Corporate Accounting Set 8
On This Page
This set of Corporate Accounting Multiple Choice Questions & Answers (MCQs) focuses on Corporate Accounting Set 8
Q1 | When an existing company takes over the business of one or more existing companies, itis called….
- amalgamation
- absorption
- internal reconstruction
- none of these
Q2 | Accounting for amalgamation is given in….
- AS 14
- AS 16
- AS 20
- None of these
Q3 | Liquidation expenses paid by the transferee company is debited to …
- General reserve account
- P/L Account
- goodwill account
- none of these
Q4 | Which of the following fictitious assets is not taken over by the transferee company?
- Preliminary expenses
- underwriting commission
- discount on issue of shares
- all of these
Q5 | Which of the following is considered as an asset while calculating purchase consideration?
- goodwill
- patent
- trade mark
- all of these
Q6 | The accumulated losses and fictitious assets of the transferor company are transferred to-------- a/c.
- equity share holders
- transferee company
- equity capital
- realization
Q7 | Which of the following a/c is debited when statutory reserve of the transferor companyis taken over by the transferee company?
- goodwill a/c
- amalgamation adjustment a/c
- capital reserve a/c
- statutory reserve
Q8 | Under purchase method of amalgamation, --------- of the transferor company continues to appear in the balance sheet of the transferee company.
- capital reserve
- general reserve
- statutory reserve
- specific reserve
Q9 | While preparing the transferee company’s financial statement under amalgamation in the nature of merger, the assets and liabilities taken over from the transferor company should be incorporated at ----------
- cost
- book value
- revised value
- none
Q10 | While preparing the transferee company’s financial statement under amalgamation in the nature of purchase, the assets and liabilities taken over from the transferor companyshould be incorporated at --------
- Cost
- book value
- revised value
- none
Q11 | Which of the following should not be considered as a part of purchase consideration?
- Payment to equity share holders
- payment to preference share holders
- payment to debenture holders
- cash payment to share holders
Q12 | Which of the following is considered while calculating purchase consideration under Net asset method?
- Assets taken over
- liabilities taken over
- good will taken over
- all of the above
Q13 | Under net payment method, purchase consideration includes all payments made to theshare holders in the form of ---------
- Equity share
- preference share
- cash
- all of these
Q14 | Which of the following is a statutory reserve?
- Development Allowance Reserve
- Capital Reserve
- Workmen’s Compensation Fund
- CRR
Q15 | Any excess amount paid to preference share holders is debited to ------ --- account
- realisation
- preference share holders
- P&L
- preference share capital
Q16 | While preparing the books of the transferee company in purchase method, the difference between purchase consideration and share capital of the transferor company should be adjusted in -------------
- Share capital
- reserves
- assets
- liabilities
Q17 | The excess of purchase consideration over net assets of the transferor company acquired by the transferee company should be recognized as -------- in purchase method
- Capital reserve
- general reserve
- good will
- P&L
Q18 | In purchase method, the excess of net asset of the transferor company acquired by thetransferee company over the purchase consideration should be recognized as ------------
- P&L
- good will
- general reserve
- capital reserve
Q19 | Alteration of shares of smaller amounts into shares of larger amount is called…..of sharecapital
- surrender
- subdivision
- consolidation
- none of these
Q20 | The amount of surrendered shares is credited to …
- CRR
- sinking fund
- capital reduction account
- reserve
Q21 | Amount sacrificed by shareholders are credited to ….
- capital reserve
- general reserve
- capital reduction
- none of these
Q22 | Capital reduction account is used to …
- write off losses
- transfer to capital
- issue bonus shares
- none of these
Q23 | Any increase in the value of assets is…. to capital reduction
- debited
- credited
- Ignored
- None of these
Q24 | --------- is the account created in connection with internal reconstruction.
- realization a/c
- capital reduction a/c
- adjustment a/c
- CRR a/c
Q25 | Alteration of shares of larger denominations into smaller denominations is called -------- of shares.
- consolidation
- surrender
- sub-division
- valuation