S1: Social accounting reports the social and environmental impact of a business. S2: Social audit is a formal assessment of a company's social accounting systems. Which statement(s) is/are correct? MCQ with Answer and Explanation

S1: Social accounting reports the social and environmental impact of a business. S2: Social audit is a formal assessment of a company's social accounting systems. Which statement(s) is/are correct?
A. Neither S1 nor S2
B. S1 only
C. Both S1 and S2
D. S2 only
Answer: Option C
Solution (By JKSSB Mock Tests)
Social accounting communicates the social and environmental effects of a company's actions. Social audit is the systematic evaluation of these social accounting reports to ensure accountability. Both are correct.

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Practice More Accountancy and Book Keeping Questions

Question #1
The 'Quick Ratio' excludes inventory because:
A. Inventory is a fixed asset
B. Inventory is not an asset
C. Inventory may not be easily convertible into cash
D. Inventory is never sold

Correct Answer: Option C


Explanation:
Quick ratio considers only quick assets (liquid), inventory is less liquid, so excluded.

Question #2
The 'Limited Liability Partnership' (LLP) is governed by:
A. Indian Contract Act
B. Limited Liability Partnership Act, 2008
C. Partnership Act, 1932
D. Companies Act, 2013

Correct Answer: Option B


Explanation:
LLP is a separate legal entity governed by LLP Act, 2008.

Question #3
The journal entry for transferring 'Net Profit' to capital account is:
A. Profit & Loss Appropriation A/c Dr. To Capital A/c
B. Drawings A/c Dr. To Capital A/c
C. Profit & Loss A/c Dr. To Capital A/c
D. Capital A/c Dr. To Profit & Loss A/c

Correct Answer: Option C


Explanation:
Net profit is closed by debiting Profit & Loss A/c and crediting Capital A/c (or Retained Earnings for companies).