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139. Which one of the following methods of inventory costing produces ending stock cost close to the market value of the inventory?

FIFO
LIFO
AVCO or averrage cost
Answer: Option A
✅ The correct answer is A.
FIFO methods of inventory costing produces ending stock cost close to the market value of the inventory. FIFO (First-in, first-out) method is based on the perception that the first inventories purchased are the first ones to be sold. It is a cost flow assumption for most companies. Since the theory perfectly matches to the actual flow of goods, therefore it is considered as the right way to value inventory.

1579. A bond whose price will rise above its face value is classified as

premium face value
premium bond
premium stock
premium warrants
✅ The correct answer is B.
A bond whose price will rise above its face value is classified as premium bond. A premium bond is a bond trading above its face value or in other words; it costs more than the face amount on the bond.

1581. Under trading means.

Having low amount of working capital
High turnover of working capital
Sales are less compared to assets employed
Low turnover of working capital
✅ The correct answer is D.
Under trading means low turnover of working capital. Under-trading is the reverse of over-trading. It means keeping funds idle and not using them properly. This is due to the under employment of assets of the business, leading to the fall of sales and results in financial crises.

1573. Which of the following statements are correct?

The Ombudsman’s authority is limited to claims matters only
The Ombudsman is not a judicial authority
Both the statements above are correct
None of the three
✅ The correct answer is B.
The insurance ombudsman mechanism had been set up by the insurers themselves, as an alternative dispute redressal system. It is a quasi-judicial body, established to address the grievances of customers, without them having to involve themselves in lengthy court proceedings.

1571. Nominal rate which is quoted to consumers on loans is considered as

annual percentage rate
annual rate of return
loan rate of return
local rate of return
✅ The correct answer is A.
Nominal rate which is quoted to consumers on loans is considered as annual percentage rate. An annual percentage rate (APR) is the annual rate charged for borrowing or earned through an investment. APR is expressed as a percentage that represents the actual yearly cost of funds over the term of a loan.

1555. Profits

Are lower in the long run than in the short run
Can be negative
Are less in perfect competition than in monopoly
All of the above
✅ The correct answer is D.
Profits are lower in the long run than in the short run, it can be negative and are less in perfect competition than in monopoly.
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