Question No. 1 Which of the following statements is true concerning assets? Options (© They are recorded st costand adjusted for inflation. © They are ecorded st market value for financial reporting because historical cost is arbitrary. © Accounting principles require that companies repert assets on the income statement. © Assets are measured using the cost concept. ‘Save and Next ‘Question No. 2 When the concept of conservatior applied to the Balance Sheet, it results in options © overstatement of Capital O understatement of Ceital © overstatement of Assets © Understatement of Assets. Save and Next ‘Question No. 3 Which of the following is a correct expression of the accounting equation? Options © Assets - Liabilities + Owners’ Equity O Assets = Liabilities - Owners’ Equity O Assets + Owners’ Equity = Liabilities © Assets = Liabilities + Owners’ Equityopto ‘Question No. 5 ‘The process of recording the economic effects of business transactions in a book of original entry: ‘options © double entry system Odevit Ocreait © soumalizing otene (© main enn ante ac amaet wet mate a © tiesto pases mn psun unc mete (© on noy ener en men pring oie he ene ng en opt eel ne, 2d ad Ro upllos on halt Jnuay 208, During 206, ups with a eot of Re, O80 woo purchasad, At Decmbo 31, ‘ok cl wit bd sno, ines spond Bec, 8 ble © sein a Sateen 0Question No. 8 In the statement of changes in financial position, uses of resources are defined as: options © transection debits O Fund increases O transection credits O rund decreases ‘Save and Next ‘Question No. 9 Most firms elected to define funds in the statement of changes in financial position as: options © cash © Working capital © current assets © owners’ Eauity Question No. 10 The funds flow statement included: Options © allsources and uses of resources. © ony cash transactions. © ony transactions affecting curent assets. © omy transactions affecting fund accounts,Wich of th ellowing isnot an sxample of anon fund aajusment to income required in preparing the statment of changes in nancial owion when nde wore dtd ae woking ex? pon © opin expanse ‘Question Wo. 12 In the cash flow statement, cash is defined as: ‘options © Quick assets: © Literal cash on hand or on demand deposit, plus cash equivalents. (© Literal cash on hand or on demand deposit, plus marketable securities. O attof the above ‘Save and Next QuestionNo. 13 Flexible budgets Options ‘© accommodate changes in the inriation rate. © Accommodate changesin activity levels. O Are uses to evaluate capacity utitzation. (are static puagets that nave been revised for changes n prices. Saye and Next Wh ofthe following stars rpardng changing invontoy metho Is wus? > a cangein nena tad cn bese ie hg nao tir mh pts ih eeeine 1, 2106, The wun a the note thority dae RG, 200. Tho wate woe sapdb Soll for morchndc old Bedrock wine sang peso Res U8 The ot nS months To iron of R20 between the amount fhe nots (Rs, 20 and he sles price of the merchandise (Rs, C0) © manera epg ent wh ig com il wo © stone of ens eninge ant stenet tah ows. "Lid sole equipment for Re4, OOD, This resulted ina Ret, $00 loss, What isthe impact of i slo onthe working capital? ‘opvons © eauces wong exp. O meaner working capt (© Wisma on wong capa te ‘Save and nox Question No. 18 ‘2 company’s asset tumover rate increased from 2005 to 2006, which of the following conclusions can be made? options (© The company was less efficent during 200 in using its assets to produce profs. ‘The company produced mote cals in 206 for sach delle inveetod in acest, (© tne company was more prottabi in 2095, ‘The company Is over mvestein assets 2006. ‘Save ana extX Le mate budget calle or th producton of 600 unt of product monly. The mastr budge acute indict bor of 86 009 {anoiy coeieendc nor oe obec. hang te month ot Seam 30a profs rea ond Indect or conte of 290870 wore incued. A pefommanc epot ung Nenble budgeting woul eprta este budget valance ‘Question No. 20 Which of the following is not an advantage for using standard costs for variance analysis? ‘options © standards simplify product costing. © standards are developed using past costs end are available ata relatively low cost. (© standards are usually expressed on a per unit basis, © standards can take into eccount expected changes planned to cccur in the budgeted period. ‘Save and Next Question No. 24 ‘The main purpose of cost accounting is to- Options © maximize profits, (© Provide information to management for decision making hetp in fixing selina price © To watch cash flows ‘Save and Next‘Question No. 22 Conversion costis total of: ‘options © birect material and direct wages © birect material, direct wagee, and production overheads © pirect wages ana producton overneacs. © None of the above. ‘Save and Next ‘Question No. 23 A cost, which does not involve cash outlay, is called: options O Historical cost O imputed cost © out or pocket cost. @ Explicit cost. Save and Next Question No. 24 Committed fixed costs are those, whi options O Arise from yearly budget appropriations ( are incurred because management can afford O Arise from additional capacity. OQ atofabove Saye and NextQuoction Ne. 25 Cost of research undertaken at the request of the customer should be: Options © charged to costing profit end lose account © charged to seting overheads © recovered trom the customer. Oatiotabove Save and Next Question No. 26 Salaries due for the month of March will appear ‘options O onthe Receipt side of the Cash Book © omtne Payment side of tne cash Book Oasacontra entry OQ Nownsrein the Cath Book. Save and Next ‘Question Mo. 27 Liabilities of business are Rs. 11,220 and owner's equity is Rs. 18,000. The assets of the business will be. ‘options. © ns.a.760, Oas.26220, Ons.s120. Ons. 15000. Save and NextQuoction No. 28 An entry of Rs. 320 has been debited to Eknath’s account at Rs. 230. If is an error of options O Principle. omission. O commission. O compensatory. Save and Next‘Question Wo. 30 Options © when themerchandise is ordered. O when the goods are transferred from the seller to the buyer. O None of the above. ‘Save and Next QuestionNo. 31 Alll of the following ore “other receivables” except: Options Oetty cash. O interest receivable. © income taxes retundable, © Aavances to employees. Saye and Next ‘oveston No. 32 Depreciation Is dependent on a number of estimates, When a change in an estimate Is required, the change is made: ‘opens inthe cunt yous tome uate year Oto priorpereds. ‘Save and Next‘Question No. 33 In order to pay a di lend: options O the corporation must have adequate retained earnings. Othe board of directors must declare a dividend. (O tne corporation must have adequate cash. Qatiof theabove, Save and Next ‘sh ow activites hatnclude he ash ees of transactions tha ete evrtes ad expanses a ths ete ino the deamination of vetincome ar ered > onan ate, Question No. 35 All of the following are used in preparing a statement of cash flows except: options Oa triatbatance. © comparative belance shoot. © current income statement. © additional information. ‘Save and Noxt‘question No. 36 Depreciation is result of options © usage. Orime. © obsolescence. altos the above. ‘save and Next ‘Question No. 37, ‘Outstanding Expenses are the examples of Options. © Personal Accounts. © reat accounts. © Nominal Accounts. © Nona of the above. ‘Save and Next Question No. 38 li Assets are inclusive of all current assets except options O inventorise, © Prepaid Expenses. Ocasn. © Both (a) and (b) above. Save and Next‘Question No. 33 ‘Management Accounting is mainly related to Options (© Presentation of Figures from Financial Accounting. (© Presentation of Figures from Cost Accounting. Principles © Both (a) and (b) above. Saye and Next Question No. 40 Variance Analysis is done with regards to actuals with- Options © standards. (© Budgeted Figures. (© Benchmarks OC atiofthe above. save