MCQ Questions on Commerce

MCQ Questions on Commerce

1. If earnings per share of a company is Rs. 5 and the price earning ratio of other similar companies is 4, then the market value of the share of the company would be–
(A) Re. 0•80 (B) Rs. 1•25
(C) Rs. 9 (D) Rs. 20
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2. If the cost of goods sold is Rs. 1,00,000, the value of opening stock is Rs. 20,000 and the value of closing stock is Rs. 80,000, then the stock turnover ratio would be–
(A) 5 Times (B) 4 Times
(C) 2 Times (D) 1 Time
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3. EPS is calculated as–
(A) EBIT / Equity shares (B) EBIT – Preference Dividend / Equity shares
(C) EAT / Equity shares (D) EAT – Preference Dividend / Equity shares
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4. If profit made during the year is Rs. 10,000; increase and decrease in the current assets is Rs. 5,000 and Rs. 4,000 respectively, then the cash from operation equals–
(A) Rs. 9,000 (B) Rs. 10,000
(C) Rs. 11,000 (D) Rs. 19,000
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5. Which of the following is NOT correct about the management auditor ?
(A) He appraises and reviews the past performance and future plans of the company
(B) He evaluates the performance of management and finds out whether they are efficient or not
(C) He works simultaneously with the statutory auditor vertifying the financial state of affairs of the company
(D) He examines both financial and non-financial records of the organisation
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6. Commercial paper is a–
(A) long-term corporate security meant for small investors
(B) medium-term corporate security meant for institutional investors
(C) treasury paper meant for corporate investors
(D) short-term corporate security meant for large-scale investors
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7. A cartel is a combination of firms–
(A) which are functioning in a particular industry
(B) whose combined assets are worth more than 90% of total assets of the industry
(C) who control major chunk of the market
(D) whose combined profits are enormous
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8. The takeover of a company in which most of the purchase price is paid with borrowed money is referred to as–
(A) hostile takeover (B) illegal takeover
(C) leveraged buy-out (D) management buy-out
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9. One of the major difficulties improving the industrial efficiency in enterprises is–
(A) low investment (B) low productivity
(C) ineffective marketing (D) poor inventory control
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10. Exam Bank of India provides financial assistance to exporters and importers in India:
(A) in foreign currency only (B) both in Indian currency and foreign currencies.
(C) as zero-interest loans (D) as subsidies
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11. Impact of O & M is that–
(A) promotion possibility becomes restricted
(B) it leads to less scope for high salary and wages
(C) entire organization is streamlined
(D) work measurement is costly
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12. The term ‘Organisational climate’ best represents–
(A) human environment prevailing in an organisation
(B) union-management relations within an organisation
(C) problems introduced by faulty organisational structure
(D) socio-cultural environment in an organisation
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13. The Memorandum of Association shall be signed by each–
(A) director (B) shareholder
(C) subscriber (D) promoter and director
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14. Changing the name of a company requires–
(A) special resolution and approval of Company Law Board
(B) special resolution and approval of Securities and Exchange Board of India
(C) special resolution and approval of Central Government
(D) ordinary resolution and approval of Company Law Board
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15. Registration of Articles of Association is optional in the case of–
(A) unlimited company (B) private company limited by shares
(C) company limited by guarantee (D) public company limited by shares
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16. Under the accrual concept which one of the following will not be shown as an asset/liability in the balance sheet of an entity ?
(A) Interest due but not paid (B) Interest due but not received
(C) Interest due and paid (D) Interest paid but not due.
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17. A company purchased 8% bonds at a cost of Rs. 12,00,000 (Face value Rs. 10,00,000) on January 1, 2013. Half yearly interest is payable on this investment on June 30 and December 31st each year. The Company closes its accounts on 31.3.2013. The amount of accrued interest shown in profit and loss account for the year ended is–
(A) Rs. 40,000 (B) Rs. 60,000
(C) Rs. 20,000 (D) Rs. 80,000
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18. Goods worth Rs. 24,000 were returned by X. The accountant however credited the sales returns account by Rs. 42,000. In order to rectify this error, what should be done ?
(A) Debit the sale return by Rs.42,000
(B) Credit the sales return account by Rs. 24,000
(C) Debit the sales return account by Rs. 66,000
(D) Debit the sales return account by Rs. 18,000
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19. A machine with a written down value of Rs. 10,000 has been sold for Rs. 13,000. The amount realized is a–
(A) Capital receipt and profit involved should be transferred to Capital Reserve
(B) Revenue receipt
(C) Capital receipt and profit involved should be transferred to General Reserve
(D) Capital receipt and profit involved should be transferred to Profit and Loss A/c
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20. Rs. 10,000 spent on the replacement of worn out parts of an electronic machinery is treated as–
(A) Capital expenditure (B) Revenue expenditure
(C) Deferred revenue expenditure (D) Capital loss
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