The 'Rights Issue' is offered to: MCQ with Answer and Explanation

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The 'Rights Issue' is offered to:

A. Public

B. Promoters

C. Existing shareholders in proportion to their holding

D. Employees

Answer: Option C

Solution (By JKSSB Mock Tests)

Rights shares are offered to existing equity shareholders on a pro-rata basis.

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

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Practice More Accountancy and Book Keeping Questions

Question #1

The 'Deferred Revenue Expenditure' is an expenditure that:

A. Is capital expenditure

B. Is never written off

C. Is entirely charged to current year

D. Provides benefit over several accounting periods

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Correct Answer: Option D

Explanation:
Deferred revenue expenditure (e.g., heavy advertisement) is written off over a number of years.

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

Question #2

The 'Test of Details' includes:

A. Ratio analysis

B. Trend analysis

C. Vouching, tracing, and inspection of documents

D. Budget comparison

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Correct Answer: Option C

Explanation:
Test of details are specific tests of transactions and balances.

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Question #3

In Social Cost Benefit Analysis (SCBA), 'Shadow Pricing' is used to:

A. Assign a true economic value to goods when market prices are distorted or non-existent

B. Calculate depreciation of intangibles

C. Price products below cost to gain market share

D. Hide illicit profits

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Correct Answer: Option A

Explanation:
Shadow prices reflect the true opportunity cost of resources to society, used when market prices fail to reflect this true cost.

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

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