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

Question
The 'Substantive Analytical Procedure' involves:
A. Detailed testing of samples
B. Evaluating financial information through analysis of plausible relationships
C. Physical verification only
D. Inquiry 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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Practice More Accountancy and Book Keeping Questions

Question #1
Net Profit Ratio is calculated on:
A. Gross sales
B. Total assets
C. Net sales
D. Capital
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Correct Answer: Option C

Explanation:
Net profit ratio = (Net profit / Net sales) * 100.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #2
In the journal, 'L.F.' stands for:
A. Ledger Folio
B. Long Form
C. Liquidity Fund
D. Liability Factor
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Correct Answer: Option A

Explanation:
L.F. column indicates the page number of the ledger where the account is posted.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #3
Accounting by Non-Profit Organizations (NPOs) usually revolves around which system?
A. Responsibility Accounting
B. Standard Costing
C. Fund Based Accounting
D. Social Accounting
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Correct Answer: Option C

Explanation:
NPOs use fund-based accounting where resources are categorized into specific funds based on restrictions placed by donors.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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