CORPORATE ACCOUNTING

QUESTION BANK

UNIT –I, UNIT -III

MCQ’S

1. A company can be liquidated by

a) Compulsory winding up the court
b) Voluntary winding up by the members or contributories
c) Winding up under the supervision of the court
d) All of the above
2. A petition for the winding up of a company in all the above conditions:
a) Any government employee
b) Any employee of the company
c) Any creditor
d) All of the above

3. Which of the following is a contributory?

a) Shareholder b) Employee c) Regulator d) All of the above

4. Assets specifically pledged are a part of

a) list A b) list B c) List C d) List D

5. Assets specifically pledged as per list B are taken at

a) their cost price b) Their book value

c) Estimated Realizable value d) Government Valuation

6. Debenture holders secured by floating charge are a part of

a) List C B) List D c) List E d) List F

7.Which of the following is an over-riding preferential creditor?

a) Bank dues b) workmen’s dues c) Calls in Advance d) None of the above

8.Liquidator’s commission does not include

a) Commission on assets sold by him

b) Commission on assets sold by creditors

c) Commission of payment to unsecured creditors

d) Commission on payment to preferential creditors

9. Which comes first among the following in the order of payment by liquidator?

a) Preference Shareholders b) Debenture Holders

c) Liquidator’s Remuneration d) Equity Share holders

10.In case of compulsory winding up, the remuneration to liquidator is fixed by

 a) The court b) their shareholders c) The creditors d) All of them

11. In case of voluntary winding up, liquidator is appointed by

a) Shareholder b) Employee c) Regulator d) all of the above

12. The capital reduction scheme can be implemented after getting permission form

a) competent court b) Central Government c) State government d) SEBI

13. Reconstruction A/c is used in the case of

a) External reconstruction b) internal reconstruction

c) Amalgamation d) Absorption

14. Which of the following is not “alternation of share capital”

a) Consolidation of shares b) Sub-division of shares

c) Cancelling or writing off lost capital, not represented by assets

d) Conversion of shares into stock and vice versa

15. Any surplus in capital reduction account is transferred to

a) General Reserve b) profit& Loss A/c

c) Share Capital A/c d) Capital Reserve a/c

16. Preference Shareholder’s sacrifice of undeclared preference divided is to be credited to

a) Preference share capital a/c b) Paid up capital a/c

c) Equity capital stock a/c d) none of these

17. Any gain on revaluation of assets will be credited to

a) Capital reduction/c b) General Reserve a/c

c) Profit & loss a/c d) capital Reserve a/c

18. Any loss on revaluation of assets will be transferred to

a) Profit & loss a/c b) Reconstruction a/c

c) Capital Reserve A/c d) None of these

19. Amount sacrificed by shareholders are credited to

a) Capital Reserve a/c b) Profit & Loss a/c

c) Reconstruction a/c d) Balance sheet

20. In consolidation of shares, total number of shares

a) Increases b) Decreases c) Does not charge d) Changes Proportionately

21. Effect of sub- division of shares

a) Paid up capital and number of shares increase

b) paid up capital increases but number of shares reduces

 c) paid up capital does not change but number of shares increases

d) paid up capital does not change but change but number of shares reduces

22. On acquisition of business, which of the following item is not taken over by the purchasing company

a) profit and loss a/c b) Cash balance

c) Bank balance d) none of these

23. On Purchases of business, which of the following is taken over by the purchasing company

a) Share Capital b) External liabilities

c) Reserve Fund d) Undistributed profit

24. The accounting treatment with respect to acquisition of business will be by using.

a) when new set of books in opened b) when the same set of books in continued

c) a & b d) none of these

25. Purchase consideration can be paid by the company in

a) Shares b) Debentures c) cash d) All of the above

26. Goodwill A/c will be debited with the difference amount

a) when the value of net assets is less than purchase price

b) When the value of net assets is greater than purchase price

c) a & b d) None of these

27. If the interest is due on the purchases price, the account to be debited is

a) Vendor’s account b) Bank A/c

c) Interest A/c d) Vendor’s Suspense A/c

28. The excess of net assets over purchase consideration is

a) goodwill b) Net loss c) capital reserve d) balance in suspense a/c

29. When the same set of books is continued amounts realized from the proceeds of assets taken over by partners will
be distributed in the ration of

a) Profit Sharing b) Capital c) 1:1 d) final claim

30. Any profit or loss arising on account of realizing book debts and discharging creditors will be borne by

a) The purchasing company b) The vendor c) a & b d) none of these

ANSWERS:

1) D 2) C 3) A 4) C 5) D 6) B 7) B 8) C 9) A 10) B
11) B 12) A 13) B 14) C 15) D 16) D 17) A 18) B 19) C 20) B

21) D 22) A 23) B 24) C 25) D 26) A 27) C 28) C 29) D 30) B