CORPORATE ACCOUNTING (CA) MCQS - Study For Buddies

Wednesday, March 31, 2021

CORPORATE ACCOUNTING (CA) MCQS

S.Y. B.COM
SEMESTER - IV

CORPORATE ACCOUNTING
(CA)
MCQS = UNIT - 3 

CHAPTER - 2

VALUATION OF SHARES

1) Normal Rate of Return depends on .............

A) Rate of interest 
B) Rate of Risk 
C) Both (A) and (B)
D) None of the above

2) While calculating capital employed ............

A) Tangible trading assets should be considered
B) Intangible assets should be considered
C) Fictitious assets should be considered
D) None of the above

3) Any non-trading income included in the profit should be ............

A) Eliminated 
B) Deducted
C) Ignored
D) All of the above

4) Capital employed at the end of the year is Rs. 4,20,000. Profit earned Rs.40,000.
Average capital employed is ...........

A) Rs. 4,00,000
B) Rs. 4,20,000
C) Rs. 4,40,000 
D) Rs. 4,60,000

5) Rate of interest is 11% and the rate of risk is 9%. The normal rete of return is ...........

A) 2%
B) 20%
C) 9%
D) 11%

6) Capital employed at the beginning of the year is Rs. 5,20,000 and the profit earned during the year is Rs 60,000. Average capital employed during the year is ..........

A) Rs. 4,60,000
B) Rs. 5,20,000
C) Rs. 5,80,000
D) Rs. 5,50,000

7) Shares are to be valued on ...........

A) Mergers
B) Sale of Share 
C) Gift Tax
D) All of the above

8) Under net asset method, value of a share depends on ...........

A) Net Assets available to equity shareholders
B) Net assets available to debentures holders
C) Net assets available to preference shareholders 
D) None of the above

9) Net asset value is also called as ............

A) asset backing value 
B) Intrinsic value
C) Liquidation value
D) (A) and (B) and (C)

10) While deciding net asset value, fictitious assets ............

A) Should not be considered
B) Should be considered
C) Added to total assets
D) None of the above

11) Net asset value method is based on the assumption that the company is .........

A) A going concern 
B) Going to be liquidated
C) (a) and (b)
D) None of the above
 
12) Yield value depends on ..........

A) Paid-up equity share capital
B) future maintainable profit
C) Normal rate of return
D) None of the above

13) F.M.P for yield valuation is ...........

A) Profit that would be available to equity shareholders
B) future profit
C) Past profit
D) None of the above

14) Yield value is based on the assumption that .......

A) The company will be liquidated
B) The company is a going concern
C) The company is sick
D) None of the above

15) Fair value of a share is equal to ...........

(A) Intrinsic value only
(B) Yield value only
(C) Average of intrinsic and yield value
(D) None of the above

16) Value of a partly paid equity share is equal to ..............

(A) Value of fully paid share-calls unpaid per share 
(B) Calls in arrears per share
(C) Paid-up value per share
(D) None of the above

17) Following details are extracted from the records of a company:

 

Rs

2,000 9% preference shares of Rs.100 each

2,00,000

50,000 Equity shares of Rs.10 each, Rs.8 per share paid up

4,00,000

Expected Profit

2,18,000

Tax Rate

40%

Transfer to general reserve

20%

Normal rate of earning

15%


Yield value per share us ...........

(A) Rs.15
(B) Rs.17.50
(C) Rs.11.55
(D) Rs.16

18) Gross assets are Rs.1,01,000 fictitious assets Rs.350 are included in the gross assets. External liabilities are Rs.7,500. 6% preference share capital is Rs.45,000. Equity capital is 4,500 equity share of Rs. 10 each fully paid. Average expected profit is Rs.8,500. Transfer to reserves is 10% preference dividend is payable. NRR is 9%. The Net Asset Value Per share is .............

(A) Rs. 11
(B) Rs.10.70
(C) Rs.15
(D) Rs.20

19) Following are the profits of past 3 years 39,600, 48,600, 39,600. Average future maintainable profit is

(A) Rs.42,200
(B) Rs.46,600
(C) Rs.42,600
(D) Rs.46,200

20) Quoted shares are those shares which are .............

(A) Listed on the stock exchange
(B) Quoted daily
(C) Quoted by the seller
(D) Quoted by the buyer

21) Following is the method of valuation of share

(A) Net Asset Backing Method
(B) Average Method
(C) Super profit method
(D) None of above

22) Net Asset value of ES is derived by the following formula.

(A) Profit/Esc
(B) Net Assets for ESH/No.of Es
(C) Super profit method
(D) None of above

23) To calculate Net Assets

(A) Fictitious Assets are excluded
(B) Fictitious Assets are included
(C) Tangible Assets are excluded
(D) Intangible Assets are excluded

24) When there are different paid up values of equity shares

(A) Uncalled amount is cancelled 
(B) National call is made
(C) both a and b
(D) None of above

25) Value of share as per yield method is derived by

(A) NRR / EROD × 100
(B) EROD / NRR × 100
(C) EROD / NRR × Paid up Value of ES
(D) EROD / NRR × ESC

26) Market value of share is equal to

(A) PER «  EPS 
(B) EPS x No.of ES 
(C) PER x EPS 
D) EPS « PER

27) Earnings per share is equal to

(A) No. of Es/Profit 
(B) Profit for ESH / No. of ES
(C) PER « No.of ES 
(D) None of above

28) Price Earning Ratio is equal to

(A) NRR/No.of ES
(B) Profit/NRR
(C) NRR/100
(D) 100/NRR

29) Normal Rate of Return is equal to

(A) Profit / EPS
(B) EPS / Profit
(C) Market price per share / Dividend per share × 100
(C) Dividend per share / Market price per share × 100

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