InterviewSolution
Saved Bookmarks
InterviewSolution
This section includes InterviewSolutions, each offering curated multiple-choice questions to sharpen your knowledge and support exam preparation. Choose a topic below to get started.
| 351. |
What is the importance of Financial Statement? |
| Answer» SOLUTION :Financial STATEMENT are comprehensive WAY of communicating financial information to the USERS of accounting information. | |
| 352. |
What is the ideal quick ratio? |
| Answer» | |
| 353. |
What is the formula for calculating sacrificing ratio? |
| Answer» SOLUTION :SACRIFICING Rartio = OLD RATIO - New Ratio. | |
| 354. |
What is the basis for preparing an Income and Expenditure Account in the case of Not-for-Profit Organisation ? |
| Answer» Solution :ACCRUAL basis of accounting is followed for preparing INCOME and Expenditure ACCOUNT. | |
| 355. |
What is the criteria for determing Current Liability ? |
|
Answer» Solution :Current Liability Is that liability which Is: (i) expected to be settled In COMPANY's normal operating cycle, or (II) due to be settled within 12 months after the REPORTING date, i.e., Balance Sheet date, or (iii) held primarily for the PURPOSE of being traded, or (IV) there is no unconditicnal right to defer settlement for at least 12 months after the reporting date. |
|
| 356. |
What is the criteria for detemining current assets ? |
|
Answer» Solution :Currrent Assets are those assets which are (i) expected to be REALISED in or intended for sale or CONSUMPTION in the company's normal operating cycle , or (ii) held primarlly for the purpose of trading or (iii) expected to be realised WITHIN 12 MONTHS from the reportin, date or closing date i,e Balance sheet date or (Cash and cash Equivalents unless they are resticted from being exchanged or used to settle a liablility for at least 12moths after the reporting date i,e, Balance sheet date ? |
|
| 357. |
What is the acceleration treatment of Investments Fluctuation Reserve when Investments as shown in the firm 's Balance Sheet are transferred to Realisation Account and are sold to a person other than a partner at their book value at the time of dissolution of the firm ? |
| Answer» SOLUTION :When investments are TRANSFERRED to REALISATION A/c by debiting the Realisation A/c and crediting Investment A/c , it BECOMES essentialto transfer investments Fluctuation Reserve by debiting Investments Fluctuation Reserve and crediting Realisation A/c . When investments are SOLD to person other than a partner , Cash or Bank A/c is debited with corresponding credit to Realisation A/c. | |
| 358. |
What is the balance of Debenture Redemption Reserve transferred to General Reserve? |
| Answer» SOLUTION :The amount proportionate to the debentures redeemed shall be TRANSFERRED from Debenture REDEMPTION Reserve (DRR) to GENERAL Reserve. For EXAMPLE, if the amount of Outstanding Debentures is Rs.10,00,000 and there is a DRR of Rs.2,50,000, then if 40% i.e. Rs.4,00,000 debentures are redeemed, 40% of Rs.2,50,000 i.e., Rs.1,00,000 shall be transferred to General Reserve. | |
| 359. |
What is the activity sequence of the basic information processing mode |
|
Answer» Solution :The ACTIVITY sequence of the basic information MODE is collect data, organizeand process ITAND Then COMMUNICATE the information EXTRACTED |
|
| 360. |
What is surplus with reference to Not-for-Profit Organisation? |
| Answer» Solution :When INCOME of a Not-for-Profit ORGANISATION is more than its EXPENSES, the difference is CALLED surplus. | |
| 361. |
What is Subscribed Capital ? |
| Answer» Solution :It is that part of issued CAPITAL which is SUBSCRIBED for by the PUBLIC. | |
| 362. |
What is Subscribed Capital? |
| Answer» Solution :SUBSCRIBED Capital' MEANS such PART of the capital which is for the time being subscribed by the members of a company. | |
| 363. |
What is status of partnership firm from an accounting viewpoint? |
| Answer» Solution :From an accounting vieqpoint, PARTNERSHIP FIRM is a separted business entity FORM the PARTNERS. | |
| 364. |
What is Statement of Profit and Loss? |
| Answer» Solution :Statement of Profit and Loss is part of FINANCIAL STATEMENTS PREPARED to ascertain the result of business operations for an ACCOUNTING year. | |
| 365. |
What is segment reporting ? |
| Answer» Solution :Segment reporting is the reporting of the operating segmets of a company in the disclosures accompanying its FINANCIAL statements. Segment reporting is reqiured for publicly -held ENTITIES ,and is not REQUIRED for privately held ONES,segment reporting in intendend to give information to investors and Creditors regarding the financial reslults and position of the most IMPORTANT operating units of a company ,which they can use as the bassis for decisions to the company. | |
| 366. |
What is Sacrificing Ratio ? |
| Answer» Solution :The RATIO in which one or more of the EXISTING partners SURRENDER some of their old SHARE in favour of one or more of other partners is called sacrificing ratio. Sacrificing ratio is computed by DEDUCTING the new ratio from the old ratio. | |
| 367. |
What is Reserve? |
| Answer» Solution :Reserve is a PART of profits, set aside for the purpose of STRENGTHENING the FINANCIAL POSITION of the business | |
| 368. |
What is Realisation Concept of accounting? |
| Answer» Solution :ACCORDING to this concept/principle, REVENUE from any business TRANSACTION should be recognised (recorded) in the ACCOUNTING BOOKS only when it is realised. | |
| 369. |
What is Rebate? |
| Answer» SOLUTION : Rebate is also a reduction in value of goods sold allowed by the seller of goods but for REASON other than for which trade DISCOUNT is allowed, For example, rebate may be allowed for POOR quality of goods sold or goods being not as per specification, etc. | |
| 370. |
What is Realisation Account ? |
| Answer» | |
| 371. |
What is Proprietary Ratio? |
| Answer» SOLUTION :PROPRIETARY RATIO establishes the relationship between Sharehoders' FUNDS and total assets. | |
| 372. |
What is Quick Ratio? |
| Answer» SOLUTION :Quick Ratio is the RELATIONSHIP between quick ASSETS and current LIABILITIES. | |
| 373. |
What is Quick Ratio ? |
| Answer» SOLUTION : QUICK RATIO is a RELATIONSHIP of quick assets with current liabilities | |
| 374. |
What is pro-rata allotment of shares ? |
| Answer» Solution :When issue is over-subscribed, the company will have to ALLOT shares on Pro-rata BASIS. It means that smaller NUMBER of shares are ALLOTTED to each applicant according to the number of shares applied by him. For example, in case a company has offered, 1,00,00 shares to the public but the public has applied for 2,00,000 shares, pro-rata allotment will be made in the proportion of 1 : 2. | |
| 375. |
What is Profit ? |
|
Answer» Solution :Profit is EXCESS of REVENUE over the expenses incurred to generate such revenue .It is also KNOWN as NET income .It can be expressed as Profit =Revenue -Expenses |
|
| 376. |
What is Over-subscription ? |
| Answer» SOLUTION :Shares are said to be over-subscribed when the number of shares applied for is more than the number of shares OFFERED to the public for subscription. For example, in CASE a COMPANY has offered 1,00,000 shares to public but the public applied for 1,50,000 shares, it is called a case of over-subscription. | |
| 377. |
What is operating profit? |
| Answer» | |
| 378. |
what is operting cost? |
| Answer» | |
| 379. |
What is Operating Cost? |
|
Answer» Solution :Operating COST = Cost of REVENUE from Operations (Cost of Goods SOLD) + Operating EXPENSES. |
|
| 380. |
What is Net Profit? |
| Answer» Solution :NET Profit means the EXCESS of all revenue (WHETHER operating or non-operating) over EXPENSES and losses (whether operating or non-operating) | |
| 381. |
What is Money Measurement Assumption ? |
| Answer» Solution :ACCORDING to this assumption ,only those TRANSACTIONS that can be expressed in terms of money are recorded in the BOOKS of ACCOUNT. | |
| 382. |
What is Minimum Subscription? |
|
Answer» Solution :Minimum Subscription (Section 39(1) of the Companies Act, 2013) defines it to be the amount which in THEOPINION of the Board of Directors of a COMPANY, must be received towards subscription of the issued share capital. Securities and Exchange Board of India (SEBI), has prescribed that a company must RECEIVE at least 90% subscription of the Issued Share Capital before making any allotment or shares or DEBENTURES to the public. |
|
| 383. |
what is ment by operating expenses? |
| Answer» | |
| 384. |
What is ment by liquidity of business? |
| Answer» | |
| 385. |
What is menat by Normal Profit? |
| Answer» SOLUTION :Normal Profit means the profit earned by other FIRMS with same CAPITAL INVESTMENT in similar industry. | |
| 386. |
What is menat by 'Fixed Capital' of a partner? |
| Answer» SOLUTION :Fixed CAPITAL' of a partner MEANS that the capital remains unchanged unless additional capital is INTRODUCED or withdrawal is MADE from the existing capital. | |
| 387. |
What is measured by Liquidity Ratios? |
| Answer» Solution :The liquidity RATIOS MEASURE the ability of an ENTERPRISE to meet its short-term obligations and REFLECT the short-term financial STRENGTH of an enterprise. | |
| 388. |
What is measured by liquidity ratios ? |
| Answer» | |
| 389. |
What is meant by Unsecured Debentures? |
| Answer» SOLUTION :Unsecured Debentures are those debentures that are secured by NEITHER a FIXED charge nora floating charge. | |
| 390. |
What is meant by Vertical Analysis? |
| Answer» Solution :Vertical ANALYSIS is MADE to REVIEW and analyse the finanical STATEMENT of ONE particular year only. Such analysis is also called Static Analysis. | |
| 391. |
whatis meantbyunlimitedliabilityof apatner? |
| Answer» SOLUTION :unlimitedliabilitymeansthattheliabilty of apartneris jointlyand severalthepersonal ASSETS of the partnercan beutilised forpayinga firm'sdebts. | |
| 392. |
What is meant by the term financial year? |
| Answer» Solution :FINANCIAL Year means a year beginning on 1ST April and ENDING on 31ST MARCH. | |
| 393. |
What is meant by Undersubscription of Shares? |
| Answer» Solution :Undersubscription of Shares MEANS the NUMBER of shares APPLIED for is less than the number of shares offered for SUBSCRIPTION. | |
| 394. |
What is meant by Sweat Equity Shares ? |
| Answer» Solution :Sweat EQUITY shares means equity shares ISSUED by the COMPANY to its employees or directors at a discount or for consideration other than cash for PROVIDING know-how or making available intellectual PROPERTY rights. | |
| 395. |
What is meant by Super Profits? |
| Answer» SOLUTION :Super Profit is the excess of actual AVERAGE profit over NORMAL profits. | |
| 396. |
What is meant by subscription? |
| Answer» SOLUTION :Subscription is the AMOUNT paid by the MEMBERS of the Not-for-Profit Organisations on periodical basis so that their membership remain alive. | |
| 397. |
What is meant by surrender of shares ? |
| Answer» Solution :It is voluntary RETURN of SHARES by a shareholder for the PURPOSE of CANCELLATION. | |
| 398. |
What is meant by Share Application Money Pending Allotment? |
| Answer» SOLUTION :Share Application Money PENDING Allotment MEANS money received by the COMPANY as share application against which shares will certainly be allotted. | |
| 399. |
What is meant by slovency of business? |
| Answer» | |
| 400. |
What is meant by 'Securities Premium'? |
| Answer» Solution :The EXCESS of ISSUE price over the nominal (face) VALUE of a Share/Debenture is 'Securities PREMIUM'. | |