Accountancy and Book Keeping MCQs

Accountancy and Statistics

Accountancy and Book Keeping MCQs

Practice the latest Accountancy MCQs with answers and detailed explanations. Explore chapter-wise multiple-choice questions covering important accounting concepts, bookkeeping, financial statements, journal entries, ledger, trial balance, depreciation, ratio analysis, partnership accounts, company accounts, and more. Perfect for Class 11 & 12, B.Com, CA Foundation, CUET, Banking, SSC, JKSSB, JKPSC and competitive exams.

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Page 85 of 94
Question #1681
The 'Exploration for and Evaluation of Mineral Resources' is covered by:
A. Ind AS 106
B. Ind AS 16
C. Ind AS 38
D. Ind AS 102
Discuss
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Correct Answer: Option A

Explanation:
Ind AS 106 deals with extractive industries.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1682
The 'Service Concession Arrangements' are dealt with by:
A. Ind AS 109
B. Ind AS 116
C. Ind AS 115
D. Appendix A of Ind AS 115 (IFRIC 12)
Discuss
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Correct Answer: Option D

Explanation:
Service concession arrangements (like BOT projects) are addressed by IFRIC 12, incorporated as an appendix.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1683
The 'First-time Adoption of Ind AS' (Ind AS 101) requires:
A. No changes
B. Full retrospective application of all Ind AS with certain optional exemptions and mandatory exceptions
C. Prospective application
D. Only current year change
Discuss
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Correct Answer: Option B

Explanation:
Ind AS 101 sets the transition rules with some relief.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1684
The 'Concept of OCI' (Other Comprehensive Income) was introduced to:
A. Bypass profit and loss for all items
B. Report certain gains and losses outside profit or loss to present a more comprehensive view
C. Hide losses
D. Reduce tax
Discuss
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Correct Answer: Option B

Explanation:
OCI captures unrealised gains/losses and re-measurements not routed through P&L.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1685
The 'Fair Value Measurement' (Ind AS 113) defines fair value as:
A. Liquidation value
B. Replacement cost
C. Historical cost
D. Price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date
Discuss
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Correct Answer: Option D

Explanation:
It is an exit price.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1686
The 'Level 1 Inputs' in fair value hierarchy are:
A. Inputs based on market-corroborated data
B. Cost of the asset
C. Quoted prices (unadjusted) in active markets for identical assets or liabilities
D. Unobservable inputs
Discuss
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Correct Answer: Option C

Explanation:
Level 1 gives highest priority to quoted prices in active markets.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1687
The 'Impairment of Assets' testing: Goodwill is allocated to:
A. Parent company only
B. Individual assets
C. Cash-generating units (CGUs) or groups of CGUs that are expected to benefit from synergies
D. All assets equally
Discuss
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Correct Answer: Option C

Explanation:
Goodwill must be tested for impairment at the CGU level.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1688
The 'CGU' is the smallest identifiable group of assets that:
A. Has highest revenue
B. Is a legal entity
C. Generates cash inflows independently
D. Has most employees
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Correct Answer: Option C

Explanation:
Definition of CGU per Ind AS 36.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1689
The 'Value in Use' calculation uses:
A. Only current cash flows
B. Present value of estimated future cash flows expected from the asset/CGU
C. Market price
D. Replacement cost
Discuss
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Correct Answer: Option B

Explanation:
Value in use is the discounted present value of future cash flows.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1690
The 'Incremental Borrowing Rate' is used in lease accounting when:
A. Never
B. The lessee cannot determine the interest rate implicit in the lease
C. The lessor does not disclose rate
D. For all leases
Discuss
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Correct Answer: Option B

Explanation:
If implicit rate is not readily determinable, lessee uses its incremental borrowing rate.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1691
The 'Lessee' under Ind AS 116 does not apply to:
A. Equipment leases
B. Finance leases
C. Property leases
D. Short-term leases (≤12 months) and leases of low-value assets (like IT equipment) – subject to recognition exemption
Discuss
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Correct Answer: Option D

Explanation:
Ind AS 116 provides recognition exemptions for short-term and low-value leases.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1692
The 'Variable Lease Payments' that depend on an index or rate:
A. Are included in the lease liability initially measured using the index/rate at commencement date
B. Are excluded from lease liability
C. Are always expensed
D. Are capitalised only if fixed
Discuss
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Correct Answer: Option A

Explanation:
Variable payments based on index/rate are included; those based on performance/usage are excluded.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1693
The 'Sale and Leaseback' transaction: If the transfer qualifies as a sale under Ind AS 115, the seller-lessee:
A. Keeps the asset
B. Treats as operating lease
C. Derecognises the asset and recognises a right-of-use asset at the proportion of the previous carrying amount related to the right retained
D. No entry
Discuss
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Correct Answer: Option C

Explanation:
Under Ind AS 116, the seller-lessee only recognises a right-of-use asset for the part retained.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1694
The 'Modification of a Lease' is accounted for as:
A. Original lease continues
B. A separate lease if it adds the right to use one or more underlying assets at a price commensurate with standalone price; otherwise remeasure
C. No accounting
D. Termination of original lease
Discuss
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Correct Answer: Option B

Explanation:
Ind AS 116 provides specific guidance for modifications.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1695
The 'Discount Rate' for measuring defined benefit obligation under Ind AS 19 is determined by reference to:
A. Market yields on government bonds at the reporting date
B. Incremental borrowing rate
C. Expected return on plan assets
D. Fixed rate
Discuss
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Correct Answer: Option A

Explanation:
The discount rate reflects the time value of money; usually based on high-quality corporate bonds or government bonds.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1696
The 'Asset Ceiling' in defined benefit plans under Ind AS 19 refers to:
A. Limit on the amount of surplus that can be recognised as an asset (present value of refunds/reductions in future contributions)
B. No limit
C. Only for gratuity
D. Maximum plan assets
Discuss
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Correct Answer: Option A

Explanation:
Ind AS 19 restricts the recognised asset to the economic benefits available.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1697
The 'Current Service Cost' and 'Net Interest' on defined benefit liability/asset are recognised in:
A. Both P&L and OCI
B. OCI
C. Balance Sheet directly
D. Profit or Loss
Discuss
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Correct Answer: Option D

Explanation:
Service cost and net interest are recognised in P&L; re-measurements in OCI.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1698
The 'Termination Benefits' under Ind AS 19 are recognised:
A. When the employee retires
B. At the earlier of when the entity can no longer withdraw the offer or when the entity recognises restructuring costs
C. When paid
D. Over the service period
Discuss
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Correct Answer: Option B

Explanation:
Termination benefits are recognised at the point of no withdrawal.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1699
The 'Stratified Sampling' in audit:
A. Divides the population into homogeneous subgroups and selects samples from each
B. Selects items randomly
C. Selects all high-value items
D. Ignores low-value items
Discuss
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Correct Answer: Option A

Explanation:
Stratification improves audit efficiency by grouping items with similar characteristics.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1700
The 'Monetary Unit Sampling' (MUS) is a:
A. Random number sampling
B. Non-statistical method
C. Haphazard selection
D. Statistical sampling method that uses value-weighted selection
Discuss
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Correct Answer: Option D

Explanation:
MUS selects sample items based on monetary units, focusing on larger values.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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