Tag: commercial applications

Questions Related to commercial applications

Mr.Ashok buys clothing of Rs.50,000 paying cash Rs.20,000. What is the amount of expense as per the accrual concept?

commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

  1. Rs. 30,000

  2. Rs. 20,000

  3. Rs. 50,000

  4. Nil

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Correct Option: C

An entry for the goods sold to Madhav for Rs. 1,020 was posted to his account as Rs. 1,200. If rectification is done before preparation of trial balance then which of the following is correct? 

commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

  1. Supense A/C      Dr.        180
           To Madhav A/C                 180

  2. Profit & Losdd Adj. A/c     Dr.     180
            To Madhav A/c                           180

  3. Credit Madhav with Rs. 180 saying "By Excess debit for sales Rs. 180"

  4. Debit Madhav with Rs. 180 saying "To Excess debit for sales Rs. 180"

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Correct Option: C

When a change in accounting policy is justified?

commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

  1. To comply with accounting standard

  2. To ensure more appropriate presentation of the financial statement of the enterprise

  3. to comply with law

  4. All of the above

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Correct Option: D

All of the following are valuation principles except ___________________.

commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

  1. Historical cost

  2. Current cost

  3. Realizable value

  4. Future value

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Correct Option: D

Companies are regulated by Companies Act, ______.

commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

  1. 1972

  2. 1929

  3. 2013

  4. 1955

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Correct Option: C

Match List I with List II and select the correct answer using the codes given below the lists.
List I                                                    List II
A. Doctrine of ultra vires                    1. Articles of association
B. Doctrine of indoor management    2. Prospectus
C. Doctrine of golden rule                   3. Memorandum of association

commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

  1. A-1, B-3, C-2

  2. A-3, B-1, C-2

  3. A-2, B-1, C-3

  4. A-3, B-2, C-1

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Correct Option: B

The most liquid asset among the following is?

commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

  1. Gold

  2. Share

  3. Cash

  4. land

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Correct Option: C

Overvaluation of opening stock in financial accounting results _____________.

commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

  1. decreases costing profit

  2. decreases financial accounts profit

  3. increases costing profit

  4. increases financial accounts profit

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Correct Option: B

The current ratio of a company is 2: 1. Which of the following suggestions would improve the ratio?

commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

  1. To pay a current liability

  2. To borrow money on an interest-bearing promissory note

  3. To purchase stocks for cash

  4. To give an interest-bearing promissory note to a creditor to whom money was owed on current account

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Correct Option: B

Globalisation of financial services is being promoted by _____________.

commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

  1. World Trade Organisation

  2. International Finance Corporation

  3. International Bank for Reconstruction and Development

  4. International Monetary Fund

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Correct Option: D