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Accounting - Questions and Answers for Competitive Exams | GkSeries

37. In funds flow statement, outflow of funds on account of operations is
  • [A] application of fund
  • [B] source of cash
  • [C] application of cash
  • [D] source of fund

Answer: Option [A]

38. In funds flow statement, repayment of long-term loans is
  • [A] application of fund
  • [B] source of cash
  • [C] application of cash
  • [D] source of fund

Answer: Option [A]

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39. In adjusted P & L account, depreciation on fixed assets will be
  • [A] debited
  • [B] credited
  • [C] ignored
  • [D] deducted

Answer: Option [A]

40. Cash flow analysis is based on the
  • [A] capital
  • [B] fixed assets
  • [C] cash concept of funds
  • [D] working capital

Answer: Option [C]

41. In cash flow statement, increase in current asset
  • [A] increases cash
  • [B] decreases cash
  • [C] increases working capital
  • [D] decreases working capital

Answer: Option [B]

42. In cash flow statement, opening balances of bank balance is posted in which side of the statement
  • [A] sources of cash
  • [B] application of cash
  • [C] sources of funds
  • [D] application of funds

Answer: Option [A]

43. In cash flow statement, closing balances of bank balance is posted in which side of the statement
  • [A] sources of cash
  • [B] application of cash
  • [C] sources of funds
  • [D] application of funds

Answer: Option [B]

44. Production cost under marginal costing includes
  • [A] prime cost only
  • [B] prime cost and fixed overhead
  • [C] prime cost and variable overhead
  • [D] prime cost, variable overhead and fixed overhead

Answer: Option [C]

45. Contribution margin is equal to
  • [A] fixed cost - loss
  • [B] profit + variable cost
  • [C] sales - fixed cost - profit
  • [D] sales - profit

Answer: Option [A]

46. P/V Ratio is an indicator of
  • [A] the rate at which goods are sold
  • [B] the volume of sales
  • [C] the volume of profit
  • [D] the rate of profit

Answer: Option [D]

47. An increase in variable costs
  • [A] increases p/v ratio
  • [B] increases the profit
  • [C] reduces contribution
  • [D] increases margin of safety

Answer: Option [C]

48. CVP analysis is most important for the determination of
  • [A] sales revenue necessary to equal fixed costs
  • [B] relationship between revenues and costs at various levels of operations
  • [C] variable revenues necessary to equal fixed costs
  • [D] volume of operations necessary to Break-even

Answer: Option [A]

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