Corporate Accounting Set 2
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This set of Corporate Accounting Multiple Choice Questions & Answers (MCQs) focuses on Corporate Accounting Set 2
Q1 | Which of the following is not a component of cost of an asset?
- purchase price
- refundable sales tax
- import duties
- estimate of compulsory future dismantling costs
Q2 | When an item of property, plant and equipment is revalued, what should be revalued?
- a selection of assets decided by management
- a selection of assets picked at random
- the whole class of assets to which it belongs
- the individual asset
Q3 | Which of the following is not an asset that falls under the scope of Ind AS 16?
- assets held for sale in the normal course of business
- tangible assets
- assets expected to be used for more than one period
- assets held for the production or supply of goods or services
Q4 | How should an asset be initially recognised in the financial statements?
- measure at market value
- measure at cost
- measure at net realisable value
- measure at fair value
Q5 | Where is the amortisation of an intangible asset recognised?
- equity
- profit or loss
- statement of financial position
- statement of cash flows
Q6 | Which of the following is not a requirement to capitalise development costs under Ind AS 38Intangible Assets?
- the commercial feasibility for the asset may be uncertain
- it must be technically feasible
- the entity intends to sell the completed intangible asset
- the entity can demonstrate how the asset will generate future economic benefits
Q7 | An intangible asset with a finite useful life should be amortised over
- a period determined by management
- five years
- its expected useful life
- no foreseeable limit
Q8 | What are intangible assets?
- nonmonetary assets without physical substance
- monetary assets without physical substance
- monetary assets with physical substance
- nonmonetary assets with physical substance
Q9 | Which of the following is an intangible asset under Ind AS 38?
- patent rights
- market share
- customer loyalty
- technical knowledge training
Q10 | Which of the following measurement models is not permitted for the subsequentmeasurement of intangible assets under Ind AS 38?
- revaluation model
- fair value model
- cost model
- capital assets pricing model
Q11 | What is the correct treatment for all eligible borrowing costs under Ind AS 23?
- expensed
- capitalised
- invested
- none of the above
Q12 | Which of the following is not a qualifying asset under Ind AS 23 Borrowing Costs?
- manufacturing plants
- made to order inventory
- mass produced inventory
- investment property
Q13 | Which of the following items should be disclosed as per the requirements of Ind AS 2?
- carrying amount of inventories pledged as security for liabilities
- average lead time of procurement for major classes of inventories
- list of major customers to whom the inventories were sold during the reporting period
- average holding period of inventories of the entity as at the end of the reporting period
Q14 | Which of the following items are excluded from the scope of Ind AS 2 Inventories?
- inventories that are stated at net realisable value
- assets held for sale in the ordinary course of business
- inventories whose fair value is more than the cost
- agricultural produce at the point of harvest
Q15 | Under Ind AS 2, fixed production overheads should be allocated to items of inventory on thebasis of ____ production capacity.
- actual
- abnormal
- normal
- estimated
Q16 | Which of the following cost models is not permitted under Ind AS 2?
- fifo
- lifo
- actual cost
- simple average
Q17 | Which of the below mentioned formula are covered by Ind AS 2? (i) FIFO, (ii) LIFO, (iii)Weighted Average.
- i, ii
- i, iii
- ii, iii
- all
Q18 | Which of the following costs must be expensed under Ind AS 2?
- selling and distribution overheads incurred in the ordinary course of business
- variable production overheads that are allocated to each unit based on actual usage
- import duties on raw materials that are paid to the authorities
- costs of purchase that are paid to the suppliers of raw materials
Q19 | How are unallocated overheads treated as per Ind AS 2?
- recognise as an expense in the period in which they are incurred
- recognise as an expense so long as there is a profit in the current period
- treated as deferred expenditure
- capitalised with the cost of inventories
Q20 | After convergence of Indian accounting standards with IFRS, new standard issued forpreparing the cash flow statement is:
- ind as 10
- ind as 3
- ind as 7
- ind as 12
Q21 | Under Ind AS 12 a temporary difference is defined as
- the difference between the tax base of an item and that items carrying amount in the balance sheet
- the difference between the carrying amount of an item and that items fair value less costs to sell
- the difference between the carrying amount of an item and that items revalued amount
- a difference which will reverse in the next accounting period
Q22 | Activities that result in changes in the size and composition of the equity capital andborrowings of an entity are called
- financing activities
- operating activities
- investing activities
- none of these
Q23 | The principal revenue-producing activities of an entity are called
- investing activities
- operating activities
- financing activities
- none of these
Q24 | Cash payments to and on behalf of employees is an example of cash flows from
- operating activities
- financing activities
- investing activities
- none of these
Q25 | Which of the following is not a heading for cash flows under Ind AS 7?
- cash flows from normal activities
- cash flows from operating activities
- cash flows from investing activities
- cash flows from financing activities