UNIT – I and UNIT – II

1. What is the main purpose of IFRS?

A. To standardize accounting practices globally
B. To regulate national accounting standards
C. To oversee financial audits
D. To manage financial institutions
Answer: A

2. Which organization issues IFRS?

A. International Accounting Standards Board (IASB)
B. Financial Accounting Standards Board (FASB)
C. Securities and Exchange Board of India (SEBI)
D. Reserve Bank of India (RBI)
Answer: A

3. Ind AS are converged with which global accounting standards?

A. US GAAP
B. IFRS
C. UK GAAP
D. IAS
Answer: B

4. Which Ind AS deals with revenue from contracts with customers?

A. Ind AS 115
B. Ind AS 16
C. Ind AS 110
D. Ind AS 32
Answer: A

5. What is the IFRS equivalent of Ind AS 16 (Property, Plant, and Equipment)?

A. IFRS 16
B. IAS 16
C. IFRS 15
D. IAS 32
Answer: B

6. Ind AS 21 deals with:

A. Leases
B. The Effects of Changes in Foreign Exchange Rates
C. Revenue Recognition
D. Employee Benefits
Answer: B

7. Which IFRS standard is applicable for financial instruments?

A. IFRS 7
B. IFRS 9
C. IFRS 13
D. IFRS 16
Answer: B
 8. Ind AS 109 is related to:
A. Financial Instruments
B. Consolidated Financial Statements
C. Leases
D. Revenue from Contracts with Customers
Answer: A

9. Which IFRS standard focuses on fair value measurement?

A. IFRS 3
B. IFRS 9
C. IFRS 13
D. IFRS 16
Answer: C

10. Ind AS 24 deals with:

A. Related Party Disclosures
B. Earnings per Share
C. Borrowing Costs
D. Income Taxes
Answer: A

11. What is the IFRS equivalent of Ind AS 110 (Consolidated Financial Statements)?
A. IFRS 10
B. IFRS 11
C. IFRS 12
D. IFRS 13
Answer: A

12. Which standard sets out the principles for the recognition, measurement, presentation,
and disclosure of leases?
A. IFRS 16
B. IFRS 17
C. Ind AS 16
D. Ind AS 17
Answer: A

13. Ind AS 37 relates to:

A. Provisions, Contingent Liabilities, and Contingent Assets
B. Income Taxes
C. Intangible Assets
D. Financial Instruments
Answer: A

14. IFRS 15 deals with:

A. Leases
B. Revenue from Contracts with Customers
C. Financial Instruments
D. Fair Value Measurement
Answer: B
 15. Which Ind AS standard corresponds to IFRS 1 (First-time Adoption of International
Financial Reporting Standards)?
A. Ind AS 101
B. Ind AS 102
C. Ind AS 103
D. Ind AS 104
Answer: A

16. IFRS 3 addresses:

A. Business Combinations
B. Employee Benefits
C. Financial Instruments
D. Revenue Recognition
Answer: A

17. Ind AS 36 is associated with:

A. Impairment of Assets
B. Borrowing Costs
C. Employee Benefits
D. Consolidated Financial Statements
Answer: A

18. Which IFRS standard deals with insurance contracts?

A. IFRS 4
B. IFRS 7
C. IFRS 9
D. IFRS 16
Answer: A

19. Ind AS 19 relates to:

A. Employee Benefits
B. Income Taxes
C. Leases
D. Financial Instruments
Answer: A

20. Which IFRS standard corresponds to Ind AS 113 (Fair Value Measurement)?
A. IFRS 13
B. IFRS 10
C. IFRS 11
D. IFRS 12
Answer: A

21. IFRS 10 deals with----------------------------

a) Financial instruments b) Consolidated financial statements c) Operating segments d) Joint
arrangements
Answer: B

22. …...........................is developed by ministry of corporate affairs

a) IND AS b) IFRS c) IASB d) GAAP
Answer: A

23. The component which is not included in the financial statement of IND AS
a) Profit &loss a/c b) Cash flow statement
c) Balance sheet d) Statement of profit &loss
Answer: A

24. A statement which presents the revenues and expenses of an enterprise for an
accounting period is
a) Trading A/c b) Profit & Loss A/c
c) Balance Sheet d) Cash flow statement
Answer: B

25. Which one is financial report?

a) Ledger b) Trial Balance c) Balance sheet d) Sales account
Answer: C

26. Measurements also refers to

a) recognition b) disclosure c) valuation d)Presentation
Answer: C

27. The term current asset doesn’t cover

a) Car b) Debtors c) Stock d)Prepaid expenses
Answer: A

28. IASB stands for

"Indian Accounting Standard Board"
"International Accounting Standard"
c) "International Accounting Service"
d) "Indian Accounting Service Board"
Answer: B

29. An obligation to transfer economic benefit as a result of past transactions or events is

called
a) Asset b) Liability c) Purchase d) Trading
Answer: B

30. Accounting Standard-3 (AS-3), issued by The Institute of Chartered Accountants

of India (ICAI) deals with the
a) Trial Balance b) Balance Sheet
c) Profit and loss a/c d) Cash Flow statement
Answer: B

31. Accounting Standard 3 deals with

a) Depreciation b) Cash Flow Statement
c) Disclosures d) Foreign Exchange
Answer: B

32. For companies covered in phase one, the transition date would be
a) 1-Apr-15 b) 31-Mar-14 c) 31-Mar-15 d) 1-Apr-16
 Answer: A

33. Accounting Standard 6 deals with

a) Depreciation b) Cash Flow Statement
c) Disclosures d) Foreign Exchange
Answer: A

34. Organizations in US follows________

a) GAAP b) IFRS c) IAS d) None of these
Answer: A

35. Recording of capital contributed by the owner as liability ensures the adherence
of principle of
a) Consistency b) Going concern
c) Separate entity d) Materiality
Answer: C

36. Which accounting standard governs the impairment of assets?

a) IFRS 15 b) IAS 36 c) IFRS 9 d) IAS 1
Answer: B

37. What was IFRS previously known as?

a) Accounting standards
b) Standard interpretations
c) Indian accounting standards
d) International accounting standards"
Answer: D

38. Which account is least likely to be debited when revenue is recorded?

a) Account Payable b) Accounts receivable
c) Cash d) Unearned
Answer: A

39. Approximately, how many countries have adopted IFRS around the world?
a) 120 b) 135 c) 144 d) 115
Answer: C

40. IASC was established in the year

a) 1976 b) 1974 c) 1973 d) 1986
Answer: C

41. What is the main characteristic of U.S. GAAP compared to IFRS?

A. U.S. GAAP is rules-based.
B. U.S. GAAP is principles-based.
C. Both are principles-based.
D. Both are rules-based.
Answer: A

42. Which organization issues IFRS?

A. Financial Accounting Standards Board (FASB)
 B. International Accounting Standards Board (IASB)
C. Securities and Exchange Commission (SEC)
D. American Institute of CPAs (AICPA)
Answer: B

43. Which organization is responsible for U.S. GAAP?

A. IASB
B. FASB
C. SEC
D. AICPA
Answer: B

44. What is the main characteristic of U.S. GAAP compared to IFRS?

A. U.S. GAAP is rules-based.
B. U.S. GAAP is principles-based.
C. Both are principles-based.
D. Both are rules-based.
Answer: A

45. Ind AS 1 deals with:

A. Presentation of Financial Statements
B. Income Taxes
C. Leases
D. Financial Instruments
Answer: A

46. Under Ind AS 16, property, plant, and equipment should be initially measured at:
A. Historical cost
B. Fair value
C. Current cost
D. Replacement cost
Answer: A

47. Ind AS 21 deals with:

A. Borrowing Costs
B. The Effects of Changes in Foreign Exchange Rates
C. Employee Benefits
D. Consolidated Financial Statements
Answer: B

48. Which of the following is covered under Ind AS 40?

A. Investment Property
B. Revenue Recognition
C. Share-Based Payment
D. Business Combinations
Answer: A

49. Which Ind AS standard deals with financial statements of insurance companies?
A. Ind AS 104
B. Ind AS 106
 C. Ind AS 108
D. Ind AS 110
Answer: A

50. Ind AS 19 relates to:

A. Income Taxes
B. Employee Benefits
C. Revenue from Contracts with Customers
D. Leases
Answer: B

51. Which of the following is covered under Ind AS 2?

A. Inventories
B. Cash Flow Statements
C. Intangible Assets
D. Financial Instruments
Answer: A

52. Ind AS 37 is concerned with:

A. Provisions, Contingent Liabilities, and Contingent Assets
B. Financial Instruments
C. Revenue from Contracts with Customers
D. Leases
Answer: A

53. Ind AS 41 relates to:

A. Agriculture
B. Financial Instruments
C. Property, Plant, and Equipment
D. Investment Property
Answer: A

54. Ind AS 7 deals with:

A. Statement of Cash Flows
B. Presentation of Financial Statements
C. Inventories
D. Revenue Recognition
Answer: A

55. When should the capitalization of borrowing costs cease?

A. When the funds are borrowed
B. When the asset is substantially ready for its intended use or sale
C. When the loan is repaid
D. At the end of the financial year
Answer: B

56. Borrowing costs include:

A. Only interest on borrowings
B. Interest on borrowings and other costs incurred in connection with the borrowing
of funds
 C. Only the administrative costs of borrowings
D. Only the interest payable on government loans
Answer: B

57. Which of the following is considered a qualifying asset under Ind AS 23?
A. Inventory that is routinely manufactured
B. A building constructed over a period of 18 months
C. Financial investments
D. A company vehicle
Answer: B

58. Which Ind AS standard deals with accounting policies, changes in accounting
estimates, and errors?
A. Ind AS 1
B. Ind AS 8
C. Ind AS 10
D. Ind AS 16
Answer: B

59. A change in accounting policy should be applied:

A. Prospectively
B. Retrospectively
C. Only to current period
D. Only to future transactions
Answer: B

60. Which of the following is not considered a change in accounting policy?

A. Adopting a new accounting standard
B. Switching from straight-line depreciation to reducing balance method
C. Changing the estimation technique for determining bad debts
D. Correcting an error from a prior period
Answer: D

61. Which Ind AS standard deals with the impairment of assets?

A. Ind AS 16
B. Ind AS 36
C. Ind AS 38
D. Ind AS 40
Answer: B

62. An asset is considered impaired when:

A. Its carrying amount exceeds its recoverable amount
B. Its carrying amount is less than its recoverable amount
C. Its fair value exceeds its historical cost
D. Its historical cost exceeds its fair value
Answer: A
63. Recoverable amount is the higher of:
A. Fair value less costs of disposal and carrying amount
B. Carrying amount and historical cost
C. Fair value less costs of disposal and value in use
 D. Fair value less costs of disposal and net realizable value
Answer: C
64. Ind AS 36 requires an impairment test for intangible assets with an indefinite useful
life:
A. Annually and whenever there is an indication of impairment
B. Only when there is an indication of impairment
C. Every five years
D. Only upon disposal
Answer: A
65. If an impairment loss is identified, it should be:
A. Deferred and amortized over time
B. Recognized immediately in profit or loss
C. Disclosed in the notes only
D. Ignored until the asset is disposed of
Answer: B
66. Which Ind AS standard deals with inventories?
A. Ind AS 2
B. Ind AS 16
C. Ind AS 36
D. Ind AS 41
Answer: A
67. Inventories should be measured at:
A. Historical cost
B. Net realizable value
C. The lower of cost and net realizable value
D. Fair value
Answer: C
68. Which cost formula is not permitted under Ind AS 2?
A. First-In, First-Out (FIFO)
B. Weighted Average Cost
C. Last-In, First-Out (LIFO)
D. Specific Identification
Answer: C
69. Net realizable value is defined as:
A. The estimated selling price in the ordinary course of business less the estimated
costs of completion and the estimated costs necessary to make the sale
B. The historical cost of inventory
C. The fair value of inventory
D. The replacement cost of inventory
Answer: A
70. Which Ind AS standard deals with agriculture and biological assets?
A. Ind AS 2
B. Ind AS 16
C. Ind AS 36
D. Ind AS 41
Answer: D
71. Biological assets should be measured at:
A. Historical cost
B. Net realizable value
C. Fair value less costs to sell
 D. Replacement cost
Answer: C
72. Agricultural produce harvested from an entity's biological assets should be measured
at:
A. Cost
B. Fair value less costs to sell at the point of harvest
C. Net realizable value
D. Replacement cost
Answer: B
73. Which Ind AS standard deals with provisions, contingent liabilities, and contingent
assets?
A. Ind AS 37
B. Ind AS 36
C. Ind AS 38
D. Ind AS 40
Answer: A
74. A provision should be recognized when:
A. There is a possible obligation
B. There is a present obligation that is probable and can be reliably estimated
C. There is a present obligation that cannot be reliably estimated
D. There is a future obligation
Answer: B
75. A contingent liability is:
A. A present obligation that is probable and can be reliably estimated
B. A possible obligation depending on whether some uncertain future event occurs
C. A certain future obligation
D. A past obligation
Answer: B
76. A contingent asset is:
A. Recognized when the future inflow of economic benefits is virtually certain
B. Recognized when the future inflow of economic benefits is probable
C. Disclosed in the notes when the inflow of economic benefits is probable
D. Ignored in financial statements
Answer: C
77. Provisions should be measured at:
A. The best estimate of the expenditure required to settle the present obligation
B. The historical cost
C. The fair value
D. The nominal value
Answer: A
78. Which of the following is not a provision?
A. Warranties
B. Restructuring costs
C. Accounts payable
D. Onerous contracts
Answer: C
79. Which Ind AS standard deals with events after the reporting period?
A. Ind AS 1
B. Ind AS 10
C. Ind AS 37
 D. Ind AS 24
Answer: B
80. Events after the reporting period are those events that occur:
A. Before the reporting period
B. After the reporting period but before the financial statements are authorized for
issue
C. After the financial statements are authorized for issue
D. During the reporting period
Answer: B
81. Adjusting events after the reporting period are:
A. Events that provide evidence of conditions that existed at the end of the reporting
period
B. Events that provide evidence of conditions that arose after the reporting period
C. Events that do not affect the financial statements
D. Events that occur after the financial statements are authorized for issue
Answer: A
82. Non-adjusting events after the reporting period are:
A. Events that provide evidence of conditions that existed at the end of the reporting
period
B. Events that provide evidence of conditions that arose after the reporting period
C. Events that do not affect the financial statements
D. Events that occur before the reporting period
Answer: B
83. If an entity declares dividends after the reporting period, the dividends should be:
A. Recognized as a liability at the end of the reporting period
B. Disclosed in the notes to the financial statements
C. Recognized as an asset at the end of the reporting period
D. Ignored
Answer: B
84. A material non-adjusting event after the reporting period should be:
A. Recognized in the financial statements
B. Disclosed in the notes to the financial statements
C. Ignored
D. Deferred to the next reporting period
Answer: B
85. According to Ind AS 36, the impairment loss for an asset can be reversed:
A. If the asset’s recoverable amount increases
B. If the asset’s carrying amount decreases
C. If the asset is sold
D. If the asset is revalued
Answer: A
86. According to Ind AS 2, inventories are recognized as an expense:
A. When they are purchased
B. When they are sold
C. When they are produced
D. When they are distributed
Answer: B
87. Ind AS 41 requires fair value changes of biological assets to be recognized in:
A. Profit or loss
B. Other comprehensive income
 C. Equity
D. Notes to financial statements
Answer: A
88. A provision for restructuring costs is recognized when:
A. A restructuring plan is announced
B. The restructuring plan is approved and has started
C. The restructuring plan is announced and started
D. The restructuring plan is approved and has been announced to those affected
Answer: D
89. According to Ind AS 37, a provision should be reviewed:
A. At the end of each reporting period
B. At the end of each financial year
C. Only when a significant change occurs
D. At the discretion of management
Answer: A
90. Under Ind AS 10, an event that provides additional information about a condition that
existed at the end of the reporting period is:
A. An adjusting event
B. A non-adjusting event
C. A contingent event
D. An uncertain event
Answer: A