Top 250+ Solved Auditing MCQ Questions Answer
Q. Receipts from sale of investments should be vouched with the help of
a. Brokers bought notes
b. Brokers Sold notes
c. Minutes book
d. Inventory of investment
Q. Which of the following expenses should not be treated as capital expenditure?
a. Expenses paid on installation of a plant.
b. Cost of dismantling a building in case a new building is to be constructed on the land
c. Legal expenses incurred to defend a suit related to title of patent. The suit has been lost
d. The fees paid to engineer who constructed the plant.
Q. Which of the following is not a revenue expense?
a. Cost of raising a loan
b. Cost of accessories of motor vehicles spent at the time of purchase
c. Expenses incurred for laying of sewers on land purchased
d. Insurance premium paid at the time of registration of the ship
Q. Depreciation does not arise form _______
a. Effluxion of time
b. Use
c. Obsolescence through technology be market changes
d. Remarket expectation
Q. Which of the following Schedule of the Companies Act, 1956 deals with depreciations?
a. Schedule XIV
b. Schedule V
c. Schedule XIII
d. Schedule X
Q. Schedule XIV has prescribed rates of depreciation for double shift and triple shiftworking for which one of the following assets?
a. Building
b. Plant and Machinery
c. Furniture and fittings
d. Ships
Q. A company has bought patents. Which of the following methods is most suitable forproviding depreciation on them?
a. SLM
b. WDV
c. Sum of year digits
d. Any of the above
Q. Which of the following is a revenue reserve?
a. Capital redemption reserve
b. Security premium account
c. Debenture redemption reserve
d. Capital reserve
Q. Which of the following will not lead to creation of secret reserve?
a. Undervaluation of closing stock
b. Charging capital expenditure to revenue
c. Goods sent on consignment being shown as actual sales
d. Charging higher rates of depreciation on fixed assets than actually required
Q. Who is responsible for the appointment of statutory auditor of a limited company?
a. Directors of the company
b. Members of the company
c. The Central Government
d. All of the above
Q. Which of the following sections deal with qualifications of the auditor ?
a. Section 226 (1) and section 226(2)
b. Section 224 (1) and section 224 (2)
c. Section 226 (3) and section 226(4)
d. Section 224(3) & Sec.224
Q. Which of the following statement is not true?
a. A partnership firm can be appointed as a statutory auditor of limited company
b. Appointment can be made in the name of the firm
c. Majority of the partners should be practicing in India
d. All partners should be chartered accountants
Q. As per the requirements of section 226(3) and 226(4) a person is disqualified frombeing appointed as a statutory auditor if he holds
a. Equity shares or debentures of the company
b. Equity shares carrying voting of the company
c. Shares carrying voting rights of the company
d. Security carrying voting rights of the company
Q. The board of directors shall appoint first auditor of a company
a. Within one month of completion of capital subscription state of the company
b. Within one month of the promotion of the company
c. Within one month of the commencement of the business of the company
d. Within one month of incorporation of the company
Q. The term of the auditor ship of first auditor would be from the date of appointmenttill__
a. the conclusion of statutory meeting
b. the conclusion of first annual general meeting
c. the conclusion of next annual general meeting
d. the date of removal