Assertion (A): The maximum number of partners has been specified in the Companies Act. 1956.Reason (R): The Partnership Act, 1932 has been merged with the Companies Act, 1956.
A. Both (A) and (R) are true and (R) is the correct explanation of (A)
B. Both (A) and (R) are true, but (R) is not correct explanation of (A)
C. (A) is true but (R) is false
D. (A) is false but (R) is true
Select an option to see the answer and solution.
Which of the following statements is not correct:
A. Bonus shares cannot be issued except out of the profits of the company
B. Bonus shares can be issued either at par or at a premium
C. Only fully paid bonus shares can be issued out of capital redemption reserve
D. Bonus can be utilised for making partly paid up shares as fully paid up
Select an option to see the answer and solution.
Buy back of equity shares in any financial year shall not exceed
A. 5% of its total capital
B. 25% of nominal share capital
C. 25% of fully paid equity share capital
D. None of the above
Select an option to see the answer and solution.
As applied in Accounting, depreciation:
A. is a process of asset valuation for balance sheet purposes
B. applies only to long life intangible assets
C. is used to indicate a decline in the market value of long-life asset
D. is an accounting process which allocates to cost of long-life asset to various accounting periods
Select an option to see the answer and solution.
Advertising expenses done on launching of a new product are treated as
A. Capital Expenditure
B. Revenue Expenditure
C. Deferred Revenue Expenditure
D. None of these
Select an option to see the answer and solution.
The Debt Equity ratio of a company for three consecutive years was as follows:
Year
Debt Equity Ratio
1989
28 399
1990
34 493
1991
42 624
The aforesaid ratios show:
A. That the company's financial structure is sound
B. That the company is capable of meeting its shrot-term liabilities
C. That the interests of creditors are not safe in the company
D. That the long-term liquidity of the company is improving from year to year
Select an option to see the answer and solution.
A and B are partners in a partnership firm without any agreement. A has given a loan of Rs. 50,000 to the firm. At the end of the year, the business incurred loss. The following interest may be paid to A by the firm
A. 5% per annum
B. 6% per annum
C. 6% per month
D. As there is a loss in the business, interest cannot be paid
Select an option to see the answer and solution.
In which method of depreciation, asset account is debited with interest?
A. Sum of year's digit method
B. Annuity method
C. Insurance policy method
D. Diminishing Balance Method
Select an option to see the answer and solution.
Unless otherwise stated, a Preference Share is always presumed to be
A. cumulative, participating and non-convertible
B. non-cumulative, non-participating and non convertible
C. cumulative, non-participating and non convertible
D. non-cumulative, participating and non convertible
Select an option to see the answer and solution.
Which of the following is not business transaction?
A. Purchase Rs. 1,00,00 furniture for business
B. Paid his son's fee Rs. 20,000 from his personal bank account
C. Paid employees salary Rs. 50,000
D. Purchased goods worth Rs. 75,000
Select an option to see the answer and solution.
Dissolution of partnership must take place when:
A. a partner misbehave
B. a partner becomes of unsound mind
C. business is running at a loss
D. a partner dies
Select an option to see the answer and solution.
If the withdrawals are made by the partners evenly in the beginning of each month, interest is usually calculated for the whole of the amount (annual) for:
A. 5 months
B. 5 and half months
C. 6 months
D. 6 and half months
E. Average of 12 months
Select an option to see the answer and solution.
In certainty equivalent approach, adjusted cash flows are discounted at:
A. Accounting Rate of Return
B. Internal Rate of Return
C. Hurdle Rate
D. Risk Free Rate
Select an option to see the answer and solution.
Accounting Standard-14 is
A. Accounting for amalgamation
B. Accounting for government grant
C. Accounting for investment
D. Accounting for intangible asset
Select an option to see the answer and solution.
Share capital account . . . . . . . . when shares are forfeited.
A. Debit
B. Both of the above
C. Credit
D. None of the above
Select an option to see the answer and solution.
Working capital of previous year and current year are Rs. -50,000 and Rs. 60,000 respectively, then the amount of change in the working capital will be:
A. Increase of Rs. 10,000
B. Decrease of Rs. 10,000
C. Increase of Rs. 1,10,000
D. Decrease of Rs. 1,10,000
Select an option to see the answer and solution.
On the dissolution of a firm, the amount realized from an unrecorded asset is transferred to
A. Revaluation Account
B. Realization Account
C. Partner's Capital Account
D. Credit side of Cash Account
Select an option to see the answer and solution.
If cost is Rs. 18,000 and profit is 33 3 1 %
A. Rs. 2,000
B. Rs. 3,000
C. Rs. 6,000
D. None of the above
Select an option to see the answer and solution.
A partnership firm is illegal when
A. Any of the partners is from enemy country
B. Established for unlimited period
C. There are seven partners
D. Registered under the Partnership Act
Select an option to see the answer and solution.
What is the use of managerial accounting?
A. Mandatory
B. Optional
C. Mortgage
D. None of these
Select an option to see the answer and solution.
