SO_Part-2_MCQ_Booklet

Multiple Choice Questions
(MCQs)
For
Departmental Accounts Examination (DAE) for

Section Officer Part-II of HPUs
HVPN POWER TRAINING INSTITUTE,

Director Principal HPTI,
HPTI Complex, Sector-26, Panchkula.
GSTIN:06AAATH7060D1Z0
E-mail: [email protected] , [email protected]
(PAPER-VI)
Advance, Cost & Management Accounting
(For All HPUs)
A. Advance Accounting
Q.1 Disclosure of which ratio is not required as per new Schedule III of
Companies Act, 2013.
(a) Inventory Turnover Ratio (b) Net Capital Turnover Ratio

(c) Assets Turnover Ratio (d) Trade receivable Turnover ratio
Q.2 Account prepared for calculation of Gross Profit Earned by branch

under Stock & Debtors system is________________.
(a) Branch Stock Account (b) Branch Adjustment Account

(c) Goods sent to branch account (d) Branch Debtors Accounts
Q3. Which Method is used generally for small size branches?
(a) Debtors Method (b) Stock & Debtors Method

(c) Small Branch Method (d) Analytical Method
Q4. Which account is prepared, when branch sell goods on credit?
(a) Branch Adjustment Account (b)Branch Debtors Accounts

(c)Goods Sent to Branch A/c (d) Debtors Reconciliation A/c
Q5. Goods sent by Head office to branch either at cost plus profit or
at_________________.
(a) Cost Price (b) Selling Price

(c) Market Price (d) Invoice Price
Q6. Financial Statement of Companies are prepared as per schedule

______________ of Companies Act, 2013.
(a) III (b) IV

(c)V (d)VI
Q7. Which ratio is used to measure firm’s ability to meet current

obligation?
(a) Leverage Ratio (b) Activity Ratio
(c) Liquidity Ratio (d) Profitability Ratio
Q8. Acid-Test Ratio is also known as_______________.
(a) Current Ratio (b) Cash Ratio
(c) Acid-Test Ratio (d) working Capital Ratio
Q9. From the following ratios which ratio is covered under Activity Ratio?
(a) Debt-Equity Ratio (b) Working Capital Ratio
(c)Interest Coverage Ratio (d) Inventory Turnover Ratio
Q10. From the following which ratio is not covered under Leverage Ratio?
(a) Debt-Equity (b) Return on Equity
(c) Interest Coverage Ratio (d)Debt to Assets Ratio
Q11Departmental Accounting facilitates

(a)Comparison of trading results
(b)Planning and Control
(c)Evaluate Departmental performance
(d)All of the above
Q12 In departmental accounting, where separate books are kept for each
department, know as:-
a) Independent Accounting
b) Columnar Accounting
c) Consolidated Accounting
d) Advanced Accounting
Q13.Expenses which cannot be reasonably allocated to any particular

department are taken in to:-
a) Debtors Accounts
b) Cash Book
c) Balance Sheet
d) General P&L Account
Q14. Branch which does not maintain its own books of accounts is_______.
a) Independent Branch
b) Local Branch
c) Foreign Branch
d) Dependent Branch
Q15. All expenses such as rent, salary etc are paid by H.O. in case of ____.
a) Independent Branch
b) Dependent Branch
c) Local Branch
d) Foreign Branch
Q16.Goods are supplied by the H.O. to dependent ranches are at:-

Cost Price
a) Cost or Invoice Price
b) Market Price
c) Invoice Price
Q17.Under Debtors system depreciation on fixed assets is______________

a) Credited to Branch Account
b) Debited to Branch Account
c) Not shown in Branch Account
d) Shown in Debtors Account
Q18.In Single Entry System Net Worth Method is also known as_____.
a) Mercantile System
b) Double Entry System
c) Accrual System
d) Statement of Affairs Method
Q19.Positive difference between opening net worth &closing net worth is:
a) Capital Balance
b) Cash Balance
c) Profit
d) Loss
Q20.In single entry system a statement of affairs is just like :-

a) Balance Sheet
b) Profit & Loss Statement
c) Cash Book
d) Trading Account
Q21.Under single entry system in net worth method drawing is added in :

a) Opening Capital
b) Closing Capital
c) Additional Capital
d) Cash
Q22. Credit Sale can be obtained by preparing:-

a) Cash Book
b) Debtors Account
c) Creditors Account
d) Statement of Affairs
Q23.In single entry system generally which accounts are maintained:-

a) Assets Account
b) Personal Accounts
c) Income Account
d) All of the above
Q24.in single entry system profit is calculated:-

(a) Opening Capital + Drawings + Fresh Capital-Closing Capital
(b) Closing Capital-Drawings –Fresh Capital-Opening Capital
(c) Opening Capital - Drawings + Fresh Capital-Closing Capital
(d) Closing Capital + Drawings –Fresh Capital-Opening Capital
Q25.Net Worth of an organisation means excess of Assets over:-

a) Income
b) Liabilities
c) Working Capital
d) Both b & c
Q26.Rs. 2000 paid for installation of Machine Should be debited to:

a) Wages Account
b) Machinery Account
c) Capital Accounts
d) P & L statement
Q27. Old furniture purchased and Rs. 1000 spent on its repair before use,
Rs. 1000 should be debited to:-
a) Repair Account
b) Furniture Account
c) Labour Paid account
d) None of the Above
Q28. Goods of Rs. 500 given as charity should be credited to:-

a) Charity Account
b) Sales Account
c) Purchase Account
d) None of the above
Q29. In cash book favourable balances indicates :-
a) Credit Balance
b) Bank Overdraft
c) Adjusted balances
d) Debit Balance
Q30.In bank statement, cash deposit by company is known as:-

a) Liability
b) Credit
c) Debit
d) Expense
Q31.Deposit in Transit will be ________________while preparing BRS.

a) Subtracted from bank balance
b) Added in bank balance
c) No effect
d) Added to cash book balance
Q32.Unpresented cheques are also refers as:-

a) Bounced Cheque
b) Uncredited cheques
c) Outstanding Cheques
d) Stopped Cheques
Q33. Bank charges Rs. 5000 not recorded, adjustment in cash book by:-
a) Credit in cash book
b) Debit in Cash Book
c) No effect in cash book
d) Add it in cash Balance
Q34. Bank reconciliation is not a:-

a) Reconciliation Record
b) Memorandum Statement
c) Ledger Account
d) Adjustment statement
Q35.Favourable Balance means:

a) Credit balance in cash book
b) Debit balance in bank statement
c) Credit balance in bank statement
d) All of above
Q36.Credit balance in Pass book means:-
a) Bank overdraft
b) Balance as per cash book
c) Assets for the entity
Q37.Cheque returned by bank showing technical reason is known as:

a) Dishonoured Cheque
b) Stale Cheque
c) Crossed Cheque
Q38.Outstanding Cheque is the missing entry of:-

a) Cash Book
b) Pass Book
c) Both of Above
Q39. Unfavourable Bank Balance means:-

a) Debit balance in cash Book
b) Favourable balance in Cash Book
c) Debit Balance in Pass Book
Q40. Which of the following is a error of Commission?

a) Repair of assets debited to Assets account
b) A sale of Rs. 5000 omitted to record
c) A purchase of 7400 was wrongly posted in ledger
Q41. Wages paid for machine installation debited in wages accounts, it

is___
a) An error of Commission
b) An error of omission
c) An error of Principal
d) Compensating Error
Q42.If amount of any known liability can’t be determined with substantial

accuracy then:-
a) A provision should be created
b) A contingent liability should be created
c) A definite liability should be created
d) A reserve should be created
Q43. Which of the following statement is not true about provision?

a) It is an appropriation of Profit
b) A charge against profits
c) Shown as liability in Balance Sheet
d) Uncertainty as a matter of financial prudence
Q44.Which one is not a cause of depreciation?

a) Passage of time
b) Price Inflation
c) Obsolescence
d) Natural wear and tear
Q45.Deperciation is calculated from the date of_____

a) Purchase of Assets
b) Receipt of Assets
c) Assets Put to use
d) Assets Installed
Q46.If the amount of any known liability can be determined with
accuracy:-
a) A liability should be provided
b) A provision should be provided
c) A reserve be created
d) A contingent liability should be disclosed
Q47.Which of the following is the example of Capital Reserve?

a) Workman’s compensation fund
b) General Reserve
c) Debenture Redemption Reserve
d) Premium on issue of Share
Q48.Loss on sale of Assets is shown in:-

a) Credit side of Trial Balance
b) Profit & Loss Appropriation Account
c) Trading Account
Q50. Reserve is created by debiting:-
a) Trading Account
b) Profit & Loss Account
c) Profit & Loss Appropriation Account
d) Income & Expenditure Account
Q51. Debenture Redemption Reserve can be created out of:-

a) Current year profits
b) In case current year loss then from retained earnings of previous
years
c) Both a & b above
Q52.Fixed assets loss its value due to:-

a) Amortisation
b) Deprecation
c) Both a & b above
d) Provisions
Q53.Which of the following best describes the ‘Depreciation’?

a) Value of Fixed Assets at end of the year
b) Verification of Assets
c) Allocation of value of fixed assets over its useful life
d) Decrease in market value of assets
Q54.Deprication is
a) Deferred revenue expenditure
b) Capital Expenditure
c) Revenue Expenditure
Q55.Working Capital is:-

a) Fixed Assets-Current Assets
b) Current Assets-Current Liability
c) Liquid Assets-Current Liability
d) Cash and cash equivalents
Q56.Which of the following transaction will improve the Current Ratio?

a) Purchase of goods for cash
b) Payment of Trade Payables
c) Credit Purchase of Goods
d) Cash received from Debtors
Q57. Statement of Affairs is prepared to:-

a) Know about Assets
b) Know about Liability
c) Calculate Capital
d) Know Financial Position
Q58.Statement of Affairs is a:-

a) Statement of Income & Expenditure
b) Statement of Assets & Liabilities
c) Summary of Cash Transactions
d) Summary of Credit transactions
Q59. If books of accounts kept under Single Entry System, opening stock
is ascertained by preparing:-
a) Opening Stock Account
b) Stock Register
c) Memorandum Trading Account
d) Opening Statement of Affairs
Q60.What should be added in closing capital to calculate opening capital:

a) Loss & Drawings
b) Profit only
c) Profit & Drawings
d) Loss only
Q61.Current Ratio is:

a) Solvency Ratio
b) Liquidity Ration
c) Activity Ratio
d) Profitability Ratio
Q62.Liquid asset does not include :

a) Bill receivable
b) Debtor
c) Bank Balance
d) Prepaid Expenses
Q63.The __________ of a business firm is measured by its ability to satisfy
its short term obligations as they become due:
a) Activity
b) Liquidity
c) Debt
d) Profitability
Q64.Patent and copy right fall under the category of :

a) Factitious Assets
b) Current Assets
c) Intangible Assets
d) Tangible Assets
Q65.Which of the following transaction will improve quick ratio:

a) Sale of Goods for cash
b) Sale of Goods on credit
c) Issue of new share for cash
d) All above
66.Debit equity ratio is :
a) Operating Ratio
b) Liquidity Ratio
c) Solvency Ratio
d) Activity Ratio
Q67. Ideal Quick Ratio is
a) 1:1
b) 2:1
c) 1:2
d) 1:3
Q68 If Current Ratio is 2:1, after payment of creditors ratio will
a) Decrease
b) Increase
c) No change
Q69. If Current Ratio is 2:1, after purchase of goods on credit ratio will
a) Decrease
b) Increase
c) No change
Q70. Debt Equity Ratio is
a) Short Term Debts /Shareholder’s fund

b) Long term debts/ Shareholder’s fund
c) Shareholder’s fund/ Long term debts
d) Long term debts+ Short Term Debts/ Shareholder’s fund
Q71.Debt Equity Ratio is 1:2,which of the following transition will increase

it
a) Issue of new share for cash

b) Issue of Debenture
c) Redemption of Debenture
d) Credit Purchase
Q72. If Inventory Turnover ratio is divided in to 365, it becomes a measure
a) Average Collection Period

b) Average age of Inventory
c) Sales Turnover
d) Debtors Aging
Q73. What are the results of equipment sales on credit?
a) Assets increase, Income increase

b) Assets Decrease, Liability increase
c) Assets Increase, Liability decrease
d) Assets decrease, Loss Increase
Q74.Which of the following transition will increase the total assets of

Company?
a) Purchase Assets on credit

b) Purchase Assets in Cash
c) Received cash from Debtors
d) Investment made in shares
Q75. Which of the following transaction will reduce total assets and
liability?
a) Assets Purchase in Cash

b) Purchase goods on credit
c) Repayment of loan
d) Subsidy received from Government
Q76.Call in arrears appears in the company Balance Sheet under
a) Share Capital
b) Current Liability
c) Long term borrowing
d) Reserve & Surplus
Q77. Ratio which reflects managerial efficiency in handling assets is:-
a) Turnover Ratio
b) Solvency Ratio
c) Profitability Ratio
d) Coverage Ratio
Q78. Return on Investment is a __________
a) Turnover Ratio
b) Solvency Ratio
c) Profitability Ratio
d) Coverage Ratio
Q79.Return on equity is also called

a) Return on investment
b) Net profit Ratio
c) Gross Profit Ratio
d) Return on net Worth
Q80. Preliminary expenses are example of

a) Fixed Assets
b) Tangible Assets
c) Intangible Assets
d) Fictitious Assets
Q81. Profit for the objective of calculating a ratio may be taken as
a) Profit before tax but after interest

b) Profit after interest and tax
c) Profit before interest and tax
d) All the above
Q82. When a fixed asset is brought as hire purchase, interest element is

classified under___________ activity and loan element is classified
under__________ activity.
a) Operating, Financing
b) Financing, Investing
c) Investing, operating
d) Investing, Financing
Q83. NPV is a tools used for

a) Financial Statement Analysis
b) Capital Budgeting
c) Cost accounting
d) All of the above
Q84. High Price to earnings ratio shows company
a) High growth prospect

b) Low growth prospect
c) Low dividend payout
d) High dividend payout
Q85. Dividend payout ratio is
a) PAT/Share Capital
b) DPS/EPS
c) Pref. Dividend /PAT
d) EPS/DPS
Q86. DU PONT analysis deals with
a) Analysis of Current Assets

b) Analysis of Profits
c) Analysis of equity
d) Analysis of capital budgeting
Q87. The term EVA used for
a) Extra value Analysis
b) Economic Value Added
c) Expected Value Analysis
d) Earning value Analysis
Q88. One of the most important tools of cost planning is________-
a) Budget
b) Direct cost
c) Unit cost
d) Cost sheet
Q89. Depreciation rates are provided in which schedule of companies act?

a) Schedule I
b) Schedule III
c) Schedule II
d) Schedule IV
Q90. Interest on loans given by a financial institution is shown in P & L as
a) Revenue from operation

b) Other income
c) Sundry expenses
d) Indirect expenses
Q91. Closing stock is recorded in the_________

a) Balance sheet
b) Trading account
c) Profit & loss account
d) Both a & b
Q92. Mining rights are

a) Tangible assets
b) Intangible Assets
c) Fictitious Assets
d) Nominal Assets
Q93. Which of the following is written off every year from the profit of
business?
a) Preliminary Expenses
b) Goodwill
c) Trademark
d) Intangible Assets
Q94. Which of the following is non free reserve?
a) General reserve
b) Revenue reserve
c) Security premium reserve
Q95. Decrease in the value of natural assets is ______

a)Depreciation
b)Depletion
c)Amortisation
d)None of the above
Q96. Depreciation is a process of ________

a) Allocation
b) Valuation
c) Transformation
Q97. Which of the following account is never reported in Income statement

as Expense:-
a) Interest expense
b) Income tax expense
c) Dividend expense
d) Depreciation expense
Q98. Which of the account will appear in trial balance:-

a) Income tax expense
b) Dividend expense
c) Both will appear
d) Both will not appear
Q99. The account that records expenses, income, loss & profit is called__
a) Personal Account
b) Nominal Account
c) Real Account
Q100. Higher inventory ratio indicates _________

a) Quick inventory turnover
b) Better inventory management
c) Both a & b are correct
B. Management Accounting return
Q1. The basic financial statements include
A) Statement of Cash Flows

B) Statement of Retained Earnings
C) Balance Sheet and Income Statement
D) All of the Above
Q2.Cash flow example from a financing activity is
A) Payment of Dividends
B) Receipt of Dividend on Investment
C) Cash Received from Customers
D) Purchase of Fixed Asset
Q3.Cash flow example from an investing activity is
A) Issue of Debenture
B) Repayment of Long-term Loan
C) Purchase of Raw Materials for Cash
D) Sale of Investment by Non-Financial Enterprise
Q4. Cash flow example from an operating activity is
A) Purchase of Own Debenture
B) Sale of Fixed Assets
C) Interest Paid on Term-deposits by a Bank
D) Issue of Equity Share Capital
Q5.Preparation of cash flow statement is:

(a) Mandatory
(b) Recommendatory
(c) Required under the Companies Act
(d) None of these
Q6.Cash from operating activities will decrease due to :

(a) Increase in Current Assets
(b) Decrease in Current Liabilities
(c) Neither of the two
(d) Both (a) and (b)
Q7.While calculating operating profit which will be added to net profit:
(a) Interest received
(b) Profit on sale of Asset
(c) Increase in General Reserve
(d) Refund of Tax
Q8.While calculating cash flow from operating netivities which will be deducted ?
(a) Increase in Creditors
(b) Increase in Debtors
(c) Decrease in Debtors
(d) Decrease in Prepaid Expenses
Q9.While calculating cash flow from operating activities, which will be added ?
(a) Increase in Stock
(b) Increase in Creditors
(c) Decrease in Bills Payable
(d) Increase in Debtors
Q.10. Where will you show purchase of goodwill in Cash Flow Statement:
(a) Cash Flow from Operating Activities
(b) Cash Flow from Investing Activities
(c) Cash Flow from Financing Activities
(d) Cash Equivalent
Q11. Interest received by a finance company is classified under which kind of

activity while preparing a Cash Flow Statement ?
(b) Investing Activities
(c) Financing Activities
(d) Cash Equivalent
Q12. Which of the following item is considered as cash equivalents:

(a) Bank Overdraft
(b) Bills Receivable
(c) Debtors
(d) Short-term Investment
Q13. Which of the following item is not considered as cash equivalents ?

(a) Bank Overdraft
(b) Commercial Papers
(c) Treasury Bills
(d) Investment
Q.14. In cash flow statement, the item of ‘Interest’ is shown in:

(a) Operating Activities
(c) Financial Activities
(d) In both (d) & (c)
Q.15. Cash Flow Statement in based upon:

(a) Cash basis of accounting
(b) Accrual basis of accounting
(c) (a) and (b) both
(d) None of these
Q16.Cash Flow Statement is related to:

(a) IND AS-3
(b) IND AS-7
(c) IND AS-9
(d) IND AS-12
Q17. Claims received from Insurance Companies are treated as:

(d) None of these
Q18.Cash flow statement according to AS-3 is mandatory to:

(a) All enterprises
(b) Companies listed on a stock exchange
(c) Enterprises having turnover expending 50 Rs crore
(d) (b) & (c) both
Q19. In cash flow statement, the item of interest is shown in
A) Operating Activities
B) Financing Activities
C) Investing Activities
a) Both A and B
b) Both A and C
c) Both B and C
d) A, B, C
Q20Which of the following statements are true?
A) Cash flow reveals only the inflow of cash

B) Cash flow reveals only the outflow of cash
C) Cash flow is a substitute for income statement
D) Cash flow statement is not a replacement of funds flow statement.
a) Only A
b) Only B
c) Both B and C
d) Only D
Q21. Cash flow statement is based upon _________ while Funds Flow Statement
recognizes _______.
a) Cash basis of accounting, accrual basis of accounting

b) Accrual basis of accounting, cash basis of accounting
c) Both are based on cash basis of accounting
Q22. Statement of changes in working capital is prepared separately in
a) Cash Flow Statement

b) Funds Flow Statement
c) Both a and b
Q23. Cash flow from sales is calculated by
a) Cash sales + Cash Collections

b) Sales + Opening debtors+ Opening B/R –Closing Debtors – Closing B/R
c) Both a and b
Q24. Cash outflow on purchases is calculated by
a) Purchases + Opening Creditors + Opening B/P –Closing Creditors-Closing

B/P
b) Purchases + Opening Creditors - Closing Creditors +Closing B/P
c) Purchases - Opening Creditors - Opening B/P + Closing Creditors +Closing B/P
Q25. Which of the following are added to net profit after tax and extraordinary
items to reach to net profit before tax and extraordinary items?
A) Provision for tax made during the year

B) Proposed dividend made during the year
C) Interim dividend
D) Transfer to General reserves and other reserves
a) Both A and B
b) Both A and C
c) Both B and C
d) A, B, C and D
Q26. Which of the following statements represent example of cash flow from
investing activities?
a) Cash advances and loans made by financial enterprises

b) Cash advances and loans made to third parties
c) Both a and b
Q27. In case of other enterprises cash flow arising from interest paid should be
classified as cash flow from ________ while dividends and interest received
should be stated as cash flow from ____.
a) Operating activities, financing activities

b) Financing activities, investing activities
c) Investing activities, operating activities
Q28. When a fixed asset is bought as hire purchase, interest element is classified
under ______ and loan element is classified under________.
a) Operating activities, financing activities

b) Financing activities, investing activities
c) Investing activities, operating activities
Q29. . Which of the following statements are false?
A) Old Furniture written off doesn’t affect cash flow.

B) Cash flow statement is a substitute for cash account.
C) Appropriation of retained earnings is not shown in Cash flow statement.
D) Net cash flow during a period can never be negative.
a) A, B, C
b) B, C, D
c) C, D, A
Q30. Funds flow statement is prepared on the basis of _________.

a) Profit and loss account of the current year
b) The balance sheet of the previous and current year
c) Both a and b
Q31.Which of the following are sources of funds for an organisation?

a) Conversion of debentures into shares
b) Conversion of loans into shares
c) Issue of shares against the purchase of fixed assets
Q32. Which of the following are sources of funds?

A) Issue of bonus shares
B) Issue of shares against the purchase of fixed assets
C) Conversion of debentures into shares
D) Conversion of loans into shares
a) A and C
b) A and D
c) A, B, C and D
Q33. Which of the following are applications of funds?
a) Payment of dividend on share capital

b) Payment of tax
c) Increase in working capital
d) All of above
Q34. As per Indian Accounting standard IND AS7, provision for taxation should be
treated as:-
a) As a current liability
b) As an appropriation of profits
c) Either a or b
Q35. Out of the following statements, which statement does not imply the item
that has to be shown under the application of fund flow
a) Purchase of investments as well as fixed assets

b) Payment of tax and dividend
c) Reduction in the working capital
d) Growth in the working capital
Q36. Out of the following options, what can be called the sources of funds
a) Sales of assets, dividends and payment of tax

b) Long term loans, funds from operations and the sale of an asset
c) Repayment of long-term loans and sale of an asset
d) Buying of fixed assets, sale of an asset and repayment of long-term goals
Q37. Which of the following statements help in describing the funds flow analysis
in the most suitable manner
1. Funds flow analysis can be a comparison between the balance sheet’s

varying facets
2. Funds flow analysis can be used for determining the employee engagement
in their work
3. Funds flow analysis can help in understanding the vision and mission of the
company
4. Funds flow analysis can be useful for understanding the goals of the
company
Q38. Fund flow statement is based on the concept of…
A. business entity
B. accounting period
C. going concern
D. all of the above
Q39. Which of the following is an application of funds?

A. funds lost in operation
B. income from investment
C. funds from operations
D. all of these
Q40. Working capital requirements depends on the credit policy of …

A. the company
B. the suppliers
C. both
D. none
Q41. Which one of the following statements is not true?

a) Depreciation is source of funds.
b) Major source of working capital in the long run, is profits form operations
c) Any transaction that increases working capital is a source of funds.
d) Profits earned from non-operating activities is added to net profit while
calculating profits from operations.
Q42. A statement of change in financial position typically would NOT disclose the
effect of
a) share capital issued to acquire productive facilities

b) dividends on share declared
c) cash dividend declared but not yet paid
d) purchase and retirement of treasury stock
Q43.Which of the following does not result in an inflow of funds in case of fund
flow statement?
(A) Issue of equity share capital
(B) Premium received on issue of shares/ debentures
(C) Sale of investments
(D) Cash received from debtors
Q44.Assertion
(A) Funds are not related to working capital.
Reason (R):
The flow of funds takes place whenever there is a change in the funds.
Select the correct answer from the following
(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 the correct explanation of A
(C) A is true, but R is false
(D) A is false, but R is true
Q45. If provision for taxation is treated as a current liability, then payment of tax is
(A) An application of funds
(B) A source of funds
(C) No flow of funds
(D) None of the above
Q46. Which one of the following is a non-current item

(A) Securities premium
(B) Outstanding wages
(C) Trade payables
(D) Bank balance
Q47. In the fund flow statement, the flow of fund will occur when a transaction is
happened between:
(A) Current Assets & Current Liabilities

(B) Non-current Assets & Non-cur-rent Liabilities
(C) Current Assets & Non-current Assets
(D) All of the above
Q48. Which of the following statement is correct?

(A) A decrease in current liability during the year results in an increase in
working capital.
(B) Only non-cash expenses are added to net profit to find out funds from
operations.
(C) Conversion of debentures into equity shares appears in the fund flow
statement.
(D) Collection of debtors is a source of funds.
Q49. When current ratio is 2 : 1 and if equal increase in current assets and current
liabilities would result in
No change in current ratio

Increase in current ratio
Decrease in current ratio
Current ratio will double
Q50.Net worth means paid up share capital and reserve & surplus (i.e.
shareholders equity)
Return on equity = profit after tax/net worth
Working capital turnover ratio = sales/net working capital
Total cost of production is more than net sales realisation (NSR) at
breakeven point
Q51.Which of the following is not an objective of Analysis of Financial Statements?

A)To judge the financial health of the firm
b) To judge the short term and long term liquidity position of the firm
c) To judge the reasons for the change in the profitability of the firm
d) To judge the variations in the accounting practices of the business
followed by differententerprises
Q52.Feature of financial analysis is to present the data contained in financial

statement in
a) Easy form
b) Convenient and rational groups
c) Comparable form
d) All of the above
Q53.Analysis of financial statement of an enterprise over a period of time

is known as:
a) Cross-sectional Analysis
b) Time Series Analysis
c) Static Analysis
d) External Analysis
Q54.The area of interest for lenders while analyzing financial statements will be
a) Liquidity alone
b) Profitability and Liquidity
c) Solvency, Profitability, and Liquidity
d) None of these
Q55.Cross-sectional Analysis involves
a) the comparison of financial statements of an enterprise for two or more

accounting periods.
b) the comparison of financial statements of two or more subsidiary of a company
for the same accounting period.
c) the comparison of the actual ratio of one firm with those of other similar
firms belonging to the same industry
Q56. Comparison of actual ratios of one period with those of earlier periods for the
same enterpriseis known as
a) Cross-sectional analysis
b) Time-series Analysis
c) Inter-firm Analysis
d) None of these
Q57.When assets are subtracted from liabilities it will be equal to?
(a) Share Capital

(b) Networth
(c) Working capital
(d) Goodwill
Q58. Cash receipt received from the sales fixed assets are recorded under the
head of:
(a) Other activities

(b) Investing activities
(c) Financing activities
(d) Operating activities
Q59. Current asset that can be transferred into cash within three months is known
as:
(a) Cash equivalent

(b) Intangible asset
(c) Liquid asset
(d) Cash asset
Q60. Which statement shows the flow of cash and cash equivalents during the
financial period?
(a) Statement of changes in equity

(b) Cash flow statement
(c) Balance sheet
(d) Income statement
Q61.Which statement is not mandatory as per Schedule III of Companies Act

2013.
(a) Statement of changes in equity

(b) Cash flow statement
(c) Balance sheet & P& L
(d) Fund flow statement
Q62.Which of the following are techniques, tools or methods of analysis and
interpretation of financial statements?
a) Ratio Analysis
b) Average Analysis
c) Trend Analysis
d) All of the above
Question 63.The most commonly used tools for financial analysis are:
(a) Comparative Statements
(b) Common-size Statement
(c) Accounting Ratios
(d) All the above
Q64. The analysis of financial statement by a shareholder is an example of:

(a) External Analysis
(b) Internal Analysis
(c) Vertical Analysis
(d) Horizontal Analysis
Q65.Payment of Income Tax is considered as :

(a) Direct Expenses
(b) Indirect Expenses
(c) Operating Expenses
(d) None of these
Q66.Which of the following is the purpose or objective of financial analysis ?

(a) To assess the current profitability of the firm
(b) To measure the solvency of the firm
(c) To assess the short-term and long-term liquidity position of the firm
(d) All the above
Q67.An annual report is issued by company to its :

(a) Directors
(b) Auditors
(c) Shareholders
(d) Management
Q68.In which meeting of company directors report is presented ?

(a) Directors Meeting
(b) Annual General Meeting
(c) Manager’s Meeting
(d) All of the above
Q69. Long term solvency is indicated by

a) Current ratio
b) Debit equity ratio
c) Net profit ratio
d) Liquidity ratio
Q70. Liability of Shareholders is limited to________ of the shares allotted

a) Paid up value
b) Called up value
c) Face value
d) Reserved price
Q71. Maximum number of members in a private company is :
a) 50
b) 100
c) 200
d) No limit
Q72. Equity shares cannot be issued for the purpose of:
a) Cash Receipts
b) Purchase of Assets
c) Redemption of debentures
d) Distribution of Dividend
Q73.A Company cannot issue:
a) Redeemable Equity Shares

b) Redeemable Preference Shares
c) Redeemable Debenture
d) Fully Convertible Debentures
Q74. Preference Shareholders have
a) Preferential right as to dividend only.

b) Preferential right in the management.
c) Preferential right as to repayment of capital at the time of
liquidation.
d) Preferential right as to repayment of capital at the time of
liquidation & Preferential right as to dividend
Q75. Which Shareholders have right to receive arrears of dividend from
future profits
a) Convertible preference shareholders
b) Non convertible preference shareholders
c) Cumulative preference shareholders
d) Non Cumulative preference shareholders
Q76. A preference share which have right of sharing in surplus profits is
a) Convertible preference share

b) Non convertible preference share
c) Cumulative preference share
d) Participating preference share
Q77. Unless otherwise stated, a preference share is always deemed to be
a) Cumulative, Participating, Non- convertible

b) Non-Cumulative, Non-Participating, Non-convertible
c) Cumulative, Non-Participating, Non- convertible
d) Non-Cumulative, Participating, Non- convertible
Q78. Nominal Share Capital is
a) That part of authorised capital which is issued by the company

b) That part of authorised capital which is applied by the
shareholders
c) Issued but not called up
d) Authorised share capital
Q79. Portion of capital which can be called up only the on winding up of

company is called
a) Authorised Capital
b) Called up capital
c) Uncalled Capital
d) Reserve Capital
Q80.Which one of the following technique is not normally used for

inventory control?
a) ABC Analysis
b) FSN Analysis
c) GOLF Analysis
d) FSND Analysis
Q81. Which section of the Companies Act requires that Balance Sheet is to
be prepared in the prescribed form?
a) Sec 129
b) Sec 148
c) Sec 128
d) Sec 198
Q82. Which of the following is prepared on a particular date?

a) Trading Account
b) Profit & Loss Account
c) Balance Sheet
d) All of the Above
Q83.Which of the following is not an objective of Financial Statements?
a) To show the company’s financial position
b) To show company’s operating efficiency
c) To the effectiveness of management
d) To determine Income Tax liability
Q84 Dividend usually paid on:

a) Authorised Capital
b) Issued Share Capital
c) Paid up Capital
d) Called up share capital
Q85. Which of the following is not the method of Financial Statements

Analysis?
a) Ratio Analysis
b) Comparative Analysis
c) Trend Analysis
d) Capitalization Method
Q86. Contingent liability is shown in Financial Statements as: -
a) In Long term liability

b) In Short term liability
c) In Miscellaneous Liability
d) In notes to accounts
Q87. Depreciation rates used by HVPNL for preparing Financial

Statements
a) As per Companies Act, 2013

b) As per Income Tax Act
c) As per HERC
Q88. Appointment of Statutory Auditor of a PSU made by:-
a) C&AG India
b) PAG of the state
c) Management of the PSU
d) Central/State Government
Q89. Supplementary Audit of PSU means
a) Audit by a firm of Chartered Accountants

b) Audit by Audit party appointed by PAG of the state
c) Special team nominated by Central Government
d) Vigilance team of the state
Q90. Appropriation of profits is shown in
a) Cash Flow Statement

b) Income statement
c) Balance Sheet
d) SOCIE
Q91. As per Companies Act, Balance Sheet of a company is required to be

prepared in __________
a) Horizontal form
b) Vertical form
c) Either Horizontal form or Vertical form
d) Neither of above
Q92. Call in advance appears in the company Balance Sheet under
e) Share Capital
f) Current Liability
g) Long term borrowing
h) Reserve & Surplus
Q93. Which of the following is not recorded in the Balance Sheet?
a) Prepaid Rent
b) Outstanding Rent
c) Rent as security
d) Rent Paid
Q94. Which of the following is measured as profit margin?
a) Operating efficiency
b) Assets use efficiency
c) Financial efficiency
Q95. Which of the following is not an example of Intangible Assets?
a) Trademarks
b) Patents
c) Technical Expertise
d) Preliminary Expenses
Q96. Stock is shown at cost or market prices whichever is less, due to:-
a) Accounting Concept
b) Accounting Principle
c) Accounting Conventions
d) Accounting Standards
Q97. If value of opening Inventory increase then grosses profit:-
a) Increase
b) Decrease
c) Stay same
d) Get closer to net profit
Q98. Incorrect cash flow planning can leads to___________
a) Solvency
b) Insolvency
c) Bankruptcy
d) Wining up
Q99.Capital Employed is:-
a) Total Assets-Current Liability

b) Non Current Assets+ Working Capital
c) Both a & b
Q100.Cash flow arises from __________ assets, ____________ liabilities and

_________ shareholders’ equity.
a) Increasing, Increasing, Decreasing

b) Increasing, Decreasing, Decreasing
c) Decreasing, Increasing, Increasing,
d) Decreasing, Increasing, Decreasing
C. COST Accounting
Q1.The following cost will remain same whatever the level of activity.
a) Incremental cost
b) Sunk Cost
c) Fixed Cost
d) Both b & C
Q2. The cost of property, plant & equipment at the price paid originally for
them is ___________________
a) Replacement cost
b) Historical Cost
c) Implicit cost
d) Fixed Cost
Q3. Which of the following is(are) fixed cost(s)?

a) Factory Rent
b) Insurance
c) Interest on Capital
d) All of the Above
Q4. Average Fixed Cost (AFC) is

a) Total Fixed Cost/No. Of Output Produced
b) Total Fixed Cost/No. Of units Purchased
c) Total Fixed Cost/Average inventory at store
d) Total Fixed Cost/Cost of Goods Sold
Q5. Marginal Cost is independent from the_________

a) Fixed cost
b) Variable cost
c) Incremental Cost
d) Both a & b above
Q6. Following is(are) advantage(s) of Marginal Cost.

a) Break Even Point analysis
b) Calculate /Unit of Profit
c) To decide whether firm needs to extend or not
d) To decide make or buy decision
Q7.LIFO method of pricing of materials is more suitable when________

a) Material prices are rising
b) Material prices are falling
c) Material prices are constant
d) Material Prices are fluctuating
Q8.Average method of pricing of materials is suitable when________

a) Material prices are rising
b) Material prices are falling
c) Material prices are constant
d) Material Prices are fluctuating
Q9.Scrap is ______________.
a) Residue Material
b) Wastage of Material
c) Surplus Material
d) Abnormal loss of material
Q10.EOQ stands for

a) Economic Output Quantity
b) Essential Order Quantity
c) Economic Order Quantity
d) Essential Output Quantity
Q11. Job Costing used in

a) Paper Miles
b) Chemical Work
c) Textile Works
d) Printing Works
Q12. A document which provides the detailed cost centre and cost units
a) Bill of Quantity
b) Profit & Loss statement
c) Cost Sheet
d) Quantity Purchased register
Q13. Direct Materials is a

a) Variable cost
b) Fixed cost
c) Semi variable cost
d) Semi fixed cost
Q14 According to Which Method of Pricing Issues is close to current

Economic Values?
a) First In First Out
b) Last in First Out
c) Highest in First Out
d) Weighted Average Price
Q15 VED analysis is a technique of ______________
a) Inventory Management Strategy
b) Activity Based Costing Strategy
c) Market research strategy
d) SWOT strategy
Q16.Which of the following Method of stock control aims at concentrating

efforts on selected items of materials?
a) Perpetual Inventory System
b) Annual Stock Taking System
c) Level Setting System
d) ABC analysis System
Q17. Material Requisition is meant for

a) Purchase of material
b) Sale of material
c) Storage of material
d) Supply of Materials from store
Q18.GRN number refers to _____________in Inventory Management.

a) Goods Returned Note
b) Goods Received Note
c) Goods Requisitioned Note
d) GST record Number
Q19. Labour Turnover means

a) Productivity of labour
b) Efficiency of labour
c) Change in Labour Force
d) Total sales/turnover using Labour
Q20.Idle Time is ___________

a) Time spent by workers in factory
b) Time spent by workers in the office
c) Time spent by workers off their job
d) Time spent by workers on their job
Q21. Under which system time spent on job is not considered.

a) Time Rate
b) Piece Rate
c) Halsey Plan
d) Rowan Plan
Q22.Which System is suitable when quality of work is important?

a) Time Rate
b) Piece Rate
c) Halsey Plan
d) Rowan Plan
Q23. Halsey Plan paid bonus to workers on the basis of___________.

a) Quantity Produced
b) Time Saved
c) Quality of Work Done
d) Zero Defected production
Q24 Following is a Direct Worker

a) Material Handler
b) Machine Operator
c) Foreman
d) Both a & b
Q25.Materials which can’t be charged directly is called______________

a) Direct Material
b) Indirect Material
c) Overheads
Q26.Rent of building is
a) Indirect overhead
b) Direct Overhead
c) Fixed overhead
d) Capital Expenditure
Q27.Depriciation on machinery is charged under which overhead?

a) Indirect Overhead
b) Direct Overhead
c) Office Overhead
d) Factory Overhead
Q28.Royalty on Production is a ____________charge.

a) Direct
b) Indirect
c) Overhead
Q29 Costing Department expenses are which kind of overhead?

a) Office Overhead
b) Selling Overhead
c) Production Overhead
d) Administrative Overhead
Q30. Which of the following represent a direct expense?

a) Administration
b) Advertisement
c) Office Rent
d) Wages
Q31. Under absorption costing, profit is ascertained
a) On the basis of difference between sales and total cost.

b) By computation as per desired rate of profit on sales or cost
c) Both a and b
d) None of the above.
Q32. Marginal costs is taken as equal to
a) Prime Cost plus all variable overheads

b) Prime Cost minus all variable overheads
c) Variable overheads
Q33. Which of the following statements related to Contribution Analysis are ture?
a) If contribution is zero, there is loss equal to fixed costs

b) If contribution is negative, loss is less than fixed costs
c) If contribution is positive and more than fixed cost there will be profit.
d) All of the above
Q34. When contribution is negative but less than fixed cost,
a) There is loss equal to fixed costs

b) There is loss more than fixed costs
c) There will be loss less than fixed costs
d) All of above are false
Q35. When contribution is positive but equal to fixed cost,
a) There is loss equal to fixed costs

b) There is loss more than fixed costs
c) There will be loss less than fixed costs
d) There will be neither profit not loss
Q36. Which of the following statements are true?
a) In absorption costing, cost is divided into three major parts while in marginal
costing cost is divided into two main parts.
b) IN absorption costing period is important and in marginal costing product is
important.
c) Both a and b
Q37. In context of net operating profit, which of the following statements are true?
a) If all costs are variable, the amount of profit obtained in marginal costing and
absorption costing will be same.
b) If the volume of sales and output is equal in a period, profit will be same in
absorption costing and marginal costing.
c) Both a and b
Q38. If sales is less than production and there is no opening stock, it suggests
there is closing stock. In such a scenario, profit under marginal costing will be less
than the one shown by absorption costing.
a) True
b) False
Q39. If the marginal cost is _________ buying price, additional requirement of the
component should be met by making rather than buying.
a) Equal to
b) More than
c) Less than
d) None of the above.
Q40. Which of the following models is used to calculate the timing of the inventory
order?
A. Economic order quantity model

B. Fixed order quantity model
C. Reorder point model
D. Fixed order inventory model
Hide Answer
Q41In the ABC Analysis system the B category stands for___.

A. Outstanding importance in value
B. Comparatively unimportant in value
C. Comparatively important in value
D. Average importance in value
Q42. Which among the following costs is the expense of storing inventory for a
specified period of time?
A. Purchasing cost
B. Carrying cost
C. Financial cost
D. Storing cost
Q43.The cost of insurance and taxes are included in
a) Cost of ordering
b) Set up cost
c) Inventory carrying cost
d) Cost of shortages
Q44. Buffer stock’ is the level of stock
a) Half of the actual stock

b) At which the ordering process should start
c) Minimum stock level below which actual stock should not fall
d) Maximum stock in inventory
Q45. The minimum stock level is calculated as
a) Reorder level – (Nornal consumption x Normal delivery time)

b) Reorder level + (Nornal consumption x Normal delivery time)
c) (Reorder level + Nornal consumption) x Normal delivery time
d) (Reorder level + Nornal consumption) / Normal delivery time
Q46. Which of the following is true for Inventory control?
a) Economic order quantity has minimum total cost per order

b) Inventory carrying costs increases with quantity per order
c) Ordering cost decreases with lot size
d) All of the above
Q47. The time period between placing an order its receipt in stock is known as
a) Lead time
b) Carrying time
c) Shortage time
d) Over time
Q48. Reorder level is calculated as
a) Maximum consumption rate x Maximum re-order period

b) Minimum consumption rate x Minimum re-order period
c) Maximum consumption rate x Minimum re-order period
d) Minimum consumption rate x Maximum re-order period
Q49. Average stock level can be calculated as
a) Minimum stock level + ½ of Re-order level

b) Maximum stock level + ½ of Re-order level
c) Minimum stock level + 1/3 of Re-order level
d) Maximum stock level + 1/3 of Re-order level
Q50. The internal rate of return (IRR) is the

a) Hurdle rate.
b) Rate of interest for which the net present value is greater than 1.0.
c) Rate of interest for which the net present value is equal to zero.
d) Rate of return generated from the operational cash flows.
Q51.The net present value method of capital budgeting assumes that cash flows
are reinvested at
a) The risk-free rate.

b) The cost of debt.
c) The rate of return of the project.
d) The discount rate used in the analysis.
Q52. The net present value of a proposed investment is negative; therefore, the
discount rate used must be
a) Greater than the project s internal rate of return.
b) Less than the project s internal rate of return.
c) Greater than the firm s cost of equity.
d) Less than the risk-free rate.
Q53.The accounting rate of return

a) Is synonymous with the internal rate of return.
b) Focuses on income as opposed to cash flows.
c) Is inconsistent with the divisional performance measure known as return on
investment.
d) Recognizes the time value of money.
Q54. When using the net present value method for capital budgeting analysis, the
required rate of return is called all of the following except the
a) Risk-free rate.
b) Cost of capital.
c) Discount rate.
d) Cutoff rate.
Q55.The internal rate of return for a project can be determined

a) If the internal rate of return is greater than the firm’s cost of capital.
b) Only if the project cash flows are constant.
c) By finding the discount rate that yields a net present value of zero for
the project.
d) By subtracting the firm’s cost of capital from the project’s profitability index.
Q56. A company wants to use discounted cash flow techniques when analyzing its
capital investment projects. The company is aware of the uncertainty involved in
estimating future cash flows. A simple method some companies employ to adjust
for the uncertainty inherent in their estimates is to:-
a) Prepare a direct analysis of the probability of outcomes.
b) Use accelerated depreciation.
c) Adjust the minimum desired rate of return.
d) Increase the estimates of the cash flows.
Q57. The internal rate of return on an investment:-
a) Usually coincides with the company s hurdle rate.

b) Disregards discounted cash flows.
c) May produce different rankings from the net present value method on
mutually exclusive projects.
d) Would tend to be reduced if a company used an accelerated method of
depreciation for tax purposes rather than the straight-line method.
Q58. All of the following are the rates used in net present value analysis except for
the
a) Cost of capital.
b) Hurdle rate.
c) Discount rate.
d) Accounting rate of return.
Q59. Payback period____________________?
a) And economic life of a project are the same

b) Is the length of time over which the earnings on a project equals the
investment
c) Is affected by the variation in earnings after the recovery of the investment
d) All A, B. and C
Q60. The Economic Order Quantity (EOQ) is calculated as
a) (2D*S/h)^1/2
b) (DS*/h)^1/2
c) (D*S/2h)^1/2
d) (D*S/3h)^1/2
Where, D=Annual demand (units), S=Cost per order, h=Annual carrying

cost per unit
Q61. Profit forgone by capital investment in inventory rather than investment of
capital to somewhere else is classified as
a) relevant purchase order costs

b) relevant inventory carrying costs
c) irrelevant inventory carrying costs
d) relevant opportunity cost of capital
Q62. An example of purchasing costs include

a) incoming freight
b) storage costs
c) insurance
d) spoilage
Q63. Which of the following is not true about Capital Budgeting?
a) Capital Budgeting decisions have an influence on the future stability of an

organisation
b) Capital Budgeting decisions include investments to expand the business
c) Capital Budgeting decisions are of an irreversible nature
d) Sunk cost is a part of Capital Budgeting
Q64. Which of the following can be a criterion for the acceptance of a project?
a) The Profitability Index should be greater than unity

b) The Internal Rate of Return should be greater than the cost of capital
c) The Net Present Value should be greater than zero
d) All of the above
Q63. Which of the following is a disadvantage of using the payback period?

a) It does not take into account the cost of capital and timing of return
b) When compared to the accounting rate of return method, it is more difficult
to calculate and understand
c) It does not take the initial investment into account
d) All of the above
Q64.Which of the following is an advantage of the Standard Costing System?

a) It helps in promoting and measuring efficiencies within an organisation
b) It helps to control and reduce the overall costing within an organisation
c) It helps to fix the selling price for the products manufactured within an
organisation
d) All of the above
Q65 Which of the following activities is true about the cost variance under the
Standard Costing System?
a) Cost variance is the difference between the standard cost and the
actual cost
b) Cost variance is the difference between the standard cost and the budgeted
cost
c) Cost variance is the difference between the standard cost and the marginal
cost
d) Cost variance is the difference between the actual cost and the marginal
cost
Q66.Which of the following is the audit fees a part of under the Standard Costing
System?
a) Audit fees is a part of the administration overhead in an organisation
b) Audit fees is a part of the distribution overhead in an organisation
c) Audit fees is a part of the selling overhead in an organisation
d) Audit fees is a part of the works on cost in an organisation
Q67.Which of the following parties are responsible for material price variances?
a) Production supervisors
b) Purchasing managers
c) Production schedules
Q68.Which of the following is a part of the Standard Costing process within an

organisation?
a) Comparison of standard and actual costing process
b) Preparation and usage of the standard costing
c) Analysis of variances
d) All of the above
Q69. It is not possible to measure labour productivity by comparing ______.

a) Standard time with actual time
b) Total output with total wage
c) Total person-hours with the total output
Q70.A company maintains a _____ to avoid stopping production due to the

shortage of material.
a) Minimum stock level
b) Reorder level
c) Maximum stock level
Q71.Break-even Analysis shows:
(a) Relationship between cost and sales

(b) Relationship between production and purchases
(c) Relationship between cost and revenue
(d) None of these
Q72.The margin of safety can be calculated using
a) Fixed cost-PV ratio

b) Total sales – Break-even sales
c) Fixed cost- Contribution
d) Total Sales –Fixed Cost
Q73.P-V Ratio can be improved by

a) Increasing selling price per unit
b) Reducing the direct and variable cost
c) Change product mix , production of high profitable products
d) All of the above
Q74. Which of the following formula cannot be used for calculation of PV Ratio?
(a) (Sales value-variable cost)/sales value

(b) (Fixed cost + Profit)/Sales Value
(c) Change in Profits/Change in sales
(d) Profit/Sales Value
Q75.Make or Buy decision is made by comparing cost with the outside purchase
price.
a) Fixed cost
b) Variable cost
c) Sunk Cost
d) Joint Cost
Q 76.Under which of the following method of budgeting, all activities are re-
evaluated each time a budget is set
(A) Materials budget
(B) Zero base budgeting
(C) Sales budget
(D) Overheads budget
Q 77. A budget that gives a summary of all the functional budgets and budgeted
statement of profit and loss is called
(A) Flexible budget
(B) Master budget
(C) Performance budget
(D) Zero base budgets
Q78. While preparing the cash budget, which of the following items would not be
included
(A) Interest paid to debenture holders
(B) Salaries and wages
(C) Bonus shares issued
(D) Income-tax paid
Q79. When demand forecasting is difficult, the budget which is prepared:
(A) Sales Budget
(B) Production Budget
(C) Financial Budget
(D) Flexible Budget
Q80.The quantity required to have desired profit is …………………
(a) (Fixed cost + desired profit ) / contribution per unit
(b) (Fixed cost – desired profit ) / contribution per unit
(c) (Fixed cost +desired profit ) * contribution per unit
(d) Fixed cost / (desired profit +contribution per unit)
Q81.Which of the following transactions will improve the Current Ratio?
A) Purchase of Goods for Cash.
B) Payment to Trade Payables.
C) Credit purchase of Goods.
D) Cash collected from Trade Receivables.
Q82. Inventory ratio is a relationship between ______.
A) Cost of goods purchased and cost of average inventory.
B) Cost of goods sold and cost of average inventory, and cost of goods
purchased and cost of average inventory.
C) Cost of goods sold and cost of average inventory.
D) None of the options is correct.
Q83.Higher the ratio, the more favourable it is, doesn’t stand true for
a. Debt equity Ratio

b. Liquidity ratio
c. Stock turnover ratio
d. Net Profit ratio
Q84. Business finance addresses which of the following?
a) Capital Budgeting
b) Capital Structure
c) Working Capital Management
d) All of the above
Q85. Difference between sales price & cost of inventory is____
a) Net Loss
b) Net Worth
c) Capital
d) Mark up
Q86.Total of all direct costs is termed as ___________
a) Prime cost
b) Works cost
c) Cost of sales
d) Cost of production
Q87. While evaluating deviation of actual and standard cost, technique used is
a) Regression analysis
b) Variance analysis
c) Linear progression
d) Trend analysis
Q88.Imputed cost is a__________________
a) Notional Cost
b) Real Cost
c) Normal Cost
d) Variable cost
Q89. Operating costing is suitable for __________
a) Job order business
b) Contractors
c) Sugar Industry
d) Service Industry
Q90. Process costing is suitable for __________

a) Hospitals
b) Transport business
c) Oil refining firm
d) Bricks Laying Firm
Q91 Cost accounting was developed because of the limitations of ______

a) Management Accounting
b) Human Resource Management
c) Double entry system
d) Financial Accounting
Q92. The cost which is to be incurred even when business unit is closed is a__
a) Imputed cost
b) Sunk cost
c) Historical cost
d) Shutdown cost
Q93. Direct Expenses are also called_______
a) Major Expense
b) Chargeable expenses
c) Overhead expenses
d) Sundry expenses
Q94. Warehouse rent is a part of__________
a) Office overhead
b) Selling overhead
c) Distribution overhead
d) Production overhead
Q95. Sales of defective is reduced from______________
a) Prime cost
b) Works cost
c) Cost of production
d) Cost of sales
Q96. Factory overhead can be charged on the basis of ___________
a) Material cost
b) Labour cost
c) Prime cost
d) Direct expense
Q97.A large margin of safety indicates_______________
a) Over production
b) Over capitalisation
c) Soundness of the business
d) Under capitalisation
Q98.CVP analysis is most important for determination of_________
a) Sales revenue necessary to equal fixed cost

b) Relationship between revenue & cost at various level of operation
c) Variable revenue necessary to equal fixed cost
d) Volume of operation to gain more profit
Q99. If fixed cost decrease while variable cost per unit remains same, the new
B.E.P will be ___________ than old B.E.P
a) Lower
b) Higher
c) Unchanged
d) Not able to determine
Q100. If fixed cost decrease while variable cost per unit remains same, the new
contribution margin will be ___________ than old contribution margin.
a) Lower
b) Higher
c) Unchanged
d) Not able to determine
D. Additional MCQs
Q1: The art of recording all business transactions in a systematic manner in
a set of books is called-
(a) Accounting
(b) *Book – keeping*
(c) Ledger
(d) None of these.
Q2: Cash, goods or assets invested by the proprietor in the business for
earning profit is called-
(a) Current Assets
(b) *Capital*
(c) Fixed assets
(d) None of these
Q3: The person, firm or institution who does not pay the price in cash for the
goods purchased or the services received is called-
(a) Creditor
(b) Proprietor
(c) *Debtor*
(d)Vender
Q4: …………… represents the excess of assets over liabilities.
(a) *Capital*
(b) Bank Balance
(c) Closing stock
(d) Reserve & surplus
Q5: The amount drawn by businessmen for his personal use is-
(a) Capital
(b) *Drawing*
(c) current assets
(d) Loss.
Q6: Cash – book always show-

(a) *Debit balance*
(b) Credit balance
(c) Debit or Credit balance
(d) None of these.
Q7: The entry which affects cash and bank column of a triple column cash –
book is known as –
(a) Compound entry
(b) *Contra entry*
(c) Journal entry
(d) Control entry
Q8: What statement is used while closing a Drawing Account-

(a) Balance c/d
(b) By Trading A/c
(c) By P & L A/c
(d) *By Capital Account*
Q9: The balance of closing stock of good’s Account is transferred to-
(a) Profit and loss Account
(b) Trading Account
(c) *Trading & Balance sheet*
(d) P&L & Balance sheet.
Q10: Contra entry is made in …………… book.

(a) Journal book
(b) Purchase book
(c) *Cash book*
(d) Sales book
Q11: Effect of Credit purchase of assets

(a) Decrease assets & liability
(b) increase assets decrease liability
(c) increase liability decrease assets
(d) *increase assets & liability*
Q12: Effect of Payment of liability

(a) *Decrease assets & liability*
(b) increase assets decrease liability
(c) increase liability decrease assets
(d) increase assets & liability
Q13: Effect of fresh capital introduction in business

(a) Decrease assets & liability
(b) increase capital decrease liability
(c) increase capital decrease assets
(d) *increase assets & capital*
Q14: Drawings’ falls under which account-

(a) *Personal account*
(b) Real account
(c) Nominal account
(d) None of these.
Q15: Income tax is treated as-

(a) Nominal Expense
(b) Direct Expense
(c) Personal Expense
(d) *Indirect Expense*
Q16: Cash purchase of goods is recorded in-

(a) Purchase book
(b) Sales book
(c) *Cash – book*
(d) Journal book
Q17: Credit purchase of goods is recorded in-

(a) *Purchase book*
(b) Sales book
(c) Cash – book
(d) Journal book
Q18: Credit purchase of furniture shall be recorded in-

(a) Purchase book
(b) *Journal book*
(c) Cash – book
(d) Return outward book
Q19: Who prepares a debit note-

(a) Seller
(b) *Purchaser*
(c) Cashier
(d) None of these.
Q20: Who prepares a credit note-

(a) *Seller*
(b) Purchaser
(c) Cashier
(d) None of these.
Q21: Return of goods by a customer is recorded in-

(a) Purchase book
(b) Sales book
(c) *return inward book*
(d) Return outward book
Q22: Such transactions for which no separate subsidiary books are

maintained are recorded in ……………..
(a) Petty cash book
(b) Miscellaneous transaction book
(c) *journal book*
(d) other subsidiary book
Q23: credit note is sent to -

(a) Seller
(b) *Purchaser*
(c) Cashier
(d) None of these.
Q24: Bank account is classified as

(a) Real account
(b) *Personal account*
(c) Nominal account
(d) Permanent account
Q25: Income tax is classified as
(a) *Personal account*
(b) Real account
(c) Nominal account
(d) Indirect account
Q26: When a single journal entry is passed for two transactions of same
nature on same date, such an entry is called?
(a) Contra entry
(b) *Compound entry*
(c) Mixed entry
(d) Combined entry
Q27: Interest on capital is recorded in which subsidiary book?

(a) Cash book
(b) *Journal book*
(c) Return outward book
(d) Return inward book
Q28: Which discount is recorded in purchase and sales book?
(a) *Trade discount*

(b) Cash discount
(c) Both a & b
(d) none of the above
Q29: Bank reconciliation is not a?

(a) Reconcile records
(b) Memorandum statement
(c) *Ledger account*
(d) Procedure to provide cash book adjustments
Q30: The balance on the debit side of the bank column of cash book
indicates?
(a) The total amount has drawn from the bank
(b) *Cash at bank*
(c) The total amount overdraft in the bank
(d) Cash deposit in to bank
Q31: Favourable balance means?

(a) Credit balance in the cash book
(b) Credit balance in Bank statement
(c) Debit balance in cash book
(d) *both b and c*
Q32: Unfavourable balance means?

(a) *Credit balance in the cash book*
(b) Credit balance in Bank statement
(c) Debit balance in cash book
(d) both b & c
Q33: Which of the following items is not a reason for difference between
bank balance as per cash book and pass book?
(a) Dishonoured check
(b) Cheques deposited but not yet cleared
(c) *Credit sales to customer*
(d) Cheques issued but not yet presented for payment
Q34: Directly collections of bank are to be ___________ in cash book?

(a) *Dr*
(b) Cr
(c) both
(d) None
Q35: Of the two sides of Trial balance does not tally, which Account is
opened –
(a) *Suspense Account*
(b) Personal Account
(c) Real Account
(d) None of the above
Q36: The error which can be disclosed by Trial balance-

(a) Error of omission
(b) Error of principal
(c) Compensatory error
(d) *None of these*.
Q37: Errors are rectified in this book-

(a) Ledger book
(b) *Journal proper*
(c) Trial balance
(d) None of these.
(e)
Q38: Asset Disposal A/c is prepared when :
(a) *Provision for Depreciation A/c is prepared*
(b) Asset A/c is prepared
(c) Profit & Loss A/c is prepared
(d) Depreciation A/c is prepared
Q39: Which of the following is the example of Capital Reserve?

(a) Workmen’s Compensation Fund
(b) None of these
(c) *Premium Received on issue of shares or debentures*
(d) General Reserve
Q40: Provision is created by debiting :

(a) *Profit and Loss Account*
(b) None of these
(c) Profit and Loss Appropriation Account
(d) Trading Account
Q41: Reserve is created by debiting :

(a) Profit and Loss Account
(b) None of these
(c) *Profit and Loss Appropriation Account*
(d) Trading Account
Q42: Under Reducing Balance Method, depreciation to be charged :
(a) Scrap Value
(b) *None of these*
(c) Real Value
(d) Original value
Q43: The depreciation charged on an asset will be credited to :
(a) Depreciation A/c
(b) *Asset A/c*
(c) P & L A/c
(d) Cash A/c
Q44: An alternative term used for accumulated depreciation expenses?
(a) *Provision for depreciation*
(b) Cumulative depreciation
(c) Targeted depreciation
(d) Depletion
Q45: Which of the following is reserve

(a) Provision for bad debt
(b) Contingent liability
(c) Workmen compensation paid
(d) *Retained earnings*
Q46: On what basis accounting principles are developed?

(a)Book keeping & recording
(b) *Accounting Conventions & Concepts*
(c) As decided by business
(d) non of the above
Q47: On dishonour of a discounted bill whom does the bank look for
payment
(a) *Drawer*
(b) Drawee
(c) Endorser
(d) Payee
Q48: On whom the trade bill drawn
(a) Seller
(b) Creditor
(c) *Debtor*
(d) Owner
Q49: What are the possible parties to a bill of exchange

(a) *Drawee, Drawer, Payee*
(b) Drawee, Drawer, Debtor
(c) Payer, Drawee, Drawer
(d) Drawee, Drawer, Creditor
Q50: If the drawer is in need of money and cannot wait till due date and
receive the money form bank is called?
(a) Endorsement of bill
(b) *Discounting of bill*
(c) Transfer of bill
(d) Dishonour of bill
Q51: In case if endorsement of bill the endorser debits?

(a) *Creditor account*
(b) Cash account
(c) Bill receivable account
(d) Bill payable account
Q52: Drawing is goods is credited from:

(a) Sales
(b) *Purchase*
(c) Returns outward
(d) Capital
Q53: Balance sheet is a ………………
(a) Account
(b) *Statement*
(c) Analysis
Q54: Increase in capital at the end of the year represents ………

(a) Capital introduction
(b) Profit
(c) *both a & b*
Q55: Prepaid expenses are shown in-

(a) Liability side
(b) *Asset side*
(c) Assets or Liability side
(d) None of these.
Q56: Receipt and payment account is a summary of-

(a) Income & Expenditure account
(b) Profit & Loss A/c
(c) *Cash – book*
(d) None of these.
Q57: Goods given in charity is credited in …………… Account.

(a) Expenses
(b) *Purchase*
(c) Charity
(d) Sundry charges
Q58: [24/07, 11:58 am] Albatross: Unearned income is shown on the

……………….. side of balance sheet.
(a) Asset
(b) *Liability*
(c) Both a & b
Q59: ……………. represents the excess of assets over liabilities.

(a) Profit
(b) Loss
(c) *Capital*
(d) Bank balance
Q60: Reserve share capital means :

(a) Part of authorised capital to be called at the beginning
(b) *Portion of uncalled capital to be called only at liquidation*
(c) Oversubscribed capital
(d) Under subscribed capital
Q61: When full amount is due on any call but it is not received, then the
short fall is debited to :
(a) Calls-in-advance
(b) *Calls-in-arrear*
(c) Share Capital
(d) Suspense Account
Q62: The difference between subscribed capital and called up capital is

called :
(a) Calls-in-arrear
(b) Calls-in-advance
(c) *Uncalled capital*
(d) None of these
Q63: Securities Premium can not be applied :
(a) *For paying dividend to members*
(b) For issuing bonus shares to members
(c) For writing off preliminary expenses of company
(d) For writing off discount on issue of debentures
Q64: Securities Premium is shown under which head in the Balance Sheet
?
(a) *Reserve and Surplus*
(b) Miscellaneous Expenditure
(c) Current Liabilities
(d) Share Capital
Q65: Capital included in the liabilities of a company is called :

(a) Authorised Capital
(b) Issued Capital
(c) Subscribed Capital
(d) *Paid-up Capital*
Q66: When shares are forfeited, the Share Capital Account is debited with:
(a) Nominal value of Shares
(b) Market value of Shares
(c) *Called-up value of Shares*
(d) Paid-up value of Shares
Q67: If the loss on reissue of shares is less than the amount forfeited, the
‘surplus’ or profit is transferred to :
(a) *Capital Reserve*
(b) Revenue Reserve
(c) Profit & Loss A/c
(d) None of these
Q68: Forfeiture of shares results in the reduction of:

(a) *Paid-up Capital*
(b) Authorised Capital
(c) subscribed Capital
(d) Reserve Capital
Q69: Amount of calls in Arrear is :

(a) Added to capital
(b) *Deducted from share capital*
(c) Shown on the assets side
(d) Shown an the equity and liability side
Q70: Discount allowed on reissue of forfeited shares is debited to:

(a) Share Capital A/c
(b) *Share Forfeiture A/c*
(c) Profit & Loss A/c
(d) General Reserve A/c
Q71: A company has…………

(a) Separate Legal Entity
(b) Perpetual Existence
(c) Limited Liability
(d) *All the above
Q72: Right shares are the shares, which :

(a) Are issued to the Direction of the company
(b) *Are issued to existing shareholders of the company*
(c) Are issued to promoters in consideration of their services
(d) Are issued to the vendors for purchasing assets
Q73: The maximum capital beyond which a company is not allowed to

raise funds, by issue of shares is called …………..
(a) Issued capital
(b) Reserve capital
(c) *Authorised capital*
(d) Subscribed capital
Q74: Which one of the following is the registered capital of the company ?
(a) Paid-up capital
(b) Uncalled capital
(c) *Authorised capital*
(d) Issued capital
Q75: Which account should be debited when shows an issued to
promoters:
(a) Share Capital A/c
(b) Assets A/c
(c) Promoter’s A/c
(d) *Goodwill A/c*
Q76: Which of the following should be deducted from the called-up capital
to find out paid-up capital:
(a) Calls-in-advance
(b) *Calls-in-arrear*
(c) Share forfeiture
(d) Discount on issue of shares
Q77: When all debentures are redeemed, balance in the Debenture

Redemption Fund Account is transferred to:
(a) Capital Reserve
(b) *General Reserve*
(c) Profit & Loss Appropriation A/c
(d) None of these
Q78: According to SEBI guidelines, a Company will have to create
debenture redemption reserve equivalent to the amount of the following
percentage of debenture issued:
(a) 50%
(b) *25%*
(c) 70%
(d) 100%
Q79: [Debentures can be redeemed out of:

(a) Profit
(b) Capital
(c) Provision
(d) *All of the above*
Q80: Debentures cannot be redeemed at:

(a) Par
(b) Premium
(c) *Discount*
(d) More than 10% premium
Q81: If debentures purchased in open market are not immediately

cancelled, they are treated as :
(a) Current Assets
(b) Current Liabilities
(c) *Investment*
(d) Capital
Q82: If redemption of debentures is made by conversion method, the

amount to be transferred to ‘Debenture Redemption Reserve Account’ will
be equal to…….percent of converted amounted.
(a) 25
(b) 50
(c) 75
(d) *Not required*
Q83: Loss on Issue of Debenture Account is shown:

(a) *On Assets side of Balance Sheet*
(b) On Liabilities side of Balance Sheet
(c) On Credit side of P & L Account
(d) on the debit side of P & L
Q84: Profit on sale of Sinking Fund Investment is transferred to:

(a) Profit & Loss Account
(b) General Reserve
(c) *Sinking Fund Account*
(d) Capital Reserve
Q85: Premium on Redemption of Debentures A/c is:

(a) Asset
(b) Expenses
(c) *Liability*
(d) Revenue
Q86: Sinking Fund is a part of:

(a) Fixed Liabilities
(c) *Reserves and Surplus*
(d) Fixed Assets
Q87: Discount on issue of Debentures is in the nature of:

(a) Revenue Loss
(b) *Capital Loss*
(c) Deferred Revenue Expenditure
(d) None of there
Q88: The balance of discount on debentures is shown in the Balance

Sheet on:
(a) *Assets side*
(b) Liabilities side
(c) None of these
(d) All of these
Q89: Discount on issue of Debentures should be written off:

(a) Out of Securities Premium Account
(b) Out of Capital Profits
(c) Out of Statements of Profit and Loss
(d) *In the above order over the period of debentures*
Q90: Debenture premium can be used to :

(a) Write off the discount on issue of shares or debentures
(b) Write off the premium on redemption of shares or debentures
(c) Write off capital loss
Q91: Which of the following is false ?

(a) A company can issue redeemable debentures
(b) *A company can issue debentures with voting rights*
(c) A company can buy its own shares
(d) A company can buy its own debentures
(e)
Q92: Equity ₹ 90,000 Liabilities ₹ 60,000 Loss of the year ₹ 20,000. Then
total assets will be :
(a) ₹ 1.70,000
(b) ₹ 1,50,000
(c) *₹1,30,000*
(d) ₹ 1,10,000
Q93: The reserve which is created for a particular purpose and which is a
charge against revenue is called:
(a) Capital Reserve
(b) General Reserve
(c) Secret Reserve
(d) *Specific Reserve*
Q94: An Annual Report is issued by a company to its:

(a) Directors
(b) Authors
(c) *Shareholders*
(d) Management
Q95: The profit and loss disclosed by the accounts of a company is:
(a) Transferred to share capital account
(b) Shown under the head of ‘Current liabilities’ and provisions
(c) *Shown under the head ‘Reserves and Surplus*
(d) None of these
Q96: Debit Balance of Profit & Loss Statement will be shown on:
(a) Assets Side of Balance Sheet
(b) Liabilities Side of Balance Sheet
(c) Under the head Reserve & Surplus
(d) *Under the head Reserves and Surplus as a negative item*
Q97: Contingent Liabilities are exhibited under the heading:

(a) Fixed Liabilities
(c) *As a footnote*
(d) None of these
Q98: Provision for Provident Funds is shown in the Balance Sheet of a

company under the head :
(a) Reserves and Surplus
(b) *Non-current Liabilities*
(c) Provision
(d) Contingent Liabilities
Q99: According to which part of Schedule III of the Indian Companies Act,
2013, Indian companies have to prepare Balance Sheet:
(a) *Part 1*
(b) Part 2
(c) Part 3
(d) Part 4
Q100: Which of the following assets is not shown under the head ‘Fixed
Asset’ in the Balance Sheet ?
(a) Goodwill
(b) *Investments*
(c) Buildings
(d) Vehicle
Q101: Amount set aside to meet losses due to bad debts is called:
(a) Reserve
(b) *Provision*
(c) Liability
(d) contingent liabilities
Q102: The most commonly used tools for financial analysis are:
(a) Comparative Statements
(b) Common-size Statement
(c) Accounting Ratios
(d) *All the above*
Q103: For calculating trend percentages any year is selected as:

(a) Current year
(b) Previous year
(c) *Base year*
(d) None of these
Q104: Which of these are not the method of financial statement analysis?
(a) Ratio Analysis
(b) Comparative Analysis
(c) Trend Analysis
(d) *Capitalisation Method*
Q105: Break-even Analysis shows:

(a) *Relationship between cost and sales*
(b) Relationship between production and purchases
(c) Relationship between cost and revenue
(d) None of these
Q106: The financial statements of a business enterprise include:

(a) *Statement of change in equity*
(b) Trial Balance
(c)Fund Flow Statement
(d) All the above
Q107: Balance Sheet provides information about financial position of the

enterprise :
(a) *At a Point of Time*
(b) Over a Period of Time
(c) For a Period of Time
(e)
Q108: In which meeting of company directors report is presented?
(a) Directors Meeting
(b) *Annual General Meeting*
(c) Manager’s Meeting
Q109: Proprietary Ratio indicates the relationship between proprietor’s
funds and….
(a) Reserve
(b) Share Capital
(c) *Total Assets*
(d) Debentures
Q110: Profitability Ratios are generally expressed in :

(a) Simple Ratio
(b) *Percentage*
(c) Times
(d) None of these
Q111: Albatross: Operating Ratio is:

(a) *Profitability Ratio*
(b) Activity Ratio
(c) Solvency Ratio
(d) None of these
Q112: Which of the following is an operating’ income ?

(a) *Sale of Merchandise*
(b) Interest Income
(c) Dividend Income
(d) Profit on the sale of old car
Q113: Capital employed we mean:

(a) Net Fixed Assets
(b) Current Asset-Current Liabilities
(c) Gross Block
(d) *Fixed Assets + Current Assets-Current Liabilities*
Q114: Ratio based on figures of profit & loss as well a the Balance sheet
are:
(a) Profitability Ratios
(b) Operation Ratio
(c) Liquidity Ratio
(d) *Composite Ratio*
Q115: What does Creditors Turnover Ratio take into account:

(a) *Total credit purchases*
(b) Total credit sales
(c) Total cash sales
(d) Total cash purchases
Q116: Stock turnover ratio comes under :
(a) Liquidity Ratio
(b) Profitability Ratio
(c) *Activity Ratio*
(d) None of these
Q117: The satisfactory ratio between internal and external equity is. :
(a) 1 : 2
(b) *2 : 1*
(c) 3 : 1
(d) 4 : 1
Q118: Which of the following transactions will improve the current ratio?
(a) Purchase of good for cash
(b) Cash received from customers
(c) *Payment of creditors*
(d) Credit purchase of goods
Q119: Issue of shares in consideration of purchase of plant and machinery

results into :
(a) Inflow of Cash
(b) Outflow of Cash
(c) *Neither Inflow nor Outflow*
(d) None of these
Q120: If net profit is ₹ 35,000 after writing off good will ₹ 6,000 and loss on
sale of furniture ₹ 1,000, cash flow from operating activities will be :
(a) ₹ 35,000
(b) *₹ 42,000*
(c) ₹ 29,000
(d) ₹ 28,000
Q121: Cash from operating activities will decrease due to :

(a) Increase in Current Assets
(b) Decrease in Current Liabilities
(c) Neither of the two
(d) *Both (a) and (b)*
Q122: Which of the following is an example of Cash Flow from Operating

Activities?
(a) Purchase of Machinery
(b) Issue of Shares
(c) *Purchases of Inventory for Cash*
(d) Purchases of Investment
Q123: While calculating operating profit which will be added to net profit:
(a) Interest received
(b) Profit on sale of Asset
(c) *Increase in General Reserve*
(d) Refund of Tax
Q124: While calculating cash flow from operating nativities which will be
deducted?
(a) Increase in Creditors
(b) *Increase in Debtors*
(c) Decrease in Debtors
(d) Decrease in Prepaid Expenses
Q125: While calculating cash flow from operating activities, which will be
added ?
(a) Increase in Stock
(b) *Increase in Creditors*
(c) Decrease in Bills Payable
(d) Increase in Debtors
Q126: An example of Cash Flows from Financing Activity is :

(a) Sale of goods
(b) Sale of Investment
(c) *Cash receipts from issue of shares*
(d) Interest received
Q127: How will you treat payment of ‘Interest of Debentures’ while

preparing a Cash Flow Statement ?
(c) *Cash Flow from Financing Activities*
(d) Cash Equivalents
Q128: Where will you show purchase of goodwill in Cash Flow Statement:
(b) *Cash Flow from Investing Activities*
(d) Cash Equivalent
Q129: Interest received by a finance company is classified under which kind
of activity while preparing a Cash Flow Statement?
(a) *Cash Flow from Operating Activities*
(c) Financing Activities
(d) Cash Equivalent
Q130: In cash flow statement, the item of ‘Interest’ is shown in:

(a) Operating Activities
(c) Financial Activities
(d) *In both (d) & (c)*
Q131: Which of the following is not a Cash Outflow:
(a) *Increase in Creditors*
(b) Increase in Debtors
(c) Increase in Stock
(d) Increase in prepaid expenses
Q132: Cash Flow Statement is prepared from:

(a) Balance Sheet
(b) Profit & Loss Account
(c) Additional Information
(d) *All of these*
Q133: Claims received from Insurance Companies are treated as:

(a) *Cash Flow from Operating Activities*
(d) None of these
Q134: Long term assets having no physical existence but, possessing a

value are called
(a) *Intangible assets*

(b) Fixed assets
(c) Current assets
(d) Investments
Q135: Gross profit is

(a) Cost of goods sold + Opening stock
(b) *Excess of sales over cost of goods sold*
(c) Sales - Purchases
(d) Net profit fewer expenses of the period
Q136: Which of these best explains fixed assets?

(a) Are bought to be used in the business
(b) Are expensive items bought for the business
(c) Are items which will not wear out quickly
(d) *Are of long life and are not purchased specifically for
resale*
Q137: Suppliers personal a/c are seen in the
(a) Sales Ledger
(b) Nominal ledger
(c) *Purchases Ledger*
(d) General Ledger
Q138: At the balance sheet date, the balance on the Accumulated Provision
for Depreciation Account is
(a) Transferred to Depreciation Account
(b) Transferred to the Asset Account
(c) Transferred to Profit and Loss Account
(d) *Simply deducted from the gross value of asset in the
Balance Sheet*
Q139: If we take goods for own use we should

(a) *Debit Drawings Account, Credit Purchases Account*
(b) Debit Drawings Account: Credit Stock Account
(c) Debit Sales Account: Credit Stock Account
(d) Debit Purchases Account: Credit Drawings Account
Q140: Carriage inwards is shown on:

(a) *Debit side of Trading Account*
(b) Debit side of Profit and Loss Account
(c) Assets side of the Balance Sheet
(d) Liabilities side of the Balance Sheet
Q141: Returns Outward is deducted from:

a.Sales
b.Net Profit
c.Capital
d.*Purchases*
Q142: An example of fictitious asset is:
(a) Patent right
(b) *Preliminary Expenses*
(c) Furniture
(d) Investment
Q143: An example of intangible asset is:
(a) Machinery
(b) Prepaid Insurance
(c) Mine
(d) *Copyrights*
Q144: Outstanding rent is a:

(a) *Representative Personal Account*
(b) Real Account
(c) Nominal Account
(d) Personal Account
Q145: It is necessary to make a distinction between capital and revenue

items because:
(a) It is helpful to assess financial position

(b) It is helpful in calculating true profit or loss
(c) It is required by accounting principles
Q146: Expenditure of installation of a new machinery, is:

(a) *Capital expenditure*
(b) Revenue expenditure:
(c) Deferred Revenue expenditure
(d) Recurring expenditure
Q147: Heavy advertisement expenditure is an example of:

(a) Revenue Expenditure
(b) Capital Expenditure
(c) *Deferred Revenue Expenditure*
Q148: Which of the following is not a revenue receipt?

(a) Discount received
(b) Sales made
(c) *Sale of Plant*
(d) Commission
Q149: Accounting Standards in India are Issued by the …………..

(a) *ICAI*
(b) BMCC
(c) IT
(d) IMA
Q150: Accounting Standards are beneficial not only to the business

enterprises but also to the………….. as well.
A. *accountants & auditor*
B. Customers
C. Family and Country
D. Traders
Q151: Which one of the following is the “Product Cost” ?

a. Salesmen Commission
b. Administrative Staff salary
c. Interest on Bank Loan
d. Indirect materials
Q152: Where several undertakings of the same industry use the same costing
principles, they make use of
a. Absorption Costing
b. Uniform Costing
c. Marginal Costing
d. Historical Costing
Q153: Material with lowest price is issued first” this sentence is suitable to
a. LIFO
b. HIFO
c. FIFO
d. NIFO
Q154: When an employee is given wages according to units he produces,
then _________ is given to him.
a. Time Card
b. Piece Work Card
c. Job Card
d. Both Piece Work Card and Job Card
Q155: Which method is also a repeated Distribution method?
a. Graphic Presentation method

b. Average method
c. Indirect method
d. Trial and Error method
Q156: Suppose the total cost of the product is ` 5,000 and profit on Selling
price is 20%, what will be the profit on cost price ?
(a) 1,000
(b) 750
(c) 1,500
(d) 1,250
Q157: Which of the following is NOT necessary for the purpose of regulating
the Profession of Auditing in India ?
(a) The Companies Act, 1956
(b) The Institute of Chartered Accountants of India, 1949
(c) Comptroller and Auditing General of India
(d) Income Tax Act, 1961
Q158: Which one of the following is an error of Principle?

(a) Double Posting
(b) Posting wrong amount to an Account
(c) Debiting Landlord’s account for the payment of rent
(d) Omission to post to an Account
Q159: Which one of the following is NOT a relevant voucher for vouching of
cash received on issue of shares ?
(a) Cash book and Pass book
(b) Share Application and Allotment Shares
(c) Board of Director’s resolution
(d) Agreements with the financial institutions for borrowing loans.
Q160: Which one of the following is NOT a relevant while conducting

verification and valuation of assets?
(a) All items of stock on hand is to be physically checked.
(b) Plant and Machinery needs to be shown in the Balance Sheet at
Cost less depreciation.
(c) Any change on the business assets must be verified.
(d) The Auditor should verify the actual physical existence of assets
Q161: Which one of the following is NOT correct with regards to the “Rights of
An Auditor”?
(a) Right to receive remuneration.
(b) Right to be indemnified.
(c) Right to attend the Board of Director’s meeting
(d) Right to get “Expert advice”.
Q162: Contribution received at the Break Even point is equal to _________

(a) Total fixed cost
(b) (2) Variable cost
(c) (3) Loss
(d) Profit
Q162: If Proprietary Ratio is 100%, then it means that _______.
(a) Business totally depends on outside funds
(b) The proportion between owned and outside funds is 1:1
(c) Business totally depends on owned funds
(d) It is hard to say because of lack of information
Q163: From the following, in calculation of which ratio, Preference Dividend is
deducted from Net Profit ?
(a) Return on Shareholder’s fund
(b) Return on Capital Employed
(c) Net Profit Ratio
(d) Return on Equity Shareholder’s fund
Q. 164 Which of the following describes the format of the Materials Purchase
Budget?
(a) Required Production + Desired Closing Inventory – Opening Inventory
(b) Required Production – Desired Closing Inventory + Opening Inventory
(c) Sales + Desired Production – Opening Inventory
(d) Desired Production – Desired Closing Inventory + Opening Inventory
Q165. After the end of Financial Year, within how much time, Final Accounts of the
company should be presented in Annual General Meeting ?
(a) Nine Months
(b) Three Months
(c) Any time before the end of Next Financial Year
(d) Six Months
Q166. Which of the following considers the project’s profitability?

(a) Average Rate of Return
(b) Payback Period
(c) Discounted Cash Flow
(d) Profitability Index
Q167 A “Zero” NPV indicates

(a) Rate of Return on Original Investment
(b) Rate of Return on Average Investment
(c) Internal Rate of Return
(d) Average Rate of Return
Q168. Statement-I : Interest & Dividend are received from investments. Naturally,
they should be classified as cash inflows from investing activities. (In case of other
enterprise)
Statement-II : Examples of Non-cash transactions are – (i) Purchase of assets by
issue of shares (ii) Conversion of debentures into shares
(a) Both the statements are correct.
(b) Both the statements are incorrect.
(c) Statement I is correct & Statement II is incorrect.
(d) Statement I is incorrect & Statement II is correct.
Q169. What is the full form of IFRS?
(a) International Fiscal Report Statement
(b) International Financial Reporting Statement
(c) International Financial Reporting Standard
(d) International Fiscal Recording Statement
Q170. What is the correct sequence of following stages in accounting process? 1.
Income statement 2. Trial balance 3. Journalizing 4. Posting 5. Position statement
6. Balancing
(a) 2,5,1,3,6,4
(b) 3,6,4,2,5,1
(c) 3,2,1,6,4,5
(d) 3,4,6,2,1,5
Q171.What is the full form of GAAP ?
(a) Generally Accepted Accounting Procedure
(b) Generally Accepted Accountant Procedure
(c) Generally Accepted Accounting Principles
(d) Generally Accepted Accountant Principles
Q172.The order in which various assets and liabilities are shown either in order of
liquidity or in the order of permanency in the balance-sheet is termed as
(a) Classification
(b) Grouping
(c) Marshalling
(d) Tabulation
Q173.Which one of the following is not the type of standard ?
(a) Ideal Standard
(b) Basic Standard
(c) High Standard
(d) Current or Expected Actual Standards
Q174. If contractor had to deposit some amount on accepting the contract i.e.
Tender Deposit is shown
(a) Contract account
(b) Balance sheet
(c) P & L account
(d) Contractee account
Q175. What will be the correct formula of Gearing Ratio ?

(a) Fixed charge capital [Long term loans+ Preference shares]/Fictitious assets
(b) Equity share capital / Preference Share Capital + Debentures
(c) Preference Share Capital + Debentures / Equity share capital
(d) Equity share capital + Preference share capital / Debentures
Q176. The account of head office for an Independent branch is like

(a) Nominal Account
(b) Profit and Loss Account
(c) Capital Account
(d) Real Account
Q177. The balance of the goods sent on the Consignment Accounts should be
shown on the _________.
(a) Credit Side of the Trading Account
(b) Debit Side of the Profit and Loss Account
(c) Debit Side of the Trading Account
(d) Credit Side of the Profit and Loss Account
Q178.Depreciation is calculated on machinery purchased by company in
(a) Pre incorporation
(b) Post incorporation
(c) Sales ratio
(d) Time ratio
Q179.Interest on the security is calculated on

(a) Purchase Price
(b) Market Value
(c) Face Value
(d) Nominal Value
Q180.The amount brought in by owner of the business should be credited to?

(a) *Owner Equity*
(b) Drawing
(c) Cash
(d) All of above
Q181. Of the following account types, which would be increased by a debit?

(a) Liabilities and expenses
(b) Assets and equity
(c) *Assets and expenses*
(d) Equity and revenues
Q182. Sales made to customer on credit should be debited to?

(a) *Account Receivable*
(b) Cash
(c) Bank
(d) Sales
Q183. According to the rules of debit and credit for balance sheet accounts?
(a) Increase in assets, liabilities and owner equity recorded by debit
(b) Decrease in asset and liability are recorded by credit
(c) Increase in asset and owner’s equity are recorded by debit
(d) *Decrease in liability and owner’s equity are recorded by debit*
Q184. Bank overdraft account is a :
A.*Personal account*
B. Real account
C. Nominal account
D. Representative personal account
Q185. Outstanding Salary is _ account:

(i) Real Account
(ii) Nominal Account
(iii) *Personal Account*
(iv) None of these
Q186. Every adjusting entry affects?

(a) Income statement account only
(b) Balance sheet account only
(c) *Both A & B*
(d) None
Q187. Outstanding expenses are
(a) *Current Liability*
(b) Fixed Liability
(c) Contingent Liability
(d) None of these
Q188.In case of purchase and sale of securities ex-interest

(1) Interest is payable in addition to market price.
(2) No separate calculation of interest is made.
(3) The seller gets interest on next interest date.
(4) Market price includes the interest also.
Q189. In which of the following method of sales, if the purchaser can’t pay the
amount of instalment, the vender can get the assets as return back ?
a. Cash method
b. Instalment method
c. Hire Purchase method
d. Sale or Sales return method
Q190. When the value of goodwill is not given, the value of goodwill is found out in
the purchase of business by applying the following formula :
a. Goodwill = Purchase price less net assets
b. Goodwill = Net assets less purchase price
c. Goodwill = Total assets less purchase price
d. Goodwill = Purchase price plus net assets
Q191. Total assets of a firm are 6, 60,000. Total liabilities are ` 50,000. Purchase
price is determined at ` 2, 30,000. Then remaining amount would be debited to
(1) Goodwill A/c.
(2) Capital Reserve A/c.
(3) General Reserve A/c.
(4) Both Goodwill and Capital Reserve
Q192. The cost of Inventory includes the following:

(1) Cost of Purchase + Cost of Conversion
(2) Opening Stock + Purchase
(3) Cost of goods sold – Closing Stock
(4) Purchases + Administration Expenses + Selling Expenses
Q193. In case of continuous increase in profits of the company, which profit shall
be taken into consideration for goodwill valuation?
(1) Weighted Average Profit
(2) Super Profit
(3) Revenue
(4) Simple Average
Q194.What is the formula for finding out the Super Profit?
(1) Average Profit + Expected Profit
(2) Expected Profit – Average Profit
(3) Average Profit – Expected Profit
(4) Expected Profit + Average Profit
Q195. IND AS- 16 is

(1) Inventory
(2) Income Tax
(3) Employee Benefit
(4) Property, Plant & Equipment
Q196. IND AS related to Income Tax
1. IND AS 10
2. IND AS 11
3. IND AS 12
4. IND AS 13
Q197. Statement of Cash Flow covered under
1. IND AS 7
2. IND AS 8
3. IND AS 9
4. IND AS 10
Q198. IGST means
1. Incentive Goods & Service Tax

2. Integrated Goods & Service Tax
3. Inter State Goods & Service Tax
4. Interested Goods & Service Tax
Q199. From the following which is not a technique of Capital Budgeting?
1. IRR
2. ARR
3. CRR
4. NPV
Q200. GST implemented in India from

1. 1-07-2016
2. 1-07-2017
3. 1-06-2017
4. 1-07-2018
(PAPER-VII)
GST Law, Company Law & Company Management
(For All HPUs)
1. IGST is payable when the supply is ........

a) Interstate
b) Intra- UT
c) Intra-state
d) All of the above
2. Which of the following taxes have been subsumed in GST?

a) Central sales tax
b) Central excise duty
c) VAT
d) All of the above
3. GST is levied on supply of all goods and service except.....

a) Alcoholic liquor for human consumption
b) Tobacco
c) Health care service
d) All of the above
4. The functions of goods and services network (GSTN) include....

a) Facilitating registration
b) Forwarding the return to central and state authorities
c) Computation and settlement of GST
d) All of the above
5. Aggregate turnover does not include-

(a) Inward supplies on which tax is payable on reverse charge basis
(b) Exempt supplies
(c) Export of goods or services or both
(d) Inter-State supplies of persons having the same PAN number
6. Which of the following is/are included in definition of “Goods” u/s 2(52)

I. Money
II. Actionable claim
III. Security
IV. Growing crops
Select the correct answer from the options given below
a. IV only
b. II & III
c. II & IV
d. I & II
7. A __________ supply comprising of two or more supplies shall be treated as

the supply of that particular supply that attracts highest rate of tax.
a) Composite
b) Mixed
c) Both (a) and (b)
8. GST is a comprehensive tax regime covering _________

a) Goods
b) Services
c) Goods, services and imports
d) Goods & services
9. What are the taxes levied on an intra-State supply?

(a) CGST
(b) SGST
(c) CGST and SGST
(d) IGST
10. Who will notify the rate of tax to be levied under CGST Act?
(a) Central Government
(b) State Government
(c) GST Council
(d) Central Government as per the recommendations of the GST Council
11. Which of the following taxes will be levied on imports?
(a) CGST
(b) SGST
(c) IGST
(d) CGST and SGST
12. What is time of supply of goods, in case of forward charge?

(a) Date of issue of invoice
(b) Due date of issue of invoice
(c) Date of receipt of consideration by the supplier
(d) Earlier of (a) & (b)
13. What is time of supply of goods, in case of supplier opting for

composition levy under Section 10 of the CGST Act, 2017?
(b) Date of receipt of consideration by the supplier
(c) Latter of (a) & (b)
14 . What is the time of supply of vouchers when the supply with respect to
the voucher is identifiable?
(a) Date of issue of voucher
(b) Date of redemption of voucher
(c) Earlier of (a) & (b)
(d) (a) & (b) whichever is later
15. What is the time of supply of vouchers when the supply with respect to
the voucher is not identifiable?
(a) Date of issue of voucher
(b) Date of redemption of voucher
(c) Earlier of (a) & (b)
(d) (a) & (b) whichever is later
16. What is the time of supply of service if the invoice is issued within 30
days from the date of provision of service?
a) Date of issue of invoice
b) Date on which the supplier receives payment
c) Date of provision of service
d) Earlier of (a) & (b)
17. What is the time of supply of service where services are received from
an associated enterprise located outside India?
a) Date of entry of services in the books of account of recipient of service
b) Date of payment
c) Earlier of (a) & (b)
d) Date of entry of services in the books of the supplier of service
18. Time of supply means

a. The point in time when GST is actually paid by the supplier of goods or
services
b. The point in time when GST is actually paid after taking input credit by the
supplier of goods or services
c. The point in time when goods have been deemed to be supplied or
services have been deemed to be provided
d. The point in time when GST return is filed by the supplier of goods or services
19. What is the time of supply of import of service?

a. Date of entry of services in the books of account of recipient of service
b. Date of payment
c. 61st day from the date of invoice
d. Earlier of (a) & (b)
e. Earlier of (b) & (c)
20. Which of the following shall not be included in value of supply?

a) Discount given after supply
b) Interest
c) Late fee
d) Commission
21. The value of supply should include:

a) Any non-GST taxes, duties, cesses, fees charged separately by supplier
b) Interest, late fee or penalty for delayed payment of any consideration for any
supply
c) Subsidies directly linked to the price except subsidies provided by the Central
and State Governments
d) All of the above
22. Value of supply under section 15(1) is:

a) Wholesale price
b) Market value
c) Transaction value
d) Maximum retail price
23. Which of the following forms part of transaction value?

1) GST compensation cess
2) Payments made to third parties by the recipient on behalf of the supplier in
relation to the supply
3) Entertainment tax levied by local authority
4) Commission paid to an agent and recovered from the recipient
5) Inspection charges at recipient’s site
6) Subsidy from state government
7) Charges for delay in payment waived off by supplier
State the correct answer from the options given below

a. 1, 2, 3, 4 & 5
b. 2, 3, 4, 5 & 6
c. 1, 2, 3, 4, 5, 7
d. 1, 2, 3, 4, 5, 6
24. When can the transaction value be rejected for computation of value of
supply?
(a) When the buyer and seller are related and price is not the sole consideration
(b) When the buyer and seller are related or price is not the sole
consideration
(c) It can never be rejected
(d) When the goods are sold at very low margins
25. What deductions are allowed from the transaction value?

(a) Discounts offered to customers, subject to conditions
(b) Packing Charges, subject to conditions
(c) Amount paid by customer on behalf of the supplier, subject to conditions
(d) Freight charges incurred by the supplier for CIF terms of supply, subject to
conditions
26. Rule 30 of the CGST Rules inter alia provides value of supply of goods or
services or both based on cost shall be ……………% of cost of production or
manufacture or the cost of acquisition of such goods or the cost of
provision of such services
(a) 100
(b) 10
(c) 110
(d) 120
27. Aggregate turnover includes:

a) Taxable supplies of goods or service or both
b) Exempt supplies of goods
c) Exports
d) All of the above
28. Which of the following persons are not liable for registration?
a) Any person engaged exclusively in supplying services wholly exempt from
tax
b) Casual Taxable Person
c) Both (a) and (b)
29. Within how many days a person should apply for registration?
a. Within 60 days from the date he becomes liable for registration.
b. Within 30 days from the date he becomes liable for registration.
c. No Time Limit
d. Within 90 days from the date he becomes liable for registration.
30. A person having _______business verticals in a State ______ obtain a

separate registration for each business vertical.
a. Single, shall
b. Multiple, shall
c. Multiple, May
d. Single, may
31. What is the validity of the registration certificate?
a. One year
b. No validity
c. Valid till it is cancelled.
d. Five years.
32. The registration certificate granted to Non-resident taxable person is

valid for days from the effective date of registration.
a. 30
b. 60
c. 90
d. 120
33. If an entity has multiple branches within the same state, it requires
a) Registration for each branch separately
b) Single registration for all the branches
c) Multiple registration or single registration at the option of the Assessee
d) Registration for each branch separately if the turnover of each branch exceeds
INR 20 Lakhs
34. An agriculturist is not required to take registration if he supplies

a) Any agricultural produce
b) Any agricultural produce grown by him or other agriculturalist
c) Agricultural produce out of cultivation of land
d) All the above
35. Which of the following forms are used for applicable for registration?
a) Form GSTR-1
b) Form GSTR-2
c) Form GST REG-01
d) Form GST REG-02
36. Which of the following statement are correct?

a) Voluntary registration not possible under GST
b) Voluntarily registered person is not liable to comply with all the provisions of
the GST
c) A person may get himself registered voluntarily and shall comply with all
the provisions of GST
37. An E-commerce operator should get itself registered

a) Irrespective of the threshold limit
b) If his aggregate turnover exceeds the threshold limit of INR 20,00,000
c) If he is liable to collect tax at source and his aggregate turnover exceeds the
threshold limit
d) If he is liable to collect tax at source
38. There will be deemed approval of registration if no action is taken on

application
a) Within a period of 3 working days from the date of submission of the
application
b) Within a period of 7 working days from the date of submission of the
application
c) Within a period of 10 working days from the date of submission of the
application
d) Within a period of 14 working days from the date of submission of the
application
39. A certificate of registration shall be issued by the proper officer in form

a) GST REG-02
b) GST REG-03
c) GST REG-04
d) GST REG-06
40. Which of the following requires amendment in the registration

certificate?
a) Change of name of the registered person
b) Change in constitution of the registered person
c) Switching over from composition scheme to normal scheme or vice versa
d) All of the above
41. A voluntarily registered person’s registration can be cancelled if the

person does not start business within
a) 3 months from the date of registration
b) 6 months from the date of registration
c) 9 months from the date of registration
d) 1 months from the date of registration
42. Registration can be cancelled by the proper officer if the person

registered under composition scheme has not furnished return for
a) 3 consecutive tax periods
b) 6 consecutive tax periods
c) For a consecutive period of 6 months
d) For a consecutive period of 1 year
43. Any registered person, whose registration is cancelled by the proper

officer on his own motion, may apply to such officer for revocation of
cancellation of the registration in the prescribed manner within____ from
the date of service of the cancellation order.
a. 180 days
b. 120 days
c. 90 days
d. 30 days
44. As per section 25 of CGST Act, 2017, a casual taxable person shall apply
for registration at least _____ prior to the commencement of business.
a. 5 days
b. 10 days
c. 7 days
d. 30 days
45. In case of taxable supply of services, invoice shall be issued within a
period of __________ from the date of supply of service.
a) 30 days
b) 45 days
c) 60 days
d) 90 days
46. Where the goods being sent or taken on approval for sale or return are
removed before the supply takes place, the invoice shall be issued:
a) before/at the time of supply
b) 6 months from the date of removal
c) Earlier of (a) or (b)
47. Registered person may issue a consolidated tax invoice for such
supplies at the close of each day in respect of all such supplies provided
a) The recipient is not a registered person
b) The recipient does not require such invoice
c) The value of goods and services or both per invoice is less than INR 200
d) All the above conditions are satisfied
48. In case of supply of exempted goods or services or both, the registered

person shall issue
a) A tax invoice
b) A bill of supply
c) Receipt voucher
d) Any of the above
49. In case of supply of goods by a composition dealer the registered person

shall issue
a) A tax invoice
b) A bill of supply
c) Receipt voucher
d) Any of the above
50 . Where advance payment is received, the registered person shall issue

a) A tax invoice
b) A bill of supply
c) Receipt voucher
d) Any of the above
51. The tax invoice in case of supplier of goods is issued in

a. Triplicate
b. Duplicate
c. Either (a) or (b) at the option of Taxpayer
d. Either (a) or (b) at the option of PO
52. What is the nature of supply if the nature of Supply is not

determinable?
a. Intra-state
b. Inter-state
c. Either (a) or (b) at the option of Taxpayer
d. Either (a) or (b) at the option of PO
53. Which of these electronic ledgers are maintained online?

a) Electronic liability register
b) Electronic credit ledger
c) Electronic cash ledger
d) All of the above
54. Deposits towards tax, penalty, interest, fee or any other amount are
credited into the _________________of a taxable person.
d) All of the above
55. Input tax credit as self-assessed in the return of the registered person
shall be credited to which of the following ledger?
d) All of the above
56. Which of the following items are debited to electronic credit ledger?
a) Output tax
b) Interest
c) Penalty
d) All of the above
57. Which input tax credit cannot be claimed against which output tax
liability?
a) IGST, SGST
b) CGST, IGST
c) SGST, IGST
d) CGST, SGST
58. Interest is payable on:

a) Belated payment of tax
b) Undue/excess claim of input tax credit
c) Undue/ excess reduction in output tax liability
d) All of the above
59. Which of the following liability cannot be adjusted against input tax
credit of CGST?
a) IGST
b) SGST/UTGST
c) All of the above
60. Which of the following shall be discharged first, while discharging
liability of a taxable person?
a) All dues related to previous tax period
b) All dues related to current tax period
c) Demand raised under section 73 and 74
d) No such condition is mandatory
61. Which date is considered as date of deposit of the tax dues

a) Date of presentation of cheque or
b) Date of payment or
c) Date of credit of amount in the account of Government
62. Who is required to furnish details of outward supplies in Form GSTR-1?

a) Person paying tax under composition scheme
b) Non-resident taxable person
c) Both (a) & (b)
63. What does N stand for in HSN?

a) Network
b) Nationalization
c) Nomenclature
d) Nomination
64. Which form is furnished for submission of details of outward supplies

u/s 37?
a) GSTR-1
b) GSTR-2
c) GSTR-3
d) GSTR-5
65. What is the due date for submission of monthly GSTR-1?

a) on or before 10th day of the immediately succeeding month
b) on or before 11th day of the immediately succeeding month
c) on or before 17th day of the immediately succeeding month
d) on or before 20th day of the immediately succeeding month
66. Composition tax payer is required to file return in Form no. ______.
a) GSTR-2
b) GSTR-3
c) GSTR-4
d) GSTR-5
67. The due date for filing GSTR-3B is _______.

a) on 10th day of the next month
b) on 15th day of the next month
c) on 17th day of the next month
d) on or before 20th day of the next month
68. Which of the following are not required to file the Annual Return?
a) Input Service Distributor
b) Casual Taxable Person
c) Non-resident Taxpayer
d) All of the above
69. Who is authorised to conduct audit under section 35(5) of the CGST Act,
2017?
1. Chartered accountant
2. Any person having master degree in finance of recognised university
3. Cost accountant
4. Company secretary
Select the correct answers from the options given below
a. 1, 3 and 4
b. 4, 2, 3 and 1
c. 1 only
d. 1 or 3 only
70. A registered person whose aggregate turnover during a FY exceeds INR 2
crores is required to file which of the following documents.
a. Annual Return
b. Audited annual accounts
c. A Reconciliation Statement, duly certified, in prescribed form.
d. All of the above
71. Which of the following is an intra-state supply?
A. supplier of goods located in Nagpur and place of supply SEZ in Mumbai.

B. supplier of goods located in Kolkata and place of supply in Bihar
C. supplier of goods located in Goa and place of supply in Goa
D. all of the above
72. GST council includes
A. Union finance minister

B. Union minister of state in charge of revenue or finance
C. One nominated member from each state appointed by State Government
D. all of the above
73. Composite supply means
A. The supply of two or more goods or services by a taxable person, which

comprises of a combination of goods that can’t be sold individually.
B. supply of two or more individual supplies of goods or services, or any
combination of goods and services,
C. all of the above
D. none of the above
74. GSTR-10 is use for

A. Final Return after cancellation of GST registration
B. Annual Return
C. Return for Output Supply
D. Return for Input Supply
75. GSTR-10 FORM due date is
A. 31st December of next financial

B. Within three months of the date of cancellation or date of cancellation
order whichever is later.
C. 28th of the month following the month.
D. insufficient information
76. When can one request for GST Advance Ruling?
A. Determination of the liability for a proposed transaction

B. For a transaction already undertaken
C. Both A & B
77. GST Offences related to Fraudulent Intent includes which of the
following?
A. Knowingly supplying, transporting or storing any goods that are liable for GST
B. Not registering under GST even though required to do so under GST Law
C. Falsification of documents/records or providing false information
D. all of the above
78. GST Penalties for High Value Frauds
A. Jail term not exceeding 1 year if tax amount involved is between Rs. 100
lakhs to less than Rs. 200lakhs.
B. Jail term not exceeding 3 years if tax amount involved is between Rs.200lakhs
to less than Rs. 1000lakhs.
C. Jail term not exceeding 5 years if tax amount involved is Rs. 1000lakhs or
higher.
D. all of the above
79. When can the refund be claimed?
A. Finalization of provisional assessment

B. ITC accumulation due to output being tax exempt or nil-
C. Exports (including deemed export)
D. all of the above
80. What is the time limit for claiming the refund?
A. The time limit for claiming a refund is 2 years from relevant date.
B. The time limit for claiming a refund is 1 years from relevant date.
C. all of the above
Q81. Condition to claim ITC
A. The dealer should be in possession of tax invoice

B. The said goods/services have been received
C. Input tax has been paid
D. all of the above
82. What is Exempt Supply?
A. Supplies taxable at a ‘NIL’ rate of tax* (0% tax);

B. Supplies that are wholly exempted from CGST or IGST, by way of a
notification
C. Non-taxable supplies as defined under Section 2(78)
D. all of the above
83. GST is a consumption of goods and services tax based on
A. Development
B. Manufacturing
C. Destination
D. Duration
84. ITC on goods sent for job work, in which of the following case?
A. The principal manufacturer will be allowed to take credit when goods are
return back in the place of principal manufacturer in the prescribed time.
B. The principal manufacturer sells the goods after return back from job work.
C. Manufacture can claim any time after purchase of raw materials.
85. The normally applicable rate of GST on goods and services are
A. 0%, 5%, 12%, 16%,28%

B. 0%, 5%, 12%, 18%,28%
C. 0%, 5%, 12%,16%, 18%
D. 0%, 15%,12%, 16%,24%
86. In India, the GST dual model was taken from
A. UK
B. Canada
C. France
D. China
87. How to calculate the GST payment to be made?
A. Usually, the Input Tax Credit should be reduced from Outward Tax Liability.
B. TDS/TCS will be reduced from the total GST to arrive at the net payable.
C. Also, ITC cannot be claimed on interest and late fees, these can only be paid in
cash only.
D. all of the above taken in to consideration.
88. Which of the following is statement is not correct about GST?
A. GST is like a last-point retail tax. GST is going to be collected at point of Sale.
B. GST will abolish all the direct tax levied in India.
C. It will be implemented from 1 July, 2017 in India.
D. It will unified the tax structure in India
89. Which of the following tax will be abolished by the GST?
A. Service Tax
B. Corporation tax
C. Wealth Tax
D. All of the above
90. SAC stand for ____________.
A. Service Accounting Code

B. Software Accounting Code
C. System Accounting Code
D. Service Application Code
91. IGST deals with
A. Composition scheme
B. Time of supply
C. Service tax on imported services
D. All of the above
92. Zero Rated Supplies include:
A. Exports
B. Imports
C. SEZs
D. Both A and C
93. GSTN stands for:
A. Goods and Services Tax Number

B. Goods and Service Tax Network
C. Goods and Sales Tax Network
D. Goods and Sales Tax Number
94.What is taxable event under GST?

A. Supply of goods
B. Supply of services
C. Supply of goods and services
D. Sales of goods and services
95. Is reverse charge mechanism applicable to both goods and services?
A. YES
B. NO
C. none
D. all
96. Is composition scheme available to people making inter-state supplies?
A. YES
B. NO
C. none
D. all
97. Can the taxable person under composition scheme avail the input tax credit?
A. YES
B. NO
C. none
D. all
98. Can the composition tax be collected from customers?
A. YES
B. NO
C. none
D. all
99. Where the supplier involves a movement of goods, the place of supply
shall be determined by.
A. Movement of goods
B. Location of goods at the time of final delivery
C. Supplier’s location
D. Recipients’ location
100. How will the goods and services be classified under GST regime?
A. HSN/SAC CODE
B. HSN
C. SAC
D. None of the above
101. Zero rated supply includes supplies made

A. By SEZ unit in India
B. To SEZ unit in India
C. Both (a & (b) above
102. Input tax credit on compensation cess paid under GST (Compensation
to States) Act, 2017.
A. is not available
B. is available
C. is available but not fully
D. is available after one year
103. Works contract under GST is goods used in work relating to
A. Immovable property
B. Both movable and immovable property
C. Immovable property treated as supply of service
D. Immovable property treated as supply of goods
104. A supplier is liable to get registered under GST if his aggregate

turnover in a financial year crosses Rs. 20 lakh in a state or UT other than
special category states if he is
A. an interstate supplier
B. an intra-state supplier
C. Electronic commerce operator
D. Person liable to pay GST under reverse charge
105. Registration under GST is not compulsory to
A. Casual taxable person

B. Input service distributor
C. Non-resident taxable person
106. One of the following states does not fall under special category given
under Art. 279A of the Constitution
A. Himachal Pradesh
B. Uttarakhand
C. Chhattisgarh
D. Jammu & Kashmir
107. Exemption from registration is available to
A. Central & State Govt. Departments

B. Agriculturists
C. PSU
108. Address for delivery
A. Recipient address mentioned in the tax invoice

B. Recipient address mentioned in the delivery challan
C. Recipient address not necessary
D. Recipient address mentioned in the Gate pass
109. Money means in GST
A. Indian legal tender

B. Foreign currency
C. Cheque/promissory note
D. All the above
110. Powers to declare certain activities/transactions as neither supply of

goods nor of services
A. Schedule I
B. Schedule III
C. Schedule II
D. Schedule IV
111. Agriculturist includes
A. Individual or HUF
B. Individual and HUF
C. Partnership
D. All the above
112. Deemed exports mentioned in which section
A. Section 137
B. Section 147
C. Section 142
D. Section 145
113. Tax levy in case of manufacture under composite scheme

A. Two percent
B. Three per cent
C. One per cent
D. Half per cent
115. Participation of ITC value chain in composite scheme
A. With participation
B. Without participation
C. Either a or b
116. The incidence of tax on tax is called
a) Tax Cascading b) Tax Pyramiding

c) Tax evasion d) Indirect tax
117. Under GST, ‘value addition’ refers to

a) Expenses ‘plus’ profit b) Cost plus tax
c) Cost plus tax plus ‘profit d) Tax plus profit
118. UTGST is applicable when
a)Goods are purchased by Central government b) Sold goods with in Union

territory
c) Sold from one union territory to another union territory d) There is interstate
supply
119. After introduction of GST import into India is –
a) Zero rated b) Subject to CGST plus SGST plus BCD

c) Subject to IGST plus BCD d) SGST plus CGST plus IGST plus BCD
120. Introduction of GST affects (reduce) the revenue of

a) Consuming states b) Manufacturing states
c) All the states d) Central Government
121. A person who occasionally undertakes transactions involving supply of goods
or services or both in the course or furtherance of business is
a) Business person b) Casual taxable person

c) composite dealer d) Non resident dealer
122. Supply of two or more taxable supplies naturally bundled and supplied is
called
a) Mixed supply b) Composite supply
c) Common supply d) Continuous supply
123. Goods are packed and transported with insurance, packing materials,
transport and insurance. This is a case of
a) Mixed supply c) Composite supply
b) Common supply d) Continuous supply
124. --- refers to receipt of goods or services or both whether by purchase,

acquisition or any other means with or without consideration.
a) Outward supply c) Inward supply

b) Taxable supply d) None of these
125. Two or more individual supplies of goods or services, or any combination

thereof, made in conjunction with each other
a) Mixed supply b) Composite supply

c) Common supply d) Continuous supply
126. A supply of a package consisting of canned foods, sweets, chocolates, c

akes, dry fruits, aerated drinks and fruit juices when supplied for a single price is
a) Common supply b) Composite supply

c) Mixed supply d) Continuous supply
127. Any person who occasionally undertakes transactions involving supply of

goods or services or both, but who has no fixed place of business or residence in
India is
a) Business person b) Casual taxable person

c) composite dealer d) Non resident dealer
128. Output tax of a taxable person,

a) Includes reverse charge b) Excludes reverse charge
c) Includes composite tax d) Includes all the taxes paid
129. Liability to pay tax by the recipient of supply of goods or services is called
a) Output tax b) Forward charge

c) Input tax d) Reverse charge
130. Integrated GST is applicable on goods or services

a) Imports b) Interstate Sale
c) Exported from India d) Imports and interstate sales
131. The rate of IGST is equal to the rate of

a) CGST b) SGST
c) CGST plus the rate of SGST d) SGST plus UTGST
132. Where an E- commerce operator does not have physical presence in the
taxable territory
a) Tax need not be paid b) Agent of the E- commerce operator shall be liable to
pay tax
c) Tax must be paid in advance d) IGST is not applicable
133. Where the location of the supplier and the place of supply are in two different
States –
a) IGST is applicable b) CGST is applicable
c) SGST plus CGST is applicable d) CGST plus IGST is applicable
134. Where location of the supplier and the place of supply are in two different
Union territories
a) CGST plus UTGST is applicable b) IGST is applicable
c) SGST plus UTGST is applicable d) CGST plus IGST is applicable
135. Supply of goods to or by a Special Economic Zone
a) CGST plus UTGST b) CGST plus IGST

c) IGST d) None of these
136. The place of supply of goods imported into India shall be
a) The location of exporter b) The location of the importer

c) State in which imported goods reaches first d) place of supply not applicable.
137. The managers of ITC Ltd., Kolkata (GST registered) are given one week training
in Munnar, by Infosys Ltd. Bangalore, for a sum of Rs. 10 Lakhs. Payment given at
Mumbai. The place of supply of service is
a) Mumbai b) Kolkata
c) Munnar d) Bangalore
138. The managers of ITC Ltd., Kolkata (not registered under GST) are given one
week training in Munnar, by Infosys Ltd. Bangalore, for a sum of Rs. 10 Lakhs.
Payment given at Mumbai. The place of supply of service is
a) Mumbai b) Kolkata
c) Munnar d)Bangalore
139. In case of mobile connection for telecommunication and internet services

provided on post-paid basis, the location of supply is
a) Place of office of the service provider b) Place of payment
c) Billing address of the recipient of services d) Place of supply not relevant
140.. Export of goods or services or both or Supply of goods or services to SEZ is

a) Subject to IGST b) Subject to SGST plus CGST
c) Zero rated d) Subject to CGST plus IGST
141. A registered person making zero rated supply shall be
a) Eligible to claim refund b) Not eligible for refund

c) Subject to reverse charge d) None of these
142. Gifts (other than emplacement contract) not exceeding --- in a year by an
employer to employee shall not be treated as supply.
a) Rs. 5,000 b) Rs. 10,000
c) Rs. 50,000, d) Rs. 1,00,000
143. Lease, tenancy, easement or licence to occupy land is a supply of
a) Goods b) Services
c) Both goods and services d) None
144. Transfer of the title in goods is a supply of

a) Goods b) Services c) Both goods and services d) None
145. Transfer of right in goods or of undivided share in goods ‘without the transfer
of title’ is
a) supply of Goods b) supply of Services

c) supply of Both goods and services d) None
146. Any treatment or process which is applied to another person’s goods is a

supply of

147. Construction of a complex, building, civil structure intended for sale to a
buyer, wholly or partly is supply of –
148. Works contract is a supply of
149. Services by an employee to the employer in the course of or in relation to his

employment is
a) Supply of Goods b) Supply of Services
c) Supply of Both goods and services d) Not supply
150. Actionable claims, other than lottery, betting and gambling are
a)Supply of Goods b) Supply of Services

c) Supply of Both goods and services d) Not supply
151. In the case of composite supply the rate of tax is
a) Average Rate of tax b) Rate of principal supply

c) Highest rate d) None of these
152. In the case of mixed supply the rate of tax is

a) Average Rate of tax b) Rate of principal supply
c) Highest rate d) None of these
153. The charging section of CGST is
a) Section 9 b) Section 10
c) Section 4 d) Section 2
154. Section 9(4) of the CGST Act deals with
a) GST b) Reverse charge

c) Composite tax d) None of these
155. In the case of reverse charge, tax is paid to the government by
a) Supplier b) Buyer
c) Manufacturer d) None
156. A Composite taxpayer is required to file summarised details of transactions

a) Annually b) Half yearly c) Quarterly d) Monthly
157. A taxpayer under the composition scheme
a) Can collect GST b) Can collect reverse tax
c) Cannot collect GST d) Can collect composite tax
158. A person liable to pay tax under Reverse Charge Mechanism

a) Cannot opt for composition b) Can opt for composition
c) Cannot collect GST d) Can collect composite tax
159. Composition scheme is available only for
a) Inter-state supplies b) B2B supplies

c) Intra-state supplies d) E-commerce operators
160. In order to adopt composition scheme by more than one registered persons
having the same Permanent Account Number, turnover of
a) All must be less than Rs. 1.5 crore b) At least one must be below Rs. 1 crore
c) All must be more than Rs. 20 lakh d) At least one must be less Rs. 20 lakh.
161. Persons eligible for composition levy include

a) A casual taxable person b) A non-resident taxable person
c) Person who has inter-state trade d) Person with turnover of less than Rs.
1.5 crore
162. In respect of the additional payment for value of supply like interest, late fee
etc., the time of supply is
a) Date additional payment b) Date of original payment

c) date on which supply was received d) Any date at the option of the supplier
163. If it is not possible to determine the time of supply, the time of supply shall be
a) decided by the supplier b) decided by the recipient
c) date of entry in the books of recipient d) date of entry in the books of
supplier
164. When the supply of goods or services is for a consideration not wholly in
money, the value of the supply shall be
a) Value declared by the supplier b) value declared by the recipient

c) Open market value of such supply d) None of these
165. Tax collected at the time of supply of goods or services is called
a) Output tax b) Input tax c) TCS d) Reverse tax
166. Input tax credit shall be allowed only on the support of

a) Delivery note b) Payment slip c) Credit note d) Tax invoice
167. Input tax credit shall be allowed only against
a) Any tax payable b) Output tax c) Composite tax d) Interest on delay

e) all of the above
168. Where the goods are received in lots or instalments input tax credit can be
claimed
a) upon receipt of first lot b) upon receipt of the last lot
c) on receipt of invoice d) after full payment of price
169. Where a recipient fails to pay the price within 180 days from the date of issue
of invoice, he shall be liable to pay input tax credit to the Government with --- %
interest
a) 10% b) 12% c) 18% d) None of these
170. Input tax credit is not available for
a) services b) zero rated supplies c) taxable supplies d) exempt supplies
171. Input tax credit is not available for supplies to
a) SEZ b) Exports c) Provide non taxable services d) Produce taxable

goods (e) All of the above
172. Goods or services or both on which tax has been paid under section 10 belong
to
a) Exempt category b) Composite tax category c) Blocked credit category d)
None of these
173. Input tax credit is not allowed on the support of
a) Tax invoice issued by the supplier b) A debit note issued by a supplier

c) An Input Service Distributor invoice d) Delivery chalan
174. Reversal of input tax credit happens when
a) Recipient does not pay the amount within 180 days

b) When goods are of inferior quality
c) Supplier refuses to accept payment
d) None of these
175. Input Service Distributor means
a) Any service provider b) Any GST registered service provider

c) Office distributing common service d) Office distributing common input tax
credit
176. Input Service Distributor shall distribute the credit of CGST
a) Either as CGST or IGST b) as CGST only

c) SGST only d) Either as CGST or as SGST
177. When an exempt supply in the hands of registered person becomes a taxable
supply, such person
a) can take credit of input tax b) is not entitled to take credit of input tax
c) liable to pay tax on stock d) liable to pay reverse charge
178. A registered person, after availing input tax credit, opts for composition levy,
a) liable to pay reverse charge

b) shall be liable to pay the input tax on stock or capital goods
c) shall not be liable to pay tax d) None of these
179. In case of transfer of capital goods or plant and machinery the registered
person shall
a) not be liable to pay input tax credit claimed b) be liable to pay the input tax
credit claimed c) liable to pay reverse charge d) None of these
180. Tax credit in respect of goods or inputs sent for job work can be claimed by
a) Job worker b) Principal c) Either by Job worker or Principal d) Not eligible for
input credit
181. A registered person need not issue a tax invoice if the value of supply less
than
a) 100 b) Rs. 200 c) 500 d) 1000
182. A registered person supplying exempted goods or services or paying

composition tax under section 10 shall issue
a) GST Bill b) Bill of supply c) Delivery chalan d) Debit note
183. A registered person shall, on receipt of advance payment for goods or

services, issue
a) GST Bill b) Bill of supply c) Receipt voucher d) Debit note
184. After issuing a receipt voucher for advance payment, if no supply is made --
- may be issued against such payment.
a) Refund voucher b) Debit note c) Tax invoice d) Bill of supply
185. An unregistered person
a) is allowed to collect GST b) is not allowed to collect GST

c) is allowed to collect composite tax d) is allowed to collect reverse tax
186. The duplicate copy of a tax invoice of goods belongs to
a) Recipient of supply b) Transporter of supply

c) The supplier d) GST department
187. A Debit note is issued to the recipient of goods or services if
1) Taxable value is found to be excess 2) The goods are returned by the recipient;
3) Goods supplied are found to be deficient 4) Tax charged is found to be lesser
188. Mr. P supplied goods of Rs. 1, 00,000, to Mr. Q, who returned goods of
Rs 10,000 due to inferior quality. Mr. P will later issue
a) Credit note b) Debit note c) Tax invoice d) Delivery challan
189. A credit note is issued to the recipient of goods in the following cases
1)When the taxable value of goods found to be less 2)Tax charged found to be less
3) When the recipient refuses to make payment 4) None of these
190. In the case of transportation of goods for job work,
a) Delivery challan is required b) Tax invoice is required

c) Debit note is required d) credit note is required
191. The eligible input tax will be automatically credited to the
a) Electronic Credit Ledger b) Electronic cash ledger

c) Electronic Liability register d) None of these
192. Every deposit made towards tax shall be credited to
a) Electronic credit ledger b) Electronic Cash Ledger

193. The input tax credit as selfassessed in the return of a registered person
shall be credited to his electronic
a) Cash Ledger c) Liability register c) Credit Ledger d) Debit ledger
194. The balance of IGST credit after set off IGST can be used towards the
payment of
a) CGST b) SGST c) IGST d) UTGST

195. The balance of CGST credit after set off of CGST can be used towards the
payment of a) SGST b) UTGST c) either SGST or UTGST d) IGST
196. SGST or UTGST shall not be utilised towards payment of
a) CGST b) IGST c) SGST d) UTGST
197. Tax and other dues of a registered person is recorded in
a) Electronic credit ledger b) Electronic Cash Ledger

198. Every person who fails to pay tax shall be liable to pay interest not exceeding
a) 10% b) 12% c) 18% d) 24%
199. A taxable person who makes an undue or excess claim of input tax credit
shall be liable to pay interest not exceeding
a) 10% b) 12% c) 18% d) 24%
200. TDS provision applicable only when the total value of supply, under a contract,
exceeds
a) Rs. 1,00,000 b) Rs. 1,50,000 c) Rs. 2,00,000 d) Rs. 2,50,000
MCQs of Company Law (HPTI)
Q1 Power Utilities are governed by

a) Compani b) Electricity Act c) Both d) None
es Act
2013
Q2 Private Ltd. Company require minimum ______ members and Public
Limited Company require _________ members for registration with Registrar
of Companies
a) 7, 2 b) 1, 8 c) 2,7 d) 3, 2
Q3 Company is registered with _________

a) State b) Central c) Registration of d) Co-operative Societies
Governme Governm Companies Registration
nt ent
Q4 In which of the following documents contain objectives of company for
which it is registered
a) Constituti b) Memorand c) Articles of d) State Notifications/
on of um of Association Circulations
India Association
Q5 Government Company in which not less than _____ of paid up share capital
held by State Government/Central Government/Both
a) 26% b) 50.05% c) 51% d) 25%
Q6 Equity share represents, ownership and debenture/Bond represents, debt
a) True b) Untrue c) Partially true d) None
Q7 Authorized capital upto which Company can raise capital from
Government/public is given in
a) State b) Articles of c) Memorandum of d) None
Governm Association Association
ent
Budget
Q8 Articles of Association of Company contains
a) Others b) Rules & Regulations c) Both d) None
objects of company
of
compan
y
Q9 In which of the following is Key Managerial Person (KMP) of company as
per Companies Act, 2013
a) Managi b) Company c) Chief Financial Officer d) All
ng Secretary
Directo
r
Q10 Wholetime Director is one who is in the whole time employment of
company
a) True b) Untrue c) Partially true d) None
Q11 In which of the following is ordinary Business
a) Approval b) Declaration c) Appointment of Directors d) All
of of Dividend
Financia
l
Stateme
nts
Q12 Financial Statements and declaration of dividend can be considered in

Extra Ordinary Meeting of shareholders
a) True b) False c) Partially true d) None
Q13 What are the main documents which are filed with Registrar of Companies
at the time of Incorporation of Company
a) PAN of b) Consent of c) Memorandum d) None
proposed proposed of Association
Directions Directions and Article of
Association
Q14 In which of the following is prerequisite to become Director of Company
a) Aadhar b) PAN Card c) Director Identification d) None
Card Number
Q15 Financial Statements/Replies of Management to Comptroller and Audit
General of India (CAG) observations should be recommended by ___________
before its consideration by Board of Directors
a) Commit b) Corporate Social c) Audit Committee d) Chairman
tee of Responsibility of Company
Wholeti Committee
me
Director
s
Q16 Director’s Report is prepared pursuant to provisions of Section ___________
of Companies Act
a) Section b) Section 134 c) Section 136 d) Section 77
34
Q17 The Financial Statements of Company are to be signed by
1. Managi 2. By two Directors one of 3. Chairman 4. Chief
ng which be Managing Accounts
Directo Director if any, Chief Officer
r of Financial Officer and
Compa Company Secretary
ny
Q18 Who appoints Cost Auditors in Government Companies?
a) State b) Central c) Financial Department d) Board of
Governmen Governme of State Directors
t concerned nt Government/Central
Government
Q19 Any proposal passed in circulation by the Board of
Directors/WTDs/Committee must be got noted in the immediate
subsequent meeting
a) True b) False c) Partially false d) None
Q20 To pass Special Resolution in General Meeting ________ of votes must be
cast in favour of Resolution.
a) 51% b) 67% c) 75% d) 26%
Q21 Only Special Business is discussed in the Extra Ordinary Meeting.
Q22 Notice of Annual General Meeting must be given _______ day period to
meeting
a) 7 days b) 15 days c) 21 days d) 60 days
Q23 Financial Statements must be placed before shareholders within _______

months from close of Financial Year.
a) 3 b) Upto December c) Upto September d) Within
months six
months
Q24 There is provision in the Companies Act 2013, to seek extension of Annual
General Meeting for 3 months in which Financial Statements are to be
placed for approval of shareholders, in case Financial Statements are not
ready.
Q25 To seek extension of holding of Annual General Meeting Company, is
required to write to __________.
a) State b) AG of State c) Registrar of Companies d) None
Governme
nt
Q26 The Notice of Board Meeting must be given to all Directors _____ days prior
to Board meeting.
Q27 The Agenda of Board Meeting must be given _____ days prior to Board
Meeting
Q28 The urgent proposal can be considered by Board of Directors on the day of
meeting with the permission of majority of Directors present in the
meeting
Q29 The proceedings of Meeting of Board are to be written in 30 days and
signed by Chairman
Q30 All Forms & Returns under Companies Act 2013 are filed online with
Registrar of Companies
Q31 The portal on which online filing is done under the Companies Act, 2013
a) www.sp.gov.i b) www.mca.gov. c) www.itr.gov.in d) None
n in
Q32 Any proposal which is to be considered and approved by shareholders, first
considered and approved by Board of Directors
Q33 Proceedings of General Meeting are to be written and signed by Chairman
within 30 days from conclusion of General Meeting
Q34 To increase the authorized share capital of company which of the following
documents be amended.
a) Memorandu b) Articles of c) Both d) None
m of Association
Association
Q35 To alter Articles of Association which type of resolution shall be passed
and in which type of meeting
a) Ordinary/Bo b) Special/Gener c) Ordinary/Gene d) None
ard Meeting al Meeting ral Meeting
Q36 To pass ordinary resolution the voting cast in favour should be ________
a) 60% b) 50.01 % c) 50% d) None
Q37 A person can from under Companies
a) Public b) Private company c) One man company d) All
Compan
y
Q38 Members & Directors come and go but company keep going on because it
has
a) perpetua b) Artificial person c) Legal person d) 1 and 3
l
existenc
e
Q39 X Company has two members and they died in accident. Will the company
also come to end advise
a) Yes b) No as company is legal c) Shall be wound up d) None
person and has
perpetual existence
Q40 In which of the following is Power of Board of Directors
a) To b) To diversify the c) To grant loans & give d) All
Borrow Business of the guarantee
money Company
Q41 In which of the following is not power of shareholders
a) To b) To fix c) To sell, lease or d) To remit or give time
invest borrowin otherwise dispose of for repayment of any
the g limits property of company debt due from a
funds of Director
of company
compa
ny
Q42 Memorandum of Association can be altered by seeking approval from
a) Board of b) Shareholders of c) Both d) None
Director Company
s
Q43 In Government Company Statutory Auditors are appointed by
a) AG of b) State c) Comptroller and Audit d) Shareholde
State Government General of India rs
Q44 Remuneration of statutory Auditors in a Government company is fixed by
a) Comptrolle b) State c) Board of d) Shareholders in Annual
r and Governme Directors General Meeting
Auditor nt
General of
India
Q45 In which of the following document will prevail upon in case of conflict of
provisions between Companies Act and Memorandum of Association and
Articles of Association.
a) Compani b) State c) Memorandum of d) Articles
es Act, Government Association of
2013 Instructions Associati
on
Q46 In which of following documents will prevail upon in case of conflict of
provisions Memorandum of Association and Articles of Association
a) Memorand b) Articles of c) Board of Directors d) None
um of Association
Association
Q47 In which of the following is not characteristics of company
a) Artificial b) Legal person c) To borrow money d) Limited
person liability
Q48 In which of the following is characteristics of company
a) To invest b) To give loan c) To borrow d) Perpetual
existence
Q49 In case of vacancy of Key Managerial Personnel. The vacancy shall be filled
in within ___________ from the date of vacancy
a) 3 b) 6 months c) 12 months d) 9
months months
Q50 In which of the following Audit is done in Company as per provisions of
Companies Act, 2013
a) Statuto b) Govt. Audit c) Secretarial Audit d) All
ry
Auditor
Q51 In which of the following meetings are conducted in a company
a) Board b) Committee c) General Meeting d) All
Meeting Meeting
Q52 Lifting of Corporate veil means
a) Ignoring b) Only Board of c) It relates to d) None
the Directors can Memorandum of
separate punish Association
entity of
company
Q53 Section 8 Company is formed for the purpose of

a) Charitab b) Profit purpose c) Guaranteed dividend d) None
le
objective
Q54 When a company enters into contract for a purpose not given in
Memorandum of Association means
a) Doctrine b) Lifting of c) Principle of natural d) All
of ultra Corporate veil justice
vires
Q55 How many Women Director should be on the Board of Company
a) 3 b) 2 c) 1 d) 7
Q56 Appointment of Cost Auditors in dealt under section __________of
Companies Act, 2013
a) 148 b) 134 c) 192 d) 179
Q57 In which of the following Audit (s) is not required prescribed under
a) Statutor b) Cost Audit c) Secretarial Audit d) Energy
y Audit Audit
Q58 Secretarial Audit is conducted by person having following qualification
a) Member of b) Member of Institute of c) Anyone d) None
Institute of Company Secretaries
Chartered
Accountants
Q59 Who conducts Cost Audit as per provisions of Companies Act, 2013.
a) Member of b) Member of c) Auditor General of d) None
Institute of Institute of State
Cost and Chartered
Manageme Accountants
nt
Q60 Executive Director is one who

a) Works b) Execute duties c) Attends only Board d) Helps
for as asked by Meetings and Managing
wholetim Board of Committee Director in
e in a Directors meetings execution of
Compan his duties
y
Q61 Independent Director is one who is not connected with Company
a) Financia b) Relative of Directors/ c) Both d) None
lly Managing Director/
KMP
Q62 General instructions for preparation of Balance Sheet and Profit & Loss of
Company is given in Schedule __________ of Companies Act, 2013
a) Schedule b) Schedule IV c) Schedule VII d) Schedule III
II
Q63 Quorum for Meetings means under the Companies Act, 2013
a) Minimum No. of b) Chairman & c) Managing d) None
persons presence Managing Director &
required to hold Director Wholetime
and conduct Directors
meeting
Q64 Quorum for the General Meeting in Public Company and Private Company
is
a) 2 :1 b) 5: 2 c) 2: 5 d) 3 : 2
Q65 Explanatory Statement under Section 102 of Companies Act, 2013 is
required to be annexed in case of
a) Ordinary b) Special c) Ordinary Business d) Special
Resolutio Resolution Business
n
Q66 Company can have ______________ number of maximum Directors on its
Board
a) 20 b) 12 c) 10 d) 15
Q67 Only one Director Identification Number (DIN) is required if person holds
Directorship in more than one company
a) True b) False c) DIN required for each d) None
Company
Q68 In which of the following person require DIR-KYC under the Companies
Act, 2013
a) Chairman b) Managing Director c) All Directors d) None
Q69 Who among following can be appointed on the Board of Company
a) Additional b) Alternate Director c) Nominee d) all
Director Director
Q70 Setting fee is generally paid to All Directors
1. True 2. False 3. Partially true 4. None
Q71 Sitting fee is paid to Directors other than Managing Director and
Wholetime Directors
Q72 Subsidiary of Government Company is also Government Company
Q73 Office of Director stands vacate if he absents himself from all meetings of
Board of Directors held during a period of 12 months with or without
seeking Leave of Absence
Q74 Quorum for Board Meeting is
a) One third of total b) Chairman, c) 2/3rd of total d) None
strength or two Wholetime strength or 3
Directors, Directors Directors whichever
whichever is is higher
higher
Q75 A person who is undischarged insolvent cannot be appointed as Director
on the Board
Q76 Participation of Directors by video conference or by other audio visual
shall also be counted for the purpose of quorum
Q77 Company should hold _____ Board Meetings in a year and not more than
______ days shall intervene between two consecutive meetings of board
a) 3, b) 4, 150 c) 2, 180 d) 4 , 120
100
Q78 Who conducts Supplementary Audit of Government Companies
a) Ministry b) Ministry of c) A.G. of d) Comptroller and
of Power, Govt. of State Auditor General of
Corporate India India
Affairs,
Govt. of
India
Q79 There is urgent proposal which requires approval of Board of Directors.
Advise
a) Take b) Take approval c) Get urgent proposal passed d) None
approval of State in circulation under
from Government Section 175 of Companies
Chairman Act, 2013
Q80 Company formed under Companies Act, 2013 may be either:-
a) Company b) Company c) Unlisted d) All
listed by listed by Company
shares guarantee
Q81 In which of the following Company restricts the Right to transfer its
shares
a) Public b) Charitable c) Private d) Governme
Compa Company Company nt
ny Company
Q82 Private Company can have maximum of ______ members
a) 50 b) 100 c) 20 d) 200
Q83 In which of the following company restricts invitation to public to
subscribe for any securities of the company
a) Governme b) Private Company c) Public d) Charitable
nt Company Company
Company
Q84 In which of the following is not Legal person
a) Public b) Limited c) Partnership firm d) None
Compa liability
ny Partnership
Q85 Subsidiary Company cannot holds shares in its holding company except
as Legal representative or as trustee before becoming its subsidiary
company
Q86 For which of the following meeting proxy is relevant
a) Committee b) Annual General c) General d) 2 &
Meeting Meeting Meeting 3
Q87 Leave of absence relates to
a) Annual b) Extra Ordinary c) Both d) None
General General Meeting
Meeting
Q88 OPC (One Person Company) has to be ______
a) Limited b) Private c) Public Company d) Charitable
Liability Company Company
Partners
hip
Q89 Statutory Auditor of Company cannot take Internal Audit assignment of
that Company
a) True b) False c) Partially true d) Partia
lly
false
Q90 In which of the following is the feature of Public Company
a) Artificial b) Limited liability c) Continue Existence d) All of
person above
Q91 Anything which requires approval of shareholders first needs to be
approved by _____
a) Chairm b) Managing c) Wholetime d) Board
an Director Directors of
Direct
ors
Q92 Financial Statements are got to be approved form Shareholders within six
months from the end of Financial Year. In case Financial Statements are
not ready what will be your advice.
a) To be b) To be approval c) Take extension for d) None
approval of of Board of holding of Meeting of
Chairman Director Shareholders (AGM) in
which Financial
Statements are to be
approved
Q93 Executive Chairman is one who participates in day to day affairs of the
company & take decisions for the growth & progress of company
Q94 Non executive Director/Part time Director only attends Board Meeting or
do the work as assigned by Board of Director from time to time
a) True b) False c) Partially true d) Partially
false
Q95 Subsidiary Company is one in which another Company
a) Controls the b) Exercises or control c) Both d) Non
composition more than one-half of e
of the Board the total Share
of Directors Capital
Q96 X Limited holds 50.05% of Share Capital of Y Limited. What is the status
of Y Limited vis a vis X Limited
a) Holding b) Public c) Subsidiary d) None
Company Company and Company and
and Subsidiary Holding company
Subsidiary Company
Company
Q97 While ascertaining the holding Company status in terms of owning the
share capital in another company, any shares held by subsidiary of
holding company shall be added
a) True b) False c) Partially True d) None
Q98 X Limited is Subsidiary of Y Limited and Z Limited is Subsidiary of X
Limited. What is the relation of Z Limited with Y Limited
a) Associate of b) Subsidiary of Y c) Holding Company d) None
Y Limited Limited
Q99 XY Limited at its discretion can appoint or remove all or a majority of
Directors of another Company. XY Limited is
a) Government b) Subsidiary c) Holding Company d) Associate
Company Company Company
Q10 A Limited owns 90,010 Equity Shares and its Subsidiary Company B
0 Limited holds 10,000 Equity Shares out of the total 2,00,000 Equity
Shares Capital of ABC Limited. What is the relation of ABC Limited with
A Limited
a) ABC Limited b) ABC Limited is c) A Limited is d) 1 & 3
is subsidiary subsidiary of B Holding Company
of A Limited Limited of ABC Limited
Answer Key
Q1 c Q21 a Q41 a Q61 c Q81 c
Q2 c Q22 c Q42 c Q62 d Q82 d
Q3 c Q23 d Q43 c Q63 a Q83 b
Q4 b Q24 a Q44 d Q64 b Q84 c
Q5 c Q25 c Q45 a Q65 d Q85 a
Q6 a Q26 c Q46 a Q66 d Q86 d
Q7 c Q27 b Q47 c Q67 a Q87 d
Q8 b Q28 a Q48 d Q68 c Q88 b
Q9 d Q29 a Q49 b Q69 d Q89 a
Q10 a Q30 a Q50 c Q70 b Q90 d
Q11 d Q31 b Q51 d Q71 a Q91 d
Q12 b Q32 a Q52 a Q72 a Q92 c
Q13 c Q33 a Q53 a Q73 a Q93 a
Q14 c Q34 c Q54 a Q74 a Q94 a
Q15 c Q35 b Q55 c Q75 a Q95 c
Q16 b Q36 b Q56 a Q76 a Q96 c
Q17 c Q37 d Q57 d Q77 d Q97 a
Q18 d Q38 a Q58 b Q78 d Q98 b
Q19 a Q39 b Q59 a Q79 c Q99 c
Q20 c Q40 d Q60 a Q80 d Q100 d

Q1. Companies Act, 1956 repealed by_____
A) Companies Act, 2002
B) Companies Act, 2010
C) Companies Act, 2013
D) Companies Act, 2015
Q2. A critical assumption of the net operating income (NOI) approach to valuation is:
A) That debt and equity levels remain unchanged.

B) That dividends increase at a constant rate.
C) That ko remains constant regardless of changes in leverage.
D) That interest expense and taxes are included in the calculation.
Q3. Which of the following company can held the AGM on public holiday?
A) Public company
B) Private company
C) Government company
D) Association not for profits
Q4. Management is an organ, organs can be described and defined only through their
functions. This definition was given by ____________.
A) Peter F. Drucker
B) Terry
C) Louis Allan
D) Henry Fayol
Q5. Luther Gullik classifies the function of management as ___________.
A) POSDCORB.
B) POSTCARD.
C) POSDCORB.
D) POSDORBC.
Q6. Which of the following is the meeting of shareholders?
A) Annual General Meeting

B) Extra-ordinary General meeting
C) Class Meeting
D) All of the above
Q7. Espirit de corps means______________.
A) Union is strength.
B) Service is our motto.
C) Buyer beware.
D) Product is our strength.
Q8. Where the company has three directors maximum remuneration payable to all
of them is
A)5%
B)10%
C)11%
D)20%
Q9. A person shall not be eligible for appointment as a director of a company , if ______
(A) he is of unsound mind and stands so declared by a competent court;
(B) he is an undischarged insolvent;
(C) he has applied to be adjudicated as an insolvent and his application is pending;
(D) All of above.
Q10. The Company must deliver share certificate within______ if the shares
applied for transfer.
A) 3 months
B) 2 months
C) 5 months
D) none of these
Q11. A person cannot be a managing director of more than___ companies?
A) 10
B) 15
C) 5
D) 12
Q12. Every prospectus issued by a public company should contain reports

related to profits and losses for immediately ________ preceding financial
years.
A)Six
B)Five
C)Four
D)Three
Q13. There are restrictions on who can act as a director. Which one of
following is not a valid restriction?
A) A person of unsound mind

B) A undischarged insolvent
C) Convicted of any offence
D) Do not have specified academic qualification
Q14. Qualification shares for a director are provided in.
A) Appointment letter
B) MOA
C) AOA
D)Prospectus
Q15. Section 29 of the Companies Act, 2013 provides.
A)Public offer of securities to be in dematerialized form

B)Alteration of articles
C)Registered office of the company
D)Red herring prospectus
Q16. As per sec 52 of Companies Act, 2013 the balance in security premium
account shall not be utilized for?
A) Payment of dividend
B) Capital losses
C) Writing off discount on issue
D) Issue of fully paid up bonus share
Q17. Which one of the following statement is incorrect?
A) The statutory minimum age of director is 18

B) There is no statutory maximum age for director
C) A public limited company must have two director
D) There is no legal qualification for being a director
Q18. What is a shadow director?
A) A director who does not attend Board meetings
B) A person who is not appointed as a director but whose directions or

instructions the directors of a company follow
C) A person appointed to attend Board meetings and vote in place of a

director.
D) A director who has recently retired from the Board.
Q19. Which of the following would be included in a cash budget?
A) Depreciation charges
B) Dividends
C) Goodwill
D) Patent amortization
Q20. In case of appointment of director, which form is to be filed?
A) Form DIR-11
B) Form DIR-12
C) Form DIR-13
D) Form DIR-03
Q21. In case the Comptroller and Auditor General of India does not appoint
first auditor within the stipulated date who will appoint such auditor within
next 30 days?
(A) Shareholders
(B) Board of Directors
(C) Managing Directors
(D) Company Secretary
Q22. As per Companies Act, 2013, the Board of the Company shall ensure
that the Company spends, in every financial year, at least ________ of the
average net profits of three preceding Financial Year under CSR obligations.
(A) 2 %
(B) 3%
(C) 4 %
(D) 5%
Q23. Memorandum of satisfaction of charge shall be in Form:
A) CHG 5
B) CHG 3
C) CHG 4
D) CHG 2
Q24. In how many days the minutes of proceedings of each meeting shall be
entered in the books maintained for that purpose along with the date of such
entry:
A) Within 45 days of the conclusion of the meeting
B) Within 60 days of the conclusion of the meeting
C) Within 15 days of the conclusion of the meeting

D) within 30 days of the conclusion of the meeting
Q25. What is the quorum for annual general meeting for a private limited
company?
A) 5 members personally present
B) 7 members personally present
C) 2 members personally present
D) 3 members personally present
Q26. In which Form a copy of every resolution or any agreement required to

be filed, together with the explanatory statement under section 102, if any,
shall be filed with the Registrar:
A) Form No. MGT. 14
B) Form No. MGT. 12
C) Form No. MGT. 15
D) Form No. MGT. 13
Q27. Who shall sign the Annual Return?
A) It shall be signed by a company secretary in practice, where there is

no company secretary
B) It shall be signed by a director and the company secretary
C) It shall be signed by two directors, where there is no company

secretary.
D) Any of the persons mentioned at options A and B are correct
Q28. ____________ is the combining of two or more companies into one

organization?
(A) Diversification
(B) Acquisition
(C) Merger
(D) Amalgamation
Q29. Debenture holder of a company are company’s ________.
(A) Owner
(B) Creditors
(C) Customer
Q30. The financial statements shall be in the form specified in the Companies
Act, 2013 and comply with Accounting Standards or Indian Accounting
Standards as applicable:
A) Schedule III
B) Schedule I
C) Schedule IV
D) Schedule II
Q31. An association not for profit registered under Companies Act, 2013
popularly known as:
(A) Section-8 Companies

(B) Illegal Association
(C) Subsidiary Companies
(D) Holding Companies
Q32. Which one of the following is the CORRECT sequence of stages in the
formation of a company?
A) Promotion, incorporation, capital subscription, the commencement of

business
B) Incorporation, capital subscription, promotion, the commencement of
business
C) Promotion, the commencement of business, incorporation, capital
subscription
D) Promotion, Incorporation, Certificate of commencement, capital
subscription
Q33. Which of the following contract is signed by the promoters with the
third party on behalf of the proposed company?
A) Preliminary contracts
B) Provisional contract
C) Prospectus
D) Memorandum of association
Q34. It is a form of business organization which is owned, managed, and

controlled by an individual who is the recipient of all profits and bearer of all
risks. Identify the concept.
A) Sole Proprietorship
B) Cooperative Society
C) Joint Hindu family business
D) Partnership
Q35. What is the minimum number of persons required to form a public

company?
(A) 1
(B) 2
(C) 5
(D) 7
Q36. The leader who excels as a leader because of his superior knowledge
is ___.
A) Autocratic leader
B) Intellectual leader
C) Liberal leader
D) Institutional leader
Q37. An independent director cannot hold office for more than _____
consecutive terms.
(A) Four
(B) Three
(C) Two
(D) One
Q38. Every company should have at least one director who has stayed in
India for a total period of not less than ____ days in the previous calendar
year.
A) 180
B) 90
C) 365
D) 30
Q39. The oldest type of organization__________.
A) Functional organization
B) Line organization
C) Matrix organization
D) Committee organization
Q40. Documents that regulates the internal affairs of a company are: -
A) Articles of Association
B) Memorandum of Association
C) Prospectus
D) Certificate of Incorporation
Q41. Rate of return on capital is exceptionally high in
A) Under – capitalization
B) Over – capitalization
C) Working capital
D) Fixed capital
Q42. _____ refers to the structure of total capital funds raised by the
company.
A) Fixed capital
B) Capital structure
C) Capital requirements
D) Under capitalization
Q43. What are the consideration in designing capital structure of the

company?
A) Trading of equity
B) Profitability
C) Cost of capital
D) All of above
Q44. Capital structure design has nothing to do with.
A) Profitability
B) Solvency
C) Transferability
D) Flexibility
Q45. Cost of capital does not mean.
A) Cut off rate decided by management
B) Rate of interest
C) Expectations of investors for dividend
D) Money paid to SEBI for permission to acquire capital
Q46. Which of the following is not one of the three fundamental methods of
firm valuation?
A) Discounted Cash flow
B) Income or earnings - where the firm is valued on some multiple of

accounting income or earnings
C) Balance sheet - where the firm is valued in terms of its assets
D) market share
Q47. Shareholders wealth increases with the increase in ___.
A) EPS
B) Market value of the firm
C) Dividend & market value of the firm
D) Market price of the equity share

Q48. Corporate wealth maximization is the value maximization for_____.
A) Equity shareholders
B) Stakeholders
C) Employees
D) Debt capital owners
Q49. Internal rate of return is.
A) Rate at which discounted cash inflow is more than discounted cash

outflow
B) Rate at which discounted cash inflow is less than discounted cash

outflow
C) Rate at which discounted cash inflow is equal to the discounted cash

outflow
D) Either a or b
Q50. Which of the following valuation methods is based on “Going concern

concept”
A) Market value method
B) Book value method
C) Liquidation method
D) Salvage value method
Q51. Section 177 of the Companies Act 2013 deals with___?
A) Rehabilitation and insolvency fund

B) Declaration of dividend
C) Remuneration of auditors
D) Audit Committee
Q52. The characteristics of a company are:
A) Voluntary association
B) Separate legal entity
C) Company is an artificial person created by law.
D) All of the above.

Q53. Followings are the advantages of Company form of organization except:
-
A) Diffusion of Risk
B) Expansion Potential
C) Perpetual Existence
D) Lack of Secrecy
Q54. Which of the following is importance of management?
(1) It arranges the factors of production, assembles and organizes the

resources.
(2) It helps the country to keep balanced approached in social order.
(3) It utilizes all the physical & human resources productively.

(4) It helps the employees to get stronger trade union.
(5) It gets maximum results through minimum input by proper planning
and by using minimum input.
Select the correct answer from the options given below: –
(A) (4), (2) & (1)

(B) (3), (2) & (5)
(C) (1) & (3)
(D) (3), (1) & (5)
Q55. ‘Government Company’ means a Company of which:
A) More than 50 % of paid up Share Capital is held by Centre or State

Government
B) 50 % of the paid share capital is held by Centre or State Government
C) 25 % of the paid share capital is held by Centre or State Government
D) 10 % of the paid share capital is held by Centre or State Government
Q56. Rule 3 of the Companies (Appointment and Qualification of Directors)

Rules, 2014 provides that companies shall appoint at least one woman
director:
A) Where paid-up share capital is at least ₹100 crore
B) Turnover of the company is at least ₹300 crore
C) Both the above
D) None of the above

Q57. A company shall have its Registered Office from the date __________ of
its incorporation.
A) 7th day
B) 15th day
C) 30th day
D) one month
Q58. No person shall be appointed as a director of the company, unless he

or she has been allotted the ______
(A) CIN
(B) DIN
(C) PAN
(D) PRAN
Q59. Management exists at which level of the organization?
A) Top
B) Middle
C) Bottom
D) All of the above
Q60. What order do managers typically perform the managerial functions?
A) organising, planning, controlling, leading
B) organising, leading, planning, controlling
C) planning, organising, leading, controlling
D) planning, organising, controlling, leading
Q61. Organization structure is reflected in the
A) Organization hierarchy
B) Organization chart
C) Departments
D) Span of Control
Q62. What is the due date of AGM: -
A) within six months of closing of Financial year

B) within nine months from the closing of first financial year
C) Both of the above
Q63. Which form is to be filed with ROC for increase in Authorized share
capital?
A) PAS-3
B) SH-7
C) SH-4
D) MGT-14
Q64. A person appointed as director is required to give his written consent

in form DIR-2____ to the company.
A) Within 10 days of his appointment as director
B) Within 20 days of his appointment as director
C) On or before his appointment as director
Q65. Organization Development is aimed at:-
(A) Enhancing congruence between organizational structure, processes,

strategy, people and culture
(B) Developing new and creative organizational solutions
(C) Developing the organization’s self-renewing capacity
Q66. As per Section- ______ of the Companies Act, 2013 a certain class of
companies are required to appoint an internal auditor for conducting the
Internal Audit.
A) 138
B) 228
C) 356
D) 192
Q67. According to …………..principle, each group of activities with the same

objective must have one head and one plan.
A) Unity of Direction
B) Unity of command
C) Either of these
D) None
Q68. Board of Directors shall meet atleast ____ times a year as per
A) 4
B) 2
C) 1
D) 3
Q69. According to....................approach, management is a logical process

and it can be expressed in terms of mathematical symbols and relationships.
A) Empirical
B) Management science
C) Contingency
D) Operational
Q70. Which new types of Companies were introduced in Companied Act,

2013?
A) One person Company (OPC)

B) Associate Company
C) Small Company
D) All of the Above
Q71. As per Companies Act, 2013, registration of Company is ___________.
A) Compulsory
B) Optional
C) Compulsory for private company
D) Compulsory for public company
Q72. Resolution can be passed by circulation under Section-_____.

A) 25
B) 46
C) 175
D) 105
Q73. Which of the following would constitute to be the Key managerial

personnel as per section 2(51) of Companies Act, 2013.
A) The Chief Executive Officer or the managing director or the manager
B) The company secretary
C) The Chief Financial Officer
D) All of above.
Q74. Notice of Adjourned meeting is not required of a meeting, if meeting is

adjourned________.
A) for want of quorum
B) since die
C) for more than 30 days
D) none of the above
Q75. Minimum numbers of members necessary for a meeting is called as:
A) Proxy
B) Shareholders
C) Board of Directors
D) Quorum
Q76. What is the period for which books of accounts must be retained by the
Company?
A) 8 years
B) 10 years
C) 5 years
D) till the Company exists
Q77. Board of Directors of a Company shall exercise the following powers

only with the consent of the Company by a Special resolution namely:
1) To remit, or give time for the repayment of, any debt due from a director
2) To open a bank account
3) to sell, lease or otherwise dispose of the whole or substantially the

whole of the undertaking of the company or where the company owns more
than one undertaking, of the whole or substantially the whole of any of such
undertakings.
(A) Only 1 & 2

(B) All 1, 2 & 3
(C) None of the above
(D) Only 1 & 3
Q78. …………..is highly suitable for large organizations having large number
of managerial personnel at different levels.
A) Centralization
B) Decentralization
C) Departmentalization
D) All of these
Q79. The time period for holding AGM can be extended by ROC for how many
months?
A) 2
B) 3
C) 4
D) 6
Q80. Management is not ______.
A) A pure science
B) An art
C) Art and science both
D) An applied science
Q81.Authority is the right to give--------.

A) Information
B) Orders
C) Money
D) None of these
Q82. Identify the correct sequence of steps involved in the communication

process.
(A) Sender, Message, Encoding, Media, Decoding, Receiver, Feedback

(B) Sender, Decoding, Receiver, Feedback, Message, Encoding, Media
(C) Sender, Message, Encoding, Media, Decoding, Receiver, Feedback
(D) Sender, Media, Decoding, Receiver, Message, Encoding, Feedback
Q83. ABC, as a Project Manager, is able to assess the true potential of his
subordinates and constantly motivates them to realise their full potential.
Identify the element of directing being described in the above lines.
(A) Leadership
(B) Communication
(C) Supervision
(D) Control
Q84. Separate Meeting of Independent Directors shall be held __________ a

year.
A) Atleast once
B) Atleast twice
C) Atleast four times
D) Once in six months
Q85. The time gap between consecutive AGMs shall not exceed:
A) 15 months
B) 18 months
C) 24 months
D) 12 months
Q86. Which of these is not a part of Capital Structure?
A) Equity Shares
B) Debentures
C) Short-term borrowings
D) Bonds
Q87. Motivation is not ________.
(A) Complex process.

(B) Related to satisfaction
(C) an easy process.
(D) a goal-directed behaviour
Q88. Which of the following is not a feature of leadership?
(A) It shows ability of an individual to influence others.

(B) It leads to achievement of organisational goals.
(C) Leadership is one-time process.
(D) It leads to desired change in the organisation.
Q89. Every listed public company shall have at least _____ of the total
number of directors as independent directors.
A) one third
B) half
C) two third
D) one fourth
Q90.Who appoints the Auditors in a State Government Company?
A) CAG
B) PAG
C) Chief Minister
D) Shareholders
Q91. The memorandum of a company is dealt under?
A) Section -12
B) Section -15
C) Section -6
D) Section-4
Q92. Which of the following resolutions can be passed only in a proper

convened board meeting: -
1. to make calls on shareholders in respect of money unpaid on their

shares
2. to invest the funds of the company
3. to approve amalgamation, merger or reconstruction
4. All of the above
(A) 1,2 and 3

(B) 3 and 4
(C) 1,2,3 and 4
(D) 1 and 3 only
Q 93. Which of the following is long term source.
A) Bank Overdraft
B) Trade Credit
C) Equity Finance
D) All of the above
Q94. Savings Account are ____________, but are not __________________.
A) Negotiable, Liquid
B) Liquid, Marketable
C) liquid, Personal
D) None of these
Q 95. Life Insurance Corporation is an example of.

A) Statutory Companies
B) Registered Companies
C) Private Companies
Q 96. Company limited by Shares means:
A) Its directors must contribute in share capital

B) Its employees must contribute in share capital
C) Company having the liability of its members limited by the memorandum

to the amount, if any, unpaid on the shares respectively held by them.
D) Company having the liability of its members limited by the memorandum

to such amount as the members may respectively undertake to contribute to
the assets of the Company in the event of its being wound up.
Q 97. The word MBO stands for……………..
A) Management by Organisation
B) Management by Operation
C) Management by Objectives
D) None of these
Q 98. The term “capital structure” refers to:
(A) Current assets & current liabilities

(B) Long-term debt, preferred stock, and common stock equity
(C) Total assets minus liabilities
(D) Share holders’ equity
Q 99. Which of the following is the elements of directing?
(A) Supervision
(B) Motivation
(C) Leadership
Q 100. For increase in number of Directors more than 15 ……
(A) Approval of Centre Government

(B) Pass a special resolution
(C) Pass an ordinary resolution

ANSWER KEY
Q-1. C Q-27. D Q-53. D Q-79. B
Q-2. C Q-28. C Q-54. D Q-80. A
Q-3. D Q-29. D Q-55. A Q-81. B
Q-4. D Q-30. A Q-56. C Q-82. C
Q-5. C Q-31. A Q-57. C Q-83. A
Q-6. D Q-32. A Q-58. B Q-84. A
Q-7. A Q-33. A Q-59. D Q-85. A
Q-8. B Q-34. A Q-60. C Q-86. C
Q-9. D Q-35. D Q-61. B Q-87. C
Q-10. B Q-36. B Q-62. B Q-88. C
Q-11. B Q-37. C Q-63. B Q-89. A
Q-12. B Q-38. A Q-64. C Q-90. A
Q-13. D Q-39. B Q-65. D Q-91. D
Q-14. C Q-40. A Q-66. A Q-92. C
Q-15. A Q-41. A Q-67. A Q-93. C
Q-16. A Q-42. B Q-68. A Q-94. B
Q-17. A Q-43. D Q-69. B Q-95. A
Q-18. B Q-44. C Q-70. D Q-96. C
Q-19. B Q-45. A Q-71. A Q-97. C
Q-20. B Q-46. D Q-72. C Q-98. B
Q-21. B Q-47. C Q-73. D Q-99. D
Q-22. A Q-48. B Q-74. A Q-100. B
Q-23. A Q-49. C Q-75. D
Q-24. D Q-50. B Q-76. B
Q-25. C Q-51. D Q-77. D
Q-26. A Q-52. D Q-78. B

(PAPER-VIII)
Auditing
(For All HPUs)
Commercial Auditing
Q no. 1 On the basis of the method of examination, audit may be classified as :
a) Continuous audit
b) Periodical / Annual / Final / Completed audit
c) Balance Sheet audit
d) All of the above
Ans. d
Q no. 2 A general audit may be further classified as –

a) Independent audit
b) Occasional audit
c) Interim audit
d) Partial audit
Ans. a
Q no. 3 On the basis organizational structure of the enterprise under audit,

independent audit may be classified as:
a) Statutory audit
b) Private audit
c) Cost audit
d) Both a & b
Ans. d
Q no. 4 Fill in the blank:

An audit also safeguards the interests of the __________ who may not possess
adequate knowledge of the trust laws or the principles of book – keeping and
accounting.
a) Trustees
b) Owner
c) Government
Ans. a
Q no. 5 Which of the following term define “Where audit in the case of an
enterprise is not compulsory by law, though it is opted for by the enterprise in
view of the several benefits resulting from it”?
a) Management audit
b) Private audit
c) Statutory audit
Ans. b
Q no. 6 In the case of a private audit, the nature and scope of the audit is
determined by the______________?
a) Auditor
b) Owner
c) Client
d) Investor
Ans. c
Q no. 7 Which of the following term define “A exercise in managerial control by

means of an independent appraisal by employees of the organization itself”?
a) Independent audit
b) Interim audit
c) Internal audit
d) Statutory audit
Ans. c
Q no. 8 What is the scope of Internal audit?

a) to study and evaluate the adequacy and effectiveness of accounting,
financial and operating controls;
b) to ascertain the degree of compliance with pre-determined policies, plans
and procedures;
c) to ascertain the extent to which business assets are accounted for and
safeguarded
from losses;
d) All the above
Ans. d
Q no. 9 An interim audit is conducted in between ___________

a) Two annual audits
b) Four annual audits
c) Six annual audits
Ans. a
Q no. 10 interim audit may be ordered for a ________

a) Quarter
b) six months
c) Both a & b
d) Annually
Ans. c
Q no. 11 Which of the following term define “An occasional audit is meant for
special event, time or purpose, etc. It is not conducted on a regular basis:?
a) Statutory audit
b) Governmental audit
c) Occasional audit
d) Interim audit
Ans. c
Q no. 12 Which of the following term define “a complete check and analysis of
certain items and, contingent upon effective, check, an appropriate test check on
remaining items, the whole of the unqualified opinion.”?
a) Statutory audit
b) Standard audit
c) Occasional audit
d) Interim audit
Ans. b
Q no. 13 A _________ is mainly concerned with ascertaining whether the various

internal activities in the enterprise are being carried out efficiently
a) Statutory audit
b) performance audit
c) Occasional audit
d) Interim audit
Ans. b
Q no. 14 In a Balance Sheet audit, the audit is concerned only with the items
appearing in the
Balance Sheet, such as,
a) capital reserves,
b) other outstanding liabilities
c) Assets of the business.
d) All of the above
Ans. d
Q no.15 Clerical error include the error of _________?

a) Errors of omission,
b) Errors of commission
c) Error of principal
d) Both a & b
Ans. d
Q no. 16 Which error occurs when a transaction is not recorded in the books of
account, either wholly or partially?
d) Compensating error
Ans. a
Q no. 17 Which error may be committed either at the stage of recording a

transaction in a book of original entry or while posting it to the ledger?
Ans. b
Q no.18 Which error occurs when the same transaction is recorded twice in the
books of original entry, and hence also posted twice in the ledger accounts?
c) Error of duplication
Ans. c
Q no. 19 ___________means the practice of arranging the disposition of assets and

liabilities in such a way that affairs of the business as shown in a subsequent
Balance sheet do not truly represent the normal financial position of the
business?
a) Window dressing
c) Error of duplication
Ans. a
Q no. 20 Which is not an classification of specific audit?
a) Interim audit
b) Occasional audit
c) Partial audit
d) Internal audit
Ans. d
Q no. 21 __________ is the overall control environment, established by

management of an enterprise for effective and efficient monitoring and control of,
its operations.
a) Internal control
b) External control
c) Environmental control
d) None of these
Ans. a
Q no. 22 Internal control aims to adherence?

a) management policies,
b) safeguarding of assets of the enterprise,
c) proper accounting arid record of the business, transactions
d) All of the above
Ans. d
Q no. 23 Which is not used to determine the adequacy of the internal control?
a) Narrative record,
b) Questionnaire
c) Flow chart
d) Evaluation
Ans. d
Q no. 24 Which contains a complete written description of the internal control

system of the enterprise as actually found in operation by the auditor?
b) Questionnaire
c) Flow chart
d) None of these
Ans. a
Q no. 25 Which contains a set of questions the answers to which provide a

valuable insight into the functioning of the' internal control system within the
enterprise?
b) Questionnaire
c) Flow chart
d) None of these
Ans. b
Q no. 26 Which is a graphic presentation of any system?

b) Questionnaire
c) Flow chart
d) None of these
Ans. c
Q no. 27 ________symbol indicates the flow of processing. Generally, it is shown

from left to right though in some cases it can also be from top to bottom. In case
a document takes two or more paths, the symbol may be suitably varied as
follows:
a) Horizontal flow
b) Vertical flow
c) Directional flow
d) None of these
Ans. c
Q no. 28 Internal check is a _________ internal control.

a) valuable part of
b) Different from
c) Same as
d) None of these
Ans. a
Q no. 29 Which is not a disadvantage of internal check?

a) Complacency among high officials
b) Costly for small businesses
c) Risky for the auditor
d) Early detection of errors and fraud
Ans. d
Q no. 30 The salesmen authorized to sell goods at the counter should be

specifically named means?
a) Marketing
b) Door to door sales
c) Sales at counter
d) Personal sales
Ans. c
Q no. 31 Daily cash receipts should be deposited in a bank on the ___________

a) Next day
b) Same day
c) Next week
d) Day after tomorrow
Ans. b
Q no. 32 The external auditor is independent of the enterprise which engages

him. The internal auditor is, on the other hand, often _________of the enterprise.
a) Dependent
b) Employee
c) Agent
d) All of the above
Ans. b
Q no. 33 Separate staff is not necessary in ___________ and Separate staff is

necessary on ___________ .
a) Internal check, internal audit
b) Internal audit, internal check
c) Internal audit, external audit
d) External audit, internal audit
Ans. a
Q no. 34 Which of the following may be define as "such an examination of the

ledger entries as will satisfy an auditor not only that the entry is supported by
documentary evidence but that it has been properly made upon the books of
account."
a) Vouching
b) Posting
c) Journal entry
d) None of these
Ans. a
Q no. 35 A ____________may be defined as any document which evidences a

transaction or an entry in a book of account.
a) Invoice
b) Bill
c) Voucher
d) Receipt
Ans. c
Q no. 36 Which is not a type of voucher?

a) Primary
b) Secondary
c) Collateral
d) All of the above
Ans. b
Q no. 37 Each voucher should be examined with great care and caution and
while doing so the following points must be given particular attention?
a) Each voucher should be consecutively numbered and carefully preserved.
b) It should be properly dated and correspond to the date of the transaction
to which it relates and the period under audit.
c) It should be authorised by an official properly empowered in this behalf.
d) All of the above
Ans. d
Q no. 38 If the amount of a voucher exceeds RS._________, it should be properly

stamped.
a) 20
b) 50
c) 100
d) 1000
Ans. a
Q no. 39 According to the “Statement of Auditing Practices” issued by the

Institute of Chartered Accountants of India (ICAI), the auditor’s objective in
regard to verification of assets generally is to satisfy himself that –
a) they exist;
b) they belong to the client;
c) they are in possession of the client or any person authorized by him;
d) they are not subject to undisclosed encumbrances or lien;
e) all of the above
Ans. e
Q no. 40 Assets recorded in the accounts include?

a) Scrap
b) Waste
c) Actual
d) All of the above
Ans. d
Q no. 41 The first step in process of verification is to see that the assets as
disclosed in the Balance Sheet is to check?
a) Existence of assets as at the date of the balance sheet
b) Ownership of assets
c) Proper valuation of assets
d) Proper presentation
Ans. a
Q no. 42 Which item is not require physical verification by the auditor?

a) Land and building.
b) Plant and machinery.
c) Stock and stores
d) Sundry debtors
Ans. d
Q no. 43 Auditors objective in regard to liabilities is generally to satisfy himself

that –
a) they are properly valued
b) the credit balances appearing in the books are really liabilities
c) they are properly classified and disclosed
d) All of the above
Ans. d
Q no. 44 What are the basic characteristics of a liability?

a) it involves a future outlay of money or money’s worth:
b) it arises from a past transaction
c) both a & b
d) None of these
Ans. c
Q no. 45 which asset is not subject to depreciation?

a) Land
b) Plant
c) Machinery
Ans. a
Q no. 46 The rates of depreciation should take into account on the basis of -
a) expected physical wear and tear;
b) obsolescence;
c) legal and other limits on the use of the asset
d) All of the above
Ans. d
Q no. 47 Which accounting standard relates “Depreciation accounting”?

a) AS 6
b) AS 7
c) AS 8
d) AS 9
Ans. a
Q no. 48 Which is refer to that group of assets which are in the form of cash and
bank balances, including such other assets or reserves as are expected to be
realized in cash, or sold or consumed within a period of not more than twelve
months in the ordinary course of business?
a) Floating assets
b) Current assets
c) Both a & b
d) Fixed assets
Ans. c
Q no. 49 As asset that diminishes in value by reason of, and in proportion to, the
extraction or removal of a natural product such as ores, oil, and timber, which it
contains, is a _________ .
a) Current assets
b) Fixed assets
c) Wasting assets
d) None of these
Ans. c
Q no. 50 An asset which does not have a concrete from and is not capable of
being perceived especially by the sense of tough, is an__________.
a) Tangible assets
b) Intangible assets
c) Wasting assets
d) Fictitious assets
Ans. b
Q no. 51 An asset which, like an intangible asset, does not have concrete from
but which, unlike it, is not realizable in cash, is a
a) Tangible assets
b) Intangible assets
c) Wasting assets
d) Fictitious assets
Ans. d
Q no. 52 Which accounting standard relates “Accounting for fixed assets”?

a) AS 6
b) AS 10
c) AS 8
d) AS 9
Ans. b
Q no. 53 __________ is historical cost or other amount substituted for historical

cost in the books of account or financial statements.
a) Gross book value
b) Net book value
c) Cost of assets
Ans. a
Q no. 54 Which of the following is not included in inventory?
a) Goods held by own branches, agents
b) Goods sent to customers on “sale or return” basis
c) Goods sold thought not despatched to the buyers
d) All of the above
Ans. c
Q no. 55 What is basis of valuation of inventories?

a) Cost price
b) Market/realizable value
c) Cost or net realizable value, whichever is lower
d) Cost or net realizable value, whichever is higher
Ans. c
Q no. 56 Inventory includes:

a) Raw materials
b) Semi manufactured goods
c) Finished goods
d) All of the above
Ans. d
Q no. 57 Which are the methods of depreciation?

1. Straight –line or fixed instalment, 2. Reducing balance method, 3.
Annuity method, 4. Insurance policy system, 5. Sinking or
Depreciation or Amortization Fund method
a) 1,2,3,4
b) 1,3,4,5
c) 1,2,3,4,5
d) 1,2,3,5
Ans. c
Q no. 58 ____________ a fund which is created and maintained for the purpose of
being drawn upon in future.
a) Reserve
b) Provision
c) Surplus
d) All of the above
Ans. a
Q no. 59 Which if following term may be defined as a close examination of the

accounts and records and a search for the relevant data, with a view to
ascertaining any fact for some special purpose?
a) Internal control
b) Internal check
c) Investigation
d) Valuation
Ans. c
Q no. 60 What is the object of an investigation?

a) Collect,
b) Analyse
c) Evaluate facts
d) All of the above
Ans. d
Q no. 61 As investigation is __________different from the audit programme.

a) Qualitatively
b) Quantitative
c) Both a & b
Ans. a
Q no. 62 Is it necessary for the auditor to express any opinion of his own?
a) Yes
b) No
c) Can’t say
d) May be
Ans. b
Q no. 63 Investigation is __________ and audit is _____________.

a) Limited, wide
b) Wide, limited
c) Partially, whole
Ans. a
Q no. 64 Is there need a standard audit programme in the Investigation?

a) Yes
b) No
c) Can’t say
d) May be
Ans. b
Q no. 65 What is the full form of GAAP?

a) Generally accepted auditing procedures
b) Generally accepted auditing principals
c) Generally accepted auditing progress
Ans. b
Q no. 66 Investigation may be classified as:

a) Evaluations
b) Reviews
c) Surveys
d) Analyses
e) All of the above
Ans. e
Q no. 67 Under which category of investigations are usually undertaken to

determine fraud, though these may also pertain to losses caused by fire or
machinery break down, aimed at filing a claim with the insurers.
a) Evaluations
b) Reviews
c) Surveys
d) Special audit
Ans. d
Q no. 68 When the affairs of the company may be investigated by the Central
Government (Statutory investigation)?
a) On an application by the members;
b) On a report by the Registrar of Companies;
c) On an order by the competent court.
d) All of the above
Ans. d
Q no. 69 _________is a systematic and scientific examination of the books of

accounts of a business.
a) Accounting
b) Book-keeping
c) Audit
d) Ledger posting
Ans. c
Q no. 70 ________ usually covers one accounting year _________ cover more than
one accounting year.
a) Auditing, Investigation
b) Investigation, auditing
c) Internal control, Internal check
d) Internal check, internal control
Ans. a
Q no. 71 ________ is voluntary. It is required under certain circumstances.

a) Auditing
b) Investigation
c) Internal control
d) Internal check
Ans. b
Q no. 72 Which of the following is forms of internal which control help in
ensuring correct and reliable records of transactions and operational efficiencies?
a) Accounting control
b) Administrative control
c) Both a & b
Ans. c
Q no. 73 What is the purpose of internal audit is a thorough examination of the

accounting transactions?
a) The transactions are properly recorded
b) The accounts are maintained systematically
c) There is no possibility for manipulation of accounts or misappropriation of
property of the business
d) All of the above
Ans. d
Q no. 74 _________helps the statutory audit to a large extent.
a) Internal audit
b) Investigation
c) Internal check
Ans. a
Q no. 75 Which term define “is the examination of the books of accounts of the
business by an external auditor and to report that the profit and loss account
and balance sheet are drawn according to provisions of law and the financial
statements reveal the true and fair view of the results of operations and financial
state of affairs of the business.
a) Internal audit
b) Investigation
c) Internal check
d) Statutory audit
Ans. d
Q no. 76 ___________ refers to a system of book-keeping and arrangement of staff

duties in the organization in such a manner that no one person can completely
carry through a transaction and record every aspect thereof.
a) Internal audit
b) Investigation
c) Internal check
d) Statutory audit
Ans. c
Q no. 77 What are basic principal of establishing internal audit in a business

concern?
1. Independence, 2. Definition of Duties, 3. Follow Up and Review, 4. Clarity
in scope,
5. Relationship with statutory auditor
a) 1,2,3
b) 1,3,4,5
c) 1,2,3,4,5
d) 2,3,4
Ans. c
Q no. 78 What is the scope of verification of assets?

1. That the assets were in existence on the date of the balance sheet
2. That the assets had been acquired for the purpose of business only
3. That the assets had been acquired under a proper authority
4. That the right of ownership of the assets vested in the organization
5. That the assets were free from any charge
6. That the assets were properly valued and disclosed in the balance sheet.
a) 1,2,3,6
b) 1,3,4,5
c) 1,2,3,4,5
d) 1,2,3,4,5,6
Ans. d
Q no. 79 What are techniques of verification of assets?
a) Inspection
b) Observation
c) Confirmation
d) All of the above
Ans. d
Q no. 80 Which of the following means determining the fair value of the assets
shown in the Balance Sheet on the basis of generally accepted accounting
principles?
a) Valuation of assets
b) Verification of assets
c) Checking of assets
Ans. a
Q no. 81 According to the accounting principles during the verification and

valuation of assets “auditor is not the valuer”.
a) Statement is not correct
b) Statement is correct
c) Can’t say
Ans. b
Q no. 82 _________are those liabilities which may or may not arise in the future
for payment.
a) Current liabilities
b) Non-current liabilities
c) Contingent liabilities
Ans. c
Q no. 83 “Outstanding expenses” is:

a) Current assets
b) Fictitious asset
c) Fixed asset
d) Liability
Ans. d
Q no. 84 Tax audits are required if a taxpayer's sales, turnover, or gross earnings
are more than ₹ _______in a given financial year.
a) 1 Crore
b) 2 Crore
c) 5 Crore
d) 10 Crore
Ans. a
Q no. 85 what is the limit of taxpayer's sales, turnover, or gross earnings if he

taxpayer’s cash receipts and payments are limited to 5% of the gross earnings or
turnover?
a) 1 Crore
b) 2 Crore
c) 5 Crore
d) 10 Crore
Ans. c
Q no. 86 What is the due date of filing a tax audit report for domestic
companies?
a) 30th September
b) 31st October
c) 30th November
d) 31st December
Ans. a
Q no. 87 What penalty is imposed If a taxpayer who fails to comply with tax audit
provisions?
a) Rs 1,50,000
b) 5% of the total sales, turnover, or gross receipts
c) Rs 1,50,000 & 5% of the total sales, turnover, or gross receipts whichever
is least
d) Both a & b
Ans. c
Q no. 88 What do you mean by term ‘propriety’ in propriety audit?

a) Rightness
b) Property
c) Asset
Ans. a
Q no. 89 What kind of audit extends beyond scrutinising the mere formality of
expenditure to its wisdom and economy and to bring to light, cases of improper
expenditure or waste of public money?
a) propriety audit
b) Interim audit
c) Internal audit
d) Management audit
Ans. a
Balance Sheet
1.On balance sheet, accruals, notes payable, and account payable are listed
under which category?
A) Current Liabilities
B) Accumulated Liabilities
C) Noncurrent Liabilities
D) Accrued Liabilities
2. Inventories, cash and equivalents, and accounts receivables are listed

as_______
A) Earnings on Income Statement
B) Payments on Income Statement
C) Assets on the Balance Sheet
D) Liabilities on the Balance Sheet
3. Which of the following is not a current asset_______

A) Supplies
B) Land
C) Accounts Receivable
D) Prepaid Insurance
4. In the situation of bankruptcy, a stock which is recorded above common stock

and below debt account is_______
A) Preferred Stock
B) Debt Liabilities
C) Common Liabilities
D) Hybrid Stock
5. A firm buys products but does not pay to suppliers instantly. This is recorded
as______
A) Account Receivable
B) Account Payable
C) Accumulated Liabilities
D) Current Liabilities
6. In a balance sheet, the total of common stock and retained earnings are
denoted as______
A) Common Equity
B) Due Equity
C) Preferred Equity
D) Common Perpetuity
7. The process of recording inventory that gives a lower cost of a commodity sold
in an income statement is denoted as________
A) First Out Receivable
B) Last in First Out
C) Last Out Receivable
D) First in First Out
8. Financial securities which can be changed into cash to their book value price
are categorised as___________
A) Short-term Investments
B) Inventories
C) Long-term Investments
D) Cash Equivalents
9. Earnings that have a cumulative amount and are not paid to the stockholder
as a dividend is known as_______
A) Common Earnings
B) Preferred Earnings
C) Non-paid Earnings
D) Retained Earnings
10. Information that is used by investors for expecting future earnings is

recorded in______
A) Annual Report
B) Five Years Report
C) Exchange Report
D) Stock Report
11. Balance sheet audit is also known as …………

A) Continues audit
B) Annual Audit
C) Internal Audit
D) Financial Audit
12. Meaning of verification of assets is –______

(a) Valuation of assets
(b) Checking of ownership of assets
(c) Checking of the title, existence and possession of assets
(d) All above
13, “The verification of Assets implies an enquiry into the value, ownership
and title, existence and possession and the presence of any charge on the
assets”. This is defined by __________
(a) Spicer and Pegler
(b) J.R. Batliboi
(c) Luncaster
(d) None of these
14. Principle of verification is –

(a) Physical inspection
(b) Principle of review
(c) Confirmation
(d) All of these
15. Which of the following is not the object of verification –
(a) Checking of ownership of the institution on the assets

(b) Checking of possession, lien and charge on the assets
(c) Fulfilling statute
(d) Control over frauds
16.Object of verification of assets by an auditor is –

(a) Verifying the existence of assets
(b) Verifying the value on which these are shown in balance sheet
(c) Verifying their ownership
(d) All of above
17. Which of the following does not require physical verification?

(a) Stock
(b) Plant
(c) Goodwill
(d) Loose Tools
18. In verifying liabilities, an auditor see that –

(a) All liabilities are shown clearly in the balance sheet
(b) All liabilities are related with
(c) All liabilities are correct and authorised
(d) All above
19. “The valuation of assets is an attempt to ensure the equitable

distribution of the original outlay over the period of the assets usefulness.”
This is defined by –
(a) Lancaster
(b) J.R. Batliboi
(c) Spicer and
(d) None of these
20. In how many parts generally assets are categorised –

(a) 2
(b) 3
(c) 4
(d) 5
21. Which of the following is the object of valuation –

(a) Accurate knowledge of the financial position of the organisation
(b) Knowledge about the value of the assets
(c) Knowledge about the goodwill of the institution
(d) All above
22. Valuation is –
(a) An element of verification
(b) Essential part and element of verification
(c) Alternate of verification
(d) Verification is a part of valuation
23. When auditor has any doubt about the valuation of assets, he must
disclose this fact____
(a) To secretary
(b) To manager
(c) In his report
24. Verification and Valuation both are –

(a) The same things
(b) separate things
(c) complementary to each other
(d) None of these.
25.Valuation is a part of –
(a) Vouching
(b) Verification
(c) Internal control
(d) None of these
26. Verification is based on –

(a) Physical inspection
(b) Documentary evidence
(c) Above both (a) and (b)
(d) None of these
27. Case of London Oil Storage Co. Ltd. vs. Sear Hasluck Co. (1904) is
related to –
(a) Verification of Assets
(b) Valuation of Assets
(c) Verification of Liabilities
(d) None of these
28.Stock should be valued at –

(a) Cost price
(b) Market price
(c) Cost or market price whichever is lower
(d) Cost price less depreciation
29.Which asset is valued on cost price or market price whichever is less –

(a) Furniture
(b) Building
(c) Machine
(d) Stock
30. Which reserve is useful to strength the financial position of a business?

(a) Specific reserve
(b) Secret reserve
(c) General reserve
(d) Redemption fund
31. Wasting assets means –

(a) Which decreases in value
(b) The value of which is decreases due to constant use
(c) Market price of which is reduced
(d) None of above
32. Which the following is a fixed asset –

(a) Furniture
(b) Book Debts
(c) Bills Receivables
(d) Stock
33. Current assets remain in business for –

(a) Long period
(b) Temporarily
(c) Short period
(d) All above
34. Which of the following is current asset?

(a) Stock-in-trade
(b) Book debts
(c) Raw material
(d) All above
35. Valuation of purchased goodwill is done on the basis of –

(a) Purchase agreement
(b) Market price
(c) Directions of management
(d) None of above
36. Registration from government for a name or mark of the produced

goods is termed as__________
(a) Patent
(b) Trademark
(c) Copyright
(d) Registration
37. Which of the following is wasting asset –

(a) Mines
(b) Quarry
(c) Oil wells
(d) All above
38. Which of the following is intangible asset –

(a) Goodwill
(b) Patent
(c) License
(d) All above
39. Which of the following is fictitious asset –

(a) Preliminary expenses
(b) Deferred Revenue
(c) Discount on issue of
(d) All above
40. Which of the following is an intangible asset?

(a) Patents
(b) Prepaid expenses
(c) Preliminary
(d) None of these
41. Which of the following is fictitious asset –

(a) Goodwill
(b) Copyright
(c) Preliminary expenses
(d) None of these
42. Investments in hand should be verified with the help of –

(a) Schedule of investments
(b) Balance sheet
(c) Inspection of securities
(d) Certificate from the bank
43. Direct confirmation procedure can be applied to –

(a) Debtors only
(b) Creditors only
(c) Both (a) and (b)
(d) None of above
44. Preliminary expenses include –

(a) Cost of stamp
(b) Legal expenses
(c) Underwriting
45.Verification refers to –
(a) Examination of journal and ledger
(b) Examination of vouchers related to
(c) Examination of physical existence and valuation of assets
(d) Computation of value of assets
46. Which of the following statement is correct –

(a) Valuation is a part of verification
(b) Verification is a part of valuation
(c) Valuation is not related with verification
(d) Auditor is a valuer
47. Which of the following statement is valuation of assets by an auditor –

(a) Auditor is not a valuer
(b) Auditor is a valuer
(c) Computing stock is the work of auditor
(d) None of these
48. Floating assets are valued at –
(a) Cost price
(b) Market price
(c) Cost or market price whichever is less
(d) Cost less depreciation
49.In case of unclaimed wages, the auditor should examine whether –

(a) The amount is deposited in a separate bank account
(b) Deposited with the cashier
(c) Held in a safe deposit box
(d) All of these
50. Land is valued at –

(a) Cost Price
(b) Market Price
(c) Cost or market price whichever is more
51. Which of the following is an intangible asset –

(a) Trade mark
(b) Preliminary
(c) Development expenses
(d) All above
52. Work of Valuation done by is –

(a) Secretary
(b) Auditor
(c) Manager
(d) Employee
53. Which of the following asset is valued at cost –

(a) Furniture
(b) Cash
(c) Stock
(d) Goodwill
54. “Generally stock is valued at cost price or market price whichever is

less”, this statement is given by –
(a) D. Paul
(b) Hanry Fayol
(c) Pigou
(d) Hanes
55. At which price raw material is valued –
(a) Cost Price
(b) Market Price
(c) Purchase Price
(d) All above
56. On which side Trade mark is shown in the Balance Sheet –

(a) Asset side
(b) Liability side
(c) Foot note
(d) Not Shown
57. Which of the following is wasting asset –

(a) Coal mines
(b) Furniture
(c) Goodwill
(d) Cash
58. Quoted Price is related with –

(a) Stock
(b) Shares
(c) Goodwill
(d) None of these
59. Highest in Price Out’ method of valuation is used –

(a) When the price of material is increasing
(b) When the price of material is decreasing
(c) When the price of material is constant
(d) None of these
60. In valuing livestock, auditor should take certificate of –

(a) Management
(b) Specialists
(c) Secretary
(d) All above
61. Valuation of Livestock should be made by –

(a) Expected age method
(b) Revaluation method
(c) Average age method
(d) None of these
62.Valuation of loose tools is made on the basis of –

(a) Revaluation
(b) Cost price
(c) Market price
(d) None of these
63. In the First in First Out Method’, stock is valued at –

(a) At the rate of latest consignment purchased
(b) At the rate of earliest consignment purchased
(c) On actual cost
(d) None of above
64.In the Balance Sheet contingent liabilities is shown –

(a) Assets side
(b) Liability side
(c) In form of footnote
(d) None of above
65. Which of the following is contingent liability –

(a) Liability on bills
(b) Liability for guarantee
(e) The liability for calls on partly paid shares in other company
(d) All above
66. Main cause of over and under valuation of assets and liabilities iss –
(a) Errors of principles
(b) Clerical errors
(c) Fraudulent manipulation of accounts
67.Incorrect valuation of stock affects –

(a) Profit and Loss A/e
(b) Balance Sheet
(d) None of these
68. In which case decision is that physical verification of stock is the

liability of auditor –
(a) Mackson and Robbins
(b) Kingston cotton mills
(c) Union Bank Ltd. Allahabad
(d) None of these
69. Which of the following is the result of undervaluation of stock –

(a) Decrease in profit
(b) Creation of secret reserve
(c) Decrease in price of shares
(d) All above
70. In which possibilities of fraud and error are more –

(a) Cash
(b) Stock
(c) Debtors
(d) Bills Receivables
71. When profit is inflated by making wrong valuation of stock, then profit
of succeeding year will –
(a) Decrease
(b) Increase
(c) No effect
(d) None of above
72. Material includes –

(a) Raw material
(b) Loose Tools
(e) By-product
(d) All above
73. Average Profit Method is connected with –

(a) The valuation of stock
(b) The valuation of goodwill
(c) The valuation of shares
(d) None of these
74. Instrinsic value method of valuation is concerned with –

(a) Stock
(b) Fixed Assets
(c) Shares
(d) None of these
75. Capitalisation method is concerned with –

(a) The valuation of stock
(b) The valuation of goodwill
(c) The valuation of shares
(d) None of these
76. If average capital of business is Rs. 5,00,000; Average annual income

Rs. 80,000 and normal rate of return 10% then amount of goodwill by
capitalisation method will be –
(a) Rs. 30,000
(b) Rs. 3,00,000
(c) Rs. 50,000
(d) Rs. 8,00,000
77.Method of valuating stock is –

(a) Individual method
(b) Group method
(d) None of these
78. “Depreciation is gradual and permanent decrease in the value of assets

from any use.” This definition is given by –
(a) Carter
(b) Spicer and Pegler
(c) R.G. Williams
(d) None of these
79. Which fund is created for the replacement of assets?

(a) Reserve Fund
(b) Depreciation Fund
(c) Investment Fund
(d) None of these
80.The main cause of depreciation is –

(a) Use of Asset
(b) Sale of
(c) Theft of Asset
(d) None of these
81. Which is the main base of depreciation?

(a) Life of Asset
(b) Value of Asset
(c) Capacity of Asset
(d) None of these
82. Which of the following is objective of Depreciatio management?

(a) To ascertain the correct cost of production
(b) To ascertain the accurate profit/loss
(c) Replacement of asset
(d) All above
83.Depreciation is charged on –
(a) Fixed assets only
(b) Current assets only
(c) Both fixed and current assets
(d) None of these
84. Provision for depreciation is –

(a) Voluntary
(b) Compulsory
(c) Convention
(d) None of these
85. Arrangement for depreciation on fixed asset is a –

(a) Statutory requirement
(b) Voluntary
(c) Beneficial for business
(d) None of these
86. Cause of depreciation is –

(a) Continuous use of Assets
(b) Depletion
(c) Exffluxion of the time
(d) All above
87. Which section of Companies Act is related with?

(a) Section 205
(b) Section 300
(c) Section 350
(d) All above
88. Depreciation reduced the –

(a) Book value of asset
(b) Market value of asset
(c) Replacement value of asset
(d) None of above
89. Appropriate method of depreciation for –

(a) Fixed instalment method
(b) Written down value method
(c) Annuity method
(d) Sinking fund method
90. Appropriate method of depreciation for replacement of machinery is –

(a) Fixed instalment method
(b) Written down value method
(c) Annuity method
91. Appropriate method of depreciation for Livestock is –
(a) Insurance policy method
(b) Revaluation method
(c) Depletion unit method
92. Reserve is made for –

(a) General object
(b) Specific object
(d) None of these
93. Sinking fund is made for –

(a) General object
(b) Specific object
(d) None of these
94. If cost price of a machine is Rs. 15,000; Scarp value is of Rs 3,000 and
expected life is 4 years, then amount of depreciation will be –
(a) Rs. 3750
(b) Rs. 3,000
(c) Rs. 8,000
(d) None of these
95. Which of the following fund is created for equalisation of dividend rate?
(a) Revenue Reserve
(b) Capital Reserve
(c) Sinking Fund
(d) None of these
96. Which of the following is the object of creating reserve the company –
(a) To make financial position strong of the company
(b) Increase in working capital
(c) Replacement of assets
97. Which of the following is the object provision?

(a) Arrangement of depreciation on fixed assets
(b) Arrangement for known liability
(c) Arrangement for bad debts
(d) All above
98. Which of the following is created for an unknown?
(a) Reserve
(b) Provision
(c) Secret Reserve
(d) All above
99.Which of the following can be utilised to distribute dividends among

shareholders?
(a) Capital Reserve
(b) Revenue Reserve
(c) Provision
(d) None of these
100. A reserve which is not apparent on the face of the balance sheet is –
(a) Secret reserve
(b) Capital reserve
(c) Revenue reserve
(d) Provision
101. Which of the following is the method of creating secret reserve –

(a) Overvaluation of liabilities
(b) Undervaluation of assets
(c) Treating capital expenses as revenue expenses
(d) All above
102. Which of the following statement is incorrect?

(a) Final accounts will become incorrect due to secret reserve
(b) Market price of shares falls down due to secret reserve
(c) Secret reserve might be used by dishonest directors for improper purposes
(d) Due to secret reserve, financial position of a company becomes weak
103. Capital profits can be utilised –

(a) To issue bonus shares
(b) To writing off preliminary expenses
(c) In distributing dividends
(d) Both above (a) and (b)
104. According to Companies Act, creating secret reserve is –

(a) Compulsory
(b) Voluntary
(c) Prohibited
(d) None of these
105. Which company can make secret reserve –

(a) Banking company
(b) Insurance company
(e) Finance company
(d) All above
106. Window dressing implies –

(a) Curtailment of expenses
(b) Checking wastages
(c) Undervaluation of assets
(d) Overvaluation of assets
107. “Secret reserves are also referred as hidden reserve or inner reserve”.
This is defined by –
(a) R.G. Williams
(b) De Paula
(c) Spicer and Peglar list
(d) None of these
108. A secret reserve is a reserve that is not disclosed in the Balance Sheet
so that the Financial position is, in fac better than appears from the
balance sheet.” This is defined by –
(a) R.G. Williams
(b) De Paula
(c) Spicer and Peglar
(d) None of these
ANSWERS :
1 A) Current Liabilities
2 C) Assets on the Balance Sheet
3 B) Land
4 A) Preferred Stock
5 B) Account Payable
6 A) Common Equity
7 D) First in First Out
8 D) Cash Equivalents
9 D) Retained Earnings
10 A) Annual report
11 D) Financial audit
12 D) All the above
13 A) Spicer and Pegler
14 D) All the above
15 C Fulfilling statute
16 D) All the above
17 C) Goodwill
18 D) All the above
19 A) Lancaster
20 D) 5
21 D) All the above
22 B) Essential part and element of verification
23 C) In his report
24 C) Complementary to each other

25 B) Verification
26 C) Above both (a) & (b)
27 A)Verification of assets
28 C) Cost or market price whichever is lower
29 D)Stock
30 B)Secret reserve
31 B)The value of which is decreases due to constant use
32 A)Furniture
33 B)Temporarily
34 D)All the above
35 A)Purchase agreement
36 B) Trademark
37 D)All the above
38 D)All the above
39 D)All the above
40 A)Patents
41 C)Preliminary expenses
42 C) Inspection of securities
43 B)Both )a) & (b)
44 D)Both )a) & (b)
45 (C) Examination of physical existence and valuation of assets
46 A)Valuation is a part of verification
47 A)Auditor is not a valuer
48 C)Cost or market price whichever is less
49 A)The amount is deposited in a separate bank account
50 A)Cost price
51 A)Trade mark
52 C)Manager
53 D)Goodwill
54 A)D.paul
55 A)Cost price
56 A)Asset side
57 A)Coal mines
58 B)shares
59 B)When the price of material is decreaing
60 B) specialists
61 B)Revaluation method
62 A)Revaluation
63 A)At the rate of latest consignment purchased
64 C)In form of footnote
65 D)All the above
66 C)Fraudulent manipulation of accounts
67 C)Both a & b
68 A)Mackson and Robbins
69 D)All the above
70 B)Stock
71 A)Decrease
72 D)All the above
73 B)The valuation of goodwill
74 C)Shares
75 B)The valuation of goodwill
76 B)Rs. 3,00,000
77 C)Both a & b
78 A)Carter
79 B)Depreciation fund
80 A)Use of asset
81 A)Life of asset
82 D)All the above
83 A)Fixed assets only
84 B)Compulsory
85 A)Statutory requirement
86 D)All the above
87 D)All the above
88 A)Book value of asset
89 A)Fixed instalment method
90 D)Sinking fund method
91 B)Revaluation method
92 A)General object
93 B)Specific object
94 B)Rs. 3,000
95 A)Revenue reserve
96 D)Both a & b
97 D)All the above
98 A)Reserve
99 B)Revenue reserve
100 A)Secret reserve
101 D)All the above
102 (d) Due to secret reserve, financial position of a

company becomes weak
103 D)Both a & b
104 C)prohibited
105 D)All the above
106 D)Overvaluation of assets
107 A)R.G Williams
108 C)Spicer and Peglar

Advancer Accountancy – 2 (Auditing)
1) Audit Note Book contains: ---------------------------------------------------------
(A) Various dates of reference.
(B) Details of work done.
(C) Notes regarding item requiring clarification, explanations, etc.
(D) All of the above.
Ans. : (D) All of the above.
2) Which of the following has a broader scope?
(A) Internal Control.
(B) Internal Audit.
(C) Internal Checking.
(D) None of the above.
Ans. : (D) None of the above.
3) An internal auditor is :
(A) Temporary Employee.
(B) Permanent Employee.
(C) Daily Wager.
Ans.: (B) Permanent Employee.
4) The main object of vouching is :
(A) To prepare trial balance.
(B) Conduct routine checking.
(C) Verify authenticity & authority of transactions.
(D) Checking of vouchers
Ans.: (D) Checking of vouchers
5) Valuation is the base of:
(A) Verification.
(B) Marketing.
(C) Internal checking.
(D) Vouching.
Ans. : (A) Verification.
6) The first auditor or auditors are appointed by :
(A) Central Government.
(B) Company Law Board.
(C) Board of Directors.
(D) Shareholders.
Ans. : (C) Board of Directors.
7) A number of checks & controls exercised in a business to ensure its efficient
working is known as :
(A) Internal check.
(B) Internal control.
(C) Internal audit.
(D) Interim check.
Ans. : (A) Internal check
8) Voucher relates to :
(A) Cash receipt.
(B) Cash payment.
(C) Credit transactions.
(D) All the above.
Ans. : (D) All the above.
9) Internal check is meant for :
(A) Prevention of frauds.
(B) Detection of frauds.
(C) Helping audit in depth.

(D) Detection of errors.
Ans. : (C) Helping audit in depth.
10) Internal auditor is appointed by :
(A) The management.
(B) The shareholders.
(C) The government.
(D) The statutory body.
Ans. : (A) The management.
11) Auditing begins where -------- ends.
(A) Selling.
(B) Inventory valuation.
(C) Accounting.
(D) Purchases.
12) A good audit report must at least meet one of the following qualifications:
(A) It should offer constructive and timely suggestions to the management.
(B) It should not point out mistakes.
(C) It should not be based on factual information.
(D) It should not be based on balance sheet.
Ans. : (A) It should offer constructive and timely suggestions to the
management.
13) The work of one clerk is automatically check by another clerk is called :
(A) Internal control.
(B) Internal check.
(C) Internal audit.
Ans.: (B) Internal check.
14) The owners of the company are called:

(A) Debenture holders.
(B) Debtors.
(C) Shareholders.
Ans. : (C) Shareholders.
15) Verification is :
(A) The art of recording the business transactions.
(B) An examination of the books of accounts.
(C) The act of establishing the accuracy of entries in the books of accounts.
Ans. : (C) The act of establishing the accuracy of entries in the books of
accounts.
16) The main object of investigation is :
(A) To discover errors and frauds.
(B) To prevent errors and frauds.
(C) To verify statements.
(D) All the above.
Ans. :(D) All the above.
17) Internal controls and internal check are :
(A) One and the same.
(B) Different.
(C) Internal control includes internal check.
Ans. : (C) Internal control includes internal check.
18) An auditor is like a :
(A) Watchman.
(B) Foolish dog.
(C) Mad dog.

(D) Watch dog.
Ans. : . (D) Watch dog.
19) Special audit is necessary for:
(A) Inefficient concern.
(B) Processing concern.
(C) Trading concern.
(D) Manufacturing concern.
Ans.: (A) Inefficient concern.
20) The company’s auditor is expected to give:
(A) His expert opinion about the accounts.
(B) A factual position about the accounts.
(C) A critical review of the accounts.
(D) Financial assistance.
Ans.: (B) A factual position about the accounts.
21) Auditors of a joint stock company are appointed by :
(A) Directors of the company.
(B) Annual general meeting.
(C) Election at the annual general meeting.
(D) Debenture holders.
Ans.: (C) Election at the annual general meeting.
22) A company auditor can be removed by :
(A) Board of directors.
(B) Managing director.
(C) Any director.
(D) General Meeting.
Ans. : (D) General Meeting.
23) A vacancy caused by resignation of an auditor is filled by :

(C) General meeting.
(D) Central government.
Ans. : (C) General meeting
24) Audit in depth means :
(A) Audit of each and every item.
(B) Intensive audit of each and every item.
(C) Intensive audit of few items.
(D) Audit of a few selected items.
Ans. : (B) Intensive audit of each and every item.
25) Concurrent audit is a part of :
(A) Internal check system.
(B) Continuous audit.
(C) Internal audit system.
(D) Final audit.
Ans. (C) Internal audit system.
26) Audit in depth is synonymous for:
(A) Complete audit.
(B) Completed audit.
(C) Final audit.
(D) Detailed audit.
Ans. : (D) Detailed audit.
27) Balance sheet audit included verification of :
(A) Assets.
(B) Liabilities.
(C) Income & expenditure accounts where appropriate.

(D) All of the above.
Ans. : (D) All of the above.
28) Which of the following statements is not true about continuous audit?
(A) It is conducted at regular interval.
(B) It may be carried out on daily basis.
(C) It is needed when the organization has a good internal control system.
(D) It is expensive.
Ans. : (C) It is needed when the organization has a good internal control system.
29) Which of the following is not a fact of EPA ?
(A) Economic audit.
(B) Efficiency audit.
(C) Expenditure audit.
(D) Effectiveness audit.
Ans.: (C) Expenditure audit.
30) Balance sheet does not include :
(A) Verification of assets & liabilities.
(B) Vouching of income & expense accounts related to assets and liabilities.
(C) Examination of adjusting and auditing & closing entries.
(D) Routine checks.
Ans.: (D) Routine checks.
31) When issuing unqualified opinion the auditor who evaluates the audit
findings
should be satisfied that the :
(A) Amount of known miss-statement is documented in working papers.
(B) Estimates of the total likely misstatement are less than materiality level.
(C) Estimated of the total likely misstatement is more than materiality level.
(D) Estimates of the total likely misstatement cannot be made.

Ans. : (B) Estimates of the total likely misstatement are less than materiality
level.
32) Under check system principle of_________ is followed.
(A) Division of labour
(B) Division of work
(C) Principle of scalar chain
(D) Accountancy
.ANS : (A) Division of labour
33) This kind of audit is generally conducted between two annual audits.
(A) Internal audit
(B) Interim audit
(C) Final audit
(D) Continuous audit
Ans. : (B) Interim audit.
34) Before the work of audit is commenced, the auditor plans out the whole of
audit work is known as –
(A) Audit plan
(B) Audit note
(C) Audit risk
(D) Audit program
Ans. : (D) Audit program.
35) Internal auditor is appointed by –
(A) The management
(B) The shareholders
(C) The government
(D) statutory body

36) The audit that is made compulsory under the statute is called –
(A) Statuary audit
(B) Partial audit
(C) Complete audit
(D) Continues audit
Ans. : (A) Statuary audit.
37) Who among the following can be appointed as the auditor of company?
(A) A partner or the director of the company
(B) A person of unsound mind
(C) Mr. ‘Y’ who owes Rs.500 to company
(D) Mr. ‘Z’ who holds the ‘CA’ Certificate
Ans. : Mr. ‘Z’ who holds the ‘CA’ Certificate.
38) ___ is documentary evidence by which the accuracy in the books of accounts
may be proved.
(A) Cheque
(B) Receipt
(C) Voucher
(D) Statement
Ans. : (C) Voucher.
39) Sale of Rs.50,000 to ‘A’ was entered as a sale to ‘B’. This is an example of –
(A) Error of omission
(B) Error of commission
(C) Compensating error
(D) Error of Principle.
Ans. : (B) Error of commission.
40) In comparison to the independent auditor an internal auditor is more likely to
be concerned with –
(A) Cost accountancy system
(B) Internal control system
(C) Legal compliance
D) Accounting system
Ans. : (B) Internal control system.
41) The audit program is prepared by –
(A) The auditor
(B) The client
(C) The audit assistants
(D) Auditor & his assistants
Ans. : (D) Auditor & his assistants.
42) Interim audit refers to –
(A) Examination of accounts continuously
(B) Examination of accounts intermittently
(C) Audit work to find out & check interim profits of a company
(D) Carrying on audit for bonus purposes at the end of year
Ans. : (C) Audit work to find out & check interim profits of a company .
43) A company auditor should see that the dividend is paid –
(A) After charging depreciation
(B) Without charging depreciation
(C) Out of capital
Ans. : (A) After charging depreciation.
44) Errors of omission are –
(A) Technical errors
(B) Error of principle

(D) none of these
Ans.: (A) Technical errors.
45) Vouching implies –
(A) Inspection of receipts
(B) Examination of vouchers to check authenticity of records
(C) Surprise checking of accounting records
(D) Examining the various assets
Ans. : (B) Examination of vouchers to check authenticity of records.
46) Undervaluation of stock is –
(A) Technical error
(B) Compensatory error
(C) Error of principle
(D) none of these
Ans. : (C) Error of principle.
47) Verification refers to –
(A) Examination of journal & ledger
(B) Examination of vouchers related to assets
(C) Examining the physical existence & valuation of assets
(D) Calculation of valuation of assets
Ans. : (C) Examining the physical existence & valuation of assets.
48) Valuation of fixed assets is based on the concept –
(A) Going concern
(B) Money measurement
(C) Dual aspect
(D) Cost concept.
Ans. : (A) Going concern.
49) “Auditor is not valuer.” This statement was stated in –

(A)Kingston Cotton Mill Case (B) London & General Bank Case
(C) Lee VS Neuchatel Co. LTD Case (D) London Oil Storage Co.LTDCase
Ans. :(A)Kingston Cotton Mill Case.
50) Floating assets are valued at –
(A) Cost
(B) Market price
(C) Cost price or market price whichever is less
(D) Cost less than depreciation
Ans. : (C) Cost price or market price whichever is less.
51) Outstanding expenses should be verified with the help of –
(A) Cashbook
(B) Balance book
(C) Journal proper
(D)None of above.
Ans. : (C) Journal proper
52) First auditor of the company is appointed by the –
(A) Shareholders
(B) Central government
(C) Company law board
(D) Board of directors
Ans. :(D) Board of directors.
53) The vacancy caused by resignation at a auditor is filled by –
(A) Board of directors
(B) At the general meeting of shareholders
(C) By the central government
(D) By the company law board
Ans. : (B) At the general meeting of shareholders

54) A special auditor is appointed by the –
(A) Shareholders
(B) Board of directors
(C) Central government
(D) CAG
Ans. : (C) Central government.
55) A remuneration of a company auditor is fixed by the –
(A) Shareholders
(C) Central Government
(D) Appointing authority
Ans. : (D) Appointing authority.
56) Internal auditor has to submit report to –
(A) Shareholders
(B) Government
(D) none of above
Ans. : D) none of above.
57) Auditor in general is –
(A) Employee of the company
(B) Agent of the company
(C) Agent of the shareholders
(C) None of the above
Ans. : (C) Agent of the shareholders.
58) Shares issued for consideration other than cash should be vouched with help
of –
(A) Directors minutes book

(B) Shareholders minute’s book
(C) Contract with the party concerned
(D) Cash book
Ans. : (C) Contract with the party concerned.
59) The term Standard Auditing Practices refers –
(A) Auditing techniques adopted by auditor for collecting & vouching evidences
(B) Test checking
(C) Standards of auditing
(D) True & fair view
Ans. : (A) Auditing techniques adopted by auditor for collecting & vouching
evidences.
60) AAS refers to –
(A) Audit evidence
(B) Audit Planning
(C) Risk assessments &Internal control
(D) Knowledge of business
Ans. :(D) Knowledge of business.
61) The panel of Auditors of cooperative society is maintained by –
(A) Charted Accountant
(B) Central Government
(C) Registrar
(D) Shareholders
Ans. : (C) Registrar.
62) Banking Regulation Act was passed in the year–
(A) 1912
(B) 1949
(C) 1956
(D) 1955.
Ans. : (B) 1949.
63) Which of the following statements is not correct regarding removal of first
auditor before expiry of the term?
(A) He is removed at general meeting
(B) Shareholders are authorized to do so
(C) The approval of central government is required for such removal
(D) The provision for such removal is contained in Section 224 (7)
Ans. : (C) The approval of central government is required for such removal
64) Retiring auditor does not have right to –
(A) Make written representations
(B) Get his representation circulated
(C) Be heard at the meeting
(D) Speak as member of company
Ans. :(A) Make written representations
65) According to Section ___ Special Audit is conducted at the central government
(A) Section 233(A)
(B) Section 233(B)
(C) Section 242(A)
(D) Section 242(B)
Ans. : (C) Section 242(A).
66) Audit of Banks is an example of –
(A) Statutory Audit
(B) Balance Sheet Audit
(C) Concurrent Audit
(D) All of above
Ans. : (D) All of above.

67) Auditor of a _____ company does not have right to visit foreign branches of
company.
(A) Unlimited Company
(B) Manufacturing Company
(C) Banking Company
(D) Non-Profit making company
Ans. : (B) Manufacturing Company.
68) Cost Audit under Section 233(B) of The Company Act is _____
(A) Voluntary
(B) Compulsory
(C) Advisable.
(D) Avoidable
Ans. : (C) Avoidable.
69) Internal Auditing Standards are issued by the –
(A) International Accounting Standard Board
(B) Financial Accounting Standard Board
(C) International Audit & Assurance Standard Board
(D) Auditing Practices Board
Ans. : (C) International Audit & Assurance Standard Board
70) Which of the following is not a duty of an auditor?
(A) Duty to report company’s banker
(B) Duty to report to the members
(C) Duty to sign the audit report
(D) Duty to report on any violation of law
Ans. : (A) Duty to report company’s banker.
71) The main object of vouching is :
(A) To prepare trial balance.

(B) Conduct routine checking.
(C) Verify authenticity & authority of transactions.
(D) Checking of vouchers.
Ans. : (C) Verify authenticity & authority of transactions
72) Valuation is the basis of :
(A) Verification.
(B) Marketing.
(C) Internal checking.
(D) Vouching.
Ans. : (A) Verification
73) The first auditor or auditors are appointed by :
(A) Central Government.
(B) Company Law Board.
(C) Board of Directors.
(D) Shareholders.
Ans.: (C) Board Of Directors
74) Voucher relates to:
(A) Cash receipt.
(B) Cash payment.
(C) Credit transactions.
(D) All the above.
Ans. : All of the above.
75) Internal auditor is appointed by :
(A) The management.
(B) The shareholders.
(C) The government.
(D) The statutory body.

Ans. : (A) The management
76) Auditing begins where -------- ends.
(A) Selling.
(B) Inventory valuation.
(C) Accounting.
(D) Purchases.
Ans. : (C) Accounting
77) The work of one clerk is automatically check by another clerk is called :
(A) Internal control.
(B) Internal check.
(C) Internal audit.
Ans. : (B) Internal Check
78) The owners of the company are called:
(A) Debenture holders.
(B) Debtors.
(C) Shareholders.
Ans.: (C) Shareholders
79) An auditor is like a :
(A) Watchman.
(B) Foolish dog.
(C) Mad dog.
(D) Watch dog.
Ans.: (D) Watch dog
80) A company auditor can be removed by :

(C) Any director.
(D) General Meeting.
Ans. : (D) General Meeting
81) This kind of audit is generally conducted between two annual audits.
(A) Internal audit
(B) Interim audit
(C) Final audit
(D) Continuous audit
Ans.: (B) Interim audit.
82) Before the work of audit is commenced, the auditor plans out the whole of
audit work is known as –
(A) Audit plan
(B) Audit note
(C) Audit risk
(D) Audit program
Ans. : (D) Audit program.
83) Internal auditor is appointed by –
(A) The management
(B) The shareholders
(C) The government
(D) statutory body
84) The audit that is made compulsory under the statute is called –
(A) Statuary audit
(B) Partial audit
(C) Complete audit

(D) Continues audit
Ans. : (A) Statuary audit.
85) Who among the following can be appointed as the auditor of company?
(A) A partner or the director of the company
(B) A person of unsound mind
(C) Mr. ‘Y’ who owes Rs.500 to company
(D) Mr. ‘Z’ who holds the ‘CA’ Certificate
Ans. : Mr. ‘Z’ who holds the ‘CA’ Certificate.
86) ___ is documentary evidence by which the accuracy in the books of accounts
may be proved.
(A) Cheque
(B) Receipt
(C) Voucher
(D) Statement Ans. : (C) Voucher.
87) Sale of Rs.50,000 to ‘A’ was entered as a sale to ‘B’. This is an example of –
(A) Error of omission
(B) Error of commission (
C) Compensating error
(D) Error of Principle.
Ans. : (B) Error of commission.
88) In comparison to the independent auditor an internal auditor is more likely to
be concerned with –
(A) Cost accountancy system
(B) Internal control system
(C) Legal compliance
D) Accounting system
Ans. : (B) Internal control system.

89) The audit program is prepared by –
(A) The auditor (B) The client (C) The audit assistants (D) Auditor & his assistants
Ans. : (D) Auditor & his assistants.
90) Interim audit refers to –
(A) Examination of accounts continuously
(B) Examination of accounts intermittently
(C) Audit work to find out & check interim profits of a company
(D) Carrying on audit for bonus purposes at the end of year
Ans. : (C) Audit work to find out & check interim profits of a company .
91) A company auditor should see that the dividend is paid –
(A) After charging depreciation
(B) Without charging depreciation
(C) Out of capital
Ans. : (A) After charging depreciation.
92) Errors of omission are –
(A) Technical errors
(B) Error of principle
(D) None of these
Ans.: (A) Technical errors.
93) Vouching implies –
(A) Inspection of receipts
(B) Examination of vouchers to check authenticity of records
(C) Surprise checking of accounting records
(D) Examining the various assets
Ans. : (B) Examination of vouchers to check authenticity of records.

94) Undervaluation of stock is –
(A) Technical error
(B) Compensatory error
(C) Error of principle
(D) none of these
Ans. : (C) Error of principle.
95) Verification refers to –
(A) Examination of journal & ledger
(B) Examination of vouchers related to assets
(C) Examining the physical existence & valuation of assets
(D) Calculation of valuation of assets
Ans. : (C) Examining the physical existence & valuation of assets.
96) Valuation of fixed assets is based on the concept –
(A) Going concern
(B) Money measurement
(C) Dual aspect
(D) Cost concept.
Ans. : (A) Going concern.
97) “Auditor is not valuer.” This statement was stated in –
(A)Kingston Cotton Mill Case
(B) London & General Bank Case
(C) Lee VS Neuchatel Co. LTD Case
(D) London Oil Storage Co.LTD Case
Ans. : (A)Kingston Cotton Mill Case.
98) Floating assets are valued at –
(A) Cost
(B) Market price

(C) Cost price or market price whichever is less
(D) Cost less than depreciation
Ans. : (C) Cost price or market price whichever is less.
99) Outstanding expenses should be verified with the help of –
(A) Cashbook
(B) Balance book
(C) Journal proper
(D) None of above.
Ans. : (C) Journal proper
100) First auditor of the company is appointed by the –
(A) Shareholders
(B) Central government
(D) Board of directors
Ans. : (D) Board of directors.
101) Thevacancy caused by resignation of an auditor is filled by –
(A) Board of directors
(B) At the general meeting of shareholders
(C) By the central government
(D) By the company law board
Ans. : (B) At the general meeting of shareholders
102) A special auditor is appointed by the –
(A) Shareholders
(C) Central government
(D) CAG
Ans. : (C) Central government.

103) A remuneration of a company auditor is fixed by the –
(A) Shareholders
(C) Central Government
(D) Appointing authority
Ans. : (D) Appointing authority.
104) Internal auditor has to submit report to –
(A) Shareholders
(B) Government
(D) None of above
Ans. : D) none of above.
105) Auditor in general is –
(A) Employee of the company
(B) Agent of the company
(C) Agent of the shareholders
(D) None of the above
Ans. : (C) Agent of the shareholders.
106) Shares issued for consideration other than cash should be vouched with
help
of –
(A) Directors minutes book
(B) Shareholders minute’s book
(C) Contract with the party concerned
(D) Cash book
Ans. : (C) Contract with the party concerned.
107) The term Standard Auditing Practices refers –

(A) Auditing techniques adopted by auditor for collecting & vouching evidences
(B) Test checking
(C) Standards of auditing
(D) True & fair view
Ans. : (A) Auditing techniques adopted by auditor for collecting & vouching
evidences.
108) AAS refers to –
(A) Audit evidence
(B) Audit Planning
(C) Risk assessments &Internal control
(D) Knowledge of business
Ans. : (D) Knowledge of business .
109) The panel of Auditors of cooperative society is maintained by –
(A) Charted Accountant
(B) Central Government
(C) Registrar
(D) Shareholders
Ans. : (C) Registrar.

Audit and Auditors
QNo.1 which class of Companies shall constitute an Audit Committee of the
Board?
a) All Public Companies with a paid up capital of eight crores rupees or more
b) All Public Companies with a paid up capital of seven crores rupees or
more
c) All Public Companies with a paid up capital of ten crores rupees or more
d) All Public Companies with a paid up capital of nine crores rupees or more
Ans C
QNo.2 which class of Companies shall constitute an Audit Committee of the

Board?
a) All Public Companies having turnover of one hundred crore rupees or

more
b) All Public Companies having turnover of eighty crore rupees or more
c) All Public Companies having turnover of Ninty crore or more
d) All Public Companies having turnover of seventy crore rupees or more
Ans A
QNo.3 The auditor appointed in the AGM meeting shall hold the office from the
conclusion of that meeting till the conclusion of the ___________Annual General
Meeting
a) Third
b) Fourth
c) Fifth
d) Sixth
QNo.4 In how many days, first Auditor of the Company other than Government
Company shall be appointed by the Board of the Directors from the date of its
registration?
a) Within thirty days

b) Within forty five day
c) Within sixty days
d) Within ninety days
Ans A
QNo.5 In how many days, first Auditor of the Government Company shall be
appointed by the Comptroller and Auditor General from the date of its
incorporation?
b) Within forty-five days
c) Within sixty days
d) Within ninety days
Ans C
QNo.6 In how many days, the subsequent auditor for existing government
companies shall be appointed by the Comptroller and Auditor General
a) Within 60 days
b) Within 120 days
c) Within 90 days
d) Within 180 days
Ans D
QNo.7 which section deals with eligibility and qualification of the Auditor?
a) Section 141 (1) and (2)

b) Section 141(3)
c) Section 142
d) Section 141(4)
Ans A
QNo.8 which section deals with disqualification of the Auditor?
a) Section 141 (1) and (2)

b) Section 141(3)
c) Section 142
d) Section 141(4)
Ans B
QNo.9 which section deal with the appointment of the Auditor?
a) Section 139
b) Section 141
c) Section 142
Ans A
QNo.10 Which section deal with removal of the Auditor ?
a) Section 140 (1)

b) Section 139
c) Section 141
d) Section 142
Ans A
QNo.11 Which section deal with remuneration of the Auditor?
a) Section 140 (1)

b) Section 139
c) Section 141
d) Section 142
Ans D
QNo.12 which is not correct statement in respect of the qualification of the

Auditor
a) Only a Chartered Accountant (individual) or a firm where the majority of

partners practicing in India are Chartered Accountants can be appointed as
Auditor
b) Where a firm including a limited liability Partnership (LLP) is appointed as
auditor of a company, only the partners who are chartered accountants
shall be authorized to act and sign on behalf of the firm
c) Both a and b
d) A person whose relative is a director or is in employment of the company as
a director or key managerial personnel,
Ans D
QNo.13 Which authority is empowered to fill up the casual vacancy of the Auditor
of the company whose accounts are subject to audit by an auditor appointed by
the Comptroller and Auditor General of India?
a) By Auditor-General of India
b) By the Board of the Directors
c) By the Whole Time Directors
d) By the Centre Government
Ans A
QNo.14 In which form, Auditor who has resigned from the company is required to
file a statement indicating the reasons and other facts as may be relevant with
regard to his resignation.
a) ADT-1
b) ADT-2
c) ADT-3
d) ADT-4
Ans C
QNo.15 what penalties shall be imposed upon the Auditor in case of failing to file
the statement in the form ADT-3 in cash of the resignation?
a) Monetary fine not less than Rs.50000/- and not more than Rs.500000/-
b) Monetary fine not less than Rs.40000/- and not more than Rs.400000/-
c) Monetary fine not less than Rs.30000/- and not more than Rs.300000/-
d) Monetary fine not less than Rs.20000/- and not more than Rs.200000/-
Ans A
QNo.16 Which authority is empowered to fix the remuneration of the Auditors?
a) By the Board of Directors

b) By the Whole time directors
c) By the Managing Director
d) By the shareholders in the Annual General meeting
Ans D
QNo.17 the CAG shall have a right to the conduct a supplementary audit of
the financial statement of the company and comment upon or supplement such
audit report. In how many days audit report should be submitted by by the CAG?

b) Within sixty days
c) Within ninety days
d) Within forty five days
Ans B
QNo.18 What is the full form of NFRA in respect of the Audit.
a) National Fund reform Act

b) National Financial Reporting Authority
c) National fund Reporting Act
d) National financial reform Authority
Ans B
QNo.19 If the auditor of a company, in the course of the performance of his duties
as Auditor has reason to believe that an offence involving fraud is being or has
been committed against the company by the officers or employees of the company.
In how many days, he shall report the matter to the Central Government
immediately.
a) Within 30 days
b) Within 45 days
c) Within 60 days
d) Within 90 days
Ans C
QNo.20 In which form, report of the fraud committed by the officers or employees
of the company shall be filed by the Auditor?
a) ADT-1
b) ADT-2
c) ADT-3
d) ADT-4
Ans D
QNo.21 Which section deals with Auditor not to render certain services (prohibited
services)?
a) Section 139
b) Section 142
c) Section 144
d) Section 146
Ans C
QNo.22 which section deal with signing of the Audit Report by the Auditor?
a) Section 145
b) Section 144
c) Section 139
d) Section 140
Ans A
QNo.23 Which section deal with cost Record and their Audit?
a) Section 144
b) Section 145
c) Section 146
d) Section 148
Ans D
QNo.24 In how many days, Every cost Auditor who conducts an audit of the cost
records of the company is required to submit the cost audit report along with his
or its reservations or qualifications to the Board of the Directors from the close of
the company’s financial year to which the report relates?
a) 60 days
b) 120 days
c) 180 days
d) 240 days
Ans C
QNo.25 In how many days, a company is required to furnish the cost audit report
to Central Government alongwith full information and explanation on every
reservation or qualification from the date of receipt of a cop of the cost audit report?
a) 30 days
b) 45 days
c) 60 days
d) 90 days
Ans A
QNo.26 how many new clauses have been added in the CARO 2020?
a) Two
b) Three
c) Four
d) Five
Ans D
QNo.27 What is the full form of CARO?
a) Cost Audit Report Order

b) Companies Auditor’s Report Order
c) Companies Account’s Report order
d) Cost Accounts report order
Ans B
QNo.28 Clause 20 of the CARO 2020 deals with
a) Cash losses
b) Resignation of Auditor
c) CSR compliance
d) Company ability to meet its current liabilities in Auditor opinion based on
ratios, realizations and ageing
Ans C
QNo.29 Clause17 of the CARO 2020 deals with
a) Cash losses
c) CSR compliance
Ans A
QNo.30Clause 18 of the CARO 2020 deals with
a) Cash losses
c) CSR compliance
Ans B
QNo.31 Clause 19 of the CARO 2020 deals with
a) Cash losses
c) CSR compliance
Ans D
QNo.32 How many clauses are covered in CARO 2020?
a) 16
b) 18
c) 20
d) 21
Ans D
QNo.33 What is the full form of CAS in the cost Accounting
a) Cost Accounting standard

b) Cost Auditing standard
c) Cost Accounting signs
d) Cost Auditing status
Ans A
Cost Audit
1. Part C of the Annexure to the Cost Audit Report in CRA 3 deals with .
(A) Manufacturing Sector
(B) Service Sector
(C) Regulated Sector
(D) Unregulated Sector
2. Cost Accounting Standard 8 is a Cost Accounting Standard on .

(A) Employee Cost
(B) Utilities Cost
(C) Pollution Control Cost
(D) Selling and Distribution Cost
3. Under the Generally Accepted Cost Accounting Principles, the cost

of cane supplied from own farm to the sugar mill is treated as .
(A) Direct Materials Cost
(B) Indirect Materials Cost
(C) Production Overhead
(D) Administrative Overhead
4. Constitution of Audit Committee by the Board of Directors is

mandatory for_____.
(A) All companies
(B) All listed companies only
(C) All listed companies and those prescribed under the
Companies (Meetings of Board and its Powers) Rules only
(D) All public companies having turnover of ₹100crore or more only
5. Cost Auditing Standard 102 deals with .

(A) planning an Audit of Cost Statements
(B) Cost Audit Documentation
(C) knowledge of process and business
(D) overall objectives of the Independent Cost Auditor
6. As per the Central Excise Valuation Rule s 2000, the assessable value
of goods used for captive consumption is .
(A) at actual cost of production of such goods
(B) at marginal cost of production of such goods
(C) at 110% of cost of production of such goods
(D) at market price of such goods
7. A shoe manufacturing company has a plant capacity of producing

700 shoes per shift. During the year of 300 working days, 3 shifts of
8 hours with half-hour recess per shift, it produces 35.91 lakh shoes.
The Normal Capacity Utilization percentage is .
(A) 82%
(B) 76%
(C) 74%
(D) 78%
8. Propriety Audit in the context of Government Audit seeks to ensure

that____
(A) public money are not spent for the benefit of a particular person
(B) public officer should exercise same vigilance as in respect of
expenditure of his/her own money
(C) no authority should pass an order which will be directly or
indirectly to its own advantage
(D) All the above
9. The Cost Accounting Standard 15 is a Cost Accounting Standard on .

(A) Employee Cost
(B) Utilities Cost
(C) Pollution Control Cost
(D) Selling and Distribution Overheads Cost
10. Overall Objectives of the independent Cost Auditor and conduct of

an Audit in accordance with Cost Auditing Standard is dealt in
.
(A) Cost Auditing Standard 101
(B) Cost Auditing Standard 102
(C) Cost Auditing Standard 103
(D) Cost Auditing Standard 104
11. A company, engaged in construction business, is covered under

the Companies (Cost Records and Audit) Rules, 2014 but does not
include______.
(A) outsourcing by a sub-contracting company
(B) a company working on BOT (Build, Operate, Transfer) mode
(C) a company working in a Special Economic Zone
(D) a project undertaken as EPC (Eng., Procurement, Constn.) contract
12. A manufacturing unit showed, during the Financial Year 2016-17,

the following financial data (in ₹lakh): Net Sales 1,250, Export
Incentives 85, Other income 106, Adj. of Finished Stock (+) 95,
Materials 634, Salaries 425, Overheads 101.8, and Tax 52.6. The
Value Added as per Rules is (in ₹lakh)____.
(A) 946
(B) 796
(C) 755
(D) 688
13. Royalty paid on production ₹35,000, Job Charges ₹20,000, Special

Design Charges ₹ 20,000, Software Development Charges related to
Production ₹27,000, and Travelling abroad for Training ₹25,000 The
Direct Expenses as per CAS 10 is ₹_____.
(A) 92,000
(B) 1,00,000
(C) 1,02,000
(D) 1,27,000
14. Operational Audit can lead to better management with the focus on .
(A) Transaction-based analysis for Fraud Prevention
(B) Compliance of Rules
(C) Risk Identification, Process Improvement
(D) Budget Monitoring
15. Penalty paid to PF authorities is in Employee Cost.

(A) included
(B) excluded
(C) based on individual case
(D) partly included
16. Item appearing only in Cost Records is .

(A) Profit on Sale of Assets
(B) Interest ReceivedLoss on Sale of Assets
(C) Notional Interest on Capital
17. Analysis is evaluation of every resources declared in the

industry.
(A) Capacity
(B) Energy
(C) Productivity
(D) Efficiency
18. Which one of the following is not a professional misconduct in

relation to Cost Accountants in Practice as per the Second
Schedule of The CWA Act, 1959?
(A) He / she fails to invite attention to any material departure from
the generally accepted procedure of costing and pricing
applicable to the circumstances
(B) He / she does not exercise due diligence or is grossly negligent
in the conduct of his/her professional duties
(C) He/ she fails to report a material misstatement known to him
/her to appear in a cost or pricing statement with which he / she
is concerned in a professional capacity
(D) In the opinion of the Council, he /she brings disrepute to the
profession or the Institute as a result of his/her action whet her or
not related to his/her professional work
19. In which CRA Form, is the Cost Audit Report of a company filed
with the Central Government?
(A) CRA-4
(B) CRA-3
(C) CRA-1
(D) CRA-2
20. CAS 23 deals with _____.

(A) Quality Control
(B) Manufacturing Cost
(C) Overburden Removal Cost
(D) Treatment of Revenue in Cost Statements
21. As per the Cost Auditing Standard 101, the risk of Material
Misstatements has two components, viz______.
A) Inherent Risk and Control Risk
B) Detection Risk and Audit Risk
C) Material Risk and Implicit Risk
D) Financial Risk and Explicit Risk
22. As per Part D, Para 4 of the Companies (Cost Records and Audit) Rules,
2014, Value Addition and Distribution of Earnings are to be
computed based on
A) Audited Financial Data
B) Cost Record Data
C) Unaudited Financial Data
D) Both (A) and (B)
23. The audit of data or information, depicting social performance

of a business in contrast to its normal economic performance as
measured in financial audit, is
A) Energy Audit
B) Efficiency Audit
C) Social Audit
D) Propriety Audit
24. Which of the following is not a Professional Misconduct as per the First
Schedule of The CWA Act, 1959, in relation to the Cost Accountants
in Practice?
A) Pays or allows or agrees to pay or allow, directly or indirectly,
any share, commission or brokerage in the fees or profits of his/her
professional work, to any person other than a member of the
Institute or a partner or a retired partner or the legal
representative of a deceased partner
B) Enters into a partnership, in or outside India, with any person
other than a Cost Accountant in Practice or such other person
who is a member of any other professional body having such
qualifications as may be prescribed
C) Advertises his/her professional attainments or services or uses any
designation or expression other than Cost Accountant on
professional documents, visiting cards, letter heads or sign boards,
unless it is a degree of a University established by law in India or
recognised by the Central Government or a title indicating
membership of The ICAI or any other institution that has been
recognised by the Central Government or may be recognised by
the Council
D) Expresses his/ her opinion on cost or pricing statements of any
business or enterprise in which, he / she, his/her firm or a partner
in his / her firm has substantial interest
25. Remuneration of the Non-Executive Di rectors is treated as________.

A) Employee Costs
B) Administrative Overheads
C) Salaries and Wages
D) Management Expenses
26. As per the CAS 23, the activity of Overburden Removal that benefits
the identified component of an ore to be mined by the entity is
called as______.
A) Mining Activity
B) Overburden Removal
C) Stripping Activity
D) Advance Stripping
27. Cost Information the organization to structure the cost, understand

it and use it for communicating with the stakeholders.
A) Enables
B) Disables
C) Useful
D) None of these
28. Costing is an important tool in shareholder and stakeholder value.

A) Determining
B) Calculating
C) Assessing
D) None of these
29. Costing includes product, process, and resource-related information

covering_______ of the organization and its value chain.
A) Performance
B) Ability
C) Consistency
30. Functions Cost Records re maintained on______
A) Accrual
B) Cash
C) Actual
D) None of these
31. Cost Audit represents true and fair view of the_______

A) Cost of sale
B) Cost of raw material consumption
C) Cost of production
D) None of these
32. Cost Audit conducted by a Chartered Accountant.

A) May be
B) Can be
C) Cannot be
D) May not be
33. The Cost Auditor appointed has to render the cost audit report
to the board of directors of the Company, as per the specified time
limit, in Form .
A) CRA-3
B) CRA – 1
C) XBRL
D) CRA – 2
34. The cost records are to be maintained as specified in:

A) CRA3
B) CRA1
C) CRA 4
D) CRA 2
35. ‘Sugar and Industrial Alcohol’ belong to sector for the

purpose of Application of Cost Records.
A) Regulated
B) Non-Regulated
C) Both depending on circumstances
D) None of above
36. Cost Audit was initially introduced in the year

(A) 1959
(B) 1965
(C) 1949
(D) 1975
37. The Central Govt. released the CCRA – Rules, 2014 in pursuance to
the powers vested with it U/ s_________ of the Companies Act,
2013
A) Section 469
B) Section 148
C) Section 465
D) Section 469 and 148
38. The CCRA – Rules, 2014 supersedes

A) Companies (Cost Accounting Records) Rules, 2011
B) Companies (Cost Audit Report) Rules, 2011
C) Cost Accounting Records (Telecommunication Industry) Rules, 2011
D) All the above
39. The provisions related to maintenance of cost records were introduced
in the year _________by amendment to the companies act, 1956.
(A) 1960
(B) 1965
(C) 1966
(D) 1970
40. The CCRA – Rules, 2014 is not applicable to

A) MSME
B) Export oriented units
C) Private limited companies
D) Units operating from SEZ
41. The cost audit report under CCRA – Rules, 2014 is to be submitted in
---------------
A) Form – 3
B) Form – 4
C) Form – 1
D) Form – 2
42. The cost audit report under CCRA – Rules, 2014 is to be filed as an
attachment to ------
A) Form – 3
B) Form – 4
C) Form – 2
43. Which one of the below is not a regulated industry
A) Fertilizers
B) Aluminium
C) Sugar
D) Petroleum products
44. The turnover criteria for applicability of CCRA – Rules, 2014 is

A) At the end of immediately preceding financial year
B) At the end of the financial year
C) Average of 3 preceding financial year
D) When the company achieves the turnover during the current
financial year
45. The cost auditor to be appointed within days of the beginning of

the financial Year.
A) 90 days
B) 180 days
C) 6 months
D) 270 days
46. CCRA – Rules, 2014 is applicable from the financial year

commencing on or after (A) 01.01.2014
(B) 01.04.2014
(C) 01.07.2014
(D) 01.04.2015
47. Which Para in covered in Part D to the Annexures to Cost audit report.
A) Profit Reconciliation
B) Value addition and distribution of profit
C) Reconciliation of Indirect taxes
D) Abridge Cost Statement
48. CAS 11 deals with:
A) Administrative Overhead
B) Factory Overhead
C) Selling & Distribution Overhead
D) Financial Cost
49. CAS 5 deals with

A) Equalized cost of transportation
B) Captive consumption
C) Capacity determination
D) Cost classification
50. The foreign exchange component of imported material is converted at

the rate on –
A) Date of Payment
B) Date of Delivery
C) Date of Transaction
D) Date of Use
51. Variances due to abnormal reasons form part of cost as per GACAP.
A) Will Not
B) Is
C) Are
D) Will
52. As per CAS 2 Actual Capacity utilization shall be presented as a

percentage of capacity.
A) Installed Capacity
B) Practical Capacity
C) Abnormal Loss (%)
D) Actual Production
53. CAS-20 deals with

A) Royalty and Technic al Knowhow fee
B) Material Cost
C) Research & Development Cost
D) Financial Cost
54. The objective of CAS – 101 is to .

A) Prepare cost records
B) Prepare cost audit documentation
C) Guide the members to make planning for the audit of cost
statement
D) Enable the cost auditor to have knowledge of the clients business
55. The procedures followed by the cost auditor to reduce the audit risk
to an acceptable level will not detect a misstatement that exists
and that could be material is .
A) Inherent risk
B) Detection risk
C) Control risk
D) None o f t hese
56. Cost auditing standard deals with .

A) Auditors responsibility
B) Auditors power Auditors right
C) Auditors flexibility
57. Cost auditing standards preface to the standards on .

A) Quality control
B) Planning
C) Development
D) None of these
58. Cost auditing standards preface to the standards on auditing,

quality control review and related services rendered by the cost
accountant has been issued by________.
A) ICAI
B) ICMAI
C) CAASB
D) ICWAI
59. CAS ensures the achievement of audit objectives with

available resources and securing coordination with the auditee on
audit work.
A) CAS – 102
B) CAS –104
C) CAS – 103
D) CAS- 101
60. CAS 104 enables the cost auditor .

A) To have knowledge of the clients business
B) Overall objectives of the cost auditor and the conduct of an audit
C) Guide the members to prepare cost audit documentation
D) Making plan for audit of cost statement
61. Requirements of CAS – 104, the cost auditor shall .

A) Comply with the relevant ethical requirements
B) Have adequate level of understanding of the knowledge of business
C) Prepare audit documentation
D) None of these
62. The cost auditing standards deal with the of the cost auditor.
A) Efficiency
B) Effectiveness
C) Qualifications
D) Responsibility
63. The cost auditor is for forming and expressing an opinion on

the cost statements.
A) Responsible
B) Reasonable
C) Irresponsible
D) Assessing
64. Which one of the following KPI is used to measure productivity &
efficiency a machinery
A) % of Idle time to total available time
B) Machine downtime ratio
C) Cost per of Break-Down Hour
D) Contribution per unit of material used
65. KPI can be classified in following Category.

A) Quantitative & Qualitative
B) Actionable
C) Trending
D) All of the above
66. Which one of the following is covered under performance analysis report
A) Cost per unit of material used
B) Cost of utilities
C) Impact of IFRS on the Cost Structure
D) Impact of CAS and GACAP
67. The basic objective to prepare report on performance analysis is/are as

under
A) to improve profits and profitability
B) to optimize resource allocation
C) to optimize the product and services portfolio
D) All of the above
68. Performance Prism is basic ally used for the purpose of

A) Cost Reduction
B) Cost Control
C) Total performance management
69. Kaizen Costing & Lean Manufacturing (Management Accounting Tool)

are used as
A) Cost Reduction Tool

B) Cost Computation Tool
C) Performance Measure Tool
D) Control Tool
70. Management Audit is the unique process of ______Managers or the

performance of Management
A) Appraising
B) Calculating
C) Auditing
D) Planning
71. Management audit is normally presumed to be a _______ performance of

a manager or group of managers.
A) Routine investigation
B) Non-routine investigation
C) Auditing
D) None of these
72. The main objectives of management audit is to .

A) Suggest improvement in methods of operations
B) Framing basic policies for the organization
C) Setting up an organizational framework
D) None of these
73. Management audit on financial matters.

A) Involves
B) Only concentrate
C) Does not concentrate
D) None of these
74. The main emphasis of Management Audit is:

A) Problem solving
B) Problem identification
C) Problem definition
D) Problem avoidance
75. Efficiency Audit ensures return on Capital Employed

A) optimum
B) maximum
C) minimum
D) average
76. There are no fixed items of evidence to be checked by Management

Auditor
A) The statement is true
B) The statement is false
C) The statement is partly true
D) The statement is partly false
77. Consumer Service Audit is part of

A) Business Activity Audit
B) Social Audit
C) Service Audit
D) None of Above
78. Management Audit Report Submitted to:

A) Cost Audit Branch
B) Audit Committee
C) Central Government
D) Management of Concern
79. There areno fixed items of evidence to be checked by

Management Auditor. A management Auditor has to rely more on
A) his experience and acumen

B) Auditors Working Paper
C) Physic al Verification Sheet
D) Information Provided by Management
80. Assurance engagements involve

A) Only Individual Parties
B) Three separate parties
C) Contractor and Contractee
D) None of them
81. Zero base budget (ZBB) system was modeled by

A) Peter A Woodcock
B) Peter A Phyrr
C) P F Ducker
D) None of them
82. Important point in Corporate planning is

A) Time and Work Study
B) Imposing Control System
C) Forecasting and goal setting
D) SWOT analysis.
83. Who is the developer of Management Audit
A) T. G. Rose
B) T. G. Tailors
C) M. C. Shukla
D) None of them
84. Internal control system can be comprised of

A) Preventive Control
B) Detective Control
C) Corrective Control
D) All of the above
85. Who can be appointed as Internal Auditor as per the Companies Act,
2013
A) A Chartered Accountant
B) A Cost Accountant
C) Such other professional
D) All of the above
86. Which section of Companies Act deals with Internal Audit

A) Section 138
B) Section 148
C) Section 139
D) Section 192
87. One of the major components of government audit is/ are

A) Government Revenue
B) Union Budget and Control
C) Government Expenditure
D) Taxation and Fiscal Policies
88. Internal Audit can be performed by______.

A) Employee of the Organization
B) External Agencies
C) Management itself
D) Both (A) and (B)
89. NGO(s) are incorporated under__

A) Societies Registration Act, 1860
B) India Trust Act, 1882
C) As Section 8 Company
D) All of the above
90. The management auditor shall consider in the evaluation of capacity

utilization –
A) Method of measuring base machine capacity
B) Capacity measurement is based on “capital output ratio” or sundry
other factors
C) Technical terminology like licensed capacity, installed capacity,
rated capacity etc should be properly defined
D) All of the above
91. Qualities of good Internal Auditor are/is_____
A) Right Attitude
B) Technic al Expertise
C) Communication and other soft skills
D) All of the above
92. An audit of or for a government agency is composed______

A) Financial compliance
B) Economy and efficiency
C) Program results
D) All of the above
93. Aspects may be taken into consideration for proper inventory control
A) Maximum, minimum and reorder level fixation
B) Fixed order quantity system and different replenishment systems
C) Fast moving, slow moving and non-moving analysis etc
D) All of the above
94. Internal Audit is

A) One time activity
B) A continuous activity
C) Half yearly
D) None of above
95. There is no requirement of Audit Working Papers while conducting

audit and they only result in loss of time.
A) The Statement is Correct
B) The Statement is Incorrect
C) The Statement is Incomplete
D) None
96. Co-operative Auditor has to conduct an examination of the overdue

debts, if any, and a valuation of the assets and liabilities of the
society while conducting internal audit as per_____
A) Section 17(3) of the Cooperative Societies Act, 1912
B) Section 17(2) of the Cooperative Societies Act, 1912
C) Section 17(5) of the Cooperative Societies Act, 1912
D) Section 37(2) of the Cooperative Societies Act, 1912
97. Field Balance Sheet Approach to audit can be applied in case of audit
of the__
A) Co-Operative societies
B) Local Body Corporate
C) Self-Help Group
D) Club
98. Under ‘propriety audit’, the auditors try to bring out what type of
expenditure:
A) Improper
B) Avoidable
C) In fructuous
D) All of the above
99. States about the audit of accounts of Municipalities.

A) Article 243Z of the Constitution
B) Article 243J of the Constitution
C) Both (A) and (B)
100. What is the first step to conduct Hospital Audit?

A) Check the letter of appointment
B) Study Trust Deed
C) Examine Records
D) Physical Verification
101. Who appoint the auditor for Government Company?

A) Board of Directors
B) Audit Committee
C) C&AG
D) CBDT
102. C&AG has right to direct the manner in which the company’s
accounts shall be audited by the auditor and to give such auditor
instructions in regard to any matter relating to the performance of his
functions as per section
A) 44AB of income Tax
B) 143 of the Companies Act, 2013
C) 173 of the Companies Act, 2013
D) 134 of the Companies Act, 2013
103. Financial Administration of Local Bodies includes

A) Budgetary Procedure
B) Expenditure Control
C) Accounting System
D) All of the above
104. Non-Governmental Organizations can be incorporated as a company

A) Section 25 of the Companies Act, 1956
B) Section 8 of the Companies Act, 2013
C) Section 28 of the Companies Act, 2013
105. The government also engages in commercial activities and for the
purpose it may incorporate type of entities.
A) Five
B) Three
C) Many
D) Various
106. Which one of the followings in an example of “Profitability Ratio”

A) Inventory Turnover Ratio
B) Proprietary Ratio
C) Expenses Ratio
D) Capital Gearing Ratio
107. Which one of the followings in an example of “Solvency Ratio”

A) Capital turnover Ratio
B) Debt Equity ratio
C) Debtors Turnover Ratio
D) None of above
108. Which one of the following is not an utilities.

A) Steam
B) Water
C) Compressed Air
D) Broadband internet services
109. Cost of Inventory does not include

A) Costs of Purchase
B) Costs of Conversion
C) Other Direct Cost
D) Administrative overheads that do not contribute to bringing
inventories to their present location and condition
110. Which one of the following costs appeared only in Cost Accounts?
A) Interest on mortgage and loans
B) Notional Interest on Capital
C) Dividend equalization fund, sinking, fund etc.
D) Loss due to scrapping of plan and machinery
111. Royalty paid on sales ₹30,000; Royalty paid on units produced

₹20,000, Hire Charges of equipment used for production ₹2,000,
Design charges ₹15,000, Software development charges related to
production ₹22,000. The Direct Expenses amount is:
A) ₹88000
(B)₹89000
(C)₹99000
(D) ₹98000
112. The Balance Sheet of X Ltd As on 31st Marc h 2017 showed the following
information:
Capital - ₹1500 lacs, Reserves - ₹696 lacs, Loans - ₹600 lacs, Sundry
Creditors ₹774 lacs, Total assets - ₹3570 lacs. For the year 16-17, PBT
- ₹900 lacs, Provision for tax is ₹ 360 lacs and proposed dividend is
₹300 lacs. Return on Networth is:
(A) 30.41 %
(B) 29.41 %
(C) 28.41 %
(D) 27.41%
113. Royalty paid on units produced ₹20,000, Hire Charges of equipment

used for production ₹2,000, Design charges ₹15,000, Software
development charges related to production ₹22,000. The Direct
Expenses is:
(A)
₹57000
(B)
₹59000
(C)
₹37000
(D)
₹44000
114. A cotton textile mill had cumulative waste percentage of 8% in

Blow Room, 6% in Carding, 4% in Drawing, 4% in Simplex and 9%
in Ring Frame. For an input of 1000 kg. of cotton in Blow Room, the
output at Ring Frame is .
(A) 735.27 Kg
(B) 725.27 Kg
(C) 745.27 Kg
(D) 755.27 Kg
115. Gross Sales ₹16500 lacs, Excise Duty ₹1240 lacs, Increase in stock ₹42
lacs,Cost of raw materials ₹6250 lacs, Power ₹2220 lacs, other overhe
ads ₹215 lacs, Value Added is:
(A) ₹15260 Lac
(B) ₹6617 Lac
(C) ₹6533 Lac
(D) ₹15302 lac
116. Rule 4 of the Companies (Cost Records and Audit) Rules, 2014 deals
with:
A) Application of Cost Records
B) Application of Cost Audit
(C)Appointment of Cost Auditor
(D) Cost Audit Report
117. Abnormal Loss due to flood or earthquake is charged to:

A) Administrative Overhead Cost
B) Material Cost
C) Costing Profit and Loss Account
(C) Selling and Distribution Cost
118. XBRL is a language based on:

A) XBL family of languages
B) XRL family of languages
C) XML family of languages
D) XGL family of languages
119. Part B of the Annexure to Cost Audit Report deals:

A) Service Sector
B) Manufacturing Sector
C) Both manufacturing and service sector
120. CAS 14 deals with:

A) Repair and Maintenance Cost
B) Pollution Control Cost
C) Direct Expenses
D) Packing material cost
121. Operating Expense does not include:

A) Rent
B) Equipment
C) Interest
D) Payroll
122. Outward transportation cost shall form part of :

A) Cost of material
B) Cost of Sale
C) Packing material
(D)Administration
Overhead
123. Rule 6 of the Companies (Cost Records and Audit) Rules, 2014 deals
with:
A) Application of Cost Records
B) Application of Cost Audit
C) Appointment of Cost Auditor
D) Cost Audit Report
124. Product and Profitability Statement (For audited products/services) is

shown under ________ of Annexure to Cost Audit Report.
A) Part A
B) Part B
C) Part C
D) Part D
125. Any casual vacancy in the office of a cost auditor, shall be filled
by the Board of Directors within days of occurrence of such
vacancy.
(A) 180
(B) 90
(C) 30
(D) 60
126. The Companies are required to maintain Cost Records if turnover

exceeds crores or more during immediately preceding Financial Year
in respect of the products and services specified
(A) ₹25
(B) ₹30
(C) ₹35
(D) ₹10
127. Which one of the following is not a professional misconduct in

relation to Cost Accountants in Practice as per the First Schedule of
The CWA Act, 1959?
A) discloses information acquired in the course of his professional
engagement to any person other than his client so en gaging him,
without the consent of his client, or otherwise than as required
by any law for the time being in force
B) allows any person to practice in his name as a cost accountant
unless such person is also a cost accountant in practice and is
in partnership with or employed by himself
C) accepts or agrees to accept any part of the profits of the
professional work of a person who is not a member of the
Institute
D) secures, either through the services of a person who is not an
employee of such cost accountant or who is not his partner or
by means which are not open to a cost accountant, any
professional business
128. CAS 9 deals with ________.

A) Direct Material Cost
B) Indirect Material Cost
C) Packing Material Cost
D) Imported Material Cost
129. Operational Audit is a Level Management Audit.

A) Macro
B) Micro
C) Depends on situation
130. Exemptions from application of the Rules are provided to Companies

whose revenue from exports, in foreign exchange, exceeds of total
revenue and companies operating from Special Economic Zones.
(A) 45%
(B) 50%
(C) 75%
(D) 80%
131. In XBRL Format process of determining the elements that

correspond to lines and columns in a financial statement and which
elements must be created by extension is:
A) Mapping
B) Label
C) Hierarchy
D) Scaling
132. Before submission to the Auditor for Report, the Form CRA 3 should
be signed by________ .
A) The Secretary and the Chief Finance Officer of the company
B) The Secretary and the Cost Accounts Officer of the company
C) The Secretary and one Director of the company
D) The Chief Finance Officer and the Managing Director of the company
133. Cost of self-generation utilities for own consumption shall comprise .

A) Administrative overheads
B) Distribution cost
C) Factory overheads
134. The useful life of an intangible asset, like amount paid on technic
al knowhow, shall not exceed from the date it is available for use.
A) 5 years
B) 8 years
C) 10 years
D) 12 years
135. Cost Audit Documentation is dealt in the

A) Cost Auditing Standard 101
B) Cost Auditing Standard 102
C) Cost Auditing Standard 103
D) Cost Auditing Standard 104
136. A member of The ICAI shall be deemed to be guilty of other

misconduct, if he/she is held guilty by any civil or criminal court
of an offence which is punishable with imprisonment .
A) For a term exceeding 3 years
B) For a term exceeding 3 months
C) For a term exceeding 6 months
D) For a term exceeding 2 years
137. Costing Taxonomy is best defined as a .

A) Dictionary
B) Made Easy
C) Tax Ready Reckoner
D) Referencer
138. Which of the following ratios appears as Profit ability Ratio in Part D
of Annexure to the Cost Audit Report ?
A) Net Profit to Net Sale
B) Value added to Net Sales
C) Profit before Tax to Value Added
D) Net Profit to Share Capital
139. CAS 24 deals with .

A) Overburden Removal Cost
B) Interest and Financing Charges
C) Royalty and Technic al Knowhow Fee
D) Treatment of Revenue in Cost Statements
140. ORS Ltd is a multi-product company having annual turnover of ₹103

crore, Table A items under CARO being ₹26 crore, Table B items ₹8
crore and the rest are not covered in either of the Tables. Cost Audit
will be .
A) not applicable to the company
B) applicable for Table A products only
C) applicable for all products
D) applicable for Table A and Table B products only
141. The wages of employees of contractor engaged in the organization

for the past period is Employee Cost.
A) included in
B) excluded from
C) included to the extent of statutory contribution of employer

D) partly included
142. The figures below are available for Reliable Ltd Budgeted
production - 800 units, Standard hours per unit 25, Actual
production 576 units and actual working— 12000 hours. What is the
Efficiency Ratio?
(A) 110%
(B) 120%
(C) 100%
(D) 125%
143. Machinery used in defense, space and atomic energy sector and
fulfilling turnover criteria is under
A) regulated sector
B) unregulated sector
C) exempted by different statute
D) not applicable category
144. Cost Auditing Standard 102 deals with .

A) knowledge in performing of audit of cost statements, records etc
B) ensuring conduct of audit of cost statements
C) planning on audit of cost statements, records etc
D) documentation of audit of cost statements, records etc
145. The abridged cost statement (CRA 3) need not be separate for
A) each product with separate (CTA) CETA heading
B) each product having separate industry specific expenses
C) each product having different unit of measure
D) self/captive consumption of each product
146. The Management Auditor should evaluate MIS of an organization after

_.
A) studying content, quality and source of information
B) studying flow of information
C) studying correlation of information in decision areas
D) studying all the above
147. The first step in audit of Educational Institutions —

A) Read through the minutes of the meetings of the Managing
Committee or Governing Body
B) Check admission fees with admission slips signed by the head of
the institution and confirm that the amount had been credited to
a Capital Fund
C) Verify the annual statement of accounts
D) To examine the Trust Deed or Regulations
148. SHYAN LTD. has a machine of productive capacity of 1500 unit per
hour. It runs 3 shifts with 1 weekly off and 12 holidays per year, each
shift has one hour stoppage due to lunch, change shift etc
Maintenance is done in running time. The Normal Capacity of the
plant as per CAS-2 will be
A) 131.40 lakh units
B) 94.815 lakh units
C) 108.36 lakh units
149. BORS & Co., a firm of Cost Accountants was appointed as Cost Auditor
of PANTEX LTD on 31.07.2018 for auditing the cost records for the
FY 2018-19. The Auditor appointed as such shall continue in such
capacity upto______
A) 31.07.2019, on expiry of one year of appointment
B) 30.09.2019, on expiry of six months from close of accounts
C) 30.08.2019, date of submission date of Cost Audit Report
D) 15.09.2019, date of holding of Annual General Meeting of PANTEX
LTD
150. Which one of the following KPI (Key Performance Indicator) is

used to measure efficiency of manufacturing performance?
A) Production per Machine Hour
B) Operating Cycle of Materials turnover
C) Material as % of Total Cost
D) % of idle time to total available time
151. The consumer service audit critically examines:

A) Outstanding payment of consumers
B) Price consumers are ready to pay for particular product/ service
C) An appraise management of business enterprise of
responsibility towards consumers
D) Demand of a product by consumers
152. “Related Party” with relation to a party means

A) a Director or his relative
B) a Key Managerial Person or his relative
C) a firm, in which a Director, Manager or his relative is a partner
D) Either or all of the above
153. Once the instance document is successfully validated from the tool, the
next step is to_____
A) download XBRL validation tool
B) pre-scrutinize the validated instance document
C) convert to human readable format and verify correctness of the
instance document
D) attach instance document to the Form CRA-4
154. The Bureau of Energy Efficiency is formed under

A) The Electricity Act, 2003
B) The Energy Conservation Act, 2001
C) The Electricity (Supply) Act, 1948
D) The Electricity Regulatory Commission Act, 1998
155. The knowledge of Entity’s Internal Control is to be understood by the

Cost Auditor as required by_______
A) Cost Auditing Standard 101
B) Cost Auditing Standard 102
C) Cost Auditing Standard 103
D) Cost Auditing Standard 104
156. Profit Reconciliation of the company as a whole is dealt in_____

A) Part D para 2 of the Annexure to Cost Audit Report
B) Part C para 1 of the Annexure to Cost Audit Report
C) Form of the Cost Audit Report
D) Part A para 1 of the Annexure to Cost Audit Report
157. The following details relating to MENG LTD are given:

₹
Royalty paid on Units produced 25,000
Hire charges on Equipment 20,000
Design Charges 18,000
Software Development Charges for 22,000
Production
What will be the Direct Expenses of the Company (as per

CAS-10)?
(A) 60,000
(B) 63,000
(C) 65,000
(D) 85,000
Answer:
(1) (B) Service Sector
(2) (B) Utilities Cost
(3) (A) Direct Material Cost
(4) (C) All listed companies and those prescribed under the Companies (Meetings of
Board and its Powers) Rules only
(5) (B) Cost Audit Documentation
(6) (C) at 110% of cost of production of such goods
(7) (B) 76%
(8) (D) All the above
(9) D) Selling and Distribution Overheads Cost
(10) (C) Cost Auditing Standard 103
(11) (C) a company working in a Special Economic Zone
(12) (B) 796
(13) (D) 1,27,000
(14) (C) Risk Identification, Process Improvement
(15) (B) Excluded
(16) (D) Notional interest on capital
(17) (C) Productivity
(18) (D) In the opinion of the Council, he / she brings disrepute to the
Profession or the
(19) (A) CRA-4
(20) (C) Overburden Removal Cost
(21) (A) Inherent Risk and Control Risk
(22) (A) Audited Financial Data
(23) (C) Social Audit

(24) (D) Expresses his/ her opinion on cost or pricing statements of any
business or enterprise in which, he /she, his/her firm or a partner in his/her firm
has substantial interest.
(25) (B) Administrative Overheads
(26) (C) Stripping Activity
(27) (A) Enables
(28) (C) Assessing
(29) (D) Functions
(30) (A) Accrual
(31) (C) Cost of production
(32) (C) Cannot be
(33) (A) CRA-3
(34) (B) CRA1
(35) (A) Regulated
(36) (B) 1965
(37) (D) Section 469 and 148
(38) (D) All the above (39) (B) 1965
(40) (A) MSME
(41) (A) Form – 3
(42) (B) Form – 4
(43) (B) Aluminium
(44) (A) At the end of immediately preceding financial year
(45) (B) 180 days (46) (B) 01.04.2014
(47) (D) Abridge Cost Statement
(48) (A) Administrative Overhead
(49) (A) Equalized cost of transportation

(50) (C) Date of Transaction
(51) (A) Will Not
(52) (A) Installed Capacity
(53) (A) Royalty and Technic al Knowhow fee
(54) (C) Guide the members to make planning for the audit of cost statement
(55) (B) Detection risk
(56) (A) Auditors responsibility
(57) (A) Quality control
(58) (C) CAASB
(59) (D) CAS- 101
(60) (A) To have knowledge of the clients business
(61) (B) Have adequate level of understanding of the knowledge of business
62 (D) Responsibility
(63) (A) Responsible
(64) (B) Machine downtime ratio
(65) (D) All of the above
(66) (C) Impact of IFRS on the Cost Structure
(68) (C) Total performance management
(69) (A) Cost Reduction Tool
(71) (B) Non-routine investigation
(72) (A) Suggest improvement in methods of operations
(73) (C) Does not concentrate
(74) (B) Problem identification
(75) (A) optimum
(76) (A) The statement is true

(77) (B) Social Audit
(78) (D) Management of Concern
(79) (A) his experience and acumen
(80) (B) Three separate parties
(81) (B) Peter (A) Phyrr
(82) (D) SWOT analysis
(83) (A) T. G. Rose
(86) (A) Section 138
(87) (C) Government Expenditure
(88) (D) Both (A) and (B)
(94) (B) A continuous activity
(95) (B) The Statement is Incorrect
(96) (B) Section 17(2) of the Cooperative Societies Act, 1912
(97) (C) Self-Help Group
(99) (A) Article 243Z of the Constitution
(100) (A) Check the letter of appointment
(101) (C) C&AG
(102) (B) 143 of the Companies Act, 2013

(104) (B) Section 8 of the Companies Act, 2013
(105) (B) Three
(106) (C) Expenses Ratio
(107) (B) Debt Equity ratio
(108) (D) Broadband internet services
(109) (D) Administrative overheads that do not contribute to bringing

inventories to their present location and condition
(110) (B) Notional Interest on Capital
(111) (B) ₹89000
(112) (B) 29.41 %
(113) (B) ₹59000
(114) (B) 725.27 Kg
(115) (B) ₹6617 Lac
(116) (B) Application of Cost Audit
(117) (C) Costing Profit and Loss Account
(118) (C) XML family of languages
(119) (B) Manufa cturing Sector
(120) (B) Pollution Control Cost
(121) (C) Interest
(122) (B) Cost of Sale
(123) (C) Appointment of Cost Auditor
(124) (D) Part D
(125) (C) 30
(126) (C) ₹35
(127) (A) discloses information acquired in the course of his professional

engagement to any person other than his client so engaging him, without the
consent of his client, or otherwise than as required by any law for the time
being in force
(128) (C) Packing Material Cost
(129) (B) Micro
(130) (C) 75%
(131) (A) Mapping
(132) (C) The Secretary and one Director of the company
(133) (C) Factory overheads
(134) (C) 10 years
(135) (B) Cost Auditing Standard 102
(136) (C) For a term exceeding 6 months
(137) (A) Dictionary
(138) (C) Profit before Tax to Value Added
(139) (D) Treatment of Revenue in Cost Statements
(140) (B) applicable for Table A products only
(141) (B) excluded from
(142) (B) 120%
(143) (B) unregulated sector
(144) (D) documentation of audit of cost statements, records etc
(145) (D) self/ captive consumption of each product
(146) (D) studying all the above
(147) (D) To examine the Trust Deed or Regulations
(148) (B) 94.815 lakh units
(149) (B) 30.09.2019, on expiry of six months from close of accounts
(150) (B) Operating Cycle of Materials turnover

(151) (C) An appraise management of business enterprise of responsibility
towards consumers
(152) (D) Either or all of the above
(153) (B) pre-scrutinize the validated instance document
(154) (B) The Energy Conservation Act, 2001
(155) (D) Cost Auditing Standard 104
(156) (A) Part D para 2 of the Annexure to Cost Audit Report
(157) (D) ₹85,000

(PAPER-IX)
Legal Studies (Open Book Paper)
(For All HPUs)
QNo.1 How much penalty can be imposed upon Central Public Information officer
or State Public Information officer who knowingly give incorrect or misleading or
incomplete information under RTI Act,2005?
a) 500 per day subject to maximum of Rs.50000/-
b) 300 per day subject to maximum of Rs.30000/-
c) 400 per day subject to maximum of Rs.40000/-
d) 250 per day subject to maximum of Rs.25000/-
Ans D
QNO.2 In how many days, information under the RTI Act,2005 can be supplied to
the applicant?
a) Within 30 days
b) Within 45 days
c) Within 60 days
d) Within 90 days
Ans A
QNo.3 in how much period, information shall be supplied under RTI Act,2005
where the information is sought for concerns the life or liberty of a person?
a) Within 30 hours
b) Within 36 hours
c) Within 48 hours
d) Within 60 hours
Ans C
QNo.4 Any information relating to any occurrence, event or matter which has taken
place, occurred or happened ________________ before the date on which any request
is made under section 6 of the RTI Act shall be provided to any person making a
request.
a) Ten years
b) Fifteen years
c) Twenty years
d) Twenty five years
Ans C
QNo.5 In how many days, a written notice shall be served to the third party, where
a Central Public Information officer or State Public Information officer intends to
disclose any information or record or part thereof on a request which relates to
third party?
a) Within five days from the receipt of request
b) Within seven days from the receipt of request
c) Within ten days from the receipt of request
d) Within fifteen days from the receipt of request
Ans A
QNo.6 In how many days, third party may represent against the proposed
disclosure by the Central Public Information officer or State Public Information
officer under RTI Act?
a) Within five days
b) Within seven days
c) Within ten days
d) Within fifteen days
Ans C
QNO.7 which schedule of the RTI Act,2005 defines the departments on whom RTI
act is not applicable?
a) The first Schedule
b) The Second schedule
c) The third Schedule
d) The Fourth Schedule
Ans B
QNo.8 In how many days, second appeal can be filed against the decision of Central
Public Information officer or State Public Information officer under RTI Act,2005?
a) Within 45 days
b) Within 60 days
c) Within 90 days
d) Within 120 days
Ans C
QNo.9 which section of the RTI act,2005 deals with the penalties?
a) Section 20
b) Section 21
c) Section 22
d) Section 23
Ans A
QNo.10 which authority is competent to remove State Information Commissioner
under RTI Act,2005?
a) Chief justice of High court
b) Chief Minister
c) Legislative assembly
d) Governor
Ans D
QNo.11 Which statement is incorrect under the RTI Act,2005, when a request is
rejected by Central Public Information officer or State Public Information officer?
a) He will communicate the reasons of reject
b) He will communicate the period within which appeal against such rejection
may be preferred
c) He will communicate the fees of appeal
d) He will communicate the particular of the appellate authority
Ans C
QNo.12 No chief Information Commissioner shall hold office as such after he has
attained the age of ____________.
a) 60 years
b) 65 years
c) 70 years
d) 75 years
Ans B
QNo.13 which section deals with the appeal under RTI Act,2005?
a) Section 19
b) Section 20
c) Section 21
d) Section 22
Ans A
QNo.14 ___________________ means a person other than the citizen making a
request for information and includes a public authority under RTI act, 2005.
a) Third party
b) Second party
c) Appellate authority
d) Appellant
Ans A
QNo.15 which authority shall prescribe the salaries ,allowance and other
conditions of services of the Chief information Commissioner?
a) Centre Government
b) State Government
c) President
d) Governor
Ans A
QNO.16 which authority prepare the National Electricity Policy and tariff policy?
a) Central Government
b) State Government
c) Centre Electricity Authority
d) Centre Electricity regulatory commission
Ans A
QNo.17 Centre Electricity Authority shall prepare a National electricity plan in

accordance with the national electricity policy and notify such plan once in
_______________.
a) Three years
b) Four years
c) Five years
d) Six years
Ans C
QNo.18 Which authority shall review or revise the National Electricity Plan in
accordance with the National electricity policy?
b) State Government
d) Centre Electricity Regulatory Commission
Ans C
QNo.19 Which authority shall formulate a national policy in consultation with the
State Governments and the state Commissions, for rural electrification and for bulk
purchases of power and management of local distribution in rural areas through
Panchayat Institutions, users associations, co-operative societies, non-government
organizations or franchisees.
b) State Government
d) Centre Electricity Regulatory Commission
Ans A
QNo.20 which section deals with National electricity policy and plan in the
Electricity Act,2003?
a) Section 1
b) Section 2
c) Section 3
d) Section 4
Ans C
QNO.21 __________________ may establish, operate and maintain a generating
station without obtaining a license under electricity Act, 2003 if it complies with
the technical standards relating to connectivity with the grid referred to in section
73.
a) Transmission Company
b) Distribution Company
c) Trading in electricity company
d) Generating Company
Ans D
QNo.22 Which section of the electricity Act,2003 deals with the captive generation ?
a) Section 9
b) Section 10
c) Section 11
d) Section 12
Ans A
QNo.23 Which section of the electricity Act,2003 deals with grant of licence for
transmission, distribution and trading in the electricity?
a) Section 11
b) Section 12
c) Section 13
d) Section 14
Ans D
QNo.24 A licence shall continue to be in force for a period of ______________ as per
electricity Act,2003 unless such licence is revoked.
a) 20 years
b) 25 years
c) 30 years
d) 35 years
Ans B
QNo.25 In how many days, licence shall be issued by the appropriate commission,
where a person makes an application for issue of licence under electricity Act,
2003?
a) 45 days
b) 60 days
c) 90 days
d) 120 days
Ans C
QNo.26 No licence shall be revoked unless the appropriate commission has given to
the licensee not less than _______________notice in writing stating the grounds on
which it is proposed to revoke the licence
a) Two months
b) Three months
c) Four months
d) Six months
Ans B
QNo.27 The appropriate Commission shall within one year of appointment of the
___________________either revoke the licence in accordance with the provisions
contained in section 19 or revoke suspension of the licence and restore the utility
to the distribution licence whose licence had been suspended, as the case may be
a) Administrator
b) Chief Executive officer
c) Chief secretary
d) Arbitrator
Ans A
QNo.28 if any licensee, generating company or any other person fails to comply
with the directions issued by RLDC, he shall be liable to a penalty not exceeding
rupee _____________.
a) Five lacs
b) Ten lacs
c) Fifteen lacs
d) Twenty lacs
Ans C
QNo.29 At present, which company has been looking after the working of the SLDC
in the Haryana.
a) HPGCL
b) UHBVN
c) DHBVN
d) HVPN
Ans D
QNo.30 if any licensee, generating company or any other person fails to comply
with the directions issued by SLDC, he shall be liable to a penalty not exceeding
rupee _____________.
a) Five lacs
b) Ten lacs
c) Fifteen lacs
d) Twenty lacs
Ans A
QNo.31 A transmission licensee may engage in any business for optimum
utilization of its assets. A proportion of the revenue derived from such business
shall be utilized for reducing the _____________________.
a) Wheeling of electricity charges
b) Sale of electricity charges
c) Open access charges
d) Transmission charges
Ans D
QNo.32 who will appoint the electricity ombudsman for the redressal of grievances
against the consumer Grievances redressal forum?
a) State transmission utility
b) Distribution utility
c) State government
d) State commission
Ans D
QNo.33 who will appoint the Consumer Grievances redressal forum to listen the
grievances of the consumers?
a) State transmission utility
b) Distribution utility
c) State government
d) State commission
Ans B
QNo.34 if a distribution licensee fails to supply the electricity within a period of one
month, he shall be liable to a penalty which extend to _________________________ for
each day of default.
a) One thousand rupees
b) Two thousand rupees
c) Three thousand rupee
d) Four thousand rupee
Ans A
QNo.35 which section deals with the Electricity supply code in respect of the
distribution licensee under electricity Act, 2003?
a) Section 50
b) Section 51
c) Section 52
d) Section 53
Ans A
QNo.36____________________ means goods to be manufactured or produced or
acquired by the seller after the making of the contract of sale.
a) Future goods
b) Specific goods
c) Goods
d) Delivered goods
Ans A
QNo.37 ___________________means goods identified and agreed upon at the time ,a
contract of sale is made
a) Future goods
b) Specific goods
c) Goods
d) Delivered goods
Ans B
QNo.38 A person is said to be ______________________ who has ceased to pay his
debts in the ordinary course of business, or cannot pay his debts as they become
due, whether he has committed an act of insolvency or not.
a) Agent
b) Insolvent
c) Owner
d) Debtor
Ans B
QNo.39 Where there is a contract for the sale of specific goods, the contract is
______________,if the goods without the knowledge of the seller have, at the time
when the contract was made, perished or become so damaged as no longer to
answer to their description contract
a) Void
b) Valid
c) Voidable
d) Legal
Ans A
QNo.40 where there is a contract for the sale of unascertained goods, no property
in the goods is transferred to the buyer unless and until the goods are
___________________.
a) Unascertained
b) Ascertained
c) Specific
d) Future goods
Ans B
QNo.41 An agreement to sell becomes ______________ on fulfillment of the
conditions or when the time provided in the agreement elapses.
a) A sale
b) A document
c) A history
d) A book
Ans A
QNo.42 it is the duty of the _________________ to deliver the goods and of the buyer
of accept and pay for them, in accordance with the terms of the contract of sale.
a) Seller
b) Buyer
c) Debtor
d) Creditor
Ans A
QNo.43 Where the seller delivers to the buyer a quantity of goods less than he
contracted to sell, the buyer may reject them, but if the buyer accepts the goods so
delivered he shall pay for them at the ___________.
a) Market rate
b) Issue rate
c) Contract rate
d) No rate
Ans C
QNo.44 where the seller delivers to the buyer a quantity of goods larger than he
contracted to sell, the buyer may accept the goods included in the contract and
reject the rest, or he may reject the whole. But, if the buyer accepts the whole of
the goods so delivered he shall pay for them at the ___________.
a) Market rate
b) Issue rate
c) Contract rate
d) No rate
Ans C
QNo.45 Which section of the sale of goods act, 1930 deals with sale and agreement
to sell?
a) Section 4
b) Section 5
c) Section 6
d) Section 7
Ans A
QNo.46 which section of the sale of goods act,1930 deals with existing or future
goods?
a) Section 4
b) Section 5
c) Section 6
d) Section 7
Ans C
QNo.47 which section of the sale of goods act, 1930 deals with sale by description?
a) Section 14
b) Section1 5
c) Section1 6
d) Section17
Ans B
QNo.48 which section of the sale of goods act, 1930 deals with sale by sample?
a) Section 14
b) Section1 5
c) Section1 6
d) Section17
Ans D
QNo.49 which section of the sale of goods act, 1930 deals with duties of seller and
buyer?
a) Section 31
b) Section 32
c) Section 33
d) Section 34
Ans A
QNo.50 which section of the sale of goods act, 1930 deals with effect of part
delivery?
a) Section 31
b) Section 32
c) Section 33
d) Section 34
Ans D
QNo.51 The floor of every workroom shall be cleaned at least once in
_________________ by washing, using disinfectant, where necessary or by some
other effective method as per the factories act 1948.
a) Every week
b) Every month
c) Every quarter
d) Every fifteen days
Ans A
QNo.52 All doors and window frames and other wooden or metallic framework and
shutters shall be kept painted or varnished and the painting or varnishing shall be
carried out at least once in every period of _____________________ as per factories
act,1948.
a) Two years
b) Three years
c) Four years
d) Five years
Ans D
QNo.53 _______________________ may prescribed a standard of adequate ventilation
and reasonable temperature for any factory or class or description of factories or
part thereof as per the Factories act,1948.
a) State Government
b) Centre Government
c) Chief Inspector
d) Chief Executive inspector
Ans A
QNo.54 How much space shall be provided for every worker employed in the factory
as per the factories act,1948?
a) 14.1 cubic metres

b) 14.2 cubic metres
c) 14.3 cubic metres
d) 14.4 cubic metres
Ans B
QNo.55 On how many worker in the factory, a provision shall be made for cooling
drinking water during hot weather by the effective means ?
a) 100 workers
b) 150 workers
c) 200 workers
d) 250 workers
Ans D
QNo.56 How much penalty shall be imposed on account of spitting in open in the
factory?
a) Five rupees
b) Ten rupees
c) Fifteen rupees
d) Twenty rupees
Ans A
QNo.57 for how many workers in the factory, a safety officer in the factory shall be
appointed under section 40-B of the factories act,1948?
a) 250 workers
b) 500 workers
c) 1000 workers
d) 1500 workers
Ans C
QNo.58 which section of the factories act,1948 deals with appointment of safety
officer in the factory?
a) Section 40-A
b) Section 40-B
c) Section 41-A
d) Section 41-B
Ans B
QNo.59 which constitute the site appraisal Committees under the factories
act,1948?
a) State Government
b) Centre Government
c) Appropriate Commission
d) Chief justice of High Court
Ans A
QNo.60 In how many days, the site appraisal Committees shall examine an
application for the establishment of a factory involving hazardous process and
make its recommendation to the state Government?
a) 45 days
b) 90 days
c) 120 days
d) 150 days
Ans B
QNo.61 ___________________________ shall have power to call for any information
from the person making an application for the establishment or expansion of a
factory involving a hazardous process.
a) State Government
b) Site Appraisal Committee
c) Centre Government
d) Appropriate Commission
Ans B
QNo.62 Which section of the factories Act, 1948 deals with the constitution of site
appraisal Committees?
a) Section 40-A
b) Section 40-B
c) Section 41-A
d) Section 41-B
Ans C
QNo.63 Which schedule of the factories act, 1948 defines the maximum
permissible threshold limits of exposure of chemical and toxic substances in
manufacturing processes (whether hazardour or otherwise) in any factory?
a) Schedule-I
b) Schedule-II
c) Schedule-III
d) Schedule-IV
Ans B
QNo.64 for how many workers, an ambulance room of the prescribed size shall be
arranged in the factory?
a) More than hundred workers
b) More than two hundred workers
c) More than four hundred workers
d) More than five hundred workers
Ans D
QNo.65 For how many workers, a facility of canteen shall be provided and
maintained in the factory?
a) More than One Hundred and fifty worker
b) Upto two hundred workers
c) Upto one hundred workers
d) More than two hundred and fifty workers
Ans D
QNo.66 For how many workers, a facility of Shelters, rest rooms and lunch rooms
shall be provided and maintained in the factory?
a) More than One Hundred and fifty worker
b) Upto two hundred workers
c) Upto one hundred workers
d) More than two hundred and fifty workers
Ans A
QNo.67 For how many women workers, a facility of Crèches shall be provided and
maintained in the factory?
a) More than ten women workers
b) More than fifteen women workers
c) More than twenty women workers
d) More than thirty women workers
Ans D
QNo.68 For how many women workers, a Welfare officer shall be employed in the
factory?
a) More than hundred workers
b) More than two hundred workers
c) More than four hundred workers
d) More than five hundred workers
Ans D
QNo.69 Which section of the factories Act,1948 deals with Penalty for obstructing
Inspector ?
a) Section 95
b) Section 96
c) Section 97
d) Section 98
Ans A
QNo.70 Which section of the factories Act,1948 deals with Offences by wokers ?
a) Section 95
b) Section 96
c) Section 97
d) Section 98
Ans C
QNo.71 How much penalty has been prescribed for obstructing the Inspector under
factories Act, 1948?
a) Upto six month imprisonment or with fine upto ten thousand rupees or with
both
b) Upto three months imprisonment or with fine upto ten thousand rupees or
with both
c) Upto six month imprisonment or with fine upto fifteen thousand rupees or
with both
d) Upto nine months imprisonment or with fine upto ten thousand rupees or
with both
Ans A
QNo.72 How much penalty has been prescribed for permitting double employment
of child under factories Act, 1948?
a) Upto 200 rupees
b) Upto 500 rupee
c) Upto 1000 rupees
d) Upto 1500 rupees
Ans C
QNo.73 How much penalty has been prescribed for using false certificate of fitness
under factories Act, 1948?
a) Upto two months or with fine upto one thousand rupees or with both
b) Upto one month or with fine upto one thousand rupees or with both
c) Upto three month or with fine upto two thousand rupees or with both
d) Upto four month or with fine upto one thousand rupee or with both
Ans A
QNo.74 The Central Government may, in the event of the occurrence of an
extraordinary situation involving a factory engaged in a hazardous process, appoint
an ___________________ to inquire into the standards of health and safety observed
in the factory.
a) Inspector
b) Inquiry committee
c) Director
d) Judge of high court
Ans B
QNo.75 How much penalty has been prescribed for wrongfully disclosing results of
analysis under section 91 of the Factories Act, 1948?
a) Upto two months or with fine upto one thousand rupees or with both
b) Upto one month or with fine upto one thousand rupees or with both
c) Upto three month or with fine upto two thousand rupees or with both
d) Upto six months or with fine upto t en thousand rupee or with both
Ans D
QNo.76 How much worker are required to constitute the work committee
under industrial dispute act 1947?
a) 20
b) 50
c) 75
d) 100
Ans D
QNo.77 ________ means failure, refusal or inability of an employer on account
of shortage of coal , power or raw material to give employment to an workmen
whose name is born on the muster roll of his establishment?
a) Lock out
b) Strike
c) Layoff
d) Retrenchment
Ans C
Q 78 __________means temporary closing of place of employment or suspension of
the work or the refusal by the employer to continue to employ any number of
persons employed by him?
a) Lock out
b) Strike
c) Layoff
d) Retrenchment
Ans A
QNo.79 Board of Conciliation self-consist of the chairman and _________ or
__________other member as appropriate govt thinks fit?
a) Two or four
b) Six or Eight
c) Eight or Ten
d) Ten or twelve
Ans A
QNo. 80 Court of enquiry under section 6 of the industrial dispute act
1947nmay consist of ___________independent person or of such number of
independent person as appropriate govt may think fit and where court consist two
or more members, one of them shall be appointed as chairman?
a) One
b) Two
c) Three
d) Four
Ans A
QNo. 81 Labour court execute upon the industrial dispute relating to the matter
specified in _________?
a) First schedule
b) Second schedule
c) Third schedule
d) Fourth schedule
Ans B
QNo.82 Which section prescribed the appointment of labour court under
industrial dispute act 1947?
a) Section 4
b) Section 5
c) Section 6
d) Section 7
Ans D
QNo. 83 Who constitute the national tribunal under industrial dispute act 1947?
a) Centre Govt
b) State Govt
c) High Court
d) Supreme Court
Ans A
Q 84 No person shall be appointed on the post of presiding officer in labour court,
tribunal and national tribunal if he has attained the age of _________?
a) 58
b) 60
c) 62
d) 65
Ans D
Q 85 Total number of the members of the Grievance redressal committee shall not
exceed more than ___________ ?
a) Four
b) Six
c) Eight
d) Ten
Ans B
Q 86 The workmen who is aggrieved of the decision of the grievance redressal
committee may prefer an appeal to the employer against the decision of the
grievance redressal committee and employer shall dispose of the appeal with in
____________ from the date of receipt of such appeal?
a) One month
b) Two month
c) Three month
d) Four month
Ans A
Q 87 Grievance redressal Committee may complete its proceeding within__________
on receipt of the written application by or on behalf of the aggrieved party?
a) 30 days
b) 60 days
c) 90 days
d) 120 days
Ans A
QNo. 86 In how many days an order shall be passed by the labour
court,tribunal/national tribunal in respect of industrial dispute connected with
individual connection
a) 3 months
b) 6 months
c) 9 months
d) 12 months
Ans : A
QNo. 87 In which section of the Industrial Dispute act 1947 deals with reference of
dispute to board, court or tribunal.
a) Section 7
b) Section 8
c) Section 9
d) Section 10
Ans: D
QNo. 88 Whenever a workman whose name is Borne on the muster roll of an
industrial establishment and who has completed not less than of
___________________of continued service under an employer is laid off, he shall be
paid by the employer for all days during which he is so laid off.
a) 1 year
b) 2 years
c) 3 years
d) 4 years
Ans: A
QNo. 90 If during any period of 12 months if a workman is so laid of for more than
_______________, no such compensation in respect of any period of the lay off after
the expiry of the 45 days.
a) 20 days
b) 30 days
c) 40 days
d) 45 days
Ans: D
QNo. 91 ___________________ means workman who is employed in any industrial
establishment in the place of another workman whose name is borne in the muster
roll of the establishment
a) Retired workman
b) Badli workman
c) Retrenched workman
d) Terminated workman
Ans B
QNo.92 the workman has been paid, at the time of retrenchment, compensation
which shall be equivalent to _______________average pay for each completed year of
continuous service or any part thereof in excess of six months.
a) Ten days
b) Fifteen days
c) Twenty day
d) Twenty five days
Ans B
QNo.93 which section of Industrial dispute act, 1947 deals with procedure for
retrenchment?
a) 25-G
b) 25-H
c) 25-I
d) 25-J
Ans B
QNo.94 which section of Industrial dispute act, 1947 deals with Works Committee?
a) Section-3
b) Section-4
c) Section-5
d) Section-6
Ans A
QNo.95 _______________ means a cessation of work by a body of person employed in
any industry acting in combination or a concerted refusal, or a refusal, under a
common understanding, of any number of persons who are or have been so
employed to continue to work or to accept employment.
a) Lock out
b) Strike
c) Layoff
d) Retrenchment
Ans B
QNo.96 How much penalty has been prescribed for lay-off and retrenchment
without previous permission under industrial dispute act, 1947?
a) Imprisonment upto one month or with fine extendable to one thousand
rupees or both
b) Imprisonment upto two month or with fine extendable to one thousand
rupees or both
c) Imprisonment upto three month or with fine extendable to one thousand
rupees or both
d) Imprisonment upto one month or with fine extendable to two thousand
rupees or both
Ans A
QNo.97 How much penalty has been prescribed for committing unfair labour
practices under industrial dispute act, 1947?
rupees or both
b) Imprisonment upto two month or with fine extendable to one thousand
rupees or both
c) Imprisonment upto three month or with fine extendable to one thousand
rupees or both
d) Imprisonment upto six month or with fine extendable to one thousand
rupees or both
Ans D
QNo. 98 How much penalty shall be imposed upon workman who participate in the
legal strike.
a) Imprisonment upto one month or with fine extendable to one hundred
rupees or both
b) Imprisonment upto two month or with fine extendable to two hundred
rupees or both
c) Imprisonment upto one month or with fine extendable to fifty rupees or both
d) Imprisonment upto six month or with fine extendable to one thousand
rupees or both
Ans C
QNo. 99 How much penalty shall be imposed upon employer who commence illegal
lockout.
rupees or both
b) Imprisonment upto two month or with fine extendable to two thousand
rupees or both
c) Imprisonment upto one month or with fine extendable to three thousand or
both
d) Imprisonment upto six month or with fine extendable to four thousand
rupees or both
Ans A
QNo. 100 Which Section of the Industrial Dispute Act of 1947 deals with the illegal
strike or lockout.
a) Section 22
b) Section 23
c) Section 24
d) Section 25
Ans C
QNo. 101 For how much period the Books of Account of every company should be
kept in good order as per Company Act, 2013.
a) 6 years
b) 8 years
c) 10 years
d) 12 years
Ans B
QNo. 102 How much penalty should be imposed on each officer who fail to prepare
books of accounts under the Companies Act, 2013.
a) Not less than Rs. 20,000 but may be extend to Rs. 2,00,000
b) Not less than Rs. 30,000 but may be extend to Rs. 3,00,000
c) Not less than Rs. 40,000 but may be extend to Rs. 4,00,000
d) Not less than Rs. 50,000 but may be extend to Rs. 5,00,000
Ans D
QNo. 103 Which Section deals with the Books of Accounts of the Company as per
a) Section 127
b) Section 128
c) Section 129
d) Section 130
Ans B
QNo. 104 When the First Annual General Meeting is held as per the Companies
Act, 2013.
a) Within 3 months from the date of closing of the first Financial Year.
b) Within 6 months from the date of closing of the first Financial Year.
c) Within 9 months from the date of closing of the first Financial Year.
d) Within 10 months from the date of closing of the first Financial Year.
Ans C
QNo. 105 When the subsequent Annual General Meeting after the First AGM is
held as per the Companies Act, 2013.
a) Within 3 months from the date of closing of the Financial Year.
b) Within 6 months from the date of closing of the Financial Year.
c) Within 9 months from the date of closing of the Financial Year.
d) Within 10 months from the date of closing of the Financial Year.
Ans B
QNo. 106 Every Annual General Meeting shall be called during business hours i.e.
between ___________.
a) 8 am and 7pm
b) 9 am and 6 pm
c) 7 am and 7 pm
d) 6 am and 5 pm
Ans B
QNo. 107 Registrar may for any special reason extend the time within which any
Annual General Meeting other than first Annual General Meeting shall be held by a
period not exceeding ______________.
a) 1 month
b) 3 months
c) 6 months
d) 9 months
Ans B
QNo. 108 Every company shall hold the first meeting of the Board of Directors
within _____________ of the date of its incorporation.
a) 30 days
b) 60 days
c) 90 days
d) 120 days
Ans : A
QNo. 109 Every Company shall hold minimum number of ___________ meetings of
its Board of Directors every year.
a) One
b) Two
c) Three
d) Four
Ans D
QNo. 110 _____________ may by notification specify such matters which shall not be
dealt within the Board Meeting through video conferencing or other audio visual
wings.
a) Central Govt.
b) State Govt.
c) Share Holders
d) Directors
Ans A
QNo. 111 A Meeting of the Board shall be called by giving not less than
______________ notice in a writing to every Director at his address registered with
company.
a) Four days
b) Five Days
c) Six days
d) Seven Days
Ans D
QNo. 112 Every officer of the company whose duty is to give notice to the every
director of the company for calling the meeting and who fail to do so shall be liable
to a penalty of _____________.
a) Ten Thousand Rupees
b) Twenty Five Thousand Rupees
c) Thirty Thousand Rupees
d) Fifty Thousand Rupees
Ans B
QNo. 113 Audit Committee shall consists of a minimum of ______________ Directors
with independent Director for forming the majority
a) 3 Directors
b) 4 Directors
c) 5 Directors
d) 6 Directors
Ans A
QNo. 114 Which Section deals with the Audit Committee as per the Companies Act,
2013.
a) Section 176
b) Section 177
c) Section 178
d) Section 179
Ans B
QNo. 115 In how many days copy of the Financial Statement shall be filed with the
registrar as per the Companies Act 2013.
a) Within 30 days of the date of Annual General Meeting
b) Within 45 days of the date of Annual General Meeting
c) Within 60 days of the date of Annual General Meeting
d) Within 90 days of the date of Annual General Meeting
Ans A
QNo. 116 Which Section of the Companies Act 2013 deal with the Annual General
Meeting.
a) Section 99
b) Section 98
c) Section 97
d) Section 96
Ans D
QNo. 117 A General Meeting of the Company may be called by giving not less than
clear ________ notice either in writing or through electronic mode as prescribed.
a) 7 day notice
b) 15 day notice
c) 21 day notice
d) 31 day notice
Ans C
QNo. 118 The Award in the matters other than international commercial arbitration
shall be made by the Arbitral Tribunal with in the period of ____________ from the
date of completion of pleading
a) 6 months
b) 12 months
c) 15 months
d) 18 months
Ans B
QNo. 119 The Award in the matters of international commercial arbitration shall be
made by the Arbitral Tribunal with in the period of ____________ from the date of
completion of pleading
a) 6 months
b) 12 months
c) 15 months
d) 18 months
Ans B
QNo. 120 If the Award is made within the period of _________ from the date the
Arbitral Tribunal enters upon the reference, Arbitral Tribunal shall be entitled to
receive such amount of additional as the parties may agree.
a) 6 months
b) 12 months
c) 15 months
d) 18 months
Ans A
QNo. 121 Which section of the Arbitration and Conciliation Act 1996 deal with the
Role of Conciliator.
a) Section 64
b) Section 65
c) Section 66
d) Section 67
Ans D
Appointment of Conciliator.
a) Section 64
b) Section 65
c) Section 66
d) Section 67
Ans A
termination of conciliations proceedings.
a) Section 74
b) Section 75
c) Section 76
d) Section 77
Ans C
QNo. 124 The Supreme Court and ______________ shall have the power to designate
Arbitral Institution, from time to time, which has been graded by the Council under
Section 43-I.
a) State Govt.
b) Central Govt.
c) High Court
d) Tribunal
Ans C
QNo. 125 Which authority has a power to amend the fourth schedule of Arbitration
and Conciliation Act 1996.
a) State Govt.
b) Central Govt.
c) High Court
d) Tribunal
Ans B
QNo.126 an agreement enforceable by law is________
a) Agreement
b) Valid contract
c) Voidable contract
d) Void contract
Ans B
QNo. 127 an agreement not enforceable by law is said to be_______
a) Agreement
b) Valid contract
d) Void contract
Ans D
QNo. 128 An agreement which is enforceable by law at the option of one party but
not at the option of other party______
a) Agreement
b) Valid contract
d) Void contract
Ans C
QNO. 129__________ is that agreement which is actually forbidden by the law
a) Illegal agreement
b) Voidable agreement
c) Valid
d) Non of the above
Ans A
QNo.130 When one person signify to another the willingness to do, or to abstain
from doing anything with the view to obtaining the assent of that other to such act,
is said to make a________
a) Proposal
b) Acceptance
c) Agreement
d) Contract
Ans A
QNo.131 When the offer made by two person to each other containing similar term
of barging cross each other in post, they are known as _______
a) Offer
b) Cross offer
c) Acceptance
d) Agreement
Ans B
QNo.132 When the offer is made to a specific person, it is known as____
a) Cross offer
b) Counter offer
c) Specific offer
d) General offer
Ans C
QNO.133 When offer is not made to any particular person but to a public at large it
is known as _____
a) Cross offer
b) Counter offer
c) Specific offer
d) General offer
Ans D
QNo. 134 An offer to give reward to anybody who finds a lost dog is a example of
__________
a) Cross offer
b) Counter offer
c) Specific offer
d) General offer
Ans D
QNo.135 When the person to whom the proposal is made signifies his assent there
to, the proposal is said to be _________
a) Agreement
b) Contract
c) Promise
d) Acceptance
Ans D
QNo.136 When the proposal or acceptance is made in words, the promise is said to
be ______
a) Express
b) Implied
c) Renew
d) Offer
Ans A
QNo.137 When proposal or acceptance is made otherwise than in words, the
promise is said to be_____
a) Express
b) Implied
c) Renew
d) Offer
Ans B
QNo.138 which section of the Indian Contract Act defines the contingent contract?
a) Section 31
b) Section 32
c) Section 33
d) Section 34
Ans A
QNo.139 A contract to pay B rs.10000 if B house is burnt, this is the example of
________.
a) voidable contract
b) void contract
c) contingent contract
d) valid contract
Ans C
QNo.140 _______ is a contract to do or not to do something, if some event, collateral
to such contract, does not happen.
a) Contingent contract
b) Valid contract
c) Void contract
d) Voidable contract
Ans A
QNo.141 Wagering agreement is also a contingent contract but that type of
contingent contract has been specifically declare to be _________ by section 30.
a) Valid
b) Void
c) Voidable
d) Legal
Ans B
QNo.142 A contract to pay B a sum of money if B marries C. C dies without being
marry to B. Since performance of an event has become impossible such
contract becomes_______
a) Void
b) Voidable
c) Legal
d) Valid
Ans A
QNo.143 when the possession of the goods is given to the pledgee as security it is
known as____
a) Hypothecation
b) Pledge
c) Warranty
d) Guarantee
Ans B
QNo.144 when the goods serves as a security but there possession remains with
the owner of the goods is known as______
a) Hypothecation
b) Pledge
c) Warranty
d) Guarantee
Ans A
QNo.145 Which section of the Contract Act deal with the essential of valid
contract?
a) Section 10
b) Section 11
c) Section 12
d) Section 13
Ans A
QNo.146 When the Haryana Civil Services (Compassionate Financial Assistance or
Appointment) Rules, 2019 was come into force?
a) 1st June,2019
b) 1st July,2019
c) 1st August,2019
d) 1st September,2019
Ans C
QNo.147 The family member shall be eligible for consideration of compassionate
appointment subject to the condition that the deceased or missing Government
employee should have completed ___________ service on regular basis.
a) Two year
b) Three year
c) Four year
d) Five year
Ans D
QNo.148 The family member shall be eligible for consideration of compassionate
appointment subject to the condition that the deceased or missing Government
employee should have not attained the age of ________________or more upto the
date of death or missing.
a) Fifty two years
b) Fifty five years
c) Forty eight years
d) Fifty years
Ans A
QNo.149 The compassionate financial assistance shall be admissible to such
eligible family member for a period of _______________ in case of death of employee
before attaining the age of thirty five years.
a) Twenty years
b) Fifteen years
c) Twelve years
d) Seven years
Ans B
on attaining the age of thirty five years but before attaining the age of forty eight
years.
a) Twenty years
b) Fifteen years
c) Twelve years
d) Seven years
Ans C
on attaining the age of forty eight years or above.
a) For a period of Twenty years or superannuation whichever is earlier
b) For a period of fifteen years or superannuation whichever is earlier
c) For a period of Twelve years or superannuation whichever is earlier
d) For a period of seven years or superannuation whichever is earlier
Ans D
QNo.151 The compassionate appointments under Haryana Civil Services
(Compassionate Financial Assistance or Appointment) Rules, 2019 shall be
confined to ________________________ only.
a) Group-A or B
b) Group-C
c) Group-D
d) Group C and Group-D
Ans D
QNo.152 The deceased or missing Government employee was holding the post of
Group-D and was drawing pay in the functional pay level corresponding to
functional Grade pay of Rs.1650, the compassionate appointment shall be made to
a post of Group D in the ______________.
a) ACP level
b) Functional level
c) Promotional level
d) Presumptive pay level
Ans B
QNo.153 Every department may nominate one or more ________________ who shall
meet the members of the family of the deceased or missing Government employee
immediately upon the demise to advise and assist the family in obtaining ex-gratia
compassionate appointment under these rules.
a) Enquiry officer
b) Welfare officer
c) Presenting officer
d) Development officer
Ans B
QNo.154 Compassionate appointment under these rules shall be made up to
maximum of __________ of sanctioned posts (falling under direct recruitment quota)
in Group C category to be determined by the Head of the Department on the 31st
march of each year.
a) 20%
b) 15%
c) 10%
d) 5%
Ans D
QNo.155 for compassionate appointment against the post of Group D category,
there shall be _____________________ of the sanctioned post.
a) 5%
b) 10%
c) 15%
d) No percentage
Ans D
QNo.156 A person appointed under Haryana Civil Services (Compassionate
Financial Assistance or Appointment) Rules, 2019 shall give an undertaking in
writing in way of an affidavit as in form _________ that he shall maintain all the
other members who were completely dependent on the deceased/missing
Government employee.
a) CFA-5
b) CFA-4
c) CFA-3
d) CFA-2
Ans A
QNo.157 In addition to monthly compassionate financial assistance or
appointment, a lump-sum ex-gratia grant of Rs.___________________________ as
specified from time to time shall be provided to the eligible family member(s) to
meet the immediate needs on the loss of the bread earner within the fifteen days
from the date of death.
a) 50,000/-
b) 1,00,000/-
c) 1,50,000/-
d) 2,00,000/-
Ans B
QNo.158 The outstanding amount of loans and advances alongwith interest, if any,
namely marriage advance, cycle advance, wheat advance, festival advance availed
by a deceased or missing Government employee of Group C and D only shall be
waived off for which _________________________ concerned shall be the competent
authority.
a) Head of the office
b) Head of the department
c) Controlling officer
d) Administrative department
Ans B
QNo.159 The outstanding amount of scooter or motor cycle advance along with
interest, availed if any, by a deceased or missing Government employee of
_________________ shall be waived off where the death occurs due accident only
a) Group-C or D
b) Group-C
c) Group-D
d) Group A and Group-B
Ans A
QNo.160 ______________________ where the deceased or missing Government
employee was in service, is competent to give compassionate appointment to the
eligible family members.
a) Head of the Department

b) Head of the office
c) Controlling officer
d) Administrative department
Ans A
QNo.161 House rent allowance for a period of _________________ at the rate drawn
immediately before death or admissible at the station from where the
compassionate financial assistance is being drawn.
a) Six months
b) One years
c) Two years
d) Three years
Ans C
QNo.162 No other allowance including __________________________ , which were
being drawn by the deceased or missing Government employee, shall be included in
the emoluments for the purpose of compassionate financial assistance.
a) Basic pay
b) Dearness allowance
c) Special pay or personal pay
d) Non-practicing allowance
Ans D
QNo.163 which authority is empowered to interpret, change, amend and relax the
rules pertaining to Haryana Compassionate assistance and appointment rules
2019?
a) Finance department
b) General Administrative Department
c) Head of the department
d) Head of the office
Ans B
QNo.164 As soon as a person joins Government service on regular basis under
Haryana Compassionate assistance and appointment rules 2019, he shall give
details of his family in form __________________to the Head of the office.
a) CFA-1
b) CFA-2
c) CFA-3
d) CFA-4
Ans D
QNo.165 It shall be the duty of person who is drawing compassionate financial
assistance to furnish a certificate to the disbursing authority_________ in a year.
a) Once
b) Twice
c) Thrice
d) Quarterly
Ans B
QNo.166 where the compassionate appointment is not given to the eligible family
member due to non-availability of post within a period of ____________, in such case
the benefit of compassionate financial assistance shall be sanctioned by the Head
of the department with retrospective effect to the eligible family member.
a) One year
b) Two year
c) Three year
d) Four year
Ans A
QNo.167 Family Pension shall also be admissible to the family of those deceased or
missing government employees who entered in service on regular basis before the
_______________ in addition to compassionate appointment.
a) 1st January,2006
b) 1st January,2016
c) 1st January,2019
d) 1st January,2010
Ans A
QNo.168 The family of deceased Government employee shall, during the tenure of
Compassionate Financial Assistance, be entitled to avail the benefit of
_________________________.
a) Hill compensatory Allowance
b) House Rent allowance
c) Special local outdoor duty allowance
d) Fixed Medical allowance
Ans D
QNo.169 The validity of the names of the eligible family members on the list of
compassionate appointment shall lapse after _______________ from the date of death
or receipt of Police report, as the case may be.
a) One year
b) Two year
c) Three year
d) Four year
Ans D
QNo.170 for determination of the total emoluments for compassionate financial
assistance (excluding compensatory allowances) in respect of both deceased
Government employees shall not exceed the maximum of the highest pay of
Rs.____________________.
a) 112050/-
b) 224100/-
c) 67230/-
d) 210000/-
Ans B
QNo.171 ______________________means such disablement,whether of a temporary or
permanent nature,as incapacitates to an employee for all work which he was
capable of performing at the time of the accident resulting in such disablement.
a) Total disablement
b) Partial disablement
c) 30% disablement
d) 50% disablement
Ans A
QNo.172 ________________ means where the disablement is of a temporary nature,
such disablement as reduces the earning capacity of the employee in the
employment in which he was engaged at the time of accident resulting in the
disablement.
a) Total disablement
b) Partial disablement
c) 30% disablement
d) 50% disablement
Ans B
QNo.173 which is not the condition for the grant of compensation to the workmen
under workmen compensation act, 1923?
a) Personal injury
b) Accident
c) Arising out during the course of employment
d) Not arising out during the course of employment
Ans D
QNo.174 which section of the employees compensation act,1923 deals with
Employer’s liability for compensation?
a) Section 1
b) Section 2
c) Section 3
d) Section 4
Ans C
QNo.175 what amount of compensation shall be paid where death results from the
injury under employee compensation act,1923?
a) Fifty percent of the monthly wages of the deceased employee multiplied by
the relevant factor or one lakh and twenty thousand whichever is more
b) Sixty percent of the monthly wages of the deceased employee multiplied by
the relevant factor or one lakh and forty thousand whichever is more
c) Forty percent of the monthly wages of the deceased employee multiplied by
the relevant factor or one lakh and ten thousand whichever is more
d) Seventy percent of the monthly wages of the deceased employee multiplied
by the relevant factor or one lakh and thirty thousand whichever is more
Ans A
QNo.176 what amount of compensation shall be paid where permanent total
disablement results from the injury under employee compensation act,1923?
a) Fifty percent of the monthly wages of the deceased employee multiplied by
the relevant factor or one lakh and twenty thousand whichever is more
b) Sixty percent of the monthly wages of the deceased employee multiplied by
the relevant factor or one lakh and forty thousand whichever is more
c) Forty percent of the monthly wages of the deceased employee multiplied by
the relevant factor or one lakh and ten thousand whichever is more
d) Seventy percent of the monthly wages of the deceased employee multiplied
by the relevant factor or one lakh and thirty thousand whichever is more
Ans B
QNo.177 what amount of compensation shall be paid where temporary
disablement, whether total or partial, result from the injury under employee
compensation act,1923?
a) A half monthly payment of the sum equivalent to ten e percent of the
monthly wages of the employee.
b) A half monthly payment of the sum equivalent to fifteen percent of the
c) A half monthly payment of the sum equivalent to twenty percent of the
d) A half monthly payment of the sum equivalent to twenty five percent of the
Ans D
QNo.178 If the injury of the employee results in his death, the employer shall, in
addition to the compensation under deposit with the commissioner a sum of not
less than _______________ for payment of the same to the eldest surviving dependent
of the employee towards the expenditure of the funeral of such employee.
a) Five thousand rupees
b) Ten thousand rupees
c) Fifteen thousand rupees
d) Twenty thousand rupees
Ans A
QNo.179 Where any employer is in default in paying the compensation due under
compensation act,1923 within in ______________ from the date it fell due, the
commissioner shall direct the employer to pay simple interest at the rate of twelve
percent on the amount of arrears.
a) One month
b) Two month
c) Three month
d) Four month
Ans D
QNo.180 Where any employer is in default in paying the compensation due under
compensation act, 1923, the commissioner shall direct the employer to pay simple
interest at the rate of twelve percent on the amount of arrears and in addition to
the amount of arrears and interest thereon, pay a further sum not exceeding
_______________ of such amount by way of penalty.
a) Twenty percent
b) Thirty percent
c) Forty percent
d) Fifty percent
Ans D
QNo.181 In how many days, report of the fatal accident and serious bodily injuries
shall by submitted by the employer to the commissioner under the Employees
compensation Act,1923?
a) Within seven days
b) Within ten days
c) Within fifteen days
d) Within twenty days
Ans A
QNo.182 what is the time limit prescribed for the disposal of cases relating to the
compensation under the Employee compensation Act,1923?
a) One month
b) Three month
c) Six month
d) Nine month
Ans B
QNo.182 In how many days, an appeal can be filed under the Employee
compensation Act,1923?
a) Thirty days
b) Sixty days
c) Ninety days
d) One hundred twenty days
Ans B
QNo.183 To which authority, an appeal against the decision of the commissioner
can be filed under the Employee compensation Act,1923?
a) High court
b) Supreme court
c) Tribunal
d) State Government
Ans A
QNo.184 Which schedule of the Employee compensation Act,1923 deals with list of
injuries deemed to result in permanent total disablement ?
a) Schedule -1
b) Schedule-2
c) Schedule-3
d) Schedule-4
Ans A
QNo.185 which section of the employees compensation Act,1923 deals with
compensation not to be assigned, attached or charged.
a) Section 9
b) Section 10
c) Section 11
d) Section 12
Ans A
186. IGST is payable when the supply is ........

a) Interstate c) Intra-state
b) Intra- UT d) All of the above
187. Maximum rate of CGST prescribed by law for intrastate supply made is.......
a) 18% c) 20%
b) 40% d) 28%+cess
188. Which of the following taxes have been subsumed in GST?
a) Central sales tax b) Central excise duty
c) VAT d) All of the above
189. GST is levied on supply of all goods and service except.....
a) Alcoholic liquor for human consumption b) Tobacco
c) Health care service d) All of the above
190. The functions of goods and services network (GSTN) include....
a) Facilitating registration
b) Forwarding the return to central and state authorities
c) Computation and settlement of GST
d) All of the above
191. Aggregate turnover does not include-
(a) Inward supplies on which tax is payable on reverse charge basis
(b) Exempt supplies
(c) Export of goods or services or both
(d) Inter-State supplies of persons having the same PAN number
192. A __________ supply comprising of two or more supplies shall be treated as the
supply of that particular supply that attracts highest rate of tax.
a) Composite b) Mixed
c) Both (a) and (b) d) None of the above
193. GST is a comprehensive tax regime covering _________
a) Goods b) Services
c) Both goods and services d) Goods, services and imports
194. What are the taxes levied on an intra-State supply?
(a) CGST (b) SGST
(c) CGST and SGST (d) IGST
195. Who will notify the rate of tax to be levied under CGST Act?
(a) Central Government
(b) State Government
(c) GST Council
(d) Central Government as per the recommendations of the GST Council
196. Which of the following taxes will be levied on imports?
(a) CGST (b) SGST
(c) IGST (d) CGST and SGST
197. Which of the following is not included in aggregate turnover?
a) Exempt supplies of goods or services or both
b) Export of goods or services or both
c) Inter-State supply of goods or services or both
d) Value of inward supplies on which tax is paid under reverse charge
198. The IGST Act,2017 extends to the
a. Whole of India except the state of Jammu & Kashmir
b. Whole of India
c. Whole of India except the state of Jammu & Kashmir & Pondicherry
d. None of the above
199. What is time of supply of goods, in case of forward charge?
(b) Due date of issue of invoice
(c) Date of receipt of consideration by the supplier
200. What is time of supply of goods, in case of supplier opting for composition levy
under
Section 10 of the CGST Act, 2017?
(b) Date of receipt of consideration by the supplier
(c) Latter of (a) & (b)

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Multiple Choice Questions

Departmental Accounts Examination (DAE) for

HVPN POWER TRAINING INSTITUTE,

Advance, Cost & Management Accounting

(For All HPUs)

(a) Inventory Turnover Ratio (b) Net Capital Turnover Ratio

Q.2 Account prepared for calculation of Gross Profit Earned by branch

(a) Branch Stock Account (b) Branch Adjustment Account

Q3. Which Method is used generally for small size branches?

(a) Debtors Method (b) Stock & Debtors Method

Q4. Which account is prepared, when branch sell goods on credit?

(a) Branch Adjustment Account (b)Branch Debtors Accounts

(a) Cost Price (b) Selling Price

Q6. Financial Statement of Companies are prepared as per schedule

(a) III (b) IV

Q7. Which ratio is used to measure firm’s ability to meet current

Q11Departmental Accounting facilitates

Q13.Expenses which cannot be reasonably allocated to any particular

Q16.Goods are supplied by the H.O. to dependent ranches are at:-

Q17.Under Debtors system depreciation on fixed assets is______________

Q20.In single entry system a statement of affairs is just like :-

Q21.Under single entry system in net worth method drawing is added in :

Q22. Credit Sale can be obtained by preparing:-

Q23.In single entry system generally which accounts are maintained:-

Q24.in single entry system profit is calculated:-

Q25.Net Worth of an organisation means excess of Assets over:-

Q26.Rs. 2000 paid for installation of Machine Should be debited to:

Q28. Goods of Rs. 500 given as charity should be credited to:-

Q30.In bank statement, cash deposit by company is known as:-

Q31.Deposit in Transit will be ________________while preparing BRS.

Q32.Unpresented cheques are also refers as:-

Q34. Bank reconciliation is not a:-

Q35.Favourable Balance means:

Q37.Cheque returned by bank showing technical reason is known as:

Q38.Outstanding Cheque is the missing entry of:-

Q39. Unfavourable Bank Balance means:-

Q40. Which of the following is a error of Commission?

Q41. Wages paid for machine installation debited in wages accounts, it

Q42.If amount of any known liability can’t be determined with substantial

Q43. Which of the following statement is not true about provision?

Q44.Which one is not a cause of depreciation?

Q45.Deperciation is calculated from the date of_____

Q47.Which of the following is the example of Capital Reserve?

Q48.Loss on sale of Assets is shown in:-

Q51. Debenture Redemption Reserve can be created out of:-

Q52.Fixed assets loss its value due to:-

Q53.Which of the following best describes the ‘Depreciation’?

Q55.Working Capital is:-

Q56.Which of the following transaction will improve the Current Ratio?

Q57. Statement of Affairs is prepared to:-

Q58.Statement of Affairs is a:-

Q60.What should be added in closing capital to calculate opening capital:

Q61.Current Ratio is:

Q62.Liquid asset does not include :

Q64.Patent and copy right fall under the category of :

Q65.Which of the following transaction will improve quick ratio:

Q67. Ideal Quick Ratio is

Q68 If Current Ratio is 2:1, after payment of creditors ratio will

Q70. Debt Equity Ratio is

a) Short Term Debts /Shareholder’s fund