Objective Type Commerce Questions

Objective Type Commerce Questions

1. According to Balance Sheet equation concept, the capital will be–
(A) Capital = Liabilities – Assets
(B) Capital = Fixed Assets –
Current Assests
(C) Capital = Assets – Liabilities
(D) Capital = Assets + Liabilities
See Answer:

2. In common size Balance Sheet analysis we evaluate–
(A) Increase or decrease over two years is analysed
(B) Only increase over two years is analysed
(C) Only decrease over two years is analysed
(D) All assets and liabilities are expressed in terms of percentage of total
See Answer:

3. Increase in fixed asset due to purchase is–
(A) Source of fund (B) Fund from operation
(C) Use of fund (D) None of the above
See Answer:

4. For the purpose of preparation of fund flow statement, fund means–
(A) Total resources (B) Cash/bank balances
(C) Current Assets (D) Working capital
See Answer:

5. The following data, relates to manufacturing company for the year 2006-07–
Net Profit as per P & L A/c–Rs. 2,40,000; Depreciation–Rs. 80,000; Goodwill written-off–Rs. 40,000, Profit on Sale of Fixed Assets–Rs. 16,000, Proposed Dividend–Rs. 96,000. The fund from operation would be–
(A) Rs. 4,40,000 (B) Rs. 4,00,000
(C) Rs. 6,40,000 (D) None of the above
See Answer:

6. A vacancy caused by the resignation of the auditor is filled only by the–
(A) Board of Directors of the Company
(B) Central Government
(C) General Meeting of the shareholders
(D) Managing Director of the company
See Answer:

7. The first auditor of a company appointed, holds office–
(A) For a period of one year
(B) For that period till new auditor is appointed
(C) Till the conclusion of first Annual General Meeting
(D) Till the holding of statutory meeting of the company
See Answer:

8. Internal Auditor is appointed by the–
(A) Management (B) Shareholders
(C) Government (D) Statutory Auditor
See Answer:

9. “Auditor is a watchdog and not a blood hound” was a remark made in the case of–
(A) The London Oil Storage Co. Ltd. 1904
(B) Kingston Cotton Mills Ltd. 1896
(C) London and General Bank 1895
(D) Delightful Cigarette Co. Ltd. 1943
See Answer:

10. The auditor is generally expected to carryout the following in a particular sequence–
1. Verification of Assets and Liabilities.
2. Vouching of transactions.
3. Checking of valuation of Assets and Liabilities.
Select the correct sequence of the above from the following–
(A) 1, 3 and 2 (B) 3, 2 and 1
(C) 2, 1 and 3 (D) 3, 1 and 2
See Answer:

11. What is the quorum of General Meetings in the case of a Private Company ?
(A) 2 members (B) 3 members
(C) 4 members (D) 5 members
See Answer:

12. Which of these must hold a Statutory Meeting ?
(A) Public Limited Company (B) Private Company
(C) Unlimited Company (D) All of these
See Answer:

13. When three sugar mills combine, it is an example of–
(A) Vertical combination (B) Horizontal combination
(C) Diagonal combination (D) None of the above
See Answer:

14. The first electronic computer system was developed in–
(A) 1920 (B) 1940
(C) 1930 (D) 1950
See Answer:

15. An Index is–
(A) A filing system (B) A photostat procedure
(C) The procedure to collect data (D) An important help in filing
See Answer:

16. Consider the following statements in respect of PERT–
1. PERT is a variation of milestone budgeting.
2. PERT employs probabilistic estimate of time required for completion of an activity.
3. PERT also includes the transfer of resources for reduction of duration of completion of a project.
Which of the statements given above are correct ?
(A) 1, 2 and 3 (B) 1 and 2 only
(C) 2 and 3 only (D) 1 and 3 only
See Answer:

17. Some organizations have escalator clause in their labour agreements.
What does this clause provide for ?
(A) Automatic increase in wage/salary depending on seniority
(B) Wage increase depending on output per day by the worker
(C) Automatic increase in wage/salary depending upon increase in price index
(D) Automatic increase in wage/salary depending on increase in profits of the firm
See Answer:

18. What is an organization structure in which each employee reports to both a functional (or division) manager and to a project (or group) manager, known as ?
(A) Strategic business unit (B) Departmentation by customer
(C) Matrix structure (D) Departmentation by territory
See Answer:

19. According to force-field theory, every behaviour is the result of equilibrium between which of the following ?
(A) Push and pull effect (B) Strong and weak forces
(C) Positive and negative forces (D) Driving and restraining forces
See Answer:

20. Life insurance is a contract of which one of the following ?
(A) Indemnity (B) Guarantee
(C) Contribution (D) Subrogation
See Answer:

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