SYMBIOSIS CENTRE FOR DISTANCE LEARNING (SCDL)

Program: PGDBF
Subject: Accounting Systems & Financial Analysis

Sample Questions:
Section I: Subjective Questions

1. What are the conditions that accounting principles must satisfy?

2. Write a note on AS 22 - Accounting for Taxes on Income.

3. How will the ERP Finance Module help improve auditing?

4. Discuss the importance of past performance study of a business firm to judge its future
prospects.

5. What do you understand by the term "use of funds"?

6. Write any ten policies covered under AS 2 for inventory valuation.

7. What is ERP?

8. What do you mean by cost of investments?

Section II: Objective Questions

Multiple Choice Single Response

1. The process of identifying, measuring and communicating economic information to

permit informed judgments and decisions by the users is known as
1] Accounting
2] Costing
3] Financial Accounting
4] Management Accounting

2. Debenture issued by a company is classified under

1] Secured Loans
2] Unsecured Loans
3] Investments
4] Current Liabilities
3. MS Excel is a very useful software to maintain accounting data of
1] small private companies & sole traders
2] large companies
3] for hawkers
4] multinational companies
 SYMBIOSIS CENTRE FOR DISTANCE LEARNING (SCDL)
Program: PGDBF
Subject: Accounting Systems & Financial Analysis

4. In vlookup( ) function of MS Excel the argument which is link between two tables is
1] range _lookup
2] table_array
3] lookup_value
4] col_index_num
5. This is a compulsory contribution collected by the Government to meet the expenses
of various public functions.
1] tax
2] subsidy
3] price
4] cost
6. The direct tax is
1] Tax on wealth
2] Sales Tax
3] Custom Tax
4] Excise Duty
7. If the total uses of funds were more than the total funds available, the difference is
1] cash deficit
2] cash surplus
3] funds deficit
4] funds surplus
8. The advantage of ERP that assist the organization from designing a product to
designing and planning a product sales campaign is
1] Design phase
2] re-engineering business process
3] Design engineering
4] Better technology
9. AS28 is
1] Impairment of Assets
2] Provisions, Contingent Liabilities & Contingent Assets
3] Financial Instruments: Recognition & Measurement
4] Financial Instruments: Presentation
10. Reserves and surplus is a
1] Sources of Funds
2] Uses of Funds
3] Current Liabilities
4] Current Assets
Multiple Choice Multiple Response

11. Investments are classified as

1] long term investments
2] current investments
3] soft investments
4] solvent investments
 SYMBIOSIS CENTRE FOR DISTANCE LEARNING (SCDL)
Program: PGDBF
Subject: Accounting Systems & Financial Analysis

12. The nature of an investment may be that of a

1] debt
2] equity
3] cash
4] credit
13. Assets can be
1] fixed assets like land and building
2] fixed assets like plant and machinery
3] current assets like raw material
4] borrowing from banks
14. In ERP software the Manufacturing module includes following activities
1] preparing Balance sheet
2] Financial Analysis
3] Preparing bill of Material
4] Capacity requirement Planning
15. Equity Share Capital is a
1] Sources of Funds
2] Capital & Reserves
3] Long Term Source
4] Application of Funds
16. The important aim of the economic policy is
1] to achieve economic growth of the nation
2] equitable distribution of wealth and income in the country
3] reduction of poverty
4] unemployment
17. MRP II system included
1] production planning
2] inventory
3] Accounts
4] Maths
18. The word "funds" mean
1] working capital
2] cash
3] financial resources
4] raw material
Fill in the Blanks

19. Where long-term investments are reclassified as current investments, transfers are
made at the _________ of cost and carrying amount at the date of transfer.
1] lower
2] higher
3] assumption
4] fair value
 SYMBIOSIS CENTRE FOR DISTANCE LEARNING (SCDL)
Program: PGDBF
Subject: Accounting Systems & Financial Analysis

20. When the new venture is strategically related to the existing lines of business, it is
called _________.
1] concentric diversification
2] Conglomerate diversification
3] Unrelated diversification
4] matched diversification
21. _________ take place when there is a combination of two or more organizations
related to each other.
1] Concentric mergers
2] Conglomerate mergers
3] Vertical mergers
4] Horizontal mergers
22. When similar type of product (or service) is provided with the help of related
technology it is called _________.
1] Marketing and Technology Related Concentric Diversification
2] Technology-Related Concentric Diversification
3] Marketing-Related Concentric Diversification
4] related diversification
23. The function which returns the net present value of an investment based on a series
of periodic cash flows and a discount rate is _________.
1] NPV( )
2] FV( )
3] DB( )
4] IRR( )
24. On disposal of an investment, the difference between the carrying amount and the
disposal proceeds, net of expenses, is recognised in the _________.
1] profit and loss statement
2] balance sheet
3] ledger
4] folio
25. The tax on income, the tax on wealth and the tax on gifts are _________ taxes.
1] direct
2] indirect
3] profit from government
4] individual undertakings
26. _________ are levied on commodities at the stage of manufacture, sale or import.
1] Indirect Taxes
2] direct taxes
3] tax on income
4] tax on gift
27. _________ is the most important source of revenue of the States.
1] Sales tax
2] Gift-tax
3] wealth-tax
 SYMBIOSIS CENTRE FOR DISTANCE LEARNING (SCDL)
Program: PGDBF
Subject: Accounting Systems & Financial Analysis

4] customs duty
28. _________ are frequently against the wishes of the acquired firm.
1] hostile takeover
2] mergers
3] consolidation
4] acquisition
State True or False

29. Company always collects call money through its bankers.

30. Conglomerate diversification occurs when the new and old businesses are related.

31. If omitted the guess parameter in IRR ( ) function the default value taken is 0.1.

32. The Institute of Chartered Accountants of India, constituted Accounting Standard

Board (ASB) on 21st April, 1977.
33. Funds flow statement for the past accounting period indicates the method of financing
by the company in the future.
34. Costing has a vital role to play in almost any activity which involves expenditure of
money, whether it is a business house or a charitable concern or whether it is a
Government department.
35. Assets or properties that we own can be broadly classified into those which are
retained for the purpose of creating goods or services which are used for the purpose
of generating revenue or income.
36. Public revenue does not includes direct taxes, indirect taxes, profit from government,
commercial undertakings, etc.
37. Financial statements are usually complex, unreliable and incomparable.

38. Financial accounting falls short of meeting challenges of modern business

organizations hence, cost accounting has come into existence to solve all the
managerial problems.

Match the Following

39. 1] Canon of Variety / Diversity 1] multiple tax system

2] Canon of Comprehensiveness 2] Power of understanding as well as the

act of including.

3] Sound tax system 3] should help the government to check

the inflationary trends
 SYMBIOSIS CENTRE FOR DISTANCE LEARNING (SCDL)
Program: PGDBF
Subject: Accounting Systems & Financial Analysis

4] Section-5 of the Income Tax Act 4] Specifies the scope of the total income
liable to the income-tax in any previous
year.

5] Provides a complete list of all the

incomes that are totally exempt from tax.

6] The definitions of various expressions

used in the Act.

40. 1] Ratio analysis helps in 1] assessing the long term financial

viability of a firm
2] Current Ratio 2] measures the short term liquidity of a
firm
3] Net working capital 3] measures the liquidity of a firm

4] Acid Test or Quick Asset Ratio 4] measures the liquidity position of a

firm
5] measures long term liquidity of the
firm
6] measures bank finance to the firm

41. 1] Inventory Turnover ratio 1] indicates how fast inventory is sold

2] Debtor's Turnover Ratio 2] measures how fast debts are collected

3] Creditors Turnover Ratio 3] indicates how much credit is received

by the firm
4] Debt Equity Ratio 4] indicates the relative proportions of
debt and equity in financing the assets of
the firm
5] indicates short term debt compared to
equity of the firm

6] indicates how long it takes to receive

money from the creditors

42. 1] Financial statements reveal 1] sound financial health of a firm

2] Balance sheet is 2] statement of assets and liabilities of a

firm on given date
3] Profit and loss statement is 3] the working results of a firm for given
one year
4] Financial statements helps in 4] understanding the performance of the
firm
5] sound financial health of the owners
SYMBIOSIS CENTRE FOR DISTANCE LEARNING (SCDL)
Program: PGDBF
Subject: Accounting Systems & Financial Analysis

6] understanding the performance of the

economy of the country