Administrator, Author at GetMCQs

1671. Who will issue licence to an applicant on his certification as per regulations?

Designated person in the insurer’s office as authorised by the IRDA

An officer of the IRDA

Controller of Insurance in the Ministry of Finance

An official of the Insurance Institute of India

✅ The correct answer is A.
Designated person in the insurer’s office as authorised by the IRDA will issue licence to an applicant on his certification as per regulations.

155. Error which affect only one account can be

Error of complete omission

Error of posting

Compensatory errors

None of the above

✅ The correct answer is B.
Error which affect only one account can be Error of posting. An error in which amount is posted to the wrong side of the same account is known as error of posting. For example, goods sold to X wrongly credited to his account.

1673. In a statement of cash flows, a company investing in short-term financial investments and in fixed assets results in

increased cash

decreased cash

increased liabilities

increased equity

✅ The correct answer is B.
In a statement of cash flows, a company investing in short-term financial investments and in fixed assets results in decreased cash.

1674. What is the set time limit for completing a claim investigation?

1 month

6 months

1 year

2 years

✅ The correct answer is B.
The set time limit for completing a claim investigation is 6 months.

1675. Approaches used to allocate joint costs include

sales value at split off method

net realizable value method

constant gross margin percentage NRV method

all of above

✅ The correct answer is D.
Approaches used to allocate joint costs include sales value at split off method, net realizable value method and constant gross margin percentage NRV method.

156. Different accounting policies can be adopted in the following area(s)

Valuation of inventories

Valuation of Investments

Calculation of depreciation

All of the above

✅ The correct answer is D.
Different accounting policies can be adopted in the Valuation of inventories, Valuation of Investments and Calculation of depreciation.

1677. Conversion cost includes cost of converting……… into ……

Raw material, WIP

Raw material, Finished goods

WIP, Finished goods

Finished goods, Saleable goods

✅ The correct answer is B.
Conversion cost includes cost of converting Raw material into Finished goods. There are two main components of conversion costs: direct labor and manufacturing overheads.

1678. If overtime is resorted to at the desire of the customer, then the overtime premium:

should be charged to costing profit and loss account;

should not be charged at all

should be charged to the job directly

should be charged to the highest profit making department

✅ The correct answer is C.
If overtime is resorted to at the desire of the customer, then the overtime premium should be charged to the job directly. Overtime premium is paid to the workers for the extra time worked than the normal working hours specified in the Factories Act, 1948 or work agreement with the union.

1680. In a normal accounting period, an allocated amount of indirect cost is $700 and an actual amount is $800, then this can be classified as

under allocated indirect cost

over allocated direct cost

over allocated budget

under allocated budget

✅ The correct answer is A.
In a normal accounting period, an allocated amount of indirect cost is $700 and an actual amount is $800, then this can be classified as under allocated indirect cost because the allocated amount is less than actual amount.

157. Provision for bad debts is made as per the

Conservatism concept

Cost concept

Consistency concept

Going concern concept

✅ The correct answer is A.
Provision for bad debts is made as per the Conservatism concept. The conservatism principle is the general concept of recognizing expenses and liabilities as soon as possible when there is uncertainty about the outcome, but to only recognize revenues and assets when they are assured of being received.

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