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Commerce Questions and Answers for Competitive Exams | Commerce Quiz Set 19

Questions
1 Which of the following is not true ?
1 When all the forfeited shares are not reissued, the forfeited shares account will also show as credit balance equal to gain on forfeiture of shares not yet reissued.
2 Loss on reissue of shares cannot be more than gain on forfeiture of those shares.
3 At the time of forfeiture of shares, securities premium is debited along with share capital when premium has not been received.
4 When forfeited shares are issued at premium, the premium amount is credited to Capital Reserve Account.

Answer: When forfeited shares are issued at premium, the premium amount is credited to Capital Reserve Account.
2 Preparation of consolidated Balance Sheet of Holding Company and its subsidiary
1 AS 11
2 AS 22
3 AS 23
4 AS 21

Answer: AS 21
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3 Amount due to outgoing partner is shown in the balance sheet as his
1 Liability
2 Capital
3 Asset
4 Loan

Answer: Loan
4 In which one of the following market situations, the pricing above the prevailing market price is used as a more common practice ?
1 Markets where the selling firms face perfect competitive situations.
2 Markets where the selling firms want to gain popularity of the products having high cross elasticity of their demand
3 Markets where sellers rely on their customers’ high propensity to consume a prestigious commodity.
4 Markets where the selling firms have entered into the stages of maturity and saturation.

Answer: Markets where sellers rely on their customers’ high propensity to consume a prestigious commodity.
5 Which one of the following statements is false regarding normal distribution ?
1 Mean, Median and Mode always coincide.
2 Within ± 1.96 σ limits from Mean value, the area under the distribution is 99 percent of the total area.
3 The area under the normal curve represents probabilities for the normal random variable and the total area for the normal probability distribution is one.
4 For every pair of values of Mean and Standard deviation, the curve of the distribution is bell-shaped and symmetric.

Answer: Within ± 1.96 σ limits from Mean value, the area under the distribution is 99 percent of the total area.
6 Creating the capability of making purchases directly from a firm’s website is known as
1 Electronic Networking
2 Electronic Information Transfer
3 Electronic Data Interchange
4 Electronic Transactions

Answer: Electronic Transactions
7 In integrating specialist functions of product management with the line function of sales as major challenge to top management can be achieved by which type of marketing organization ?
1 Functional organization
2 Territorial organization
3 None of the above
4 Matrix organization

Answer: Matrix organization
8 That personal leverage can replace corporate leverage’ is assumed by
1 Traditional Approach
2 Net Income Approach
3 M M Model
4 Net Operating Income Approach

Answer: M M Model
9 In certainty-equivalent approach, risk adjusted cash flows are discounted at
1 Accounting Rate of Return
2 Internal Rate of Return
3 Hurdle Rate
4 Risk-free Rate

Answer: Risk-free Rate
10 Which council was established in India by Government of India in the year 1966 to promote safety consciousness among workers in industries ?
1 Factory Advise Council
2 National Industrial Council
3 Safety Regulations Council
4 National Safety Council

Answer: National Safety Council
11 With a view to encourage newer classes of entrepreneurs and bringing about wider dispersal of ownership and control of industrial undertakings, IDBI operates a special scheme for supplementing the equity contribution to projects made by small and new entrepreneurs. This scheme is known as
1 Bridge Loan Scheme
2 Soft Loan Scheme for Modernisation
3 Technical Development Fund Scheme
4 Seed Capital Assistance Scheme

Answer: Seed Capital Assistance Scheme
12 Which one of the following is not the objective of UTI ?
1 To give everyone a chance to indirectly own shares and securities in a large number of select companies.
2 To maximise mobilisation of people’s savings by making insurance linked savings adequately attractive.
3 To channelize the pooled savings into productive outlets.
4 To mobilise savings of the community by offering savers the triple benefits of safety, liquidity and profitability of investments

Answer: To maximise mobilisation of people’s savings by making insurance linked savings adequately attractive.
13 Which of the following correctly depicts differences between a merger and an acquisition of stock ?
1 An acquisition of stock results in the total absorption of a firm whereas a merger does not.
2 In case of a merger, the firm can deal directly with the shareholders of the acquired firm but not in the case of acquisition of stock.
3 Shareholders of the acquired or target firm vote by their response to a tender offer in an acquisition of stock but cast a formal vote in a merger situation.
4 A formal vote by the acquired firm’s shareholders is required for an acquisition of stock but not for a merger.

Answer: Shareholders of the acquired or target firm vote by their response to a tender offer in an acquisition of stock but cast a formal vote in a merger situation.
14 Which of the following statements is correct ?
1 The oldest stock exchange of India is OTCEI.
2 In book-building process, the price of the security is announced by the company.
3 Sensex is an index number of 30 scrips.
4 Futures and options in shares are traded at all stock exchanges of India.

Answer: Sensex is an index number of 30 scrips.
15 The concept of achieving maximum profits through increased consumer satisfaction for raised market share focuses on
1 Product
2 Selling
3 Production
4 Customer

Answer: Customer

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