The 'Accounting Policy Changes' are applied: MCQ with Answer and Explanation

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The 'Accounting Policy Changes' are applied:

A. Prospectively

B. Arbitrarily

C. Retrospectively, unless impracticable

D. Only with government approval

Answer: Option C

Solution (By JKSSB Mock Tests)

Ind AS 8 requires retrospective application of changes in accounting policies.

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

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Question #1

The 'GST Compensation Cess' on motor vehicles for personal use is:

A. Varies from 1% to 22% depending on engine capacity and type

B. 10%

C. Nil

D. Fixed 28%

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Correct Answer: Option A

Explanation:
Compensation cess on automobiles ranges from 1% to 22% over and above the 28% GST.

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

Question #2

The 'Goods and Services Tax' (GST) compensation cess is levied on:

A. Exported goods

B. Luxury goods, demerit goods, and certain other specified items

C. Agricultural produce

D. All goods and services

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Correct Answer: Option B

Explanation:
Compensation cess is specifically on pan masala, tobacco, coal, aerated drinks, automobiles, etc.

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Question #3

The 'Cost of Goods Sold' in a manufacturing company includes:

A. Total manufacturing cost adjusted for WIP

B. Only direct material

C. Prime cost

D. Selling expenses

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Correct Answer: Option A

Explanation:
COGS for manufacturer = Opening finished goods + Cost of production - Closing finished goods. Cost of production = total manufacturing cost + opening WIP - closing WIP.

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