In the Balance Sheet, 'Share Application Money Pending Allotment' is shown as: MCQ with Answer and Explanation

Question
In the Balance Sheet, 'Share Application Money Pending Allotment' is shown as:
A. Current liability
B. Non-current liability
C. Reserves and surplus
D. Share capital
Answer: Option A
Solution (By JKSSB Mock Tests)
It is a liability until shares are allotted, and if allotment is due within 12 months, it's current.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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Practice More Accountancy and Book Keeping Questions

Question #1
Which of the following transactions leaves the total of the accounting equation unchanged?
A. Purchasing machinery on credit
B. Collection of cash from debtors
C. Paying electricity bill
D. Introduction of fresh capital
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Correct Answer: Option B

Explanation:
Collecting cash from debtors increases one asset (Cash) and decreases another (Debtors) by the same amount, leaving total assets unchanged.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #2
The 'Physical Verification' of inventory is a part of:
A. Internal control evaluation
B. Substantive procedure
C. None
D. Compliance procedure
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Correct Answer: Option B

Explanation:
Physical verification is a substantive audit procedure to verify existence of inventory.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #3
The 'Government Company' as per Companies Act is one in which not less than 51% of paid-up share capital is held by:
A. Public
B. Foreign investors
C. Central/State Government(s)
D. RBI
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Correct Answer: Option C

Explanation:
As per Section 2(45) of Companies Act, 2013, government company has at least 51% government shareholding.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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