PRACTICAL AUDITING MCQ
Auditing typically refers to financial statement audits or an objective examination and evaluation of a company’s financial statements – usually performed by an external third party. Audits can be performed by internal parties and a government entity, such as the Internal Revenue Service (IRS)
191. A ————— report is one which contains the opinion of the auditor subject to certain conditions
a. Unqualified
b. Qualified
c. Clean
Answer:- b. Qualified
192. ————— is made out of reserves or share premium
a. Preference shares
b. Bonus shares
c. Debentures
Answer:- b. Bonus shares
193. —————- shares cannot be issued if the company makes any default in the payment of its obligation
a. Preference
b. Equity
c. Bonus
Answer:- c. Bonus
194. Capitalization of reserves means ————————-
a. Creation of provision
b. Declaration of dividend
c. Issue of bonus shares
Answer:- c. Issue of bonus shares
195. Provisions regarding bonus issue should be given in ——————– document
a. Memorandum of association
b. Articles of association
c. Prospectus
Answer:- b. Articles of association
196. Balance remaining in the forfeited Account after reissue is transferred to ————— account
a. General reserve
b. Capital reserve
c. Premium account
Answer:- b. Capital reserve
197. If reissue of shares are more than face value of shares, the excess amount is transferred to ———- account.
a. General reserve
b. Capital reserve
c. Premium account
Answer:- c. Premium account
198. Share call amount due is credited to —————— account
a. Share application account
b. Share allotment account
c. Share capital account
Answer:- c. Share capital account
199. When excess applications money is refunded to applicants it is vouched with cash book and ——-
a. Letter of allotment
b. Letter of call
c. Letter of regreat
Answer:- c. Letter of regreat
200. Partial auditing is usually done by
a. Sole trading concern
b. Joint stock company
c. Govt. department
Answer:- a. Sole trading concern
