Practice Accounts Questions and Answers

• Mr. A has the following incomes during the year: Income from Salary: ₹4,00,000 Income from House Property (net after deductions): ₹1,00,000 Profit fro...
• Which of the following incomes is not chargeable under the head "Income from Business or Profession"?
• According to AS 26, which of the following costs cannot be capitalized as part of an intangible asset?
• The amount of purchase if  Cost of Goods Sold = ₹80,700 Opening Inventory = ₹5,800 Closing Inventory = ₹6,000
• Average Inventory = ₹12,000. Closing Inventory is ₹3,000 more than Opening Inventory. The value of Closing Inventory is _____.
• Which of the following statement is true in case of bonus issue?
• Bonus issue is also known as
• In the cash flow statement, ‘cash and cash equivalents’ do not include:
• While preparing a Cash Flow Statement using the Indirect method as required under AS 3, which of the following will not be deducted from/added to the Net P...
• State which statement is correct:
• State which statement is incorrect:
• It is the duty of the agent to protect and preserve the interest on behalf of the principal’s representative in case of _____
•  Agent should not deal on his own account without first obtaining the consent of the principal, otherwise the principal may—
• Which of the following is shown under investing activities in the cash flow statement ?
• Which ratio measures the efficiency of a company in using its assets to generate sales?
• A company with higher current assets than current liabilities is said to have:
• Which of the following is a fixed cost?
•  Under the Written Down Value (WDV) method, depreciation is:
• The process of finding present value of a future amount is called:
•  NPV is positive when:
• Which of the following is not a source of long-term finance?
• AS-10 pertains to:
• Zero-based budgeting means:
• Under Ind AS 116, a company leases an asset for 5 years. On transition, it recognizes a right-of-use asset and corresponding lease liability. However, the ...
• A company is offered a trade credit term of "2/10 net 30" by its supplier. If it doesn't take the discount, what is the annualized cost of forgoing the dis...
• A company purchased machinery for ₹50,00,000 on 1st April 2020. Installation cost was ₹5,00,000. Residual value ₹3,00,000, useful life 5 years. On 1s...
• A company has the following capital structure: • Equity: ₹60,00,000 (Cost of Equity = 15%) • Debt: ₹40,00,000 (Pre-tax cost = 10%) • Tax rate = 3...
• A company changed its depreciation method from straight-line to diminishing balance, stating this better reflects usage pattern. The change led to material...
• A manufacturing firm includes administrative overheads and interest costs in inventory valuation during a slowdown. Which accounting principle is violated?
• Post-merger, the acquirer reports a goodwill of ₹120 crore, 40% higher than the net assets acquired. Upon impairment testing, only ₹10 crore is recover...
• A power company appraises a 25-year hydro project with IRR of 12% and a payback of 8 years. However, the risk-adjusted discount rate is 15%. Should the pro...
• A central PSU adopts sovereign guarantee-backed debt for a ₹2,000 crore infrastructure project. What impact will this have on its cost of capital?
• A company's current ratio is 2.5, but its quick ratio is only 0.9. What does this suggest about its liquidity?
• A firm extends credit from 30 to 60 days to push sales, increasing receivables by ₹5 crore. Cost of capital is 12%. What is the annual carrying cost?
• A firm has high current assets turnover but declining sales. What strategy should it follow?
• Valuing inventory at cost or net realizable value is based on which principle?
• If there exists a specific sports fund, the expenses incurred in relation to sports activities will be taken to:
•  Which of the following statements is true with regard to declaring and issuing of Bonus Shares?
• As per AS 10 (Revised) ‘Property, Plant and Equipment’, an enterprise holding investment properties should value Investment property:
• A company has the following inventory data for a product: •Opening Stock: 500 units @ ₹50 •Purchases: 1,000 units @ ₹55 •Sales: 1,200 units Closi...