Accountancy and Financial Management 4 MCQ Collection (Semester 4 Part 4)

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Accountancy and Financial Management IV


Accountancy and Financial Management IV


Accountancy and Financial Management 4 Second Year B.Com Sem 4 MCQ Collection


01) After redemption of debentures , balance in debenture redemption fund is transferred to ------

  1. Is transferred to profit &loss a/c
  2. Security premium
  3. General reserve a/c
  4. Revaluation reserve

Answer: General reserve a/c

02) If debentures are redeemed by conversion in to Equity shares of same amount then amount transferred to General reserve is----

  1. No amount is transferred
  2. Equal amount is transferred
  3. 50 % amount is transferred
  4. Two times amount is transferred

Answer: No amount is transferred

03) When debentures are redeemed out of profits, the amount transferred to General reserve should be-----

  1. Premium payable on redemption amount
  2. Payable on redemption
  3. Nominal value of debentures redeemed
  4. Any one of the above

Answer: nominal value of debentures redeemed

04) When debentures become due for redemption the entry is -------

  1. Debentures a/c debit to bank a/c
  2. Debentures a/c debit to debenture holders a/c
  3. Debenture holders a/c debit to bank a/c
  4. Bank a/c debit to debenture holders a/c

Answer: debentures a/c debit to debenture holders a/c

05) Loss on sale of sinking fund investment is -----

  1. debited to profit &loss a/c
  2. debited to sinking fund a/c
  3. debited to general reserve a/c
  4. Debentures a/c is credited

Answer: debited to profit &loss a/c

06) For calculating profit prior to incorporation Advertisement expenses are =====

  1. Allocated in sales ratio
  2. allocated in time ratio
  3. Debited to preincorporation
  4. debited to post incorporation

Answer: Allocated in sales ratio

07) For calculating profit prior to incorporation share transfer fees are-----

  1. debited to preincorporation period
  2. credited to post incorporation period
  3. allocated in saes ratio
  4. Allocated on time basis

Answer: credited to post incorporation period

08) A company can redeem preference shares ------

  1. At par
  2. At premium
  3. At discount
  4. any one of above as per agreement

Answer: any one of above as per agreement

09) A company cannot issue -------

  1. redeemable cumulative preference shares
  2. redeemable non cumulative preference shares
  3. Irredeemable preference shares
  4. redeemable participating preference shares

Answer: Irredeemable preference shares

10) called up capital less calls in arrears is equal to -----

  1. Authorised capital
  2. Subscribed capital
  3. reserve capital
  4. Paid up capital

Answer: Paid up capital

11) The unpaid dividend of any year will lapse in case of -----

  1. non cumulative preference shares
  2. participating preference shares
  3. cumulative preference shares
  4. non participating preference shares

Answer: non cumulative preference shares

12) The shares  on which dividend is carried forward to next year when not paid in current year cumulative preference shares

  1. Common shares
  2. non cumulative preference shares
  3. participating preference shares
  4. None of the above

Answer: cumulative preference shares

13) If share of Rs.100 is issued at Rs.100 it is called -----

  1. Issue of shares at par
  2. issue of shares at premium
  3. issue of shares at discount
  4. any one of the above

Answer: Issue of shares at par

14) The amount to be collected on application of shares should be ------

  1. less than 5% of nominal value of shares
  2. more than 5% of nominal value of shares
  3. more than 10% of nominal value
  4. More than 15% of nominal value

Answer: more than 5% of nominal value of shares

15) A company can issue Bonus shares to ----

  1. Creditors only
  2. Workers only
  3. staff of office only
  4. Equity shareholders only

Answer: Equity shareholders only

16) A company can issue Right shares to ------

  1. Old employees only
  2. New employees only
  3. Preference shareholders only
  4. Equity shareholders only

Answer: Equity shareholders only

17) Bonus shares can be issued out of -----

  1. General reserve only
  2. security premium only
  3. Capital redemption reserve only
  4. all of the above

Answer: all of the above

18) Pro rata allotment of equity shares is done - when -----

  1. There is under subscription
  2. There is oversubscription
  3. When market value of share is high
  4. when market value of share is low

Answer: There is oversubscription

19) A company purchased machinery worth Rs.1,05000  and issues Equity shares of Rs. 10 each at Rs.10.50 per share then amount of premium will be----

  1. Rs.5000
  2. Rs.10000
  3. Rs.8000
  4. Rs.7000

Answer: Rs.5000

20) G ltd purchased assets worth Rs.7,50000 and issued Equity shares of Rs.100 each at a premium of 25% ,then number shares issued will be----

  1. 7500 shares
  2. 6000 shares
  3. 5625 shares
  4. 8000 shares

Answer: 6000 shares

21) The maximum amount of capital a company can issue is given in----

  1. Memorandum of association
  2. articles of association
  3. Prospectus
  4. Register of members

Answer: Memorandum of association

22) The rules regarding internal management of company are given in =

  1. Memorandum of association
  2. articles of association
  3. Prospectus
  4. Register of members

Answer: articles of association

23) If company redeems 1000 preference shares of Rs.100 each at 10% premium the amount payable to preference shareholders will be----

  1. Rs.1,00,000
  2. Rs.1,20,000
  3. Rs.90,000
  4. Rs.1,10,000

Answer: Rs.1,10,000

24) If company redeems 2,000 preference shares of Rs. 100 each at 15% discount then amount payable to preference shareholders will be

  1. Rs.2,00,000
  2. Rs.2,30,000
  3. Rs.1,70,000
  4. Rs.1,80,000

Answer: Rs.1,70,000

25) To calculate profit before incorporation Rent rates and taxes are ------

  1. debited to preincorporation period
  2. debited to post incorporation period
  3. Divided in sales ratio
  4. divided in time ratio

Answer: divided in time ratio



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