Practice Test

Q1) Financial statements need to be prepared in accordance with : Show Answer

Q2) Objective of an audit of financial statements is to enable the auditor to express an opinion. Show Answer

Q3) If the financial statements are prepared as per the financial reporting framework the auditor gives an opinion that the financial statements Show Answer

Q4) The term 'General Purpose Financial Statements' never includes Show Answer

Q5) Which of the following errors is an error of omission. Show Answer

Q6) Which of the following errors is an error of principle ? Show Answer

Q7) Errors of recording do not allow Show Answer

Q8) Which of the following errors will affect the Trial Balance ? Show Answer

Q9) Which of the following errors will not affect the Trial Balance ? Show Answer

Q10) The total of Sales Book was not posted to the ledger. This is Show Answer

Q11) Sales Book was overcast by Rs.500. This is Show Answer

Q12) The total of a folio in the Sales Book Rs.1,000 was carried forward as Rs.100. This is Show Answer

Q13) Sales to Ram Rs.143 posted to his account as Rs.134. This is Show Answer

Q14) Sales to Meena Rs.143 posted to Meenu as Rs. 143. This is Show Answer

Q15) Goods of the value of Rs.376 were returned by Ram and were taken into stock on the same date but no entry was made in the books. This is Show Answer

Q16) A credit sale wrongly passed through the purchases book. This is Show Answer

Q17) Repairs of newly purchased second-hand machinery debited to Repairs Expenses Account. This is Show Answer

Q18) Repairs to Machinery had been charged to Machinery A/c. This is Show Answer

Q19) Cartage paid for newly purchased machinery, posted to Cartage Account. This is. Show Answer

Q20) Goods taken away by the proprietor for personal use not recorded anywhere. This is Show Answer

Q21) Which of the following errors will affect the trial balance? Show Answer

Q22) If a purchase return of Rs.84 has been wrongly posted to the debit of the sales return account but had been correctly entered in the suppliers account, the total if the trial balance would show Show Answer

Q23) A purchase of Rs.1870 by cheque has been wrongly posted in the cash book as Rs.1780. This has the effect of Show Answer

Q24) After preparing the trial balance the accountant finds that the total of the credit side is short by Rs.1500 . this difference will be Show Answer

Q25) _________ is basically responsible for prevention and detection of errors and frauds. Show Answer

Q26) Which of the following is not true about opinion on financial statement? Show Answer

Q27) Which of the following statement is not true? Show Answer

Q28) As per AAS-4, if auditor detects an error then Show Answer

Q29) Which of the following is not a limitation of audit as per AAS 4? Show Answer

Q30) How many principles are listed in AAS 1 which govern auditor's professional obligation ? Show Answer

Q31) The risk of fraud increases when Show Answer

Q32) Which of the following factors likely to identified as a fraud factor by the auditor ? Show Answer

Q33) Professional skepticism requires that the auditor assume that management is Show Answer

Q34) Audit of banks is an example of- Show Answer

Q35) Balance sheet audit includes verification of Show Answer

Q36) Which of the following statements is not true about continuous audit Show Answer

Q37) Balance sheet audit does not include Show Answer

Q38) Which of the following statements is not correct about materiality? Show Answer

Q39) State which of the following statements is false Show Answer

Q40) Audit under statute means: Show Answer

Q41) In case of audit of partnership or sole proprietorship: Show Answer

Q42) 'Error' means a __________mistake in financial information. Show Answer

Q43) 'Fraud' means a _________ mistake in financial information Show Answer

Q44) _______ audit means an audit at regular intervals throughout the accounting year Show Answer

Q45) ______ audit means an audit taken up after the end of the accounting year. Show Answer

Q46) An audit of accounts prepared for the period of six months from 1st April to 30th September, would be called _____ audit. Show Answer

Q47) ___audit is an audit of transactions as soon as a transaction takes place. Show Answer

Q48) Auditing and assurance standard ___issued by the ICAI deals with the concept of materiality Show Answer

Q49) Information is material if its _______could influence the economic decisions of users Show Answer

Q50) AAS _______ deals with 'going concern' concept Show Answer

Q51) Negative net worth ___ an indicator that the concern is not a going concern Show Answer

Q52) Inability to pay the creditors is an indicator that the concern ______ a Going Concern Show Answer

Q53) The total of sales book was not posted to the ledger. This_________affect the trial balance. Show Answer

Q54) Sales book was overcast by Rs.500. this _____affect the trial balance. Show Answer

Q55) The total of a folio in the sales book Rs. 1,000 was carried forward as Rs. 100. this ____ affect the trial balance Show Answer

Q56) Sales to Ram Rs.143 posted to his account as Rs.134. this ____affect the trial balance. Show Answer

Q57) Sales to Meena Rs.143 posted to Meenu as Rs.143. this _______ affect the trial balance. Show Answer

Q58) Goods of the value of Rs.376 were returned by ram and were taken into stock on the same date but no entry was made in the books. This ________affect the trial balance Show Answer

Q59) A credit sale was wrongly passed through the purchases book. This ___ affect the trial balance Show Answer

Q60) Repairs of newly purchased second-hand machinery were debited to repairs expenses account. This _______ affect the trial balance Show Answer

Q61) Repairs to machinery had been charged to machinery A/c. this _______ affect the trial balance Show Answer

Q62) Cartage paid for newly purchased machinery was posted to cartage account. This _____affect the trial balance Show Answer

Q63) Goods taken away by the proprietor for personal use were not recorded anywhere. This ___________ affect the trial balance Show Answer

Q64) Recording a transaction in a wrong book of original entry with wrong amount but not posted in Journal ____affect the trial balance Show Answer

Q65) Recording a transaction in a correct book of original entry with wrong amount but not posted in Journal ____affect the trial balance Show Answer

Q66) Wrong carrying forward of a balance to next page ______ affect the trial balance Show Answer

Q67) Writing an amount in the wrong account but on the correct side _____ affect the trial balance Show Answer

Q68) Wrong balancing of an account ____ affect the trial balance Show Answer

Q69) Wrong totaling of an account _____affect the trial balance Show Answer

Q70) Treating a capital item as a revenue item ______affect the trial balance Show Answer

Q71) Audit of co-operative societies is _____audit Show Answer

Q72) In _______audit the final accounts can be prepared immediately after the year end. Show Answer

Q73) ______ is known as audit in installments Show Answer

Q74) Public limited companies listed on the stock exchange have to declare their quarterly results. It is preferable to declare such results on the basis of _____ audit. Show Answer

Q75) Balance sheet audit is done if the internal control system is very _____. Show Answer

Q76) ________audit is less expensive and suitable for a small business Show Answer

Q77) The term General purpose financial statement includes a cash flow statement (wherever applicable). Show Answer

Q78) The term general purpose financial statements includes statement and explanatory note which form part thereof. Show Answer

Q79) The term general purpose financial statement does not include supplementary schedules and information based on such statements. Show Answer

Q80) The term general purpose financial statements does not include directors report. Show Answer

Q81) According to AAS-1, auditing is the independent examination of financial information of any profit oriented entity. Show Answer

Q82) It is not the objective of the audit to give an opinion on the future prospects of business. Show Answer

Q83) It is the objective of the audit to give an opinion on the efficiency of effectiveness of the management. Show Answer

Q84) A clean audit report indicated that the business will continue to be profitable in future Show Answer

Q85) An agreed trial balance indicated error-free books Show Answer

Q86) Any type of error causes difference in the trial balance. Show Answer

Q87) Two sided errors do not affect the agreement of trial balance. Show Answer

Q88) Casting error is a type of two sided error. Show Answer

Q89) Compensating error causes difference in the trial balance. Show Answer

Q90) In book keeping errors are rectified by erasing the wrong figures and writing the correct figures instead. Show Answer

Q91) Errors of omission do not allow the trial balance to agree. Show Answer

Q92) Posting a correct amount in the wrong account on correct side does not affect the trial balance. Show Answer

Q93) Errors of recording in the books of original entry will affect the trial balance. Show Answer

Q94) Correct recording in the journal proper but not posted in the ledger will affect the trial balance. Show Answer

Q95) Correct recording in the cash book but not posted in the ledger will affect the trial balance. Show Answer

Q96) Errors of principle will affect the trial balance. Show Answer

Q97) If the amount is posted in the wrong account or it is written on the wrong side of an account it is called an error of commission. Show Answer

Q98) The trial balance ensures the arithmetical accuracy of the book. Show Answer

Q99) Wrong casting of subsidiary books does not affect the trial balance. Show Answer

Q100) Rectification of errors will not necessarily balance a trial balance. Show Answer

Q101) A tallied trial balance will not reveal compensating errors. Show Answer

Q102) In window dressing the net worth in understated in the final accounts. Show Answer

Q103) Secret reserves arise when the profits are understated in the final accounts. Show Answer

Q104) A secret reserve is legally allowed to be created by banks. Show Answer

Q105) Balance sheet audit does not involve an examination of the various items in the profit and loss account. Show Answer

Q106) Audit evidence is not conclusive in nature. Show Answer

Q107) An auditor cannot be expected to discover deeply laid frauds. Show Answer

Q108) An auditor cannot take the help of experts such as valuers etc. Show Answer

Q109) Auditing of accounts is compulsory In partnership firm. Show Answer

Q110) Auditing of accounts is undertaken to detect frauds in the books of accounts. Show Answer

Q111) Audited accounts are free from errors and frauds. Show Answer

Q112) Audit of accounts is optional in case of a private limited company. Show Answer

Q113) The auditor must not disclose any information acquired by him in the course of his work without the written permission of the institute of CA of India Show Answer

Q114) The phrase used to express the auditor's opinion is give a true and correct view. Show Answer

Q115) Unless an auditor is able to discover all frauds and errors he has not performed its main function. Show Answer

Q116) There is little difference between auditing and accounting as both deal with financial statements. Show Answer

Q117) The auditor compares entries in the books of account with the vouchers;and if the two agree then his work is done. Show Answer

Q118) Safeguarding the company's property is the function of management; hence the auditor is not concerned with verification of assets and liabilities. Show Answer

Q119) Auditor is not concerned with the compliance with the accounting principles. Show Answer

Q120) Accounts become incorrect when the principle of double entry is not followed. Show Answer

Q121) The auditor should act like a bloodhound and not a watch dog. Show Answer

Q122) Interim audit of a company is compulsory under Indian Companie Act, 1956. Show Answer

Q123) Continuous audit helps the company to present its audited accounts to the shareholders immediately after the close of the financial year. Show Answer

Q124) The main object of audit is Show Answer

Q125) _______ audit is less expensive and suitable for a small business. Show Answer

Q126) A sales of RS.1,00,000 to Deepali was entered as sale to Rupali. This is an example of Show Answer

Q127) ________ audit is very expensive but is reliable. Show Answer

Q128) salary paid to Ranjita RS.50,000 is debited to her account. It is an example of error of Show Answer

Q129) Auditor audits the book of account from last 6 months then it is which type of audit he is doing? Show Answer

Q130) How many principles are listed in AAS1 / SA 200 which govern auditor's professional obligation ? Show Answer

Q131) A sale of Rs.1,00,000 to A was entered as sale to B this is an example of Show Answer

Q132) After examination of records the statutory auditor has to Communicate his judgement to Show Answer

Q133) When the account are manipulated to show a better position then it is Show Answer

Q134) Fraud through defalcation is an Show Answer

Q135) The balance sheet audit should be conducted only if Show Answer

Q136) Audited statement can be used for Show Answer

Q137) Goods sent on approval have been recorded as credit sale. This is an example of Show Answer

Q138) Hidden reserve can be done by Show Answer

Q139) Main object of audit is Show Answer

Q140) Auditor can give ________ opinion in the report Show Answer

Q141) Misappropriation of goods is conducted by Show Answer

Q142) A person may defraud his owners at the time of receipt of cash by way of Show Answer

Q143) Payment of salary to Mr.X is debited to X's A/C is an error of Show Answer

Q144) Disadvantages of continuous audit Show Answer

Q145) Manipulation of accounts to show a beter position is called as: Show Answer

Q146) Which audit is conducted in between two annual audits? Show Answer

Q147) Who should act like a watchdog but not blood hound? Show Answer

Q148) Manipulation of accounts is a Show Answer

Q149) The most difficult to detect fraud is based on Show Answer

Q150) An auditor is a watch dog and not a blood hound this decision is given in Show Answer

Q151) The risk of fraud increases when Show Answer

Q152) Audit of banks is an example of Show Answer

Q153) Concurrent audit is a part of Show Answer

Q154) Balance sheet audit is Show Answer

Q155) Audit in depth is a Show Answer

Q156) Balance sheet audit includes verification of Show Answer

Q157) Which of the following statement is not true about continuous audit Show Answer

Q158) Which of the following is not fact of Efficiency cum performance audit Show Answer

Q159) Balance sheet audit does not include Show Answer

Q160) Manufacture and other companies (Audit report) order 1988 is replaced by Show Answer

Q161) Special audit can be ordered by Show Answer

Q162) Cost audit is compulsory for Show Answer

Q163) Internal audit is same as interim audit Show Answer

Q164) Internal audit is compulsory to all companies Show Answer

Q165) Statutory audit is not applicable to Pvt. Ltd. company Show Answer

Q166) Continuous audit is day to day audit Show Answer

Q167) Balance sheet audit should be used in addition to final audit. Show Answer

Q168) ddcbajjabhjVDHIQWGD? Show Answer