An 'Adverse Opinion' is issued when: MCQ with Answer and Explanation

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An 'Adverse Opinion' is issued when:

A. Misstatements are pervasive and material, and financial statements do not present a true and fair view

B. Financial statements are true and fair

C. There is a limitation of scope

D. Auditor is unable to obtain evidence

Answer: Option A

Solution (By JKSSB Mock Tests)

Adverse opinion indicates that financial statements are materially misstated.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Question #1

Ind AS in India are converged with:

A. IFRS

B. ASB standards only

C. US GAAP

D. UK GAAP

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Correct Answer: Option A

Explanation:
Indian Accounting Standards (Ind AS) are converged with International Financial Reporting Standards (IFRS).

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2

Which of the following is NOT an advantage of Zero Based Budgeting?

A. It is less time-consuming than traditional budgeting

B. Fosters efficient resource allocation

C. Prevents arbitrary budget inflation

D. Eliminates redundant expenses

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Correct Answer: Option A

Explanation:
ZBB is actually heavily time-consuming because it requires managers to justify every single expenditure from scratch annually.

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Question #3

Which formula correctly represents 'Cost of Production'?

A. Factory Cost + Administrative Overheads

B. Prime Cost + Factory Overheads

C. Cost of Production + Selling Overheads

D. Prime Cost + Selling Overheads

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Correct Answer: Option A

Explanation:
In a cost sheet, Factory Cost added to Office and Administrative Overheads yields the Cost of Production.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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