Accounting for Internal Reconstruction MCQ

1. Internal reconstruction is a slow and tedious process since it required the approval of :

A. Court

B. Shareholders

C. Creditors

D. All of the Above.

Answer: –

D. All of the Above.

2. If the preference shareholder agree to sacrifice the arrear off preference dividend, it is credited to:

A. Capital Reduction A/C

B. Preference Shareholders A/C

C. Goodwill A/c

D. Profit& Loss A/C

Answer: –

A. Capital Reduction A/C

3. After the implementation of the scheme of internal reconstruction , any surplus in
capital reduction A/C is transferred to :

A. Capital A/C

B. Profit & Loss A/C

C. Shareholders A/C

D. Capital reserve A/C

Answer: –

D. Capital reserve A/C

4. ……………………reconstruction refers to the reduction of capital to cancel any paid up capital.

A. External

B. Internal

C. Amalagamation

D. Absorption

Answer: –

B. Internal

5. Reduction of share capital is possible by the company, if it is authorized by its:

A. Articles.

B. Special resolution.

C. Confirmation of the court.

D. All of the Above.

Answer: –

D. All of the Above.

Also Read :-

6. Converting share of smaller denomination into larger denominations is called:

A. Sub-division

B. Combination

C. Consolidation

D. Merger

Answer: –

C. Consolidation

7. Converting share of larger denomination into smaller denominations is called:

A. Sub-division

B. Combination

C. Consolidation

D. Merger

Answer: –

A. Sub-division

8. After the implementation of scheme of internal reconstruction, any amount left in the capital reduction A/C will be transfer to:

A. Capital Reserve A/C

B. Capital A/c

C. Profit & Loss A/C

D. Shareholders A/C

Answer: –

A. Capital Reserve A/C

9. The main purpose of internal reconstruction is to:

A. Eliminate the accumulated losses from the books.

B. Bring down the assets to their true values

C. Both A&B above

D. Only A

Answer: –

C. Both A&B above

10. A fair and equitable distribution of loss is the essence of a successful scheme of:

A. External reconstruction.

B. Merger

C. Amalgamation

D. Internal reconstruction

Answer: –

D. Internal reconstruction

Also Read :-

reconstruction refers to the reduction of capital to cancel any paid up capital

( Best 10+ ) Accounting for Internal Reconstruction MCQ

Accounting for Internal Reconstruction MCQ