Theoretical Framework -Accounting Standards and Policies & Indian Accounting Standards 0 Theoretical Framework -Accounting Standards and Policies & Indian Accounting Standards 1 / 30 Q.30 Accounting standards are issued for the purpose of_________ Improving reliability of financial statements Harmonizing diverse accounting practices Elimination of non-comparability between financial statements All of the above 2 / 30 Q.29 Accounting standards cover the aspects of______of accounting transaction in the financial statements. Recognition Measurements Presentation and disclosure Any of the above 3 / 30 Q.28 Accounting standards (AS)are written policy documents may be issued by_________ Expert accounting body Government Order regulatory body Any of the above 4 / 30 Q.27 Accrued interest is an example of Increase in Asset & Owner's Liability Decrease in Asset & Owner's Liability Increase in Liability & Decrease in Owner's Liability Decrease in Liability & Increase in Owner's Liability 5 / 30 Q.26 Goods destroyed by fire is an example of No change in owner's Equity Decrease in Asset & Owner's Liability Increase in Liability & Decrease in Owner's Liability Decrease in Liability & Increase in Owner's Liability 6 / 30 Q.25 Goods withdrawn by owner for personal use is an example of No change in owner's Equity Decrease in Asset & Owner's Liability Increase in Liability & Decrease in Owner's Liability Decrease in Liability & Increase in Owner's Liability 7 / 30 Q.24 which of the following is correct ? Equity + LTL - CL = FA + CA Equity + LTL = FA + CA + CL Equity + LTL = FA + working capital None of these 8 / 30 Q.23 It is essential to standardize the accounting principles and policies in order to ensure Transparency Consistency Comparability All of the above 9 / 30 Q.22 Convergence with IFR.Ss simplifies the process of preparing the financial statements. Reduces the costs of preparing the financial statements. Both (a) and (b) Facilitates global investors' understanding and confidence in high quality financial statements. 10 / 30 Q.21 Cash withdrawn by owner for personal use is an example of Increase in Asset & Owner's Liability Decrease in Asset & Owner's Liability Increase in Liability & Decrease in Owner's Liability Decrease in Liability & Increase in Owner's Liability 11 / 30 Q.20 which of the following is correct ? Net profit is always reflected in higher cash balance Net profit is always reflected in higher debtor balance Net loss is always reflected in lower cash balance Net loss is always reflected in lower net worth 12 / 30 Q.19 Mohan purchased a machinery amounting Rs.10,00,000 on 1st April, 2000. On 31st March,2006 the similar machinery could be purchased for Rs. 20,00,000 but the realizable value of the machinery (purchased on 1.4.2000) was estimated at Rs.15,00,000. the present discounted value of the future net cash inflows that the machinery was expected to generate in the normal course of business , was calculated as Rs.12,00,000. The current cost of machinery is Rs.10,00,000 Rs.20,00,000 Rs.15,00,000 Rs.12,00,000 13 / 30 Q.18 The government of india in consultation with the ICAI decides to adopt with IFRS. converge with IFRS. apply IFRS in india. notify IFRS in india. 14 / 30 Q.17 Global standards facilitates cross border flow of money. global listing in different bourses. comparability of financial statements. All of the three 15 / 30 Q.16 Making Provision for Doubtful debts is an example of Increase in Asset & Owner's Liability Decrease in Asset & Owner's Liability Increase in Liability & Decrease in Owner's Liability Decrease in Liability & Increase in Owner's Liability 16 / 30 Q.15 Goods purchased for credit is an example of Increase in Asset & Owner's Liability Decrease in Asset & Owner's Liability Increase in Liability & Decrease in Owner's Liability Decrease in Liability & Increase in Owner's Liability 17 / 30 Q.14 X purchased a machinery amounting Rs.5,00,000 on 1st April,2001.On 31st March, 2007.The similar machinery could be purchased for Rs.10,00,000 but the realizable value of the machinery was estimated at Rs.6,00,000.The present discounted value of the future net cash inflows that the machinery was expected to generate in the normal curse of business was calculated as Rs.7,00,000.The current cost of the machinery is Rs.5,00,000 Rs.7,00,000 Rs.10,00,000 Rs.6,00,000 18 / 30 Q.13 The portion of current assets that consist of cash central Govt. state Govt. Institute of chartered accounts of india. Reserve Bank of India. 19 / 30 Q.12 Mohan purchased a machinery amounting Rs.10,00,000 on 1st April, 2000. On 31st March,2006 the similar machinery could be purchased for Rest. 20,00,000 but the realizable value of the machinery (purchased on 1.4.2000) was estimated at Rs.12,00,000.The present discounted value of the future net cash inflows that the machinery was expected to generate in the normal course of business , was calculated as Rs.12,00,000. The realizable value of machinery is Rs.10,00,000 Rs.20,00,000 Rs.15,00,000 Rs.12,00,000 20 / 30 Q.11 Opening Capital Rs.10,000 .Profit during the year Rs.5,000.Drawing Rs.2,000.,Additional Capital introduced Rs.1,000 , Closing capital will be Rs.14,000 Rs.16,000 Rs.18,000 Rs.20,000 21 / 30 Q.10 Prepaid insurance is an example of Increase in Asset & Owner's Liability Decrease in Asset & Owner's Liability Increase in Liability & Decrease in Owner's Liability Decrease in Liability & Increase in Owner's Liability 22 / 30 Q.9 Creating Reserve for discount on Creditor is an example Increase in Asset & Owner's Liability Decrease in Asset & Owner's Liability Increase in Liability & Decrease in Owner's Liability Decrease in Liability & Increase in Owner's Liability 23 / 30 Q.8 Bad debts written off is an example of Increase in Asset & Owner's Liability Decrease in Asset & Owner's Liability Increase in Liability & Decrease in Owner's Liability Decrease in Liability & Increase in Owner's Liability 24 / 30 Q.7 which of the following is correct ? Capital + Long term liabilities = Fixed Assets + Current Assets + Cash - Current Liabilities Capital + Long term liabilities + Current Liabilities + Creditors = Fixed Assets + Current Assets Capital + Long term liabilities + Working Capital = Fixed Assets Capital + Long term liabilities = Fixed Assets + Working Capital 25 / 30 Q.6 Mohan purchased a machinery amounting Rs.10,00,000 on 1st April, 2000. On 31st March,2006 the similar machinery could be purchased for Rs. 20,00,000 but the realizable value of the machinery (purchased on 1.4.2000) was estimated at Rs.15,00,000. the present discounted value of the future net cash inflows that the machinery was expected to generate in the normal course of business , was calculated as Rs.12,00,000. The present value of machinery is Rs.10,00,000 Rs.20,00,000 Rs.15,00,000 Rs.12,00,000 26 / 30 Q.5 X purchased a machinery amounting Rs.5,00,000 on 1st April,2001.On 31st March, 2007.The similar machinery could be purchased for Rs.10,00,000 but the realizable value of the machinery was estimated at Rs.6,00,000.The present discounted value of the future net cash inflows that the machinery was expected to generate in the normal curse of business was calculated as Rs.7,00,000.The present value of the machinery is Rs.5,00,000 Rs.7,00,000 Rs.10,00,000 Rs.6,00,000 27 / 30 Q.4 X purchased a machinery amounting Rs.5,00,000 on 1st April,2001.On 31st March, 2007.The similar machinery could be purchased for Rs.10,00,000 but the realizable value of the machinery was estimated at Rs.6,00,000.The present discounted value of the furniture net cash inflows that the machinery was expected to generate in the normal curse of business was calculated as Rs.7,00,000.The realizable value of the machinery is Rs.5,00,000 Rs.7,00,000 Rs.10,00,000 Rs.6,00,000 28 / 30 Q.3 which accounting principle is followed in adopting accounting policy of using WDV method of depreciation year after year prudence consistency materiality All of the above 29 / 30 Q.2 A change in accounting policy is justified To comply with accounting standard To ensure more appropriate presentation of the financial statement of the enterprise To comply with law All of the above 30 / 30 Q.1 All of the following are limitations of Accounting Standards except The choice between different alternatives accounting treatment is difficult There may be trend towards rigidity Accounting standards cannot override the statute All of the above Your score is LinkedIn Facebook Twitter VKontakte