The 'Substantive Analytical Procedure' involves: MCQ with Answer and Explanation

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The 'Substantive Analytical Procedure' involves:

A. Inquiry only

B. Evaluating financial information through analysis of plausible relationships

C. Detailed testing of samples

D. Physical verification only

Answer: Option B

Solution (By JKSSB Mock Tests)

Substantive analytical procedures use ratios, trends, and relationships to detect misstatements.

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

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Question #1

Which of the following is not a feature of a company?

A. Unlimited liability

B. Common seal

C. Perpetual succession

D. Separate legal entity

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Correct Answer: Option A

Explanation:
Company has limited liability, not unlimited.

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Question #2

The 'Standard Deduction' for salaried individuals under the new tax regime is:

A. ₹75,000

B. ₹1,00,000

C. ₹50,000

D. ₹40,000

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Correct Answer: Option A

Explanation:
Finance Act 2024 increased standard deduction to ₹75,000 under new regime.

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Question #3

Hidden goodwill at the time of admission of a partner is calculated by comparing:

A. Total capital based on new partner's share and actual total capital of all partners

B. Average profits of last 5 years

C. Assets and outside liabilities

D. Super profit and normal rate of return

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Correct Answer: Option A

Explanation:
Hidden goodwill is the excess of the firm's inferred total capital (based on the new partner's contribution and share) over the actual combined capital balances.

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

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