Which audit assesses whether management's policies and procedures are operating efficiently? MCQ with Answer and Explanation

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Which audit assesses whether management's policies and procedures are operating efficiently?

A. Statutory Audit

B. Tax Audit

C. Cost Audit

D. Management Audit

Answer: Option D

Solution (By JKSSB Mock Tests)

Management audit focuses on the efficiency, effectiveness, and performance of management processes, beyond just financial accuracy.

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

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Question #1

Which income is classified under 'Income from Other Sources'?

A. Profit from a retail shop

B. Salary received from an employer

C. Dividend income and winning from lotteries

D. Capital gains on sale of shares

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Correct Answer: Option C

Explanation:
Incomes that do not fall into the first four specific heads (like dividends, lottery winnings, bank interest) are taxed as Income from Other Sources.

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Question #2

In the absence of a partnership deed, interest on partners' capital is allowed at:

A. 12% p.a.

B. 6% p.a.

C. No interest

D. 5% p.a.

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Correct Answer: Option C

Explanation:
According to the Indian Partnership Act, no interest on capital is allowed unless there is an agreement.

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Question #3

The 'Non-Current Assets Held for Sale' (Ind AS 105) are measured at:

A. Cost

B. Revaluation amount

C. Lower of carrying amount and fair value less costs to sell

D. Fair value

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Correct Answer: Option C

Explanation:
Ind AS 105 requires measurement at lower of carrying amount and fair value less costs to sell.

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