Question 1

The estimate about useful life of a fixed asset:

Accepted Answer

A) Can never be changed 
B) Can be changed 
C) all 
D) none 
A) Can never be changed 
B) Can be changed 
C) all 
D) none

Question 2

Debenture holder receive:

Accepted Answer

A) Fixed Interest 
B) Dividend 
C) Profit 
D) None of them 
A) Fixed Interest 
B) Dividend 
C) Profit 
D) None of them

Question 3

Share Capital in the balance sheet is shown under:

Accepted Answer

A) Asset 
B) Liability 
C) Income 
D) Resource 
A) Asset 
B) Liability 
C) Income 
D) Resource

Question 4

Depletion Method of depreciation is used in:

Accepted Answer

A) Cattle, Loose tools etc. 
B) Mines, Quarries etc. 
C) Machinery, Building, Furniture etc. 
D) none 
A) Cattle, Loose tools etc. 
B) Mines, Quarries etc. 
C) Machinery, Building, Furniture etc. 
D) none

Question 5

When shares issued at premium which of the following account is credited?

Accepted Answer

A) Share premium account 
B) Share first call account 
C) Share allotment account 
D) Share forfeited account 
A) Share premium account 
B) Share first call account 
C) Share allotment account 
D) Share forfeited account

Question 6

Which of the company's capital is not shown in balance sheet?

Accepted Answer

A) Authorized Capital 
B) Issued and Subscribed Capital 
C) Called and Paid up Capital 
D) Reserve Capital 
A) Authorized Capital 
B) Issued and Subscribed Capital 
C) Called and Paid up Capital 
D) Reserve Capital

Question 7

Depreciation is a process of:

Accepted Answer

A) Valuation of asset 
B) Allocation of cost 
C) Both A& B 
D) Only A 
A) Valuation of asset 
B) Allocation of cost 
C) Both A& B 
D) Only A

Question 8

For providing depreciation on leasehold property, the appropriate method of depreciation is:

Accepted Answer

A) Replacement Method 
B) Revaluation Method 
C) Fixed Installment Method 
D) none 
A) Replacement Method 
B) Revaluation Method 
C) Fixed Installment Method 
D) none

Question 9

Share allotment account is a ------------------

Accepted Answer

A) Personal Account 
B) Real Account 
C) Nominal Account 
D) Impersonal Account 
A) Personal Account 
B) Real Account 
C) Nominal Account 
D) Impersonal Account

Question 10

Debenture is treated in books of account as:

Accepted Answer

A) Personal account 
B) Nominal account 
C) Real account 
D) None of the above 
A) Personal account 
B) Nominal account 
C) Real account 
D) None of the above

Question 11

The amount of depreciation charged on a machinery will be debited to:

Accepted Answer

A) Machinery Account 
B) Depreciation Account 
C) Cash Account 
D) Repair Account 
A) Machinery Account 
B) Depreciation Account 
C) Cash Account 
D) Repair Account

Question 12

Amortization applies to

Accepted Answer

A) Current assets. 
B) Wasting assets. 
C) Intangible assets. 
D) Fixed assets 
A) Current assets. 
B) Wasting assets. 
C) Intangible assets. 
D) Fixed assets

Question 13

Premium on issue of shares can be used for -----------.

Accepted Answer

A) distribution of dividend 
B) writing off capital losses 
C) transferring to general reserve 
D) paying fees to directors 
A) distribution of dividend 
B) writing off capital losses 
C) transferring to general reserve 
D) paying fees to directors

Question 14

Shareholder's funds include:

Accepted Answer

A) Equity share capital and General Reserve 
B) Preference share capital and capital reserve 
C) Share capital and capital reserve 
D) Share capital and reserve and surplus 
A) Equity share capital and General Reserve 
B) Preference share capital and capital reserve 
C) Share capital and capital reserve 
D) Share capital and reserve and surplus

Question 15

In case of Annuity Method, the amount of depreciation is:

Accepted Answer

A) Increasing every year 
B) Fixed for all the year 
C) Decreasing every year 
D) none 
A) Increasing every year 
B) Fixed for all the year 
C) Decreasing every year 
D) none

Question 16

Loss of usefulness occasioned by improved production methods is known as____

Accepted Answer

A) Physical deterioration 
B) Obsolescence 
C) Disuse 
D) Inadequacy 
A) Physical deterioration 
B) Obsolescence 
C) Disuse 
D) Inadequacy

Question 17

AS 6 revised is an accounting standard for:

Accepted Answer

A) Inventory Valuation 
B) Depreciation Accounting 
C) Revenue recognition 
D) None of the above 
A) Inventory Valuation 
B) Depreciation Accounting 
C) Revenue recognition 
D) None of the above

Question 18

Income tax authorities recognize this method ___

Accepted Answer

A) Straight line method. 
B) Written down value method. 
C) Annuity method. 
D) Depreciation fund method 
A) Straight line method. 
B) Written down value method. 
C) Annuity method. 
D) Depreciation fund method

Question 19

Cash loaned to a company is called:

Accepted Answer

A) Dividends 
B) Debentures 
C) Shares 
D) Reserves 
A) Dividends 
B) Debentures 
C) Shares 
D) Reserves

Question 20

Share premium money can be used for:

Accepted Answer

A) Payment of dividend 
B) Writing off Goodwill 
C) Issue of fully paid bonus shares 
D) none 
A) Payment of dividend 
B) Writing off Goodwill 
C) Issue of fully paid bonus shares 
D) none

Exam 44: Depreciation and Reserves: Understanding the Accounting Concepts

The estimate about useful life of a fixed asset:

Debenture holder receive:

Share Capital in the balance sheet is shown under:

Depletion Method of depreciation is used in:

When shares issued at premium which of the following account is credited?

Which of the company's capital is not shown in balance sheet?

Depreciation is a process of:

For providing depreciation on leasehold property, the appropriate method of depreciation is:

Share allotment account is a ------------------

Debenture is treated in books of account as:

The amount of depreciation charged on a machinery will be debited to:

Amortization applies to

Premium on issue of shares can be used for -----------.

Shareholder's funds include:

In case of Annuity Method, the amount of depreciation is:

Loss of usefulness occasioned by improved production methods is known as____

AS 6 revised is an accounting standard for:

Income tax authorities recognize this method ___

Cash loaned to a company is called:

Share premium money can be used for:

Exploring Features and Advantages of Computerized Accounting Systems

Exploring Computerized Accounting Systems and Software

Non-Profit Organizations and Financial Statements

Not-For-Profit Organizations and Financial Accounts

Goodwill and Intangible Assets

Valuation and Calculation of Goodwill

Understanding the Concepts of Lessor, Lessee, and Minimum Rent

Royalty Accounting and Partnership Firms

Accounting

Accounting and Corporate Finance

Accounting and Finance

Depreciation, Share Capital, and Forfeiture of Shares

Financial Statements and Accounting Principles

Insurance Provision and Accounting Standards

Formation and Capital Structure of Public Companies

Share Forfeiture, Debentures, and Sinking Fund

Financial Accounting and Banking

Insurance and General Insurance Companies: Understanding Terms and Concepts

Single Entry System and Company Ownership

Share Capital and Shareholders in a Company

Debentures, Bonds, and Shares

Accounting Concepts and Principles

Accounting Concepts and Practices

Financial Statements and Accounting for Nonprofit Organizations

Hire Purchase, Sale of Goods, and Bookkeeping

Accounting and Bookkeeping

Allocation of Selling Expenses Among Departments Based on Sales

Accounting Concepts and Systems

Accounting and Financial Transactions

Ac Types, Balances, and Entries

Errors, Adjustments, and Expenditures in Accounting

Capitalization, Errors, Cash Book, and Types of Accounts

Revenue Recognition and Expenditure Classification

Depreciation and Asset Provision

Accounting Adjustments and Financial Statement Treatment

Balance Sheet and Profit Loss Account

Accounting and Financial Management

Bills of Exchange, Consignment, and Partnership

Accounting Standards and Joint Ventures

Accounting and Financial Management : Part A

Accounting and Financial Management : Part B

Accounting: Interest, Bill, Partnership Agreement,insurance, Contingent Liability, and Business Resources

Fundamentals of Accounting: Objectives, Concepts, and Principles

Underwriting and Creditor Questions in Company Affairs

Amalgamation, Llp, and Single Entry System

Single Entry System and Profit Calculation

Accounting for Receipts, Payments, Income, and Expenditure in Consignment and Joint Venture Businesses

Accounting for Co-Venturers, Consignments, and Branches

Accounting Arrangements and Operations for Branches

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