rural Banks were setup on
(a) 2nd Oct. 1969 (b) 1st April, 1975 (c) 2nd Oct, 1975 (d) 1st April, 1977
Ans: C
47. Demonetization in India was announced on
(a) 1-7-2014 (b) 8-11-2015 (c) 8-11-2016 (d) 1-4-2017
Ans: C
48. In the demonetization in India (2016), which currency notes were demonetized ?
(a) Rs. 500 (b) Rs. 1,000 (c) Both (a) and (b) (d) Rs. 10,000
Ans: C
49. The Consumer Protection Act, 1986 provides certain rights to consumers. How many are these ?
(a) 4 (b) 6 (c) 8 (d) 10
Ans: B
50. Under the Consumer Protection Act, 1986 provides for fine for filing frivolous complaint. The amount of fine is
(a) upto Rs. 10,000 (b) upto Rs. 1,00,000 (c) not less than Rs. 50,000 (d) None of the above
Ans: A
(A) Market targeting
(B) Market positioning
(C) Market segmentation
(D) Market strategy
Ans: C
2. Who plays their significant role in distribution of goods when they do not sell to ultimate users or consumers?
(A) Retailer
(B) Wholeseller
(C) Mediator
(D) Commission agent
Ans: B
3. In Marketing Mix, which four P’s are covered?
(A) Product, Price, Place, promotion
(B) Product, Price, Power, Promotion
(C) Product, Price, Penetration, Promotion
(D) Product, Price, Positioning, Promotion
Ans: A
4. Which research includes all types of researches into human motives when it refers to qualitative research designed to uncover the consumer’s sub consciousness or hidden motivations?
(A) Motivational Research
(B) Marketing Research
(C) Managerial Research
(D) Price Research
Ans: A
5. False and misleading claims and vulgarity in advertisements do not match with
(A) Aggressive advertising
(B) Ethics in advertising
(C) Mass level of advertising
(D) Sales promotion
Ans: B
6. Arrange the following steps involved in capital budgeting in order of their occurrence:
i. Project selection
ii. Project appraisal
iii. Follow up
iv. Project execution
(A) ii, iii, i, v, iv
(B) iii, ii, i, v, iv
(C) i, iii, ii, v, iv
(D) i, ii, iii, v, iv
Ans: B
7. Which method does not consider the time value of money?
(A) Net Present Value
(B) Internal Rate of Return
(C) Average Rate of Return
(D) Profitability
Ans: C
8. Which formula is used measure the degree of Operating leverage?
(A) EBIT/sales
(B) C/EBIT
(C) EBIT/EBT
(D) EBIT/C
Ans: B
9. Which one is more appropriate for cost of retained earnings?
(A) Weighted Average Cost of Capital
(B) Opportunity cost to the firm
(C) Expected rate of return by the investor
(D) None of the above
Ans: B
8. Match the following with the most suitable options.
List-I List-II
a. Modigliani-miller approach 1. Commercial paper
b. Net Operating income approach 2. Working capital
c. Short term money market instrument 3. Capital structure
d. Factoring 4. Arbitrage
Codes:
a b c d
(A) 4 3 1 2
(B) 3 4 1 2
(C) 3 2 1 4
(D) 4 2 3 1
Ans: A
9. During which plan was the National Apprenticeship Training Scheme introduced?
(A) 1st Five Year Plan
(B) 2nd Five Year Plan
(C) 4th Five Year Plan
(D) Annual Plans
Ans: B
10. Match the following:
List-I List-II
a. An ordinary person does not want to work on his own 1. Hierarchy Theory
b. An individual is willing to work on his own 2. Hygiene Theory
c. Motivational Factors 3. X-Theory
d. Esteem Needs 4. Y-Theory
Codes:
a b c d
(A) 1 2 3 4
(B) 3 4 1 2
(C) 1 4 2 3
(D) 3 4 2 1
Ans: D
11. Arrange the following staffing procedures in the correct sequences:
i. Determining sources of Personnel supply
ii. Preparing personal specifications.
iii. Selection of personnel.
iv. Determining personnel characteristics
(A) ii, i, iv, iii
(B) i, ii, iii, iv
(C) ii, i, iii, iv
(D) ii, iii, i, iv
Ans: A
12. Which among the following is not a voluntary method for prevention and settlement of disputes?
(A) Collective Bargaining
(B) Standing orders
(C) Joint Consultation
(D) Works Committee
Ans: D
13. Statement-I: It is no better to pay employees for little than to pay too much.
Statement-II: Competent employees will remain competent forever.
(A) Statement I is true, but II is false.
(B) Statement II is true, but I is false.
(C) Both Statements I and II are true.
(D) Both Statements I and II are false.
Ans: A
14. Match the following:
a. Credit Control 1. MCA
b. Corporate Control 2. SEBI
c. IPO Control 3. IRDA
d. ULIP Control 4. RBI
Codes:
a b c d
(A) 4 2 3 1
(B) 4 1 2 3
(C) 2 3 4 1
(D) 4 1 3 2
Ans: D
15. Which one among the following has not started Commercial Banking?
(A) SIDBI
(B) IDBI
(C) ICICI
(D) UTI
Ans: A
16. What is OTP in credit card transactions?
(A) Odd Transaction Password
(B) Owner’s Trading Password
(C) One Time Password
(D) One Time Pin code
Ans: C
17. The powers of Controller of Capital Issues of India is now shifted to
(A) Ministry of Finance
(B) SEBI
(C) AMFI
(D) Ministry of Corporate Affairs
Ans: B
18. The success of E-banking depends upon:
i. Multi-layer Security System
ii. Risk and Surveillance Management
iii. Updated Flawless Softwares
iv. Stringent Legal Frame-work
(A) i and ii
(B) i,ii, and iii
(C) ii, iii, and iv
(D) i, ii, iii and iv
Ans: B
19. International liquidity comprises which four of the following?
i. Gold held by Central Banks.
ii. Gold held by families.
iii. Forex Reserve held by Commercial Banks.
iv. Mineral wealth.
v. SDRs.
vi. Borrowing facilities.
vii. NRIs FDRs
viii. Credit facilities available under SWAP.
(A) i, ii, iii, iv
(B) ii, iii, iv, viii
(C) i,iii, v, viii
(D) iii, iv, vii, viii
Ans: C
20. Which among the following are important bodies of WTO?
i. Dispute Settlement Body. ii. NAFTA
iii. Trade Policy Review Body. iv. ASEAN
v. Council for Trade in Goods vi. IBRD
vii. Council for Trade related aspects of Intellectual Property Rights. viii. GATT
An appropriate combination is
(A) i, ii, iii, iv
(B) ii, iii, iv, v
(C) i, iii, v, vii
(D) iv, v, vi, viii
Ans: C
21. Which one is not the source of External Finance?
(A) WTO Funds
(B) World Bank Group
(C) Export Credit
(D) Foreign Direct Investment
Ans: A
22. Which one is called Bretton-Wood Twins?
(A) IBRD and IDA
(B) IMF and IFC
(C) IMF and IBRD
(D) IDA and IFC
Ans: C
23. UNCTAD stands for
(A) United Nations Committee on Tariff and Development.
(B) United Nations Conference on Trade and Deficit.
(C) United Nations Conference on Trade and Development.
(D) Union of Nations Cause for Trade and Development.
Ans: C
24. The idea that a manager tends to be promoted to the level of his incompetence is referred to as
(A) The advancement principle
(B) The Parkinson’s law
(C) The Peter principle
(D) The job design principle
Ans: C
25. Assertion (A): The emphasis in industrial psychology has shifted from the studies of the isolated individual and the physical environment to the consideration of motivation and morale.
Reason (R): A motivated employee with a high morale will always give high productivity.
Codes:
(A) Both (A) and (R) are correct, and (R) is the right explanation of (A).
(B) (A) is correct, but (R) is not correct.
(C) Both (A) and (R) are incorrect.
(D) Both (A) and (R) are correct, but (R) is not the right explanation of (A).
Ans: B
26. Match the following items of List – I and List – II in terms of functions of commercial banks:
List – I List – II
(a) Letter of reference (i) Advancing loans
(b) Sale of gold coins (ii) Receiving deposits
(c) Recurring Account (iii) Non-banking function
(d) Overdrafts (iv) Agency function
Codes:
(a) (b) (c) (d)
(A) (i) (ii) (iii) (iv)
(B) (iv) (iii) (ii) (i)
(C) (iv) (ii) (iii) (i)
(D) (i) (iii) (ii) (iv)
Ans: B
27. Which of the following are included under representation functions of a bank?
(i) Payment of cheques and bills
(ii) Providing remittance facilities
(iii) Underwriting of securities
(iv) Advancing clean credit
(v) Allowing overdrafts on current account
(vi) Purchase and sale of securities
Codes:
(A) (i), (ii), (iii) and (iv)
(B) (iii), (iv), (v) and (vi)
(C) (i), (ii), (iii) and (vi)
(D) (ii), (iii), (v) and (vi)
Ans: C
28. Call money rate is applicable for a very short period to
(A) Inter bank advances
(B) Bank to Reserve Bank advances
(C) Reserve Bank to Bank advances
(D) Commercial Banks to Industrial Banks advances
Ans: A
29. Match the following List – I with List – II:
List – I (Name of Securities) List – II (Type of Securities)
(a) Bonds of Land Development Banks (i) Semi-Government Securities
(b) Treasury Bills (ii) First Order Securities
(c) Shares of a Public Ltd. Co. (iii) Personal Securities
Codes:
(a) (b) (c)
(A) (i) (ii) (iii)
(B) (ii) (i) (iii)
(C) (iii) (ii) (i)
(D) (i) (iii) (ii)
Ans: A
30. Who is called the Father of Scientific Management ?
(a) Henry Fayol (b) F.W. Taylor (c) Peter F. Drucker (d) None of the above
Ans: B
31. Who propounded the Fourteen Principles of Management ?
(a) Henry Fayol (b) F.W. Taylor (c) Peter F. Drucker (d) None of the above
Ans: A
32. The policy of Liberalisation, Privatisation and Globalisation was introduced in the year
(a) 1956 (b) 1975 (c) 1991 (d) 2014
Ans: C
33. Which of the pairs of managerial functions are most closely related ?
(a) Planning and Organising (b) Planning and Control (c) Organising and Staffing (d) Leading and Control
Ans: B
34. If the value of money increases in terms of some foreign currency, such market mechanism is called
(a) Appreciation (b) Depreciation (c) Devaluation (d) Dumping
Ans: A
35. Export surplus is desirable where there is
(a) Excess demand (b) No demand (c) Deficit demand (d) All of the above
Ans: C
36. Which among the following is the most volatile flow of foreign exchange ?
(a) F.D.I. (b) Foreign Portfolio Investment (c) External Commercial Borrowings (d) Foreign aid from IMF
Ans: B
37. WTO came into existence on
(a) 1-1-1990 (b) 1-1-1991 (c) 1-1-1992 (d) 1-1-1995
Ans: D
38. CRR is a special instrument of
(a) Monetary policy (b) Fiscal policy (c) Both (a) and (b) (d) None of the above
Ans: A
39. NPA is a loan or advance for which the principal or interest payment remains overdue for a period of atleast
(a) 60 days (b) 90 days (c) 120 days (d) 180 days
Ans: B
40. The Foreign Exchange Management Act was implemented in
(a) 1974 (b) 1996 (c) 1998 (d) 1999
Ans: D
41. Which of the following agencies is most closely associated with the world trade ?
(a) ADB (b) IMF (c) UNO (d) UNCTAD
Ans: B
42. What is the full form of CBS ?
(a) Core Banking Solution (b) Core Baking Software (c) Core Banking System (d) Core Banking Services
Ans: A
43. The Headquarters of the IBRD is located at
(a) Brussels (b) Paris (c) London (d) Washington, DC
Ans: D
44. The Head office of SIDBI is located at
(a) Delhi (b) Lucknow (c) Mumbai (d) Chennai
Ans: B
45. Credit Control is the main function of
(a) Commercial Banks (b) EXIM Bank (c) R.B.I. (d) None of the above
Ans: C
46. The first five Regional Rural Banks were setup on
(a) 2nd Oct. 1969 (b) 1st April, 1975 (c) 2nd Oct, 1975 (d) 1st April, 1977
Ans: C
47. Demonetization in India was announced on
(a) 1-7-2014 (b) 8-11-2015 (c) 8-11-2016 (d) 1-4-2017
Ans: C
48. In the demonetization in India (2016), which currency notes were demonetized ?
(a) Rs. 500 (b) Rs. 1,000 (c) Both (a) and (b) (d) Rs. 10,000
Ans: C
49. The Consumer Protection Act, 1986 provides certain rights to consumers. How many are these ?
(a) 4 (b) 6 (c) 8 (d) 10
Ans: B
50. Under the Consumer Protection Act, 1986 provides for fine for filing frivolous complaint. The amount of fine is
(a) upto Rs. 10,000 (b) upto Rs. 1,00,000 (c) not less than Rs. 50,000 (d) None of the above
Ans: A
51. Why is the total of both sides of the balance sheet is equal ?
(a) Due to the assets and liabilities being equal (b) Due to the double-entry system of accounting
(c) Due to the correctness of trial balance (d) Due to all of the above
Ans: B
52. The ideal current ratio for a business entity is
(a) 1 : 1 (b) 1 : 2 (c) 2 : 1 (d) 3 : 1
Ans: C
53. Net working capital is
(a) excess of current assets over current liabilities
(b) excess of current liabilities over current assets
(c) excess of fixed assets over fixed liabilities
(d) excess of fixed liabilities over fixed assets
Ans: A
54. Which of the following is shown in the Profit and Loss Appropriation Account ?
(a) Provision for Income tax (b) Provision for Depreciation
(c) Provision for Doubtful debts (d) Contribution to General Reserve
Ans: D
55. The Premium received on issue of shares is shown in
(a) Credit side of the P & L A/c. (b) Debit side of the P & L A/c.
(c) Assets side of the Balance Sheet (d) Liabilities side of the Balance Sheet
Ans: D
56. The most rigorous test of liquidity is
(a) Acid test ratio (b) Current ratio (c) Quick ratio (d) None of the above
Ans: A
57. Which one of the following can be used for statistical calculations and preparation of graphs ?
(a) Adobe Photoshop (b) Excel (c) Notepad (d) PowerPoint
Ans: B
58. The difference between the subscribed capital and called up capital is called
(a) Calls in arrear (b) Uncalled capital (c) Calls in advance (d) None of the above
Ans: B
59. Share Application Account is a
(a) Nominal Account (b) Real Account (c) Personal Account (d) None of the above
Ans: C
60. Under the Hire-Purchase system, the interest for each period is to be calculated on the balance of
(a) Cash price remaining unpaid (b) Installment price remaining unpaid
(c) Cash price minus the installment paid (d) None of the above
Ans: A
61. The real amount of share capital is
(a) Authorised Capital (b) Issued Capital (c) Subscribed Capital (d) Paid up Capital
Ans: D
62. The balance of the Share Forfeited A/c. after the re-issue of the forfeited shares is transferred to
(a) General Reserve Account (b) Capital Redemption Reserve Account
(c) Revenue Reserve Account (d) Capital Reserve Account
Ans: D
63. The Advance Income tax is shown in
(a) Assets side of the Balance Sheet (b) Debit side of the P & L A/c.
(c) Credit side of the P & L A/c. (d) Liabilities side of the Balance Sheet
Ans: A
64. The inter-section of a column and a row on a worksheet is called
(a) Cell (b) Column (c) Address (d) Value
Ans: A
65. Under the Hire-Purchase system the buyer of the asset charges the depreciation on
(a) Hire-purchase price of the asset (b) Cash price of the asset (c) Lower of the two (d) None of the above
Ans: B
66. Redeemable Preference Shares can be redeemed out of
(a) The Divisible Profits (b) The proceeds of the fresh issue of shares
(c) Both (a) and (b) (d) Sale proceeds of fixed assets
Ans: C
67. The preference shareholders of the company are
(a) the creditors of the company (b) the owners of the company
(c) Both (a) and (b) (d) None of the above
Ans: B
68. The ‘Rights Shares’ are offered to
(a) Directors of the company (b) Debenture-holders of the company
(c) Creditors of the company (d) Existing share-holders of the company
Ans: D
69. The long-term solvency is indicated by
(a) Current ratio (b) Debt-equity ratio (c) Net profit ratio (d) None of the above
Ans: B
70. Which one of the following ratios is not a leverage ratio ?
(a) Debt-equity ratio (b) Quick ratio (c) Total debt ratio (d) Interest coverage ratio
Ans: B
71. Which of the following securities does not create a fixed burden on the company ?
(a) Equity Share (b) Preference Share (c) Debenture (d) None of the above
Ans: A
72. The payout ratio is concerned with
(a) The salary and bonus, etc., paid to employees. (b) The distribution of dividend to the share-holders
(c) The payment of interest to creditors (d) None of the above
Ans: B
73. If the bad debts are given in adjustment, it will be shown in
(a) Trading Account (b) Profit and Loss Account (c) Profit and Loss Account and Balance Sheet (d) Balance Sheet
Ans: C
74. Prepaid Expenses A/c. is a
(a) Personal Account (b) Real Account (c) Nominal Account (d) None of the above
Ans: A
75. The process of taking entries from Subsidiary books to Ledger is called
(a) Journalising (b) Posting (c) Transferring (d) None of the above
Ans: B
76. The Debit Balance of a Nominal Account indicates
(a) Expenses and losses of the business (b) Income and gains in the business
(c) Profits of the business (d) Assets of the business
Ans: A
77. A book used to record small cash payments is called
(a) Petty cash book (b) Cash book (c) Two columnar cash book (d) None of the above
Ans: A
78. A manager is entitled to receive commission @ 5% on net profit after charging such commission. The gross profit of the firm is Rs. 8,000 and selling expenses amounted to Rs. 5,900. His commission will be
(a) Rs. 100 (b)Rs. 105 (c)Rs. 210 (d) Rs. 400
Ans: A
79. Which of the following errors is not disclosed by Trial Balance ?
(a) Compensating errors (b) Errors of principles (c) Errors of omission (d) All of the above
Ans: D
80. The Journal is a book of
(a) original records (b) cash records (c) secondary records (d) credit record
Ans: A
81. Showing contingent liabilities as a footnote in the Balance Sheet is based on which of the following ?
(a) Convention of Disclosure (b) Cost Concept (c) Convention of Consistency (d) Convention of Conservatism
Ans: A
82. The closing stock is generally valued at
(a) Cost price
(b) Market price
(c) Cost price or market price, whichever is lower
(d) Cost price or market price, whichever is higher
Ans: C
83. The Suspense Account is opened for the purpose of balancing
(a) Personal Account (b) Real Account (c) Nominal Account (d) Trial Balance
Ans: D
84. Accounting Standard-19 pertains to
(a) Valuation of Inventory (b) Lease Accounting
(c) Net profit or loss for the period, prior period and change in accounting policies (d) Cash flow statement
Ans: B
85. International Financial Reporting Standard-3 pertains to
(a) Financial Instruments (b) Business Combinations (c) Revenue (d) Depreciation Accounting
Ans: B
86. If the profit is 25% on the cost price, then the profit on sales price will be
(a) 30%
(b) 20%
(c) 33%
(d) 40%
Ans: B
87. The Bills Receivables Account is a
(a) Personal Account (b) Real Account (c) Nominal Account (d) None of the above
Ans: A
88. The Bank Balance as per the Passbook is Rs. 20,000. Dividend of Rs. 1,000 collected by bank but has been recorded in the Cashbook as Rs. 100. The Cashbook balance shall be
(a) Rs. 20,100 (b) Rs. 21,000 (c) Rs. 19,100 (d) Rs. 19,900
Ans: C
89. If the closing stock appears in the Trial Balance, then it will also appear in
(a) Trading Account (b) Profit and Loss Account (c) Balance Sheet (d) None of the above
Ans: C
90. According to the Accrual Concept of Accounting, all financial transactions are recorded when
(a) the transaction occurs (b) the profit is computed (c) the balance sheet is prepared (d) the cash is received
Ans: A
91. Which accounting concept indicates that the business transaction should be recorded separately from the owner of the firm ?
(a) The materiality concept (b) Separate business entity concept
(c) Time period concept (d) None of the above
Ans: B
92. The Income and Expenditure Account is based on
(a) Government Accounting (b) Management Accounting
(c) Accrual Accounting (d) Cash Accounting
Ans: C
93. Which of the following is recorded in the Income and Expenditure Account ?
(a) Purchase of furniture (b) Renovation of building (c) Profit on sale of fixed assets (d) None of the above
Ans: C
94. The capital of a non-profit organisation is generally called
(a) Cash fund (b) Financial reserve (c) Accumulated fund (d) Equity
Ans: C
95. Which of the following is not a tool of financial analysis ?
(a) Comparative statement (b) Break-even analysis (c) Trend analysis (d) Ratio analysis
Ans: B
96. Workmen compensation fund is a
(a) Provision (b) Surplus (c) Current Liabilities (d) Loan
Ans: A
97. The Central Govt. Scheme “UDAAN” to provide skills training and enhance the employability of unemployed youth, is applicable to which state ?
(a) J&K (b) Assam (c) Uttarakhand (d) Manipur
Ans: A
98. Which option is used to place data taken in pen drive to appropriate place in Tally ?
(a) Split company data (b) Backup (c) Restore (d) None of these
Ans: C
99. Debenture Premium cannot be used to
(a) Write off capital loss (b) Pay Dividend (c) Write off discount on debenture (d) None of these
Ans: B
100. Which option is used in Tally to make changes in created company ?
(a) Shut company (b) Select company (c) Alter (d) None of these
Ans: C
(a) Due to the assets and liabilities being equal (b) Due to the double-entry system of accounting
(c) Due to the correctness of trial balance (d) Due to all of the above
Ans: B
52. The ideal current ratio for a business entity is
(a) 1 : 1 (b) 1 : 2 (c) 2 : 1 (d) 3 : 1
Ans: C
53. Net working capital is
(a) excess of current assets over current liabilities
(b) excess of current liabilities over current assets
(c) excess of fixed assets over fixed liabilities
(d) excess of fixed liabilities over fixed assets
Ans: A
54. Which of the following is shown in the Profit and Loss Appropriation Account ?
(a) Provision for Income tax (b) Provision for Depreciation
(c) Provision for Doubtful debts (d) Contribution to General Reserve
Ans: D
55. The Premium received on issue of shares is shown in
(a) Credit side of the P & L A/c. (b) Debit side of the P & L A/c.
(c) Assets side of the Balance Sheet (d) Liabilities side of the Balance Sheet
Ans: D
56. The most rigorous test of liquidity is
(a) Acid test ratio (b) Current ratio (c) Quick ratio (d) None of the above
Ans: A
57. Which one of the following can be used for statistical calculations and preparation of graphs ?
(a) Adobe Photoshop (b) Excel (c) Notepad (d) PowerPoint
Ans: B
58. The difference between the subscribed capital and called up capital is called
(a) Calls in arrear (b) Uncalled capital (c) Calls in advance (d) None of the above
Ans: B
59. Share Application Account is a
(a) Nominal Account (b) Real Account (c) Personal Account (d) None of the above
Ans: C
60. Under the Hire-Purchase system, the interest for each period is to be calculated on the balance of
(a) Cash price remaining unpaid (b) Installment price remaining unpaid
(c) Cash price minus the installment paid (d) None of the above
Ans: A
61. The real amount of share capital is
(a) Authorised Capital (b) Issued Capital (c) Subscribed Capital (d) Paid up Capital
Ans: D
62. The balance of the Share Forfeited A/c. after the re-issue of the forfeited shares is transferred to
(a) General Reserve Account (b) Capital Redemption Reserve Account
(c) Revenue Reserve Account (d) Capital Reserve Account
Ans: D
63. The Advance Income tax is shown in
(a) Assets side of the Balance Sheet (b) Debit side of the P & L A/c.
(c) Credit side of the P & L A/c. (d) Liabilities side of the Balance Sheet
Ans: A
64. The inter-section of a column and a row on a worksheet is called
(a) Cell (b) Column (c) Address (d) Value
Ans: A
65. Under the Hire-Purchase system the buyer of the asset charges the depreciation on
(a) Hire-purchase price of the asset (b) Cash price of the asset (c) Lower of the two (d) None of the above
Ans: B
66. Redeemable Preference Shares can be redeemed out of
(a) The Divisible Profits (b) The proceeds of the fresh issue of shares
(c) Both (a) and (b) (d) Sale proceeds of fixed assets
Ans: C
67. The preference shareholders of the company are
(a) the creditors of the company (b) the owners of the company
(c) Both (a) and (b) (d) None of the above
Ans: B
68. The ‘Rights Shares’ are offered to
(a) Directors of the company (b) Debenture-holders of the company
(c) Creditors of the company (d) Existing share-holders of the company
Ans: D
69. The long-term solvency is indicated by
(a) Current ratio (b) Debt-equity ratio (c) Net profit ratio (d) None of the above
Ans: B
70. Which one of the following ratios is not a leverage ratio ?
(a) Debt-equity ratio (b) Quick ratio (c) Total debt ratio (d) Interest coverage ratio
Ans: B
71. Which of the following securities does not create a fixed burden on the company ?
(a) Equity Share (b) Preference Share (c) Debenture (d) None of the above
Ans: A
72. The payout ratio is concerned with
(a) The salary and bonus, etc., paid to employees. (b) The distribution of dividend to the share-holders
(c) The payment of interest to creditors (d) None of the above
Ans: B
73. If the bad debts are given in adjustment, it will be shown in
(a) Trading Account (b) Profit and Loss Account (c) Profit and Loss Account and Balance Sheet (d) Balance Sheet
Ans: C
74. Prepaid Expenses A/c. is a
(a) Personal Account (b) Real Account (c) Nominal Account (d) None of the above
Ans: A
75. The process of taking entries from Subsidiary books to Ledger is called
(a) Journalising (b) Posting (c) Transferring (d) None of the above
Ans: B
76. The Debit Balance of a Nominal Account indicates
(a) Expenses and losses of the business (b) Income and gains in the business
(c) Profits of the business (d) Assets of the business
Ans: A
77. A book used to record small cash payments is called
(a) Petty cash book (b) Cash book (c) Two columnar cash book (d) None of the above
Ans: A
78. A manager is entitled to receive commission @ 5% on net profit after charging such commission. The gross profit of the firm is Rs. 8,000 and selling expenses amounted to Rs. 5,900. His commission will be
(a) Rs. 100 (b)Rs. 105 (c)Rs. 210 (d) Rs. 400
Ans: A
79. Which of the following errors is not disclosed by Trial Balance ?
(a) Compensating errors (b) Errors of principles (c) Errors of omission (d) All of the above
Ans: D
80. The Journal is a book of
(a) original records (b) cash records (c) secondary records (d) credit record
Ans: A
81. Showing contingent liabilities as a footnote in the Balance Sheet is based on which of the following ?
(a) Convention of Disclosure (b) Cost Concept (c) Convention of Consistency (d) Convention of Conservatism
Ans: A
82. The closing stock is generally valued at
(a) Cost price
(b) Market price
(c) Cost price or market price, whichever is lower
(d) Cost price or market price, whichever is higher
Ans: C
83. The Suspense Account is opened for the purpose of balancing
(a) Personal Account (b) Real Account (c) Nominal Account (d) Trial Balance
Ans: D
84. Accounting Standard-19 pertains to
(a) Valuation of Inventory (b) Lease Accounting
(c) Net profit or loss for the period, prior period and change in accounting policies (d) Cash flow statement
Ans: B
85. International Financial Reporting Standard-3 pertains to
(a) Financial Instruments (b) Business Combinations (c) Revenue (d) Depreciation Accounting
Ans: B
86. If the profit is 25% on the cost price, then the profit on sales price will be
(a) 30%
(b) 20%
(c) 33%
(d) 40%
Ans: B
87. The Bills Receivables Account is a
(a) Personal Account (b) Real Account (c) Nominal Account (d) None of the above
Ans: A
88. The Bank Balance as per the Passbook is Rs. 20,000. Dividend of Rs. 1,000 collected by bank but has been recorded in the Cashbook as Rs. 100. The Cashbook balance shall be
(a) Rs. 20,100 (b) Rs. 21,000 (c) Rs. 19,100 (d) Rs. 19,900
Ans: C
89. If the closing stock appears in the Trial Balance, then it will also appear in
(a) Trading Account (b) Profit and Loss Account (c) Balance Sheet (d) None of the above
Ans: C
90. According to the Accrual Concept of Accounting, all financial transactions are recorded when
(a) the transaction occurs (b) the profit is computed (c) the balance sheet is prepared (d) the cash is received
Ans: A
91. Which accounting concept indicates that the business transaction should be recorded separately from the owner of the firm ?
(a) The materiality concept (b) Separate business entity concept
(c) Time period concept (d) None of the above
Ans: B
92. The Income and Expenditure Account is based on
(a) Government Accounting (b) Management Accounting
(c) Accrual Accounting (d) Cash Accounting
Ans: C
93. Which of the following is recorded in the Income and Expenditure Account ?
(a) Purchase of furniture (b) Renovation of building (c) Profit on sale of fixed assets (d) None of the above
Ans: C
94. The capital of a non-profit organisation is generally called
(a) Cash fund (b) Financial reserve (c) Accumulated fund (d) Equity
Ans: C
95. Which of the following is not a tool of financial analysis ?
(a) Comparative statement (b) Break-even analysis (c) Trend analysis (d) Ratio analysis
Ans: B
96. Workmen compensation fund is a
(a) Provision (b) Surplus (c) Current Liabilities (d) Loan
Ans: A
97. The Central Govt. Scheme “UDAAN” to provide skills training and enhance the employability of unemployed youth, is applicable to which state ?
(a) J&K (b) Assam (c) Uttarakhand (d) Manipur
Ans: A
98. Which option is used to place data taken in pen drive to appropriate place in Tally ?
(a) Split company data (b) Backup (c) Restore (d) None of these
Ans: C
99. Debenture Premium cannot be used to
(a) Write off capital loss (b) Pay Dividend (c) Write off discount on debenture (d) None of these
Ans: B
100. Which option is used in Tally to make changes in created company ?
(a) Shut company (b) Select company (c) Alter (d) None of these
Ans: C