RCA Inter CA Mega Quiz Contest
Questions and Answers
- 1.
Once, AS, Ind AS and Companies Act played a game. What was the order of ranking?
- A.
Ind AS, AS, Company law
- B.
Ind AS, Company law, AS
- C.
Company law, Ind AS, AS
- D.
Company law, and then a tie between Ind AS and AS
Correct Answer
D. Company law, and then a tie between Ind AS and ASExplanation
The correct answer is "Company law, and then a tie between Ind AS and AS". This means that Company law is ranked first, followed by a tie between Ind AS and AS.Rate this question:
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- 2.
Which of the following is NOT a part of an Asset’s definition?
- A.
Control
- B.
Result of past events
- C.
Reasonable certainty of receipt
- D.
Future economic benefits
Correct Answer
C. Reasonable certainty of receiptExplanation
The concept of "reasonable certainty of receipt" is not a part of an asset's definition. An asset is generally defined as a resource that is controlled by an entity as a result of past events and from which future economic benefits are expected to flow to the entity. While control, past events, and future economic benefits are all essential components of an asset's definition, the notion of "reasonable certainty of receipt" is not explicitly included in the definition.Rate this question:
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- 3.
Which of the following is NOT a part of a Liability’s definition?
- A.
Result of past events
- B.
Present obligation
- C.
Reliable measurement of amount
- D.
Outflow of resources is expected
Correct Answer
C. Reliable measurement of amountExplanation
A liability is defined as a present obligation arising from past events, where an outflow of resources is expected. The reliable measurement of the amount is not a part of a liability's definition because the exact amount of the liability may not always be known or easily measurable.Rate this question:
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- 4.
Which of the following chapters do not use concepts from AS?
- A.
Company Final Accounts
- B.
Branch Accounting
- C.
Departmental Accounting
- D.
Every chapter would in some way cover AS
Correct Answer
C. Departmental AccountingExplanation
Departmental Accounting is the correct answer because it is a chapter that does not use concepts from AS (Accounting Standards). AS are guidelines and principles that are followed in financial reporting to ensure consistency and transparency. While Company Final Accounts and Branch Accounting may involve the application of AS, Departmental Accounting focuses on the allocation and analysis of costs and revenues within different departments of a company, and does not necessarily require the use of AS.Rate this question:
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- 5.
You have to urgently finalize the profit figure and balance sheet totals. Which of the following transactions cannot wait?
- A.
Sale of long term investments
- B.
Provision for bad debts turning out to be actual
- C.
Investing excess money from sale of investment in cash equivalents
- D.
Payment of a creditor for Assets purchased by issuing shares
Correct Answer
B. Provision for bad debts turning out to be actualExplanation
The provision for bad debts turning out to be actual cannot wait because it affects the accuracy of the profit figure and balance sheet totals. If the provision for bad debts is not adjusted to reflect the actual amount, it could result in an overstatement of profits and an incorrect representation of the company's financial position. Therefore, it is important to finalize this transaction urgently to ensure the financial statements are accurate.Rate this question:
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- 6.
Which ‘provisions’ are covered by AS 29?
- A.
Provision for expenses
- B.
Provision for bad debts
- C.
Provision for depreciation
- D.
All of the above
Correct Answer
A. Provision for expensesExplanation
AS 29 covers all of the above provisions. AS 29, also known as "Provisions, Contingent Liabilities and Contingent Assets," provides guidance on the recognition, measurement, and disclosure of provisions. It includes provisions for expenses, such as restructuring costs, legal obligations, and warranties. It also covers provisions for bad debts, which are created to account for potential losses from uncollectible accounts receivable. Additionally, AS 29 addresses provisions for depreciation, which are made to account for the decrease in value of assets over time. Therefore, all three provisions mentioned in the question are covered by AS 29.Rate this question:
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- 7.
Which AS mentions nothing about discounting to present value (whether affirmatively or negatively)?
- A.
AS 19
- B.
AS 29
- C.
AS 22
- D.
AS 26
Correct Answer
D. AS 26Explanation
AS 26 does not mention anything about discounting to present value. This means that it does not provide any guidance or requirements regarding the process of discounting future cash flows to their present value.Rate this question:
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- 8.
A Whatsapp group was created for ‘Group’ companies. Who would not be a member?
- A.
A Ltd, who owns 51% stake in B Ltd
- B.
C Ltd, which is jointly controlled by A Ltd and X Ltd
- C.
V Ltd, whose board of directors are majorly the same as A Ltd
- D.
W Ltd, whose board of director’s composition is decided by A Ltd
Correct Answer
C. V Ltd, whose board of directors are majorly the same as A LtdExplanation
The question is asking for the member who would not be a part of the Whatsapp group created for 'Group' companies. The correct answer is V Ltd because its board of directors are majorly the same as A Ltd. Since the group was created for companies that have some level of distinction or difference, V Ltd, which has majorly the same board of directors as A Ltd, would not be included in the group.Rate this question:
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- 9.
Definitions or provisions of which of the following Acts are not part of any Topic?
- A.
Banking Regulations Act, 1949
- B.
Reserve Bank of India (Amendment) Act, 1997
- C.
Partnership Act, 1932
- D.
All are covered
Correct Answer
D. All are coveredExplanation
The given question asks which Acts' definitions or provisions are not part of any Topic. The correct answer is "All are covered." This means that all of the Acts mentioned in the question (Banking Regulations Act, 1949; Reserve Bank of India (Amendment) Act, 1997; Partnership Act, 1932) have their definitions or provisions included in some Topic. Therefore, none of the Acts mentioned are excluded or not covered in any Topic.Rate this question:
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- 10.
Issue of shares with differential rights basically covers
- A.
Preference share capital
- B.
Equity Share capital
- C.
Debentures
- D.
Two of the above
Correct Answer
B. Equity Share capitalExplanation
The issue of shares with differential rights refers to the practice of issuing equity shares with different rights and privileges compared to the ordinary equity shares. This can include shares with different voting rights, dividend rights, or redemption rights. Therefore, the correct answer is equity share capital, as it is the only option that specifically relates to the issue of shares with differential rights.Rate this question:
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- 11.
Which of the following is not an Analytical Procedure as per SA 520?
- A.
Intrafirm Balance Sheet Comparison
- B.
Interfirm Profit and loss Comparison
- C.
ROI Calculation
- D.
Sales growth comparison
Correct Answer
B. Interfirm Profit and loss ComparisonExplanation
Interfirm Profit and loss Comparison is not considered an Analytical Procedure as per SA 520. Analytical procedures involve the evaluation of financial information by studying relationships between different sets of data. Intrafirm Balance Sheet Comparison, ROI Calculation, and Sales growth comparison all involve analyzing data within a single company. However, Interfirm Profit and loss Comparison involves comparing financial information between different companies, which is not classified as an Analytical Procedure according to SA 520.Rate this question:
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- 12.
If you are bored of checking a huge volume of transactions, then you will resort to which SA?
- A.
SA 530
- B.
SA 500
- C.
SA 520
- D.
SA 505
Correct Answer
A. SA 530Explanation
SA 530 is the correct answer because it specifically addresses the auditor's responsibility for examining the financial statements in order to form an opinion on them. This SA provides guidance on how to plan and perform an audit of financial statements, including considerations for assessing the risk of material misstatement and designing appropriate audit procedures. Therefore, if someone is bored of checking a large number of transactions, they would likely turn to SA 530 for guidance on how to efficiently and effectively complete the audit process.Rate this question:
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- 13.
If you as a businessman are worried of the cash being stolen from the locker, you will most likely resort to
- A.
Physical controls
- B.
Logical Controls
- C.
Segregation of Duties
- D.
Trust the most loyal employee
Correct Answer
C. Segregation of DutiesExplanation
Segregation of Duties is the most suitable option for a businessman worried about cash theft from the locker. This control measure involves dividing responsibilities and tasks among different employees to ensure that no single individual has complete control over all aspects of a transaction. By implementing segregation of duties, the risk of fraud or theft is minimized as multiple employees are involved in the cash handling process, reducing the opportunity for any one person to commit a fraudulent act without detection. This control measure promotes accountability and transparency within the organization, making it an effective solution for mitigating the risk of cash theft.Rate this question:
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- 14.
How many Standards on Auditing are there between the series SA 200 – SA 300?
- A.
7
- B.
8
- C.
9
- D.
10
Correct Answer
C. 9Explanation
There are 9 Standards on Auditing between the series SA 200 and SA 300.Rate this question:
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- 15.
Ek aisi cheez joh sirf meri hai, merit hi, aur meri rahegi
- A.
Audit Working Papers
- B.
Books of Accounts
- C.
Audit Report
- D.
Vouchers, deeds and documents
Correct Answer
A. Audit Working PapersExplanation
Audit working papers are documents that contain the evidence and information gathered during an audit. They are created by the auditors and are considered their personal property. These papers are used to support the findings and conclusions made in the audit report. They are important for future reference, as they provide a detailed record of the audit process and the evidence obtained. The working papers are confidential and should not be shared with anyone outside the audit team. Therefore, they are solely owned by the auditors and will remain their property even after the completion of the audit.Rate this question:
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- 16.
If test of contols and substantive audit procedures are other audit procedures then _________ and ___________ are substantive audit procedures
- A.
Test of Details and Test of Transactions
- B.
Test of balances and test of details
- C.
Test of Controls and Analytical Procedures
- D.
Test of Details and Analytical Procedures
Correct Answer
D. Test of Details and Analytical ProceduresExplanation
The given correct answer is "Test of Details and Analytical Procedures." This is because the question states that "Test of Controls and Substantive Audit Procedures are other audit procedures," implying that the two options mentioned are also substantive audit procedures. Therefore, the correct answer must be the option that includes both "Test of Details" and "Analytical Procedures."Rate this question:
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- 17.
Agar confirming party ka jawab aaya magar usne outstanding balance ko sahi nahi maana, toh yeh kaunsa confirmation request maana jaaygea?
- A.
Positive Response Request
- B.
Negative Response Request
- C.
Positive Confirmation Request
- D.
Negative Confirmation Request.
Correct Answer
C. Positive Confirmation RequestExplanation
If the confirming party has responded but has not accepted the outstanding balance as correct, then it means that they are not confirming the accuracy of the balance. In this case, a Positive Confirmation Request would be appropriate to request the party to confirm the balance as correct. This type of request is used when the sender wants the recipient to confirm a specific detail or amount as accurate.Rate this question:
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- 18.
If you are CA Pradyuman, which of the following audit evidences are less reliable?
- CA Daya obtaining records from the accountant of the company
- CA Abhijit witnessing cash embezzlement with his own eyes
- CA Taarika obtaining photocopy of bank statements
- A.
I, ii, iii
- B.
I, iii, iv
- C.
Ii, iii, iv
- D.
I, ii, iv
Correct Answer
B. I, iii, ivExplanation
The less reliable audit evidences in this case are obtaining records from the accountant of the company (CA Daya), obtaining photocopy of bank statements (CA Taarika), and obtaining audit evidences orally (CA Salunkhe). These evidences may be less reliable because they can be easily manipulated or altered. Witnessing cash embezzlement with one's own eyes (CA Abhijit) is a more reliable evidence as it provides direct observation of the event.Rate this question:
- 19.
A company pays royalty to state government on the basis of production, it is treated as
- A.
Direct Material Cost
- B.
Factory Overheads
- C.
Direct Expenses
- D.
Administration Cost
Correct Answer
C. Direct ExpensesExplanation
When a company pays royalty to the state government based on production, it is treated as direct expenses. Direct expenses are costs that can be directly attributed to a specific product or service. In this case, the royalty payment is directly related to the production activities of the company and is therefore considered a direct expense.Rate this question:
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- 20.
Which of the following items is included in cost accounts?
- A.
Notional Rent
- B.
Donations
- C.
Transfer to general reserve
- D.
Rent receivable
Correct Answer
A. Notional RentExplanation
Notional rent refers to the hypothetical rent that a company could have earned if it had rented out its own property instead of using it for its own operations. It is included in cost accounts because it represents an opportunity cost for the company, as it could have generated additional income by renting out the property. Including notional rent in cost accounts allows the company to accurately calculate the total cost of production and make informed decisions regarding the utilization of its resources.Rate this question:
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- 21.
Jo ho gaya, so ho gaya, ab uska kuch kar nahi sakte! Batao kaunsa cost hoon mein :
- A.
Opportunity Cost
- B.
Historical Cost
- C.
Past Cost
- D.
Sunk Cost
Correct Answer
D. Sunk CostExplanation
Sunk cost refers to a cost that has already been incurred and cannot be recovered. It is irrelevant to future decision-making because the cost is already spent and cannot be changed. In the given context, the phrase "Jo ho gaya, so ho gaya, ab uska kuch kar nahi sakte!" suggests that the cost has already been incurred and there is no possibility of changing it or taking any action related to it. Therefore, the correct answer is Sunk Cost.Rate this question:
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- 22.
If 1000 units cost Rs. 1,50,000 and 1500 units cost Rs. 1,75,000, then how much does 2,100 units cost?
- A.
3,15,000
- B.
2,45,000
- C.
2,05,000
- D.
2,73,000
Correct Answer
C. 2,05,000Explanation
Let's find the cost per unit by dividing the total cost by the number of units.
For 1000 units, the cost is Rs. 1,50,000, so the cost per unit is Rs. 150.
For 1500 units, the cost is Rs. 1,75,000, so the cost per unit is Rs. 116.67.
Now, we can calculate the cost for 2100 units by multiplying the cost per unit (Rs. 116.67) by 2100.
2100 * 116.67 = Rs. 2,45,003.33
Therefore, the cost for 2100 units is approximately Rs. 2,45,000.Rate this question:
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- 23.
In case product produced or jobs undertaken are of diverse nature, the system of costing to be used should be
- A.
Process costing
- B.
Operating Costing
- C.
Job Costing
- D.
Contract Costing
Correct Answer
C. Job CostingExplanation
When the products produced or jobs undertaken are of diverse nature, the most suitable costing system to be used is job costing. Job costing is a costing method used when each product or job is unique and requires different resources and costs. It allows for the allocation of costs to specific jobs or products, making it easier to track the costs associated with each individual job. This is particularly useful when the products or jobs vary significantly in terms of materials, labor, and overhead costs.Rate this question:
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- 24.
Ek aisa driver batao jo consumption quantity batata hai, batao batao
- A.
Activity Cost driver
- B.
Resource Cost Driver
- C.
Pool Cost Driver
- D.
Object Cost Driver
Correct Answer
B. Resource Cost DriverExplanation
The correct answer is Resource Cost Driver because a resource cost driver is a factor that determines the cost of using a particular resource in a business activity. It measures the consumption of resources such as labor, materials, or machine hours, and helps allocate costs to different activities based on their resource usage. In this context, the driver mentioned is capable of providing information about the consumption quantity, which aligns with the definition of a resource cost driver.Rate this question:
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- 25.
Calculate tax liability of Mr. Donald Trump, resident of US, aged 74 years, having income in India of Rs. 50,01,500 for AY 2020-21.
- A.
13,65,468
- B.
13,14,000
- C.
13,66,560
- D.
13,63,960
Correct Answer
C. 13,66,560 -
- 26.
Agar Abhishek ne Aaradhya (daughter) ko ghar transfer kia and she received a rent of Rs. 50,000 per month, toh bataiye Abhishek ji ko kitna taxable hoga?
- A.
Zero
- B.
5,98,500
- C.
5,82,000
- D.
6,00,000
Correct Answer
B. 5,98,500 -
- 27.
Income from Salary inme se kaunse heads se pyaar karta hai?
- A.
Income from House Property
- B.
Profits and Gains from Business Profession
- C.
Capital Gains
- D.
Income From Other Sources
Correct Answer
A. Income from House PropertyExplanation
Income from House Property is a separate head under which income from owning and renting out a property is categorized. It includes the rental income received from letting out a house or building, and any income derived from owning and maintaining a property. This income is taxed separately and is subject to specific rules and deductions. Therefore, Income from House Property is the correct answer as it represents a distinct category of income in the tax system.Rate this question:
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- 28.
For claiming deduction under section 32AD, which of the following conditions do not apply?
- A.
New plant and machinery should be installed in the office
- B.
The plant machinery should not be second hand
- C.
If the machinery is put to use for less than 180 days, 50% shall be allowed this year and 50% in the following year
- D.
Machinery not to be transferred within 5 years of purchase.
Correct Answer
C. If the machinery is put to use for less than 180 days, 50% shall be allowed this year and 50% in the following yearExplanation
The conditions that do not apply for claiming deduction under section 32AD are: If the machinery is put to use for less than 180 days, 50% shall be allowed this year and 50% in the following year.Rate this question:
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- 29.
Which of the following is true?
- Capital Gearing Ratio and Debt Equity Ratio is the same
- Zero Coupon Bonds pay the entire interest amount in the last year.
- Cost of Equity is the maximum return an investor would expect from an investment
- A.
D
- B.
C
- C.
B
- D.
A
Correct Answer
C. BExplanation
The correct answer is B. NPV and PI methods sometimes lead to different conclusions. The NPV (Net Present Value) method calculates the present value of cash flows and subtracts the initial investment to determine the profitability of an investment. The PI (Profitability Index) method calculates the ratio of the present value of cash inflows to the initial investment. While both methods are used to evaluate investment projects, they can sometimes lead to different conclusions because they prioritize different aspects of profitability.Rate this question:
- 30.
Which of the following categories of managers is correct?
- A.
Portfolio Manager – Controller
- B.
Tax Manager – Treasurer
- C.
Internal Auditor – Treasurer
- D.
Data Processing Manager – Controller
Correct Answer
D. Data Processing Manager – ControllerExplanation
The correct answer is Data Processing Manager - Controller. This is because a data processing manager is responsible for overseeing the processing and management of data within an organization, while a controller is responsible for managing the financial activities and reporting of an organization. These two roles are distinct and do not overlap with the other options provided.Rate this question:
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- 31.
Inme se kaunsa cost is a type of Agency Cost
- A.
Training Cost
- B.
Recruitment Cost
- C.
Opportunity Cost
- D.
Implicit Cost
Correct Answer
C. Opportunity CostExplanation
Opportunity cost refers to the value of the next best alternative that is forgone when making a decision. It represents the potential benefits or profits that could have been obtained if a different choice had been made. In the context of agency costs, opportunity cost can be seen as the cost incurred by an agent when they choose one course of action over another, resulting in the loss of potential benefits from the alternative option. Therefore, opportunity cost is a type of agency cost.Rate this question:
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- 32.
Which of the following instruments have the highest minimum investment amount?
- A.
Commercial Paper
- B.
Certificate of Deposit
- C.
Treasury Bills
- D.
Secured Premium Notes
Correct Answer
A. Commercial PaperExplanation
Commercial Paper typically has the highest minimum investment amount among the given instruments. Commercial Paper is a short-term debt instrument issued by corporations to raise funds for their short-term financing needs. It is typically issued in large denominations, such as $100,000 or more, and is primarily targeted towards institutional investors and high-net-worth individuals. In contrast, Treasury Bills, Certificate of Deposit, and Secured Premium Notes generally have lower minimum investment amounts and are available to a wider range of investors.Rate this question:
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- 33.
My turnover from sale of computers this financial year was RS. 25,00,000 and I sold warranties worth Rs. 25,000. Am I eligible for Composition Scheme u/s 10?
- A.
Yes, because I sold warranties for Cash
- B.
Yes, because I’m permitted to do so as per CGST Act
- C.
No, Sale of services is not allowed.
- D.
No, because gut feeling.
Correct Answer
B. Yes, because I’m permitted to do so as per CGST ActExplanation
The correct answer is "Yes, because I’m permitted to do so as per CGST Act." According to the CGST Act, businesses with a turnover of up to Rs. 1.5 crore are eligible for the Composition Scheme. Selling warranties is considered a permissible activity under this scheme. Therefore, the individual in question, who sold warranties worth Rs. 25,000, is eligible for the Composition Scheme.Rate this question:
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- 34.
Agar mujhe Lamborghini chaiye, toh tax ke taur pe kitna bharna padega
- A.
Quarter Lamborghini Price
- B.
Half Lamborghini Price
- C.
Three Forth Lamborghini Price
- D.
One Tenth Lamborghini Price
Correct Answer
B. Half Lamborghini PriceExplanation
The correct answer is "Half Lamborghini Price." This answer suggests that if the person wants to buy a Lamborghini, they would need to pay half of the Lamborghini's price as taxes.Rate this question:
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- 35.
I purchased a min bus with seating capacity of 14 passengers. My CA says it is blocked credit under section 17(5). What should I do?
- A.
A CA is always right.
- B.
CA knows much better than me.
- C.
Apply to ICAI to cancel his membership.
- D.
Change your CA.
Correct Answer
C. Apply to ICAI to cancel his membership.Explanation
The answer suggests that the individual should apply to the Institute of Chartered Accountants of India (ICAI) to cancel the membership of their CA. This implies that the CA's advice regarding the min bus being blocked credit under section 17(5) is incorrect or misleading. By canceling the CA's membership, the individual can seek guidance from a different CA who may provide more accurate information and advice.Rate this question:
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- 36.
A company offering securities under private placement, shall allot them within _____ days from the date of receipt of application money.
- A.
Fifteen
- B.
Thirty
- C.
Sixty
- D.
Ten
Correct Answer
C. SixtyExplanation
A company offering securities under private placement is required to allot them within sixty days from the date of receipt of application money. This means that the company must complete the process of allocating the securities to the applicants within this specified time frame. Failure to do so may result in non-compliance with regulations and potential penalties.Rate this question:
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- 37.
A company has to transfer _______ of the profits of the company to the reserves of the current year, before declaration of dividend.
- A.
10%
- B.
20%
- C.
25%
- D.
As the Company may decide
Correct Answer
D. As the Company may decideExplanation
The correct answer is "As the Company may decide". This means that the amount of profits to be transferred to the reserves of the current year before declaring dividends is not fixed and can be determined by the company based on their own discretion and financial needs. The company may choose to transfer any percentage of the profits to the reserves, depending on various factors such as future investment plans, expansion strategies, or financial stability.Rate this question:
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- 38.
For appointing an auditor other than the retiring director,
- A.
Special notice is required
- B.
Ordinary notice is required
- C.
Neither ordinary nor special notice is required
- D.
Approval of central government is required
Correct Answer
A. Special notice is requiredExplanation
When appointing an auditor other than the retiring director, special notice is required. This means that the company must provide advance notice to all its shareholders about the proposed appointment. This notice must be given at least 14 days before the meeting in which the appointment will be discussed. The purpose of this requirement is to ensure transparency and give shareholders the opportunity to raise any concerns or objections regarding the appointment of the new auditor.Rate this question:
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- 39.
First auditor of a government company shall be appointed within ______ days of the date of registration of the company.
- A.
15
- B.
30
- C.
60
- D.
90
Correct Answer
C. 60Explanation
The first auditor of a government company should be appointed within 60 days of the date of registration of the company. This is to ensure that the company's financial statements are audited in a timely manner and to establish transparency and accountability in the company's financial reporting. The appointment of an auditor within this timeframe allows for an independent assessment of the company's financial records and helps to identify any potential irregularities or fraudulent activities.Rate this question:
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- 40.
Company may convert all or any of its fully paid up shares into stock:
- A.
By passing a special resolution
- B.
By passing a ordinary resolution
- C.
With the approval of the Tribunal
- D.
All of the above
Correct Answer
B. By passing a ordinary resolutionExplanation
The company can convert its fully paid-up shares into stock by passing an ordinary resolution. This means that a simple majority of the shareholders present and voting at a general meeting can approve the conversion. It does not require a special resolution, which typically requires a higher majority, or the approval of the Tribunal. Therefore, the correct answer is that the company can convert its shares into stock by passing an ordinary resolution.Rate this question:
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