Commerce MCQ

1) In accordance with GAAP, which of the following methods of amortization is normally recommended for intangible assets?
A) Straight line
B) Units of production
C) Both options A and B
D) None of these

2) Match List I with List II and select the correct answer by using the codes given below :
List I (Type of Assets)
A. Lease
B. Freehold building
C. Livestock
D. Quarries
List II (Method of Depreciation)
1. Depletion method
2. Revaluation method
3. Fixed Installment method
4. Fixed method

A) A4-B3-C2-D1
B) A1-B2-C4-D3
C) A1-B3-C2-D4
D) None of these

3) At the time of dissolution of a partnership firm, an unrecorded liability is taken over by a partner. What will be the journal entry of this action?
A) Realisation A/c debit; Liability A/c credit
B) Liability A/c debit; Realisation A/c credit
C) Liability A/c debit; Partner's capital A/c credit
D) Realisation A/c debit; Partner's capital A/c credit

4) Which of the following item doesn't appear under the head "Miscellaneous expenditure" ?
A) Preliminary expenses
B) Day to day miscellaneous administrative expenses
C) Discount on issues of shares and debentures
D) None if these

5) Capital reduction account is prepared in the case of
A) External reconstruction of a company
B) Internal reconstruction of a company
C) Amalgamation of two companies
D) Both options B and C

6) For what type of Company, high geared capital structure is created?
A) a company which is newly setup and making moderate profit
B) A company which is making loss
C) a company which is matured one and making huge profits
D) None of these

7) In which of the following companies, an auditor is not required to check the sale of shares, debentures or other securities which have been sold at a price less than their cost?
A) Banking company
B) Manufacturing company
C) Service oriented company
D) Non Banking Financial Company

8) The audit of executive action and plans bearing on the finance and expenditure of a company, is known as
A) Performance audit
B) Propriety audit
C) Operational audit
D) None of these

9) In hierarchical nature of planning, which of the following is the correct hierarchy?
A) Objectives-Policies-Strategies-Programmes
B) Objectives-Strategies-Programs-Policies
C) Policies-Programmes-Objectives-Strategies

10) Who issues the small exporters policy?
A) ECGC
B) FICCI
C) RBI
D) Ministry of Commerce and Industry



ANSWERS:-
1) A
2) A
3) D
4) B
5) B
6) C
7) D
8) A
9) A
10) D
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