COMMERCE QUESTIONS FOR VARIOUS EXAMS

1. What is the correct sequence of the following actions taken by an auditor?
1. Physical verification of assets
2. Routine checking
3. Preparing the audit programme
4. Vouching
Select the correct answer using the code given below:
Code:
(a) l-4-2-3
(b) 2-l-4-3
(c) 3-2-4-1
(d) 4-3-1-2
Ans. (c)
2. Balance Sheet audit is an audit in which
(a) Balance Sheets of a number of years are audited
(b) Audit of financial statements is done
(c) Audit is done at the end of the financial year
(d) Verification of assets and liabilities is done
Ans. (d)
3. ‘Teeming and lading’ refers to which one of the following?
(a) Misappropriation of cash receipts from debtors
(b) Misappropriation of cash by showing fictitious purchases
(c) Issue of cheque when there is insufficient bank balance
(d) Cheques received from debtors but not deposited within reasonable time
Ans. (a)
4. The term ‘kiting’ refers to which one of the following?
(a) Non-recording of cash receipts
(b) Manipulation in bank accounts
(c) Showing higher depreciation in fixed assets
(d) Inflating expenditure
Ans. (b)
5. Consider the following statements:
1. The verification of assets and liabilities is primarily the responsibility of the management.
2. Auditor has to satisfy that valuation of assets has been correctly made as per accounting standards and generally accepted principles.
Which of the statement(s) given above is fare correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Ans. (c)
6. Which of the following is/are the advantage(s) of direct confirmation procedure in auditing?
1. Accurate physical verification of assets
2. Ascertaining accurate balances of debtors, loans and advances
3. Controlling of unnecessary expenditures
Select the correct answer using the code given below:
Code:
(a) 1 only
(b) 2 only
(c) 1 and 2 only
(d) 1, 2 and 3
Ans. (b)
7. Which one of the following is an example of direct confirmation?
(a) Management gives certificate of cash in hand
(b) Reconciliation of bank balance
(c) Debtors certifying outstanding balance
(d) Counting of inventories by the auditor
Ans. (c)
8. Which one of the following does not fall under audit planning (AAS-8) ?
(a) Developing the audit programme
(b) Development of overall plan
(c) Knowledge of the client’s business
(d) Performance of the peer firms
Ans. (d)
9. Consider the following steps in the preparation of an audit programme:
1. To ascertain the nature and scope of audit and its objectives
2. To obtain different records, viz., articles and memorandum of associations, agreement deeds, prospectus and other documents
3. To evaluate the systems of keeping accounts and internal check and internal control system in operation
4. To obtain detailed list of books of accounts and list of personnel responsible for different jobs
Which one of the following is the correct sequence of steps involved in the preparation of an audit programme?
(a) 1-2-3-4
(b) 3-4-2-1
(c) 4-3-2-1
(d) l-3-2-4
Ans. (a)
10. Match List -I with List -II and select the correct answer using the code given below the Lists:
List- I List -II
(Tool) (Nature of Function)
A. Test checking 1. Physical verification
B. Cash counting 2. Internal control
C. Division of labour 3. Overall assessment
D. Trend analysis 4. Selective verification
Code:
A B C D
(a) 3 2 1 4
(b) 3 1 2 4
(c) 4 2 1 3
(d) 4 1 2 3
Ans. (d)
11. You have the information that X Ltd. has declared 40% dividend. Which one of the following does it actually mean?
(a) X Ltd. has declared 40% of net profit as dividend
(b) X Ltd. has declared 40% of profits after tax as dividend
(c) X Ltd. will give dividend @40% on issued capital
(d) X Ltd. will give dividend @ 40% on paid-up capital
Ans. (d)
12. Match List I with List II and select the correct answer using the code given below the list:
List -I List -II
A. Doctrine of indoor management 1. Kotla Venkataswami vs. Ramamurthy
B. Untrue statement in prospectus 2. Ashbury Railway Carriage and Iron vs. Riche
C. Doctrine of ultra vires 3. Green Wood vs. Leather Shod Wheel Co.
D. Doctrine of constructive notice 4. Royal British Bank vs. Turquand
Code:
A B C D
(a) 4 2 3 1
(b) 4 3 2 1
(c) 1 3 2 4
(d) 1 2 3 4
Ans. (b)
13. Which one of the following exceptions for doctrine of indoor management was provided from Ruben vs. Great Fingall Consolidated case?
(a) Knowledge of irregularity
(b) Forgery
(c) Suspicion of irregularity
(d) An act outside apparent authority
Ans. (b)
14. The doctrine of indoor management seeks to
(a) protect outsider against the company.
(b) protect company against the outsider
(c) determine the relations between company and Directors.
(d) determine the relationship between Directors and auditor.
Ans. (a)
15. Under which of the following situations must dissolution of partnership take place?
1. At the expiry of the term
2. On the completion of a particular adventure
3. On death, insolvency or retirement of a partner
Select the correct answer using the code given below:
Code:
(a) 1, 2 and 3
(b) 3 only
(c) 2 and 3 only
(d) 1 and 2 only
Ans. (a)
16. Match List I with List II and select the correct answer using the code given below the Lists:
List -I List -II
(Document) (Use)
A. Bill of lading 1. To certify the origin of goods
B. Consular invoice 2. To transport cargo by ship
C. Packing slips 3. To inform about the contents of the package
Code:
A B C
(a) 3 1 2
(b) 2 1 3
(c) 2 3 1
(d) 3 2 1
Ans. (b)
17. In marine insurance, a partial loss is technically called as
(a) warranties.
(b) particular average.
(c) total loss.
(d) liabilities.
Ans. (b)
18. In which one of the following theories is it assumed that the psychological forces shaping peoples’ behavior are largely unconscious, and that a person cannot understand his or her own motivations?
(a) Maslow’s theory
(b) Herzberg’s theory
(c) Freud’s theory
(d) McGregor theory of X and Y
Ans. (c)
19. Consider the following statements:
Matrix organization is
1. most suitable when a project of a temporal nature is to be executed.
2. mostly seen in R & D and engineering organizations.
Which of the statement(s) given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Ans. (c)
20. Who among the following has advanced Transactional Analysis as an explanation of interpersonal communication strategy?
(a) Thomas A Harris
(b) Eric Frank
(c) Muriel James
(d) Eric Beme
Ans. (d)
21. Match List-I with List- II and select the correct answer using the code given below the Lists:
List -I List-II
(Theory of Motivation) (Contributor)
A. X, Y theory 1. Frederick Herzberg
B. Expectancy theory 2. J Stacey Adams
C. Two factor theory 3. Douglas McGregor
D. Equity theory 4. Victor Vroom
Code:
A B C D
(a) 3 1 4 2
(b) 2 4 1 3
(c) 2 1 4 3
(d) 3 4 1 2
Ans. (d)
22. Maslow’s need-hierarchy theory of motivation has classified the human needs into following five categories:
1. Safety needs
2. Esteem needs
3. Social needs
4. Physiological needs
5. Self-actualization needs
Which one of the following is correct hierarchy of the above needs from low order to high order?
(a) l-4-3-2–5
(b) 4-1-3-2-5
(c) 5-3-2-4-l
(d) 4- 1-2-5-3
Ans. (b)
23. Which one of the following is not included by Henry Mintzberg in the depiction of managerial roles?
(a) Interpersonal role
(b) Informational role
(c) Decisional role
(d) Organizing role
Ans. (d)
24. Which of the following is/are correct regarding coordination?
1. Coordination cannot be voluntarily produced by number of cooperating persons.
2. Coordination is, for the most part, the result of voluntary attitudes on the part of people in an organization.
3. Coordination is a far more inclusive term embracing the idea of cooperation.
Select the correct answer using the code given below:
Code:
(a) 1 and 2 only
(b) 1 and 3 only
(c) 2 only
(d) 1, 2 and 3
Ans. (b)
25. Who among the following has advanced the Power, Affiliation and Achievement motivation concepts?
(a) J. Stacey Adams
(b) BR Skinner
(c) Victor Vroom
(d) David C. McClelland
Ans. (d)
26. Which one of the following is not a method of performance appraisal?
(a) Grading method
(b) Behaviorally-anchored rating scale method
(c) Forced distribution method
(d) Paired comparison method
Ans. (a)
27. Consider the following statements about individual incentive system:
1. Individual incentive plans are used more frequently than organization based plans.
2. Individual plans can sometimes cause undesirable competition among peers.
Which of the statement(s) given above is/are not correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Ans. (d)
28. Which one of the following is an analytical method of job evaluation?
(a) Classification method
(b) Point -rating method
(c) Projection method
(d) Ranking method
Ans. (b)
29. Match List I with List II and select the correct answer using the code given above the Lists:
List -I List -II
(Contributor) (Management Thought/Theory)
A. Mary Parker Follett 1.Human relations
B. Henri Fayo 2.Integration theory
C. Elton Mayo 3.Scientific management
D. F.W. Taylor. 4 principles of management
Code:
A B C D
(a) 3 1 4 2
(b) 2 4 1 3
(c) 2 1 4 3
(d) 3 4 1 2
Ans. (b)
30. Identify the correct sequence of the following with regard to delegation of authority:
1. Creation of obligation
2. Authorization of actions
3. Determination of expected results
4. Assignment of duties
Select the correct answer using the code given below:
Code:
(a) 3-2-4-1
(b) 1-2-4-3
(c) 1-4-2-3
(d) 3-4-2-1
Ans. (d)
31. Consider the following statements with regard to ‘management by objectives’:
1. Overall objectives are set at the top of the organizational hierarchy.
2. Individual objectives coincide with the objectives of the organization.
3. Performances of employees are evaluated periodically.
Which of the statement(s) given above is/are correct?
(a) 1, 2 and 3
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1 only
Ans. (a)
32. If a situation calls for pooling the authority of two or more managers, it is referred to as
(a) splintered authority.
(b) centralized authority.
(c) decentralized authority.
(d) recentralized authority.
Ans. (a)
33. Which one of the following functions is concerned with synchronizing and unifying the actions of a group of people in an organization?
(a) Directing
(b) Controlling
(c) Coordinating
(d) Staffing
Ans. (c)
34. With which one of the following is force-field analysis associated?
(a) Understanding the pressure for and against change
(b) Incessant coordination between production schedule and product distribution schedule
(c) Understanding the process of coordination to ensure promptness and avoid red tapism
(d) None of the above
Ans. (a)
35. Which one of the following management thinkers argued in favour of separating planning from operation?
(a) Henri Fayol
(b) Luther Gulick
(c) L.F. Urwick
(d) F.W.Taylor
Ans. (d)
36. The balance brought out between economic and social models of decision-making as advanced by Herbert A Simon is called
(a) rational model
(b) satisfying model.
(c) irrational model.
(d) satisfying model.
Ans. (d)
37. For calculating, which one of the following is Dr. Aykroyd’s formula applied?
(a) Living wage
(b) Fair wage
(c) Real and nominal wage
(d) Need based minimum wage
Ans. (d)
38. Who among the following has observed that bureaucratic staff increases in inverse proportion to the amount of work done?
(a) Laurence J. Peter
(b) Peter F. Drucker
(c) Warren G. Bennis
(d) Northcote Parkinson
Ans. (d)
39. Under which one of the following conditions does false positive staffing error occur?
(a) Selection as well as performance scores are high
(b) Selection scores are low and performance scores are high
(c) Selection scores are high and performance scores are low
(d) Both selection and performance scores are low
Ans. (c)
40. Match List -I with List- II and select the correct answer using the code given below the Lists:
List-I List-II
(Selection Step) (Objective)
A. Reference checks 1. Swift evaluation of candidate
B. Preliminary interview 2. Evaluation of candidate including measuring mannerisms,
vocabulary, temperament, etc.
C. Selection test 3. Check authenticity provided in application blanks
D. Comprehensive interview 4. Measuring IQ of the candidate
Code:
A B C D
(a) 3 1 4 2
(b) 3 4 1 2
(c) 2 1 4 3
(d) 2 4 1 3
Ans. (a)
41. Consider the following stages of planned change:
1. Moving
2. Refreezing
3. Unfreezing
Which one of the following is the correct sequence of the
above according to Kurt Lewin?
(a) 1-2-3
(c) 3-1-2
(b) 2-3-1
(d) 1-3-2
Ans. (c)
42. Match List I with List II and select the correct answer using the code given below the Lists:
List- I List- II
(Contributor) (Leadership Style)
A. Robert Blake and Jane Mouton 1. Four-system model
B. W.J. Reddin 2. Normative model
C. Rensis Likert 3. Managerial grid
D. Vroom and Yetton 4. The 3-D theory
Code:
A B C D
(a) 3 4 1 2
(b) 3 1 4 2
(c) 2 1 4 3
(d) 2 4 1 3
Ans. (a)
43. Which one of the following is not a dimension of the managerial grid theory of leadership?
(a) Country club management
(b) Impoverished management
(c) Team management
(d) Entrepreneurship management
Ans. (b)
44. Which one of the following is the correct sequence with regard to communication process?
(a) Sender-Message-Encoding-Receiver – Channel Decoding- Feedback
(b) Message-Sender –Encoding-Receiver- Channel-Decoding -Feedback
(c) Encoding -Message –Sender-Decoding –Feedback-Receiver-Channel
(d) Sender-Message- Encoding-Channel-Receiver-Decoding-Feedback
Ans. (c)
45. Gangplank theory of communication, advanced by Henri Fayol, is an example of which one of the following
(a) Vertical upward communication
(b) Vertical downward communication
(c) Lateral or horizontal communication
(d) Cyclic or circular communication
Ans. (c)
46. Which one of the following is signified by the Moosa Goolam Ariff vs. Ebrahim Goolam Ariff case?
(a) The certificate of incorporation is a conclusive proof of validity
(b) The certificate of incorporation is for the commencement of the business
(c) The certificate of incorporation places limit on the working of the Directors
(d) Company can be revived after dissolution
Ans. (a)
47. Company Law Information Memorandum, as per section 60 (B) of the Companies Act, 1956 is related to
(a) the Directors responsibility statement.
(b) corporate governance,
(c) initial public offering,
(d) accounting standard relating to finance and investment companies.
Ans. (c)
48. Statutory Report
(a) shall be prepared by Board of Directors and forwarded 21 days before the statutory meeting.
(b) shall be prepared by the Secretary and forwarded 21 days before the statutory meeting.
(c) can be prepared by anyone and there is no time period prescribed.
(d) shall be prepared by the auditor and forwarded 30 days before the statutory meeting.
Ans. (a)
49. Which one of the following is the penalty imposed under the Companies Act for contravening the provisions relating to acquisition and transfer of shares?
(a) Imprisonment for a term extending to three years or with fine which may extent to rupees fifty thousand or both
(b) imprisonment for term extending to six years or with fine which may extend to rupees ten thousand or both
(c) Imprisonment for a term extending to one year or with fine which may extend to rupees five thousand or both
(d) imprisonment for a term extending to five years or with fine which may extend to rupees twenty-five thousand or both
Ans. (a)
50. Which among the following can issue shelf prospectus?
(a) Any company
(b) Only public limited company
(c) Any public financial institution
(d) Only private companies
Ans. (c)