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Practical Finance & Accounting Assignment Number 1

1. When and why companies go for Bonus Shares issue? What is

procedure to issue Bonus shares? How issue of Bonus shares effect the
Market price of those shares? What are the guidelines of SEBI for issue
of Bonus Shares?

2. Why Depreciation is provided? What are various methods of

depreciations are there? Which accounting standard speak about
depreciation and what are the main provisions of that? In which
schedule of companies act depreciation is suggested? What are
depreciation related suggestions of Income Tax?

3. What is the basic difference between depreciation, depletion &

amortization? Why these different names are used? Why these all are
provided as provision? Why these are considered as non-Cash

4. What is deferred revenue expenditure? Because of what accounting

concept we make accounting treatment for deferred revenue? Why
accounting divides all incomes and expenditures into revenue and
capital? Is differed revenue considered as fictitious asset or Intangible
Asset and why?

5. Explain about Holding company, subsidiary, production unit, division,

branch, franchisee, and affiliate, Flagship Company, Blue Chip
Company and Joint Venture Company.

6. What are the components of Manufacturing account, Trading account,

Profit & Loss account, income & expenditure account and in what
circumstances we prepare these statements?

7. What is going concern concept? Where this concept is used and if we

don’t have this concept how presentation of accounts will be effected?
Explain with examples?

8. What is importance of accrual concept? Give 5 examples where this

concept is used? How mercantile system of accounting related to this
concept? Where can we follow Cash basis of accounting? What is single
entry book keeping? Why can we use single entry for business units?
9. What is basic difference between Equity Share, Debenture, Preference
share, Bond, Stock, Security, and Note & Deposit? In what
circumstances companies issue these? What is the process of issuing

10.What is vertical balance sheet and what are the components of that?
Why balance sheet is prepared in that format? Which schedule of
companies act suggests that?

11.What are all various components of Fixed Assets? In what

circumstances depreciation is provided on Lands? Can we provide
appreciation on fixed assets if market value of those is increased?
Because of what accounting convention we cannot provide
12.What is the basic difference between accounting concept, convention,
principle, policy & standard? Why we require all of these in accounting?

13.How financial accounting differs from Management accounting & cost

accounting? Why we need three types of accounting systems?

14.What is the difference between Internal Auditor, Statutory Auditor,

External Auditor, Special Auditor, Management Auditor, Chartered
Accountant, Independent Accountant, and Certified Public Accountant
& Operational Auditor?

15. What is Book Building process in issue of shares? Why that process is
followed? Who suggested that process and why? What is the step to
step procedure to issue shares through book building? Why Qualified
Institutional buyers play vital role in Book Building?