A 'Cash Generating Unit' is defined under: MCQ with Answer and Explanation

A 'Cash Generating Unit' is defined under:
A. AS 28 Impairment of Assets
B. AS 2 Inventories
C. AS 10 Fixed Assets
D. AS 14 Amalgamation
Answer: Option A
Solution (By JKSSB Mock Tests)
CGU is a concept used in impairment testing under AS 28.

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Practice More Accountancy and Book Keeping Questions

Question #1
S1: A triple column cash book records cash, bank, and discount transactions. S2: A contra entry in a cash book involves both cash and bank columns. Which statement(s) is/are correct?
A. S1 only
B. S2 only
C. Neither S1 nor S2
D. Both S1 and S2

Correct Answer: Option D


Explanation:
A triple column cash book has columns for cash, bank, and discount on both sides. A contra entry occurs when transactions involve both cash and bank (e.g., cash deposited into bank), affecting both columns.

Question #2
The 'Asset Ceiling' in defined benefit plans under Ind AS 19 refers to:
A. Maximum plan assets
B. Only for gratuity
C. Limit on the amount of surplus that can be recognised as an asset (present value of refunds/reductions in future contributions)
D. No limit

Correct Answer: Option C


Explanation:
Ind AS 19 restricts the recognised asset to the economic benefits available.

Question #3
Zero Base Budgeting requires:
A. Justification of every budget item from scratch
B. Only incremental changes
C. No justification
D. Using last year's budget as base

Correct Answer: Option A


Explanation:
ZBB starts from a 'zero base', and every function and expenditure must be justified.