001. ______ is Supreme Authority for Company Organization.

C
A Directors B Debenture holders
C Share holders D Creditors
002. One man one vote Principle is adopted in ____ A
A Co-operative enterprises B Company
C Partnership firms D Hindu family business
003. The liability extending to the personal property of the trader called B
A Limited liability B Un limited liability
C Partial liability D Full liability
004. A Partnership firm can be formed with a minimum of Two Partners and it can have a C
maximum of _______Partners.
A 50 B 40
C 20 D 30
005. People may come and people may leave, but I go on forever is Applicable to ______ D
Business organization.
A Sole proprietorship B Partnership
C Joint Hindu Family D Company
006. A sole-trade business is started by A
A Any one person B At least two persons
C At least 7 persons D At least two persons
007. Decision Making is faster in D
A Joint stock company B Partnership firm
C Departmental undertaking D Sole trading
008. Certificate of commencement of business should be obtained by ___company to start A
its functions.
A Public B Private
C Statutory D Chartered
009. Relationship among two or more persons is called D
A Company B Organization
C Society D Partnership
010. The partners collectively are called C
A Company B Organization
C Firm D Society
011. The management of Joint Hindu Family business vests in the eldest member of the C
family, called _____.
A Director B Grand father
C Kartha D Manager
012. A sole trader and his business exist A
A Independently B together
C for others D one
013. Minimum ___ and maximum ____ members are permitted in Public limited company. D
A 50 ; Un-limited B 20 ; 50
C 7 ; 50 D 7 ; Un-limited
014. Liability of Shareholder _______________. B
A Un-limited B Limited to the share capital
C Maximum D Limited to total assets
015. If the state holds more than 51 percent of equity shares then it is called: B
A Private organization B Public organization
C Autonomous organization D Partnership organization
016. The example of departmental undertakings A
A AIR B Public organization
C Autonomous organization D Partnership organization
017. Promoting balanced regional development is one of the objectives of _______ units C
A Private sector B Joint sector
 C Public sector D Partnership
018. Whatisanadvantageofcorporationsrelativetopartnershipsandsoleproprietorships? B
A Increaseddifficultyofraisingfunds B Reducedlegalliabilityforinvestors
C Mostcommonformoforganization D Hardertotransferownership
019. The year of partnership Act .. A
A 1932 B 1962
C 1956 D 1948
020. A certificate of incorporation is related to C
A Sole trade B partnership
C company D Government
021. The Memorandum of association is stated that D
A Company product B Companys capital
C Companys Assets D Companys Scope
022. What is an Indian company D
A Whose shares traded in India B Whose business is situated in India
C Which is incorporated outside India D Which is incorporated in India
023. The Unit trust of India is a A
A Public corporation B Public enterprise
C Public company D Government company
024. A partner enjoying all the benefits from the organization but unknown to the public as a B
partner is called
A Ostensible partner B Sleeping or dormant partner
C Nominal partner D Partner by estoppels
025. An association of many persons who contribute money or moneys worth to a common D
stock and employ it for a common purpose.
A Sole trade B partnership
C Bank D Company
026. One of the needs for a public enterprise is B
A Balanced of investment B Balanced regional development
C Balanced work development D Balanced distribution development
027. A partner who lends his name to the firm without having any real interest is called as C
A Ostensible partner B Sleeping or dormant partner
C Nominal partner D Partner by estoppels
028. A corporation can enter into contract of partnership C
A As a group of individual B Both single and group of individual
C As a single individual D Such contract is not allowed
029. The company which ends the words with Pvt Ltd is called C
A Partnership B Joint stock company
C Private limited company D Public limited company
030. The written agreement among partners is A
A Partnership deed B Business deed
C Trading deed D Demand deed
031. A person doing agreement with a minor is B
A Valid B void
C May be valid D May not be valid
032. How many stages in the formation of joint stock company D
A Four stages B One stage
C Three stages D Two stages
033. When people come together to share the profits of the business carried on by all it is B
called as
A Partnership B Joint stock company
C Sole proprietorship D Sole trader
034. Which of the following is an advantage of government company? C
A Higher degree of government control B Dividend loyalties
 C Separate legal entity D Evades constitutional responsibility
035. The certificate of Commencement of business is required for the: A
A Government company B Joint stock company
C Sole proprietorship D Private company
036. When an economy enjoys full employment B
A the unemployment rate equals zero B frictional and structural
unemployment may be positive
C cyclical unemployment is positive D the economy has a rate of
employment equal to the natural rate
of employment
037. When deflation occurs B
A prices rise B the average price level declines
C the purchasing power of money D interest rates increase
declines
038. Which of the following is most sensitive to the business cycle A
A durable goods B non-durable consumer goods
C services D exports
039. Expand the letters ESIC A
A Employees state insurance B Employer state insurance corporation
corporation
C Enterprise State insurance D Entrepreneur State insurance
corporation corporation
040. The four phases of the business cycle are D
A peak, recession, trough, and boom B peak, depression, trough, and boom
C peak, depression, bust, and boom D peak, recession, trough, and recovery
041. Business cycles are measured from B
A recession to recession B peak to peak
C depression to depression D boom to bust
042. Business cycles share all of these characteristics except C
A consumer expenditures decline B business inventories of steel,
abruptly automobiles and other durable goods
rise unexpectedly
C the interest rates rise D wage growth slows down
043. Suppose that the consumer price index equaled 177.1 in 2001 and 179.9 in 2002. The A
rate of inflation between these two years thus equaled
A 1.6 percent B 2.8 percent
C 3.3 percent D 4.1 percent
044. Under which of the following conditions would Tim Nelson desire to be a lender D
A the nominal rate of interest is 15 B the nominal rate of interest is 12
percent and the inflation rate is 25 percent and the inflation rate is 12
percent percent
C the nominal rate of interest is 8 D the nominal rate of interest is 6
percent and the inflation rate is 9 percent and the inflation rate is 2
percent percent
045. If Mary Millers nominal income increases by 4 percent while the consumer price index D
increases by 6 percent, her real income
A increases by 10 percent B increases by 2 percent
C decreases by 10 percent D decreases by 2 percent
046. Because of tax indexing, a household is pushed into a higher tax bracket only if its A
A nominal income rises faster than the B nominal income rises slower than the
rate of inflation rate of inflation
C nominal income rises equal to the D nominal income falls faster than the
rate of inflation rate of inflation
047. In a typical business cycle, the expansion is followed, in order, by the ______ phases C
 A trough and recovery B peak and expansion
C peak and recession D recovery and peak
048. Inflation imposes the greatest burdens on B
A lenders, when it is anticipated B lenders, when it is unanticipated
C borrowers, when it is anticipated D borrowers, when it is unanticipated
049. Recurrent expansions and contractions of economic activity that take place over D
several years refers to
A stagflation B disinflation
C depression D the business cycle
050. Which accounting assumption assumes that an enterprise will continue in operation D
long enough to carry out its existing objectives and commitments?
A Monetary unit assumption B Economic entity assumption
C Time period assumption D Going concern assumption
051. The purchase of an office building by issuing long-term notes payable should be C
reported as a
A Cashoutflow in the financing section B Cashoutflow in the investing section
of the statement of cash flows. of the statement of cash flows.
C Noncashinvesting and financing D Cashoutflow in the operating section
activity. of the statement of cash flows.
052. The system of recording transactions based on dual aspect concept is called B
A Double account system B Double entry system
C Single entry system D Multi entry system
053. The business activities monitor with the help of B
A Marketing B Accounting
C Costing D Financing
054. In the annual report, where would a financial statement reader find out if the companys D
financial statements give a fair depiction of its financial position and operating results?
A Notes to the financial statements B Management discussion and analysis
section
C Balance sheet D Auditors report
055. The financial statements comprise D
A Trading account, balance sheet B Balance sheet, ledger
C Journal, ledger, P&L account D Trading account and P&L account,
Balance sheet
056. Profitability is generally base for A
A Accounting Principles B Financial Principles
C Balance sheet principles D P&L account principles
057. The difference between assets and liabilities is called D
A Overdraft B Net purchases
C Sales D Capital
058. In every business transaction at least ______parties are involved A
A Two B Three
C Four D Five
059. Working capital is a measure of. C
A Consistency B Liquidity
C Profitability D Solvency
060. Which of the following accounts will invariably have a debit balance? B
A Bank account B Accounts receivables account
C Accounts payable account D Loan account
061. Which is the primary or original book of accounting A
A Journal book B Ledger book
C Cash book D Purchase book
062. The amount brought in by the proprietor in the business should be credited to B
A Cash account B Capital account
 C Drawings account D Personal account
063. A measure of profitability is the C
A Currentratio B Debt tototal assets ratio.
C Returnon assets ratio. D Workingcapital.
064. The assets is not related to fixed asset C
A Buildings B Land
C Cash in bank and hand D Machinery
065. The current assets - current liabilities is called A
A Working capital B Fixed capital
C Authorized capital D Issued capital
066. The solvency ratio is represents that D
A Gross profit ratio B Debtors collection period
C Current ratio D Debt-equity ratio
067. Financial statements are the part of _________ B
A Book-keeping B Accounting
C Statementsof assets D Ledgerkeeping
068. Depreciation is calculated on D
A Current assets B Intangible assets
C Outward charges D Fixed assets
069. Bank account is a _________ A
A Personalaccounting B Realaccount
C Nominalaccount D Assetaccount
070. The current ratio is normal when it is B
A 1:2 B 2:1
C 2:2 D 2.3
071. Which ratio is shows better utilization of assets B
A Profit turnover ratio B Assets turnover ratio
C Sales turnover ratio D Purchase turnover ratio
072. The comparison of two firms are in same industry is called C
A Internal comparison B External comparison
C Inter-firm comparison D Within firm comparison
073. Gross profit ratio is D
A Gross profit/purchases x 100 B Gross profit/debtors x 100
C Gross profit/creditors x 100 D Gross profit/sales x 100
074. The Current assets - inventory + prepaid expenses is : B
A Current assets B Quick assets
C Fixed assets D Ongoing assets
075. The opening statement of affairs is usually prepared to arrive at the figure of D
A Cash inthe beginning B Debtors
C Profit during the year D Capitalin the beginning
076. Expand GAAP A
A Generallyaccepted accounting B Generallyaccepted account
principles programmers
C Generalacceptable assumption D Generalacceptable account process
practices
077. How to calculate the Return on Investment (ROI) A
A Net profit after taxes/total investment B Net profit after taxes/ total sales
C Total sales/ net profit D Total revenue/total sales
078. The normal standard of quick ratio is D
A 1:2 B 2:1
C 1:3 D 1:1
079. Financing decision refers as ________ C
A Investment decision B Utilization of funds
C Acquisition of funds D Dividend policy decision
080. Expand EAT A
A Earnings after tax B Earnings adopted tax
C Earnings accrued tax D Earnings assets tax
081. Capital expenditure are recorded in the __________ A
A Balancesheet B Tradingaccount
C Profit& loss account D Cashaccount
082. A relationship between two financial variables is called D
A Income ratio B Liquid ratio
C Leverage ratio D Financial ratio
083. The facility sanctioned by a banker to a customer to the draw more than what is B
deposited in the account, subject to a maximum limit of money is called
A Bills payable B Overdraft
C Bills receivable D Capital loan
084. Working capital turnover calculated as C
A Sales/working capital B Purchases /net working capital
C Sales/net working capita D Revenue/ net working capital
085. Which method takes into consideration The Time Value of Money? B
A Traditional Method B Discounted Cash Flow Method
C Pay Back Period Method D Average Rate of Return Method
086. Which concept is used to compare cash inflows occurring at different points of time D
with the corresponding cash flows?
A IRR B ARR
C NPV D Time value of money
087. A rate at which N.P.V = 0, then the rate is called__________ C
A Minimum Rate of Return B Required Rate of Return
C Internal Rate of Return D Average Rate of Return
088. Excess of current assets over current liabilities is known as_____ A
A Net working capital B Fixed capital
C Long run capital D Net worth
089. Which of the following is determined on an after-tax basis? D
A Capital expenditure B Future incomes
C Cash outflows D Cash inflows
090. If the rate of return is more than the cost of capital, then the project is A
A Accepted B Rejected
C Denied D Postponed
091. If _____is more than the cost of capital, the project is profitable B
A ARR B IRR
C Payback period D PI
092. What is the formula for Pay Back period? C
A Avg. Investment/Avg. earnings B Annual earnings/Cost of the product
C Cost of the project/ Annual earnings D Cash inflow/Cash outflow
093. What is the formula for profitability index? C
A Present value of cash inflow Present B Original cost of the project/Avg.
value of cash outflow annual earnings
C Present value of cash inflow/Present D Avg. Investment/Avg. earnings
value of cash outflow
094. Under Capital budgeting, only _____ Proposals are considered C
A Very short-term B Short-term
C Long-term D Mid-term
095. Which assets yield a return over a period of time in future? A
A Long-term assets B Current assets
C Short-term assets D Fictious assets
096. Cash inflows is equal to _________+ CFAT D
A Capital B provisions
 C Profits D Depreciation
097. The traditional methods of capital budgeting do not consider_______ A
A Time value of money B Cost of capital
C Profit D Capital budgeting
098. What is the current Liability from the following? C
A Bills Receivable B Closing stock
C Bills payable D Cash in hand
099. ARR is calculated as B
A Avg. investment/Avg. annual PAT B Avg. annual PAT/Avg. investment
C Avg.PAT/Avg. Profit D Avg. Profit/Avg. PAT
100. ______ method is one of the traditional methods. A
A Pay-back period B Profitability index
C Net present value D internal rate of return
101. NPV refers to the ______ of present value of future cash inflows over and above the D
cost of original investment
A Less B Minimum value
C Maximum value D Excess
102. Funds needed for short-term purpose is known as ______ C
A Fixed capital management B Capital Budgeting
C Working capital management D Long-term capital management
103. ______ holders are the real owners of the company. C
A Debenture B Preference share
C Equity share D Liability
104. A rate at which N.P.V = 0, then the rate is called__________ D
A Minimum Rate of Return B Required Rate of Return
C Average Rate of Return D Internal Rate of Return
105. Which of the following is not a relevant consideration for evaluating new projects? C
A The change in the firms fixed costs B The change in the firms variable costs
C The change in the firms amortization D The change in the firms tax expense
expense In house costs
106. The advantages of NPV is _____ D
A It does not indicate the cost of capital B Its calculations are easier than the
IRR
C Each project can be individually D It does not appropriate discount rate
evaluated
107. ______ holders have preference over dividends. B
A Equity share B Preference share
C Debenture D Ordinary share
108. The method of depreciation mostly used in capital budgeting proposals is: A
A Strait line method B Diminishing method
C Partial method D Full method
109. For the profitable projects, the profitability index is: D
A Less than 1 B Equal to 1
C Equal to 0 D Greater than 1
110. If the ____ is more than the cost of capital, the project is profitable C
A ARR B IRR
C Payback period D PI
111. Which of the following shows the firms planned operations or resource allocation for a B
given period in future
A Operating budget B Capital budgeting
C Accounting rate return D Internal rate of return
112. ______ are deducted from Current Assets, while calculating Working Capital. A
A Current Liabilities B Fixed Liabilities
C Fixed Assets D Fictious Assets
113. If the rate of return is more than the cost of capital, then the project is B
A Very short-term B Long-term
C Short term D Mid-term
114. The payback method assumes that all cash inflows are reinvested to yield a return C
equal to
A The discount rate. B The hurdle rate.
C The internal rate of return. D Zero.
115. An example of revenue expenditure is B
A Purchase of land B Salaries
C Lease D Purchase of building
116. Assets are held for the purpose of D
A Resale B Conversion into cash
C Cash D Earning revenue
117. Patents account is A
A Real account B Nominal account
C Personal account D Revenue account
118. The amount of total return to the investor will receive for a given period of time for his A
investment is called
A Dividend yield B Income received
C Revenue received D Total revenue
119. Which of the following measure companys quick assets/current liabilities? D
A Current ratio B Debtors ratio
C Stock turnover ratio D Acid test ratio
120. Which of asset is not related to current assets B
A Cash in hand and at bank B buildings
C Bills of exchange D Stock
121. The contingent proposal is one which is C
A Independent proposal B Self proposal
C Dependent on the other proposal D Individual proposal
122. The preferred technique for evaluating most capital investments is D
A payback period B discount payback period
C internal rate of return D net present value
123. The evaluation of long-term proposals is made based on their D
A Incomes B Time period
C PV factor D Profitability
124. Profitability Index specifies the project should be accepted when it has A
A PI > 1.0 B PI = 1.0
C PI < 1.0 D PI < 0.5
125. Where the cash inflows are____ computation of IRR is more by trial and error with B
respect to the discount factor
A Even B Uneven
C Zero D Negative
126. The selection of project with reference NPV C
A Lower NPV B Negative NPV
C Higher NPV D Zero NPV
127. The process of allocation of scarce resources as per the priorities over different C
projects is called ______
A Capital budgeting B Capital investing
C Capital rationing D Capital liability
128. A conflict of ranking can arise between the NPV and PI rules in case of: D
A Mutually related project B Mutually diversify project
C Mutually inclusive projects D Mutually exclusive projects
129. The diminution or reduction in the value of the asset due to wear-and-tear is called B
A Appreciation B Depreciation
 C Paid-up capital D Capital budgeting
130. Cash inflows refer to D
A Cash incomes B Future incomes
C Cash outflows D Cash inflows
131. _______ is the life blood of the business. C
A Price B Cost
C Finance D Production
132. The investment in short-term assets is known as____ A
A Working capital management B Capital Budgeting
C Fixed Investment D Fixed capital management