Which of the following statements are correct? 1. Analysis and interpretation of financial statements, is a function of accounting. 2. Profit and Loss account is prepared for ascertaining financial postition of a firm. 3. Goodwill is a wasting asset. 4. Balance Sheet is prepared for ascertaining financial position of a firm Select the correct answer

The final accounts of a manufacturing company generally include the following statements. Select the correct sequence in the which the statements are prepared
i. Balance sheet
ii. Manufacturing account
iii. Profit and loss account
iv. Trading account
v. Profit and loss appropriation account

A

i, ii, iii, iv, v

B

ii, iv, iii, v, i

C

v, ii, iv, iii, i

D

i, iv, iii, ii, v

Which of the following events after the balance sheet date would normally qualify as adjusting events according to AS-4 (Events after balance sheet date)? (A) The insolvency of a customer on the balance sheet date (B) A decline in the market value of investments (C) The declaration of an ordinary dividend (D) The determination of the cost of assets purchased before the balance sheet date Choose the most appropriate answer from the options given below:

A

(A), (C) and (D) only

B

(A) and (B) only

C

(B) and (C) only

D

(A) and (D) only

Assertion (A): In preparing final accounts, if closing stock is given in the trial balance, it is shown only in the Balance Sheet.
Reason (R): Any item appearing in the trial balance is treated only at one place i.e. either in the trading and profit & loss a/c or in the balance sheet.
Now, select the correct answer:

A

Both (A) and (R) are true and (R) is the correct explanation of (A)

B

Both (A) and (R) are true, but (R) is not correct explanation of (A)

C

(A) is true but (R) is false

D

(A) is false but (R) is true

In a survey conducted over a group of people, it was found that 65% of them have a Facebook account, 40% of them have an Instagram account and 25% of them have a Twitter account. It was also concluded that 20% have an account on both Facebook and Instagram, 12% have an account on both Instagram and Twitter and 14% have an account on both Facebook and Twitter. If 8% of the people had an account on all the three websites, what percentage of the people do not have an account on any of the three websites?

A

4%

B

8%

C

12%

D

16%

Which of the following statements regarding interpretation in historical writing are correct? (A) Interpretation as an essential step in historical method seems to lie beyond criticism and exposition (B) To know what a document means is as much a challenge to critical judgment as to know when or by whom was it written, or whether one may trust it (C) The literary exposition of historical data is greatly conditioned by the interpretation one places upon them (D) Factual interpretation deals with the facts of a document, not with the words Choose the most appropriate answer from the options given below:

A

(A), (C) and (D) only

B

(A), (B) and (D) only

C

(B), (C) and (D) only

D

(C) and (D) only

Identify the true statement of the following.
1. Balance sheet is always prepared from the point of view of the business, but not from, that of the owners.
2. The financial relationship of the business to its owners is shown in the balance sheet.
3. Balance sheet is always related to a period of time.

A

Both 1 and 2

B

Both 2 and 3

C

Both 1 and 3

D

All of the above

Given below are two statements, are labelled as Assertion (A) and other as Reason (R):
Assertion (A): The fixed assets in the balance sheet are required to be shown at cost less depreciation.
Reason (R): The balance sheet and profit and loss account disclose a true and fair view.
Choose the correct answer

A

Both (A) and (R) are true and (R) is correct explanation of (A)

B

Both (A) and (R) are true but (R) is not the correct explanation of (A)

C

(A) is true but (R) is false

D

(A) is false but (R) is true

What is the correct sequence of the following actions required for the preparation of financial accounts?
1. Trading account
2. Making adjusting entries
3. Balance sheet
4. Profit and Loss account
Select the correct answer:

A

4, 2, 1 and 3

B

2, 4, 3 and 1

C

2, 1, 4 and 3

D

4, 2, 3 and 1

Which of the following is not an agreement in restraint of trade?
1. A sells the goodwill of his business with an agreement not to carry on a similar business within specified local limits, so long as the buyer carries on a similar business.
2. A sells the goodwill of his business with an agreement not to carry on a similar business within India, so long as the buyer carries on a similar business.
3. A sells the goodwill of his business with an agreement not to practice the same trade for 25 years.
4. A sells the goodwill of his business with an agreement not to engage in any business competing or liable to compete in any way with the business for the time being carried on by the buyer.

A

1, 3 and 4

B

2, 3 and 4

C

3 and 4

D

1 and 3

A complete set of financial statements under Ind AS includes the following.
1. Balance sheet at the end of the period.
2. Statement of profit and loss for the period.
3. Statement of changes in equity for the period.
4. Statement of cash flow for the period.
5. Balance sheet at the beginning of the preceding period.
Which statements given above are correct?

A

1, 2 and 4

B

Both 3 and 5

C

2, 3 and 5

D

All of the above

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