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Q1. ……. is a statement which shows how the cash has flowed in and out of the company during the course of the financial year.

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Ans: Cash Flow Statement

Q2. …………… assets are required to run day to day business of the company but their value may change even from minute to minute.

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Ans: Current Assets

Q3. The …………… started setting accounting standards in 1979.

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Ans: Institute of Chartered Accountants of India (ICAI)

Q4. ………………. type of standard prescribes accounting treatment of an accounting issue.

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Ans: Policy standard

Q5. Today, most businesses, even the smallest, use ……………. .. accounting systems.

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Ans: Computerised

Q6. The ……………… equity represents claims of the shareholders against the assets of the company.

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Ans: Shareholders

Q7. The first systematic description of double entry bookkeeping appeared in ……………. .., two years after Columbus discovered America, in a mathematics book written by Fra Luca Pacioli.

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Ans: 1494

Q8. The rules of ……………… bookkeeping are that every transaction affects at least two accounts and total debits must equal total credits.

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Ans: Double Entry

Q9. The classification of the ……………… not only on the basis of accounts but also on the basis of payments and receipts.

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Ans: Transactions

Q10. The subsidiary journals or books are developed by the firms only based on the ……………… of the transactions.

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Ans: Occurrence

Q11. Employees must notify the …………….. when items are to be returned for credit.

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Ans: Purchasing Department

Q12. Whenever you return goods back to Supplier then it is known as ……………. ..

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Ans: Purchase Return

Q13. If the error affects both the accounts, then it can be rectified by passing a ……………… entry.

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Ans: Fresh

Q14. Sometimes, it is not possible to point out errors easily, then the difference is put to an account, known as …………….. account.

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Ans: Suspense

Q15. If the error/errors are there or committed, the effect of such errors would be either decrease or increase in the …….

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Ans: Gross Profit/Net Profit

Q16. It is must to rectify the errors at the earliest, so that ……………. .. can depict a true and fair View of the business.

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Ans: Balance Sheet

Q17. ………… .. is the permanent and continuing diminution in the quality, quantity or value of an asset.

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Ans: Pickles

Q18. The term depreciation is used only for …………. fixed assets.

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Ans: Tangible

Q19. In India, Section …………. of the Companies Act of 1956 deals with depreciation.

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Ans: 350

Q20. …………… method of calculating depreciation is easier.

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Ans: Merits of Straight Line Method

Q21. ………………. expenses are those which are done in respect of arranging finance for business.

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Ans: Financial Expenses

Q22. ……………….. refer to those profits and incomes which are received from the operation of main business.

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Ans: Income from Main Business

Q23. …………. .. consists of all unconsumed and all goods held for sale in the ordinary course of business.

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Ans: Inventory

Q24. ………….. method assumes that the inventory acquired first is also the first to be sold or used up, without regard to the physical flow of the goods.

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Ans: First-in-First-out Method

Q25. The balance sheet is prepared only after the preparation of the ………….. account.

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Ans: Profit and Loss

Q26. ………….. is a device for showing the financial position of a business in systematic standard form.

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Ans: Need for Balance Sheet

Q27. The term ………… denotes the economic resources (property) of the business and includes all current and fixed assets.

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Ans: Assets

Q28. The term …………… denotes all claims against the assets of the business and include those of the outsiders (creditors) or those of the owners of the business.

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Ans: Liabilities

Q29. The Double Account System is merely a way of presentation of ……………

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Ans: Final Accounts

Q30. To be reliable, the information in financial statements must be complete within the bounds of ………….. and …………………

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Ans: Materiality, Cost

Q31. ………….. means the difference between the total income and the total expenditure plus specific appropriations.

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Ans: Clear Profit

Q32. …………………. Reserve can be invested only in the business of electricity supply of the undertaking.

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Ans: Development

Q33. ………………. reveals the inflow and out?ow of cash during the particular period.

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Ans: Cash ?ow statement

Q34. Cash flow statement can be prepaid for ……………, half year and quarter or for any other duration.

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Ans: Year

Q35. ………………….. arising from taxes on income should be separately disclosed.

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Ans: Cash ?ows

Q36. Investing and financing transactions that do not require the use of cash equivalents should be excluded from a ……………………………

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Ans: statement of cash flows

Q37. The difference between …………….. and cash payments is the net cash flow from operating activities.

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Ans: Cash Receipts

Q38. The ……………… adjusts net profit for items that affected net profit but did not affect cash.

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Ans: Indirect Method

Q39. The ……………… statement is of primary importance to the financial management.

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Ans: Funds Flow

Q40. When a transaction involves ……………… only, no flow of funds occurs since working capital is not altered.

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Ans: Non-Current Accounts

Q41. The …………….. reports the amount of cash collected and paid out by a company in the following three types of activities: operating, investing and financing.

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Ans: Statement of Cash Flows

Q42. The …………… A/c is an activity statement that shows details and results of the company’s profit related activities for a period of time.

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Ans: Profit and Loss

Q43. ………….. ratios measure the degree of operating success of a company in an accounting period.

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Ans: Profitability

Q44. ………….. is a measure of the efficiency with which assets are utilized.

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Ans: Asset Turnover

Q45. Financial statements present ……… information for the current year and the previous years.

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Ans: Comparative

Q46. ……… analysis is the proportional expression of each item on a financial statement to the statement total.

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Ans: Vertical

Q47. The chance of earning ……………… usually prevails only at the moment of payment by the customers.

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Ans: Profit

Q48. The ……………….. is useful in segregation and identification of factors that effect the overall performance of the company.

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Ans: Du Pont chart

Q49. ……………… is a numerical relationship between two numbers which are related in some manner.

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Ans: Accounting Ratios

Q50. The ratio analysis helps the parties to read the changes that have taken place in the ……………… of the firm from one time period to another.

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Ans: Financial Performance

Q51. A company’s …………….. disclosures generally contain appropriate explanation of economic hedges that do not qualify for hedge accounting.

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Ans: Risk Management

Q52. There are many different country and jurisdiction-specific ……………… schemes.

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Ans: Carbon Trading

Q53. Most power and ……………… companies have intangible assets on their balance sheets.

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Ans: Utility

Q54. In any ……………… industry leasing can be an attractive method of acquiring assets for tax or financing reasons.

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Ans: Capital-Intensive

Q55. The ……………….. is the ratio of current assets to current liabilities.

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Ans: Current Ratio

Q56. Investors and ……………… base their decisions largely on the assessment of company’s potential liquidity and profitability.

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Ans: Creditors

Q57. The …………… auditors report deals with the creditability of the financial statements.

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Ans: Independent

Q58. The …………………… has a responsibility each year to report to shareholders on the company’s performance.

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Ans: Management of a company

Q59. The intentional preparation of..………… financial statements are called fraudulent financial reporting.

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Ans: Misleading financial statements

Q60. The motivation for incorrect ……………. .. exists to some extent in every company.

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Ans: Financial Reporting

Q61. The convention of..…………..signifies that financial statements and their notes present all information that is relevant to the users understanding of the financial statements.

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Ans: Full Disclosure

Q62. ……………… refers to the relative importance of an item or event. An item is material, if the user would have done something different if he had known about the item.

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Ans: Materiality

Q63. For accounting information to be useful, it must fulfil two major qualitative characteristics reliability.

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Ans: Relevance and Reliability

Q64. …………….. are the most important way of periodically presenting to parties outside business the information that has been gathered and processed in the accounting system.

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Ans: Financial statements

Q65. Under ……………… method, the issues are made at the price of latest consignment.

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Ans: Last in First out (LIFO)

Q66. LIFO method is helping the management to quote ……………… on the basis of latest consignments.

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Ans: Competitive Prices

Q67. The material, which is first, issued from the earliest consignment on hand and priced at the cost at which that consignment was placed in stores is known as ……………………..

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Ans: First in First out (FIFO)

Q68. The most important step in FIFO method is to issue the materials from the ……………. .. in the hands of the firm.

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Ans: Available Source of Materials

Q69. In practice, the issue of ……………… cannot be made from any singular lot purchases.

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Ans: Materials

Q70. ……………… is most rational method in finding out the issue price of the materials.

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Ans: Weighted Average Method

Q71. The major underlying assumption of ……………… is to value the closing stock as minimum as possible at the end of concluding the stores register.

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Ans: Highest in First out (HIFO)

Q72. The ……………… are issued one after the another, among the various consignment of the materials available in the stores in HIFO method.

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Ans: High Priced Materials

Q73. …………… are those liabilities that are intended to be paid in the ordinary course of business within a year, out of the current assets or earnings of the concern.

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Ans: Current liabilities

Q74. The …………… refers to investment in all the current assets taken together.

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Ans: Gross Working Capital

Q75. Working capital requirements should be met from short term as well as ……………. .. of funds.

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Ans: long-term

Q76. A …………… current asset policy tends to reduce risk.

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Ans: Conservative

Q77. The amount of taxes to be paid is determined by the prevailing tax ……………. ..

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Ans: Regulations

Q78. ……………… charges do not involve any cash out?ow.

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Ans: Depreciation Policy

Q79. The increase in the number of ……………… of production has an effect on the working capital requirements.

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Ans: Hours

Q80. The determination of ……………… cycle helps in the forecast, control and management of working capital.

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Ans: Working Capital

Q81. Banks receive deposits from public for …………… periods at varying rates of interest.

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Ans: Different

Q82. …………………….. are allowed against the security of bills, which may be clean or documentary.

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Ans: Advances

Q83. Power sector entities should be required to prepare Consolidated Financial Statements in addition to the separate financial statements as per Standard …………

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Ans: Consolidated Financial Statements

Q84. …………… standard applies to reporting of related party relationships and transactions between a reporting enterprise and its related parties.

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Ans: Related Party Disclosures

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