MCQ on Overview of Accounting Standards | Corporate and Management Accounting MCQs for CS Executive and Other Competitive Exams | Commerce Classes

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MCQ on Overview of Accounting Standards

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1. The original cost at which an asset or liability is acquired is known as –
(A) Carrying cost
(B) Replacement cost
(C) Amortization
(D) Historical cost

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2. As per AS-21, the accounting process in which the financial statements of a parent company and its subsidiaries are added together to yield a unified set of financial statements is called ____.
(A) Amalgamation
(B) Amortization
(C) Consolidation
(D) Translation

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3. AS-2 is on:
(A) Disclosure of Accounting Policies
(B) Valuation of Inventories
(C) Revenue Recognition
(D) Depreciation Accounting

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4. Which section of the Companies Act, 2013 provides that the financial statements of every company shall comply with the accounting standards?
(A) Section 129
(B) Section 130
(C) Section 131
(D) Section 132

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5. Consistency with reference to the application of accounting principles refer to the:
(A) All the companies in the same industries should use identical procedures and methods
(B) Income and assets have not been overstated
(C) Accounting methods and procedures used have to be consistently applied from year to year
(D) Any accounting method or procedure can be utilized

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6. Which aspect of Financial Instruments is death by AS-31?
(A) Recognition & Measurement
(B) Presentation
(C) Disclosures
(D) Limited Revision

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7. Accounting Standards _____ the statue.
(A) Can over-ride
(B) Cannot over-ride
(C) May over-ride
(D) None of the above

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8. As per AS-11, the process of converting foreign-subsidiary financial statements into the home currency is known as ______.
(A) Consolidation
(B) Translation
(C) Transmission
(D) Reconstruction

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9. The global key professional accounting body is the _______
(A) International Accounting Standards Board
(B) Financial Accounting Standards Board
(C) Institute of Chartered Accountants of India
(D) International Accounting Standards Committee

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10. AS-20 deals with:
(A) Earnings Per Share
(B) Lease
(C) Segment Reporting
(D) Taxes on Income

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11. Which of the following is treated as Potential Equity Share as per AS-20?
(A) Convertible debentures
(B) Share warrants
(C) Employee Stock Options
(D) All of the above

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12. If rights and beneficial interest in property are transferred but documentation and legal formalities are pending then seller & purchaser should record in their accounts as sale & purchase. This the example of –
(A) Prudence
(B) Substance over from
(C) Materiality
(D) Realization

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13. Payment of penalties/fines for violation of law should be disclosed separately. It should not be clubbed with “Office Expenses” or “Miscellaneous Expenses”. This the example of –
(A) Prudence
(B) Substance over from
(C) Materiality
(D) Realization

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14. Which of the following is included in the cost of inventory as per AS-2?
(A) Duties and taxes subsequently re-coverable from taxing authorities
(B) Freight inwards
(C) Rebates
(D) Duty drawbacks

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15. Provisions for doubtful debts, provision for discount on debtors are based on:
(A) Prudence
(B) Substance over from
(C) Materiality
(D) Realization

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By Team Learning Mantras