::::|| VU ||:::: MGT 401 quizzes

Salam to All Vu can u solve sum of these MCQ,s

Which of the following statement is/are INCORRECT under the Equity

Method for recognition of investment in associated companies?

a)    Any distribution of profits by the investee company is recorded as an income

The carrying amount of the investment is increased or decreased to reorganize

b)    the distributor's share of profits or losses of the investee after the date of

acquisition

c)    The carrying amount of the investment is increased or decreased to reorganize

the investor's share of profits or losses of the investee before the date of

acquisition

d)      All of the given options

) Which of the following is TRUE with respect to IAS-02?

a)    Inventory valuation under periodic and perpetual methods is the same under

FIFO

b)    Inventory valuation under periodic and perpetual methods is the same under

Moving Average Method

c)    In period of rising prices FIFO method gives the Lowest net profit compared to

LIFO method

d)    In period of rising prices FIFO method gives the highest net profit compared to

LIFO method

Q74) Which of the following is TRUE with respect to the issuance of shares?

a)    Equity will be increased only

b)    Share capital will be increased only

c)    Both share capital and equity will be increased

d)    Retain earning will be increased

Q75) A furnace has a lining that needs to be replaced every 5 years for technical

reasons. At the balance sheet date, the lining has been in use for 3 years.

Which of the following is TRUE with respect to IAS-37?

a)    There is no present obligation

b)    It gives rise to legal obligation.

c)    It gives rise to constructive obligation.

d)    None of the given options

 

Q76)  If a manufacturer gives warranties at the time of sale to the purchaser of its

products, under the terms of the contract for sale the manufacturer

undertakes to make good, by repair or replacement, manufacturing defects

that become apparent within three years from the date of sale. On past

experience, it is probable (i.e. more probable than not) that there will be

some claims under the warranties. Then which of the following is TRUE with

respect to IAS-37?

a)    It gives rise to legal obligation.

b)    It gives rise to constructive obligation.

c)    It does not give rise to legal obligation.

d)    It removes the legal obligation.

) If issuance of debentures against cash is Rs. 3,000 and repurchase

of shares of Rs. 4,000 then which of the following is correct?

Select correct option:

Inflow of cash Rs. 7,000

Outflow of cash Rs. 7,000

Inflow of cash Rs. 1,000

Outflow of cash Rs. 1,000

Q85) Cash flow statement is designed to assist users in assessing all of

the following except:

a)    Capability of the company to remain solvent

b)    Company's profitability

c)    Major source of cash receipts & payments during the period

d)    Provide reason why net cash flow from operating activities 

fluctuate from net

income

Which of the following is not required to disclose as additional

information when an entity decides to present its income statement on the

basis of "Function of Expense" method?

Depreciation expense

Director's remuneration

Employees' benefits expense

Amortization expense

BS Accounting & Finance  {2nd Semester}

Overseas Kuwait (Q8)

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