Top 550+ Solved Corporate Accounting MCQ Questions Answer
Q. When the purchasing company bears the liquidation expenses, it will debit theexpenses to
a. Vendor Company’s Account
b. Bank Account
c. Goodwill Account
d. none
Q. When the Vendor (seller) company agrees to bear liquidation expenses, it will debit
a. Realisation Account
b. Bank Account
c. Goodwill Account
d. none
Q. When the purchasing company does not take over a particular liability and thevendor company pays that liability, it will debit it to
a. Realisation Account
b. Bank Account
c. Liability Account
d. none
Q. When the Net Assets are less than the Purchase Consideration, the difference willbe
a. Debited to Goodwill A/c.
b. Debited to General Reserve
c. none of these
d. none
Q. While calculating purchase consideration ............... values of assets is to beconsidered.
a. Book value
b. Revalued price
c. Average price
d. Capital
Q. Net Assets minus Capital Reserve is _________
a. Goodwill
b. Total assets
c. Purchase consideration
d. None of these
Q. Hitesh Ltd.’s purchase consideration is Rs.12,345 and Net Assets Rs.3,568,then..........
a. Goodwill Rs. 8,777
b. Capital Reserve Rs. 8,777
c. Goodwill Rs. 15,913
d. Capital Reserve Rs. 15,913
Q. The original amount of preference share capital should be transferred to ............account in the time of amalgamation in the books of vendor co.
a. Preference shareholders Account
b. Capital Reserve Account
c. Equity share capital Account
d. Equity share capital Account
Q. The share capital, to the extent already held by the purchasing company, is closedby the vendor company by crediting it to:
a. Share capital account
b. Purchasing company's account
c. Realisation account.
d. none
Q. In case of inter-company holdings, the purchasing company, at the time of payment of the purchase consideration, surrenders the shares in the vendor company by crediting:
a. Vendor company's account
b. Shares in the vendor company account
c. Share capital account.
d. none
Q. The vendor company transfers preliminary expenses (at the time of absorption) to:
a. Equity shareholders' account
b. Realisation account
c. Purchasing company's account.
d. none
Q. Activities that result in changes in the size and composition of the equity capital andborrowings of an entity are called:
a. operating activities
b. investing activities
c. financing activities
d. none of these
Q. Increase in share capital of a firm in the current year as compared to previous year should berecorded in the final cash flow statement under
a. investing activities
b. financing activities
c. operating activities
d. all of the above
Q. When presenting discontinued operations in the cash flow statement
a. they are pooled with other current assets
b. they are added to non-cash items
c. they are ignored
d. they are shown separately
Q. An entity shall explain how the transition from previous GAAP to IFRSs __________ itsreported financial position, financial performance and cash flows.
a. adjusted
b. corroborated
c. affected
d. benefited