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This set of Practical Auditing Multiple Choice Questions & Answers (MCQs) focuses on Practical Auditing Set 6
Q1 | ----------------- audit refers to the evaluation of company’s performance against plannedgoals in the areas of social responsibility.
- Cost audit
- Social audit
- Management audit
- none
Q2 | Bonus shares are issued to ----------------
- New members
- Existing share holders
- Employees
- none
Q3 | -------- Section of the Companies Act deals with Appointment of Company auditor.
- Sec-226
- Sec-224
- Sec-227
- none
Q4 | -------- Section of the Companies Act deals with qualification of Company auditor.
- Sec-226
- Sec-224
- Sec-227
- none
Q5 | Amount of Share premium may be utilized for
- Payment of dividend
- Writing of preliminary expenses
- Routine expense
- none
Q6 | Share Premium Account should be shown in Balance sheet under
- Paid-up capital
- Subscribed capital
- Reserves and surpluses
- none
Q7 | Auditor should see that amount received for premium on issue of shares should be shown in
- Subscribed capital
- Capital Reserve Account
- Share Premium Account
- none
Q8 | A company can issue redeemable preference shares if authorized by
- Memorandum of Association
- Articles of Association
- Companies Act-1956
- none
Q9 | A company can issue bonus shares if authorized by
- Memorandum of Association
- Articles of Association
- Companies Act-1956
- none
Q10 | Interest on calls paid in advance according to table A, should not exceed
- 6%
- 5%
- 10%
- none
Q11 | For the forfeiture of shares, the auditor should check that it is permitted
- Memorandum of Association
- By articles of association
- Under Companies Act 1956
- none
Q12 | Profits on reissue of forfeited Shares should be transferred to
- Share forfeited Account
- Capital Reserve Account
- Profit and Loss Account
- none
Q13 | Shares issued for consideration other than cash should be vouched with the help of
- Director’s minute Book
- Shareholder’s minute Book
- Contact with the party concerned
- none
Q14 | While checking the allotment of shares, the auditor should see that it is made within
- 100 days of issue of prospectus
- 120 days of issue of prospectus
- 150 days of issue of prospectus
- none
Q15 | Which of the following percentage of nominal amount of shares should be received withapplication
- 10
- 15
- 5
- none
Q16 | Accounting standards are prepared by
- SEBI
- RBI
- ICAI
- ITA
Q17 | Which of the following is referred to confirm the allotment of shares to the vendor
- Cash book
- Pass book
- Director’s minute
- none
Q18 | Share premium Account is shown on the _______________
- Asset side of Balance sheet
- Liability side of Balance sheet
- Credit side of profit and loss Account
- none
Q19 | Issue of shares at discount should be sanctioned by the ________________
- Board of directors
- Share holders
- Company Law Board
- none
Q20 | The maximum rate of discount on shares shall not exceed________________
- 20%
- 15%
- 10%
- none
Q21 | Discount on issue of shares not written of is shown separately in Balance sheet under thehead_____________
- Miscellaneous expenditure
- Preliminary expanses
- Current assets
- none
Q22 | __________________section of Companies Act deals with share Capital
- 69
- 60
- 50
- none
Q23 | Which among the following is not a function of the author
- Checking errors and frauds
- Vouching with original documents
- Preparing final Accounts
- none
Q24 | Audit conducted as per the provisions of law is _____________
- Statutory Audit
- Continuous Audit
- Social Audit
- none
Q25 | The scope of auditing does not cover.
- Vouching
- Checking arithmetical accuracy
- Ledger posting
- none