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This set of Corporate Accounting Multiple Choice Questions & Answers (MCQs) focuses on Corporate Accounting Set 3

Q1 | Activities that result in changes in the size and composition of the equity capital andborrowings of an entity are called:
  • operating activities
  • investing activities
  • financing activities
  • none of these
Q2 | Increase in share capital of a firm in the current year as compared to previous year should berecorded in the final cash flow statement under
  • investing activities
  • financing activities
  • operating activities
  • all of the above
Q3 | When presenting discontinued operations in the cash flow statement
  • they are pooled with other current assets
  • they are added to non-cash items
  • they are ignored
  • they are shown separately
Q4 | An entity shall explain how the transition from previous GAAP to IFRSs __________ itsreported financial position, financial performance and cash flows.
  • adjusted
  • corroborated
  • affected
  • benefited
Q5 | How does an entity adopt IFRSs for the first time?
  • by reporting on its financial position, financial performance and cash flows in accordance with ifrss
  • by issuing its first financial statements in which the entity adopts ifrss, by an explicit and unreserved statement of compliance with ifrss
  • by reporting on its financial position, financial performance and cash flows in accordance with national requirements, which do not contradict ifrss
  • by issuing its first financial statements in accordance with national requirements, which contain explicit and unreserved statement of compliance with ifrss
Q6 | Which of the following is the starting point for an entity accounting in accordance withIFRSs?
  • the date when the decision about adopting ifrs has been made
  • the date of issuance of the first financial statement in accordance with ifrs
  • the date of transition to ifrss
  • the date when the explicit and unreserved statement of compliance with ifrss has been made
Q7 | Accounting in India is governed by the
  • rbi
  • company law board
  • income tax department
  • icai
Q8 | The convergence of the Indian Accounting Standards with IFRS began in
  • april 2010
  • april 2012
  • april 2015
  • april 2000
Q9 | Ind AS will apply to
  • both consolidated as well as standalone financials of the company
  • only consolidated financials
  • only standalone financials
  • optional
Q10 | Total Number of Ind AS which are notified as of date?
  • 40
  • 41
  • 42
  • 43
Q11 | Total Number of IFRSs which are notified as of date?
  • 16
  • 17
  • 18
  • 19
Q12 | Total Number of IFRIC Interpretations which are notified as of date?
  • 23
  • 24
  • 25
  • 26
Q13 | Total Number of SIC Interpretations which are notified as of date?
  • 30
  • 31
  • 32
  • 33
Q14 | What items of inventories are outside the scope of Ind AS 2?
  • work in progress arising under construction contracts
  • raw materials including maintenance supplies
  • share, debentures held as stock-in-trade
  • machinery spares exclusively used with fixed assets
Q15 | A provision is
  • a liability of uncertain timing or amount
  • a possible obligation as a result of past events that is of uncertain timing or amount
  • an adjustment to the carrying amount of assets
  • none of these
Q16 | When Redeemable Preference shares are due for redemption, the entry passed is
  • debit redeemable preference share capital a/c; credit cash a/c
  • debit redeemable preference share capital a/c; credit preference shareholders a/c
  • debit preference shareholders a/c; credit cash a/c
  • debit preference shareholders a/c; credit capital reduction a/c
Q17 | Which of the following can be utilized for the redemption of preference shares of a companyout of profit:
  • shares forfeited account
  • development rebate reserve account
  • capital redemption reserve account
  • dividend equalization reserve
Q18 | Which of the following cannot be utilized for the redemption of preference shares of acompany
  • securities premium on fresh issue of shares
  • general reserve
  • profit and loss account
  • dividend equalization reserve
Q19 | A company cannot issue redeemable preference shares for a period exceeding _________.
  • 6 years
  • 7 years
  • 8 years
  • 20 years
Q20 | Which of the following cannot be used for the purpose of creation of capital redemptionreserve account?
  • profit and loss account (credit balance)
  • general reserve account
  • dividend equalization reserve account
  • unclaimed dividends account
Q21 | The Capital Redemption reserve is created for the following reasons:
  • to maintain the capital intact
  • to safeguard the interest company’s creditors
  • both of the above
  • none of the above
Q22 | Which of the following accounts can be transferred to capital redemption reserve account?
  • general reserve account
  • forfeited shares account
  • profit prior to incorporation
  • securities premium account
Q23 | The technique of converting figures into percentage in some common base is called _____.
  • ratio analysis
  • common size statement analysis
  • trend percentages
  • none of these
Q24 | The ratio which depicts the relationship between two items, one of which is drawn from theBalance Sheet and the other from the revenue account
  • current ratio
  • equity ratio
  • net profit ratio
  • debtors turnover ratio
Q25 | The ratio of liquid asset to current liabilities
  • quick ratio
  • current ratio
  • absolute liquid ratio
  • combined ratio