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NCERT MCQ ON Analysis of Financial Statements:

Question1: Financial Statement Analysis Objectives/Need is

• a) All of the options
• b) Measure the profitability of the business
• c) Measure the financial strength of the business
• d) Make comparative study within the firm and with other forms

Answer: All of the options

Question2: Significance or Importance of Financial Analysis is

• a) All of the options
• b) To know the profitability Condition
• c) To know the liquidity Condition
• d) To know the solvency Condition

Answer: All of the options

Question3: To whom Importance of Financial Analysis is

• a) All of the options
• b) For Management
• c) For Investors
• d) For Creditors

Answer: All of the options

Question4: Which is Types of financial Analysis

• a) Horizontal Analysis and Vertical Analysis
• b) Horizontal Analysis
• c) Vertical Analysis
• d) None of the options

Answer: Horizontal Analysis and Vertical Analysis

Question5: Horizontal Analysis is also known as

• a) Dynamic Analyses
• b) Vertical Analysis
• c) Dynamic Analyses and Vertical Analysis
• d) None of the options

Answer: Dynamic Analyses

Question6: In which analysis Financial Statement for a single year analysed

• a) Vertical Analysis
• b) Dynamic Analyses
• c) Vertical Analysis and Dynamic Analyses
• d) None of the options

Answer: Vertical Analysis

Question7: Tool of Financial Analysis is

• a) Comparative Statement and Common Size Statement
• b) Comparative Statement
• c) Common Size Statement
• d) None of the options

Answer: Comparative Statement and Common Size Statement

Question8: Comparative Statement is a form of

• a) Horizontal Analysis
• b) Vertical Analysis
• c) Horizontal Analysis and Vertical Analysis
• d) None of the options

Answer: Horizontal Analysis

Question9: Study of relationship between various items is known as

• a) Accounting Ratios
• b) Vertical Analysis
• c) Horizontal Analysis
• d) None of the options

Answer: Accounting Ratios

Question10: Operating Expenses is include

• a) All of the options
• b) Office and Administrative expenses
• c) Selling and Distribution expenses
• d) Provision for doubtful debts

Answer: All of the options

Question11: Non operating Expenses are

• a) All of the options
• b) Interest on long term debts
• c) Loss on sale of fixed assets
• d) Intangible assets written off such as goodwill, patents etc

Answer: All of the options

Question12: Importance of Comparative Statement is

• a) All of the options
• b) Make the data simple and more understandable
• c) Indicate the trend with respect to the previous year
• d) compare the firm performance with the performance of other firm in the same business

Answer: All of the options

Question13: Net Reserve and Surplus means total of all reserves less

• a) Miscellaneous Expenditure
• b) Office Expense
• c) Direct expenses
• d) All of the options

Answer: Miscellaneous Expenditure

Question14: Which of the following items appear in the Statement of Profit and Loss

• a) Sales
• b) Creditors
• c) Goodwill
• d) Trade payables

Answer: Sales

Question15: When analysis is made on the basis of Published statements, reports and information it is known as

• a) External analysis
• b) Horizontal analysis
• c) Vertical Analysis
• d) None of the options

Answer: External analysis

Question16: Who is interested in the analysis of financial statement?

• a) All of the options
• b) Creditors
• c) Government
• d) Investors

Answer: All of the options

Question17: The Real object of Analysis of Financial Statement is

• a) To measure the financial strength of the business
• b) To assess the total expenses of the firm
• c) To know about historical cost concept
• d) To assess the total liabilities of the firm

Answer: To measure the financial strength of the business

Question18: Limitations of financial analysis except

• a) All of the options
• b) Dont reflect changes in price level
• c) Affected by the personal ability and bias of the Analyst
• d) Single years Analysis of financial statement have limited use

Answer: All of the options

Question19: Shareholders are interested in the analysis of financial statement because

• a) They want to judge the present and future earning capacity of the business
• b) For the assessment of tax
• c) For Research
• d) All of the options

Answer: They want to judge the present and future earning capacity of the business

Question20: Horizontal Analysis is

• a) Time Series Analysis
• b) Cross Section Analysis
• c) Profitability Analysis
• d) All of the options

Answer: Time Series Analysis

Question21: The point where total of sales is exactly equal to the total of cost.

• a) Break-even Point
• b) Profit Point
• c) Loss Point
• d) All of the options

Answer: Break-even Point

Question22: Non-operating Incomes refers to

• a) Which are not from the main revenue producing activities
• b) Which are earned in the form of sales
• c) the indirect expenses relating to the principal revenue generating activities of the enterprise
• d) The expenses and losses which are not related to the operating activities

Answer: Which are not from the main revenue producing activities

Question23: Which is not a limitation of financial statement?

• a) Assess the financial position and profitability
• b) Qualitative aspect is ignored
• c) Ignores price level changes
• d) All of the options

Answer: Assess the financial position and profitability

Question24: Rent received, Profit on sale of fixed assets, Compensation for acquisition of land are example of

• a) Non-operating Incomes
• b) Operating Incomes
• c) Operating expenses
• d) None of the options

Answer: Non-operating Incomes

Question25: Statement of Profit and Loss is prepared to assess the

• a) Net Profit and Net Loss
• b) Net Profit
• c) Net Loss
• d) None of the options

Answer: Net Profit and Net Loss

Question26: If the different financial data is analysed and compared over a period of time it is called

• a) Intra firm analysis
• b) Inter firm analysis
• c) Trade analysis
• d) None of the options

Answer: Intra firm analysis

Question27: Comparison of two or more departments or divisions of the same business unit with the objective of meaningful analysis

• a) Intra-firm comparison
• b) Inter firm analysis
• c) Intra-firm comparison and Inter firm analysis
• d) None of the options

Answer: Intra-firm comparison

Question28: Internal analysis is done

• a) By Management
• b) By Shareholders
• c) By debenture holder
• d) None of the options

Answer: By Management

Question29: Financial year always begins on

• a) 1st April-31st March
• b) 1st January-31st December
• c) 1st August -31st July
• d) None of the options

Answer: 1st April-31st March

Question30: Comparative Financial Statement is an example of

• a) Horizontal analysis
• b) Vertical Analysis
• c) External analysis
• d) None of the options

Answer: Horizontal analysis

Question31:  Shareholders fund is divided into

• a) All of the options
• b) Share Capital
• c) Reserves and Surplus
• d) Money received against share warrant

Answer: All of the options

Question32: A technique uses in comparative analysis of financial statement is

• a) Common size analysis
• b) Graphical analysis
• c) Preference analysis
• d) Returning analysis

Answer: Common size analysis

Question33: Formula such as net income available for common stockholders divided by total assets is used to calculate

• a) Return on total assets
• b) Return on total equity
• c) Return on debt
• d) Return on sales

Answer: Return on total assets

Question34: A techniques uses to identify financial statements trends are included

• a) Common size analysis and Percent change analysis
• b) Common size analysis
• c) Percent change analysis
• d) None of the options

Answer: Common size analysis and Percent change analysis

Question35: Price per ratio is divided by cash flow per share ratio which is used for calculating

• a) Price to cash flow ratio
• b) Dividend to stock ratio
• c) Sales to growth ratio
• d) Cash flow to price ratio

Answer: Price to cash flow ratio

Question36: A formula such as net income available to common stockholders divided by common equity is used to calculate

• a) Return on common equity
• b) Return on interest
• c) Return on earning power
• d) None of the options

Answer: Return on common equity

Question37: Companies that help to set benchmarks are classified as

• a) Benchmark companies
• b) Analytical companies
• c) Return companies
• d) None of the options

Answer: Benchmark companies

Question38: Total assets divided common equity is a formula uses for calculating

• a) Equity multiplier
• b) Graphical multiplier
• c) Turnover multiplier
• d) None of the options

Answer: Equity multiplier

Question39: Profit margin multiply assets turnover multiply equity multiplier is used to calculate

• a) Return on equity
• b) Return on turnover
• c) Return on stock
• d) None of the options

Answer: Return on equity

Question40: Company low earning power and high interest cost cause financial changes which have

• a) High return on assets
• b) Low return on assets
• c) Low return on equity
• d) None of the options

Answer: High return on assets

Question41: Financial analysis becomes significant because it:

a) Ignores price level changes

b) Measures the efficiency of business

c) Lacks qualitative analysis

d) Is effected by personal bias

Answer: B

Question42: When bad position of the business is tried to be depicted as good, it is known as …………….

a) Personal Bias

b) Price Level Changes

c) Window Dressing

d) All of the Above

Answer:  C

Question43: For whom the analysis of financial statements is not significant?

a) Investor

b) Government

c) Ambassador of India

d) Company’s Employee

Answer: C

Question44: While preparing Common-size Balance Sheet, each item of Balance Sheet is expressed as % of

a) Non-current Assets.

b) Current Assets,

c) Non-current Liabilities.

d) Total Assets.

 Answer: D

Question45: Which analysis is considered as dynamic?

a) Horizontal Analysis

b) Vertical Analysis

c) Internal Analysis

d) External Analysis

Answer: A

Question46: Which analysis is considered as static?

a) Horizontal Analysis

b) Vertical Analysis

c) Internal Analysis

d) External Analysis

Answer: B

Question47: Comparative Statement of Profit & Loss provides information about:

a) Rate of increase or decrease in revenue from operations

b) Rate of increase or decrease in cost of revenue from operations

c) Rate of increase or decrease in net profit

d) All of the above

Answer: D

Question48: Which analysis depicts the relationship between two figures :

a) Ratio Analysis

b) Trend Analysis

c) Cumulative figures and averages

d) Dividend Analysis

Answer: A

Question49: In which analysis total cost are equal to total revenue from Operations :

a) Trend Analysis

b) Ratio Analysis

c) Break-Even Point Analysis

d) Fund Flow Statement Analysis

Answer: C

Question50: If net revenue from operations of a firm are Rs. 1,20,000; cost of revenue from operations is Rs.66,000 and operating expenses are Rs.21,600, what will be the percentage of operating income on net revenue from operations?

a) 55%

b) 45%

c) 73%

d) 27%

Answer: D

Question51: If net revenue from operations of a firm are Rs. 15,00,000; Gross Profit is Rs.9,00,000 and operating expenses are Rs.75,000, what will be percentage of operating income on net revenue from operations?

a) 45%

b) 55%

c) 35%

d) 65%

Answer: B

Question52: Main objective of Trend Analysis is

a) To make comparative study of the financial statements for a number of years

b) To indicate the direction of movement

c) To help in forecasts of various items

d) All of the Above

Answer: D

Question53: While preparing Common-size Balance Sheet, each item of Balance Sheet is expressed as % of

a) Current Assets

b) Non-current Assets

c) Non-current Liabilities

d) Total Assets

Answer: D

Question54: Under which tool of financial analysis, 100% is taken as base and all other related amounts are expressed as a percentage of base?

a) Comparative Statement

b) Common-size Statement

c) Ratio Analysis

d) Cash Flow Statement

Answer: B

Question55: The most commonly used tools for financial analysis are :

a) Comparative Statements

b) Common Size Statements

c) Accounting Ratios

d) All of the above

Answer: D

Question56: This item is not used as a tool for Analysis of Financial Statements :

a) Cash Flow Statement

b) Fund Flow Statement

c) Ratio Analysis

d) No. of Employees Statement

Answer: D

Question57: Which one of the following items is not a tool used for financial analysis?

a) Comparative Statements

b) Ratio Analysis

c) Common Size Statements

d) Statement of Dividend Distribution

Answer: D

Question58: Amount left after deducting gross profit from Revenue from Operations is generally :

a) Cost of Revenue from Operations

b) Material consumed

c) Opening Inventory + Purchases – Closing Inventory

d) All of the above

Answer: D

NCERT MCQ ON Financial Statements of a Company:

Question1: ___________ is conducted by bankers and government

• a) External Analysis
• b) Internal Analysis
• c) External Analysis and Internal Analysis
• d) None of the options

Answer: External Analysis

Question2: Bank overdraft is shown in the balance sheet under the

• a) Short Term Borrowings
• b) Non-current liabilities
• c) Non Current assets
• d) None of the options

Answer: Short Term Borrowings

Question3: An example of fixed asset is

• a) Live stock
• b) Value stock
• c) Income stock
• d) None of the options

Answer: Live stock

Question4: The assets held by a business which can be converted in the form of cash, without disturbing the normal operations of a business

• a) Current assets
• b) Tangible assets
• c) Intangible assets
• d) Fixed assets

Answer: Current assets

Question5: The return which the company pays on borrowed funds is termed as

• a) All of the options
• b) Interest
• c) Dividend
• d) Bonus

Answer: All of the options

Question6: The following is(are) the type(s) of capital budgeting decision(s)

• a) All of the options
• b) Diversification
• c) Replacements
• d) Expansion

Answer: All of the options

Question7: The following is(are) the external source(s) of cash

• a) All of the options
• b) Long terms loans
• c) Issue of new shares
• d) Short term borrowings

Answer: All of the options

Question8: The total cost that arises when the quantity produced is increased by one unit is called

• a) Marginal cost
• b) Average cost
• c) Fixed cost
• d) None of the options

Answer: Marginal cost

Question9: Current assets are also referred to as

• a) Working capital
• b) Investments
• c) Inventory
• d) None of the options

Answer: Working capital

Question10: Carriage Inward is normally debited to ____

• a) Manufacturing Account
• b) Profit and Loss account
• c) Capital Account
• d) None of the options

Answer: Manufacturing Account 

 

Question11: Reliability of financial analysis depends upon the

• a) Reliability of financial data
• b) Reliability of Customer
• c) Reliability of financial data and Reliability of Customer
• d) None of the options

Answer: Reliability of financial data

Question12: Objectives of analysis and interpretation of financial statements are

• a) All of the options
• b) Progress
• c) Position
• d) Prospects

Answer: All of the options

Question13: Sub- headings are Non Current Liabilities are

• a) All of the options
• b) Long Term borrowing
• c) Deferred Tax Liabilities
• d) Long Term Provisions

Answer: All of the options

Question14: Main headings of assets are

• a) Current Assets and Non Current assets
• b) Current Assets
• c) Non Current assets
• d) None of the options

Answer: Current Assets and Non Current assets

Question15: Main headings of the liability side of a company balance sheet

• a) All of the options
• b) Shareholders Fund
• c) Current Liabilities
• d) Non Current Liabilities

Answer: All of the options

Question16: Financial Statement provide a summary of

• a) All of the options
• b) Assets
• c) Liabilities
• d) Capital

Answer: All of the options

Question17: Calls in advance is to be shown under the heading of

• a) Current Liabilities
• b) Current Assets
• c) Current Liabilities and Current Assets
• d) None of the options

Answer: Current Liabilities

Question18: Goodwill is shown under which subheading

• a) Intangible Assets
• b) Current Assets
• c) Current Liability
• d) None of the options

Answer: Intangible Assets

Question19: Prepaid Expenses is

• a) Current Assets
• b) Current Liabilities
• c) Long term loan
• d) None of the options

Answer: Current Assets

Question20: Non Current Assets is

• a) Patents and Trade Marks
• b) Bills Receivables
• c) Prepaid Expenses
• d) Debtors

Answer: Patents and Trade Marks

Question21: Security Premium is show under which major head

• a) Shareholders fund
• b) Current Liabilities
• c) Current Assets
• d) None of the options

Answer: Shareholders fund

Question22: Provision for Provident Fund comes under

• a) Long-term Provision
• b) Trade Payable
• c) Other Current Liabilities
• d) None of the options

Answer: Long-term Provision

Question23:  Sinking Fund is shown under which subheading

• a) Reserve and Surplus
• b) Trade Payable
• c) Non Current Liabilities
• d) None of the options

Answer: Reserve and Surplus

Question24: Authorised Capital is shown under which major heading in balance sheet

• a) Shareholders Fund
• b) Current Liability
• c) Current Assets
• d) None of the options

Answer: Shareholders Fund

Question25: Debenture is shown under which major heading in balance sheet

• a) Non Current Liabilities
• b) Other Current Liabilities
• c) Current Liability
• d) None of the options

Answer: Non Current Liabilities

Question26: Example of Short-term Provision is

• a) Provision for Tax
• b) Debentures
• c) Loan
• d) None of the options

Answer: Provision for Tax

Question27: Provision for Tax is our

• a) Liability
• b) Assets
• c) Liability and Assets
• d) None of the options

Answer: Liability

Question28: Bills Payable shown under major heading Current Liability and Subheading

• a) Trade Payable
• b) Short-term Provision
• c) Other Current Liabilities
• d) None of the options

Answer: Trade Payable

Question29: Unclaimed Dividend shown under major heading Current Liability and Subheading

• a) Other Current Liabilities
• b) Trade Payable
• c) Short-term Provision
• d) None of the options

Answer: Other Current Liabilities

Question30: Unclaimed Dividend is shown under which major heading in balance sheet

• a) Current Liability
• b) Equity and Liability
• c) Current Assets
• d) None of the options

Answer: Current Liability

Question31: Proposed Dividend shown under major heading Current Liability and Subheading

• a) Short-term Provision
• b) Trade Payable
• c) Other Current Liabilities
• d) None of the options

Answer: Short-term Provision

Question32: Proposed Dividend is shown under which major heading in balance sheet

• a) Current Liability
• b) Current Assets
• c) Equity and Liability
• d) None of the options

Answer: Current Liability

Question33: Miscellaneous Expenditure are

• a) All of the options
• b) Preliminary Expenses
• c) Discount allowed on the issue of shares/deb
• d) Development expenditure not adjusted

Answer: All of the options

Question34: Fixed Assets subheading is divided into

• a) All of the options
• b) Tangible
• c) Intangible Assets
• d) Capital work in progress

Answer: All of the options

Question35: In Balance Sheet Bills Payable is shown under the

• a) Current Liabilities
• b) Current Assets
• c) Equity and Liability
• d) None of the options

Answer: Current Liabilities

Question36: Long term Liabilities is

• a) All of the options
• b) Bonds
• c) Debenture
• d) Loans from Banks

Answer: All of the options

Question37: Non Current Liabilities classified in balance sheet

• a) All of the options
• b) Long term borrowings
• c) Deferred tax liabilities
• d) Other long term liabilities

Answer: All of the options

Question38: Financial Statement also called

• a) Final Accounts
• b) Profit & Loss A/c
• c) Trading A/c
• d) None of the options

Answer: Final Accounts

Question39: Those expenses which paid in advance by the firm

• a) Prepaid expenses
• b) Accrued income
• c) Prepaid expenses and Accrued income
• d) None of the options

Answer: Prepaid expenses

Question40: Prepaid expenses are shown under

• a) Other current assets
• b) Inventories
• c) Cash Equivalents
• d) None of the options

Answer: Other current assets

Question41: Provision for Tax appears in a Company’s Balance Sheet under the Sub-head …………….

a) Short-term Provisions

b) Reserves and Surplus

c) Long-term Provisions

d) Other Current Liabilities

Answer: A

Question42: Bills Receivables appear in a Company Balance Sheet under the Sub-head

a) Current Investments

b) Cash Equivalents

c) Trade Receivables

d) Short term Loans and Advances

 Answer: C

NCERT MCQ ON Issue and Redemption of Debentures.:

Question1: Which of the following statements is true?

• a) A debenture issued at a discount can be redeemed at a premium
• b) A debenture holder is an owner of the company
• c) A debenture holder can get his money back only on the liquidation of the company
• d) A debenture holder receives interest only in the event of profits

Answer: A debenture issued at a discount can be redeemed at a premium

Question2: Which of the following statements is false?

• a) Debentures cannot be secured
• b) A company can issue convertible debentures
• c) A company can issue redeemable debentures
• d) Debentures have no right to participate in profits over and above their fixed interest

Answer: Debentures cannot be secured

Question3: Perpetual debentures are also known as

• a) Irredeemable debentures
• b) Secured Debentures
• c) Unsecured Debentures
• d) None of the options

Answer: Irredeemable debentures

Question4: Debenture premium cannot be used to

• a) Pay dividends
• b) Write off the discount on issue of shares or debentures
• c) Write off the premium on redemption of shares or debentures
• d) Write off capital loss

Answer: Pay dividends

Question5: Loss on issue of debentures is treated as

• a) Miscellaneous expenditure
• b) Intangible asset
• c) Current asset
• d) Current liability

Answer: Miscellaneous expenditure

Question6: Secured Debentures is known as

• a) Mortgage debentures
• b) Naked debentures
• c) Unsecured Debentures
• d) None of the options

Answer: Mortgage debentures

Question7: Unsecured Debentures is known as

• a) Simple or Naked debentures
• b) Mortgage debentures
• c) Secured Debentures
• d) None of the options

Answer: Simple or Naked debentures

Question8: Which of the following is not true about debenture stock:

• a) Debenture stock are identified by their distinct number
• b) It must be fully paid.
• c) Debenture Stock can be transferred in fraction.
• d) None of the options

Answer: Debenture stock are identified by their distinct number

Question9: Which is an agreement between the company and the trustees to look after the interest of debenture holders.

• a) Debenture trust deed
• b) Partnership deed
• c) Both
• d) None of the options

Answer: Debenture trust deed

Question10: A company can not issue

• a) Debentures with voting rights
• b) Share
• c) Debentures
• d) None of the options

Answer: Debentures with voting rights

Question11: Which of the following is not a characteristic of Bearer Debentures?

• a) Their transfer requires a deed of transfer
• b) They are treated as negotiable instruments
• c) They are transferable by mere delivery
• d) The interest on it is paid to the holder irrespective of identity

Answer: Their transfer requires a deed of transfer

Question12: Which of the following is/are true with respect to debentures?

• a) Both
• b) They can be issued for cash
• c) They can be issued for consideration other than cash
• d) None of the options

Answer: Both

Question13: When debentures are issued as collateral security, the final entry for recording the transaction in the books is

• a) Debit debenture suspense a/c. and credit debentures a/c.
• b) Credit debentures a/c. and debit cash a/c.
• c) Debit debenture suspense a/c. and credit cash a/c.
• d) None of the options

Answer: Debit debenture suspense a/c. and credit debentures a/c.

Question14: Which of the following is false with respect to debentures?

• a) They can be issued in lieu of dividends
• b) They can be issued for cash
• c) They can be issued for consideration other than cash
• d) They can be issued as collateral security

Answer: They can be issued in lieu of dividends

Question15: Which of the following is true with regard to 10% Debentures issued at a discount of 20%

• a) The face value and the carrying amount of debentures are equal.
• b) The carrying amount of debentures gets reduced each year at a rate of 20%
• c) Issue price and the carrying amount of debentures are equal
• d) At the time of redemption, the debenture holder will be paid the issue price

Answer: The face value and the carrying amount of debentures are equal.

Question16: Which of the following statements is false?

• a) The issue price and redemption value of debentures cannot differ.
• b) Debenture is a form of public borrowing
• c) It is customary to prefix debentures with the agreed rate of interest
• d) Debenture interest is a charge against profits

Answer: The issue price and redemption value of debentures cannot differ.

Question17: As per the Companies Act, Interest accrued and due on debentures should be shown Under

• a) Debentures.
• b) Capital
• c) Shares
• d) None of the options

Answer: Debentures.

Question18: Which of the following is false?

• a) Interest on debentures is an appropriation of profits.
• b) Equity is owners stake and the debenture is a debt
• c) Rate of interest on debentures is fixed
• d) Debenture holders get preferential treatment over the equity holders at the time of liquidation

Answer: Interest on debentures is an appropriation of profits.

Question19: Discount on issue of debentures is a

• a) Capital loss to be written off over the tenure of the debentures
• b) Revenue loss to be charged in the year of issue
• c) Capital loss to be written off from capital reserve
• d) Capital loss to be shown as goodwill

Answer: Capital loss to be written off over the tenure of the debentures

Question20: Debentures are shown in the balance sheet of a company under the head of

• a) Non current Liabilities
• b) Current Liabilities
• c) Share Capital
• d) None of the options

Answer: Non current Liabilities

Question21: When debentures are issues at discount , the discount should be written off

• a) During the life of the debentures
• b) In the year of the issue of debentures
• c) Within 5 years of the issue of the debentures
• d) None of the options

Answer: During the life of the debentures

Question22: Debenture holder are

• a) The creditors of the company
• b) The owners of the company
• c) The vendors of the company
• d) None of the options

Answer: The creditors of the company

Question23: Debenture interest is paid

• a) At a pre determined rate
• b) At variable rate
• c) 25% of Profit
• d) None of the options

Answer: At a pre determined rate

Question24: At the time of issue of debentures , debenture Account is

• a) Credited by the face value of debentures
• b) Credited by the Amount received
• c) Credited by the issue price of debentures
• d) None of the options

Answer: Credited by the face value of debentures

Question25: Discount or loss on issue of debentures to be written of within after 12 months from the date of balance sheet or after the period of operating cycle is shown as

• a) Other Non current Assets
• b) Other Current assets
• c) Other Current Liabilities
• d) None of the options

Answer: Other Non current Assets

Question26: Discount or loss on issue of debentures to be written of within 12 months from the date of balance sheet or within the period of operating cycle is shown as

• a) Other Current assets
• b) Other Non current Assets
• c) Other Current Liabilities
• d) None of the options

Answer: Other Current assets

Question27: Debenture is a

• a) Long term Loan
• b) Short term loan
• c) Dividend
• d) None of the options

Answer: Long term Loan

Question28: Which does not have possess the voting right

• a) Debenture Holder
• b) Share Holder
• c) Both
• d) None of the options

Answer: Debenture Holder

Question29: A written promise for a debt by a company under its seal which contains the terms and conditions regarding the amount of loan

• a) Debenture
• b) Share
• c) Capital
• d) None of the options

Answer: Debenture

Question30: Debenture holders are entitled the right to receive

• a) Interest
• b) Dividend
• c) Both
• d) None of the options

Answer: Interest

Question31: Debentures of a Company can be issued :

a) For Cash

b) For Consideration other than Cash

c) As a Collateral Security

d) Any of the above

Answer: D

Question32: On issue of debentures as a collateral security, which account is credited?

a) Debentures Account

b) Bank Loan Account

c) Debenture Holdings Account

d) Debenture Suspense Account

Answer: A

Question33: Debentures issued as collateral security will be debited to :

a) Bank Account

b) Debentures Suspense Account

c) Debentures Account

d) Bank Loan Account

Answer: B

Question34: On liquidation of company, principal amount of debentures is returned :

a) First of All

b) Last of All

c) Before Equity Capital

d) After Equity Capital

Answer: C

Question35: Which of the following statements is false?

a) Debenture is a form of public borrowing.

b) It is customary to prefix debentures with the agreed rate of interest.

c) Debenture interest is a charge against profits.

d) The issue price and redemption value of debentures cannot differ.

Answer: D

Question36: Which of the following is not a characteristic of Bearer Debentures?

a) They are treated as negotiable instruments.

b) Their transfer requires a deed of transfer.

c) They are transferable by mere delivery.

d) The interest on it is paid to the holder irrespective of identity.

Answer: B

Question37: When debentures are to be redeemed at premium an extra entry has to be made at the time of issue of debentures, which a/c should be credited in this entry?

a) Loss on issue of debentures a/c

b) Debenture redemption premium a/c

c) Bank a/c

d) Debenture holder’s a/c

Answer: B

Question38: Premium on Redemption of Debentures Account is :

a) Personal Account

b) Real Account

c) Nominal Account

d) All of the Above

Answer: A

Question39: Debenture interest is paid

a) at a predetermined rate.

b) at variable rate.

c) at a rate based on net profit of the company.

d) at a rate as determined by the company from time to time.

Answer: A

Question40: At the time of issue of debentures, Debentures Account is

a) credited by the amount received.

b) credited by the issue price of the debentures.

c) credited by the nominal (face) value of the debentures.

d) None of the above.

Question41: X Ltd. acquired assets of Rs.20 lakhs and took over creditors of Rs.20 thousand from LLtd. XLtd. issued 8% debentures of Rs.200 each at a discount of 10% as purchase consideration. Number of debentures issued will be :

a) 11,000

b) 9,000

c) 10,000

d) 10,100

Answer: A

Question42: Globe Ltd. issues 20,000, 9% debentures of Rs. 100 each at a discount of 5% redeemable at the end of 5 years at a premium of 6%. For what amount ‘Loss on Issue of Debentures Account’ will be debited?

a) Rs. 1,00,000

b) Rs. 1,20,000

c) Rs.2,80,000

d) Rs.2,20,000

Answer: D

Question43: Issued 5,000, 12% debentures of Rs. 100 each at a discount of 2%, redeemable at a premium of 5%. In such case :

a) Loss on Issue will be Credited by Rs. 10,000.

b) Loss on Issue will be debited by Rs.35,000.

c) Premium on Redemption will be debited by Rs.25,000.

d) Premium on Redemption will be credited by Rs.35,000.

Answer: B

Question44: Issued 4,000, 12% debentures of Rs. 100 each at a premium of 4%, redeemable at a premium of 10%. In such case :

a) Loss on Issue will be debited by Rs.24,000

b) Loss on Issue will be debited by Rs.56,000

c) Loss on Issue will be debited by Rs.40,000

d) Premium on Redemption will be credited by Rs.24,000

Answer: C

Question45: When debentures are issued at a discount, the discount is written off

a) after debentures have been redeemed.

b) in the year when debentures are issued,

c) during the life of the debentures.

d) None of these.

Answer: B

Question46: Interest on Debentures is paid on

a) Amount received on Issue.

b) Nominal (Face) Value.

c) On Premium.

d) None of these.

Answer: B

Question47: Which of the following statements is false?

a) At maturity, debenture holders get back their money.

b) Debentures can be forfeited for non-payment of call money.

c) In company’s balance sheet, debentures are shown under the head Long term Borrowings.

d) Interest on debentures is a charge against profits.

Answer: B

Question48: Which of the following statements is false :

a) A Company can issue redeemable debentures.

b) A Company can issue debentures with voting rights.

c) A Company can issue convertible debentures.

d) A Company can buy its own debentures and shares.

Answer: B

Question49: The Principal amount of debentures will be repaid by the company either at the end of a specified period or by instalments during the life time of the company. Such types of debentures are called :

a) Redeemable Debentures

b) Irredeemable Debentures

c) Convertible Debentures

d) Bearer Debentures

Answer: A

Question50: If Vendors are issued debentures of Rs.4,40,000 in consideration of assets of Rs. 5,00,000 and liabilities of Rs. 1,00,000, the balance of Rs.40,000 will be debited to:

a) General Reserve Account

b) Capital Reserve Account

c) Goodwill Account

d) Statement of Profit & Loss

Answer: C

Question51: A Ltd. issued 1,000, 10% debentures of Rs. 100 each at a premium of 5%. What will be the total amount of interest for one year :

a) Rs. 10,500

b) Rs. 10,000

c) Rs. 5,250

d) Rs. 5,000

Answer: B

Question52: The amount of debenture is returned to the holders at the end of

a) Predetermined maturity period

b) Company

c) Current Year

d) None of the options

Answer: Predetermined maturity period

Question53: A debenture of company possesses the characteristics

a) All of the options

b) Written promise

c) Face value

d) Rate of interest

Answer: All of the options

Question54: Debenture is redeemable (payable) at a fixed and specified period of time which is called

a) Maturity period.

b) Long Term Loan Period

c) Short Term Loan Period

d) None of the options

Answer: Maturity period.

Question55: At the time of liquidation, first priority is given to the at the time of repayment.

a) Debenture Holder

b) Share Holder

c) Both

d) None of the options

Answer: Debenture Holder

Question56: Person holding debenture is known as

a) Debenture Holder

b) Share Holder

c) Both

d) None of the options

Answer: Debenture Holder

Question57: The interest paid on debentures is a

a) Charge against profit

b) Net Profit

c) Reserve & Surplus

d) None of the options

Answer: Charge against profit

Question58: Which are can be converted into equity shares of the issuing company after a predetermined period of time

a) Convertible debentures

b) Non convertible debentures

c) Secured Debenture

d) Unsecured Debentures

Answer: Convertible debentures

Question59: Convertible debentures can be

a) Both

b) Partly Convertible Debentures

c) Fully convertible Debentures

d) None of the options

Answer: Both

Question60: X Co Ltd purchased assets worth RS 28,80,000. It issued debentures of Rs. 100 each at a discount of 4% in full satisfaction of the purchase consideration. The number of debentures issued to vendor is

a) Rs. 30,000

b) Rs.32,000

c) Rs.35,000

d) None of the options

Answer: Rs. 30,000

Question61: Discount on issue of debentures is shown under the following head in the Balance Sheet

a) Miscellaneous expenditure

b) Profit and loss account

c) Debentures account

d) All of the options

Answer: Miscellaneous expenditure 

Question62: When debentures are issued at par and are redeemable at a premium, the loss on such an issue debited to

a) Loss on issue of debentures account

b) Profit and loss account

c) Profit and loss account

d) None of the options

Answer: Loss on issue of debentures account

Question63: Excess value of net assets over purchase consideration at the time of purchase of business is credited to

a) Capital reserve

b) General reserve

c) Vendors account

d) None of the options

Answer: Capital reserve

Question64: When all the debentures are redeemed, balance in the debentures redemption fund account is transferred to

a) General reserve

b) Capital reserve

c) Capital reserve

d) None of the options

Answer: General reserve

Question65: Own debentures are those debentures of the company which

a) The company purchase from the market and keeps them as investments

b) The company allots to its own promoters

c) The company allots to its own promoters

d) All of the options

Answer: The company purchase from the market and keeps them as investments

Question66: Profit on cancellation of own debentures is transferred to

a) Capital reserve

b) Profit and loss appropriation account

c) Debenture redemption reserve

d) None of the options

Answer: Capital reserve

Question67: When debentures are redeemed out of profits, an equal amount is transferred to

a) Debenture redemption reserve

b) General reserve

c) Capital reserve

d) All of the options

Answer: Debenture redemption reserve

Question68: Profit on sale of debenture redemption fund investments in the first instance is credited to

a) Debenture redemption fund account

b) Profit and loss appropriation account

c) General reserve account

d) None of the options

Answer: Debenture redemption fund account

Question69: Debentures which can be transferred by way of delivery and the company does not keep any record of the debenture holders

a) Bearer Debenture

b) Simple or Naked debentures

c) Mortgage debentures

d) Secured Debentures

Answer: Bearer Debenture

Question70: When debentures are issued at a discount and are redeemable at a premium, which of the following accounts is debited at the time of issue

a) Loss on issue of debentures account

b) Debentures account

c) Premium on redemption of debentures account

d) None of the options

Answer: Loss on issue of debentures account

Question71: The balance of sinking fund investment account after the realisation of investments is transferred to

a) Sinking fund account

b) Profit and loss account

c) Debentures account

d) None of the options

Answer: Sinking fund account

Question72: Issue of Debenture at more than face value, Called

a) Issue of debenture at premium

b) Issue of debenture at par

c) Both

d) None of the options

Answer: Issue of debenture at premium

Question73: Debentures can be issued

a) Both

b) Issue of debenture at premium

c) Issue of debenture at par

d) None of the options

Answer: Both

Question74: Loss on issue of debenture is written off each year in proportion to amount of debenture which reduces with every instalment paid, Called

a) Proportion Method

b) Equal instalment method

c) Both

d) None of the options

Answer: Proportion Method

Question75: When debentures are redeemed after fixed period here loss is spread equally over life of debenture therefore called

a) Equal instalment method

b) Proportion Method

c) Both

d) None of the options

Answer: Equal instalment method

Question76: The loss on issue of debentures is fictitious asset and shown in Balance Sheet

a) Assets side

b) Liabilities Side

c) Both

d) None of the options

Answer: Assets side

Question77: Insert on Debentures is calculated

a) At a fixed rate on its face value

b) At a fixed rate on its Par value

c) At a average rate on its Par value

d) None of the options

Answer: At a fixed rate on its face value

Question78: Insert on Debentures is

a) Change in Profit

b) Charge on profit

c) Both

d) None of the options

Answer: Change in Profit

Question79: Debenture Application Account is a

a) Personal Account

b) Real Account

c) Nominal Account

d) None of the options

Answer: Personal Account

Question80: Debenture Allotment Account is a.

a) Personal Account

b) Nominal Account

c) Real Account

d) None of the options

Answer: Personal Account

Question81: Premium on Redemption of Debentures Account is

a) Personal Account

b) Real Account

c) Capital A/c

d) None of the options

Answer: Personal Account

Question82: On 1st April 2007, Sunrise Limited issued 5,000, 8% debentures of Rs. 100 each at a discount of 5%. What will be the total amount of interest for the year ending 31st March 2008?

a) Rs.38,000

b) Rs.42,000

c) Rs.40,000

d) Rs.25,000

Answer: C

Question83: Luxor Pens Ltd. issued 10,000,7% Debentures of Rs. 100 each at a discount of Rs. 4 redeemable at a premium of Rs. 6. It will write off Loss on Issue of Debentures

a) from Securities Premium Reserve.

b) from Statement of Profit and Loss.

c) from General Reserve.

d) None of these.

Answer: B

Question84: Which of the following statement is Correct?

a) A debentureholder is an owner of the company.

b) A debentureholder can get his money back only on the liquidation of the company.

c) A debenture issued at a discount can be redeemed at a premium.

d) A debentureholder receives interest only in the event of profits.

Answer: C

Question85: In the Balance Sheet of a company, interest accrued and due on debentures is shown under the main head

(a) Share Capital.

(b) Reserves and Surplus.

(c) Current Liabilities.

(d) Non-current Liabilities.

Answer: C

Question86: Debenture holders are :

a) Owners of the Company

b) Debtors of the Company

c) Creditors of the Company

d) Promoters of the Company

Answer: C

Question87: Debentures represent the :

a) Long-term Borrowings of a Company

b) The Investment of Equity-Shareholders

c) Directors’ shares in a company

d) Short-term Borrowings of a Company

Answer: A

Question88: Zero Coupon Bonds are issued :

a) At Zero Interest Rate

b) With Specified Rate of Interest

c) Without Specified Rate of Interest

d) None of These

Answer: C

Question89: X Ltd. purchased a building for Rs.60,00,000 payable as 20% in Cash and balance by allotment of 8% debentures of Rs.500 each at a premium of 20%. Number of debentures issued will be :

a) 9,600

b) 8,000

c) 12,000

d) 10,000

Answer: B

Question90: Sunrise Ltd purchased a building for Rs.5,00,000 payable as 15% in cash and balance by allotment of 9% debentures of Rs. 100 each at a premium of 25%. Number of debentures issued will be :

a) 4,250

b) 4,000

c) 5,000

d) 3,400

Answer: D

Question91: If Vendors are issued debentures of Rs.80,000 in consideration of net assets of Rs. 1,00,000, the balance of Rs.20,000 will be credited to :

a) Statement of Profit & Loss

b) Goodwill Account

c) General Reserve Account

d) Capital Reserve Account

Answer: D

Question92: The debentures whose principal amount is not repayable by the company during its life time, but the payment is made only at the time of Liquidation of the company, such debentures are called :

a) Bearer Debentures

b) Redeemable Debentures

c) Irredeemable Debentures

d) Non-Convertible Debentures

Answer: C

Question93: Debenture Application Account is in the natutre of

a) Real Account

b) Personal Account

c) Nominal Account

d) None of the above

Answer: B

 Question94: Discount on issue of Debentures is in the nature of

a) Revenue loss

b) Capital loss

c) Deferred Revenue Expenditure

d) None of the above

Answer: B

Question95: Debentures are part of

a) Shareholders’Funds.

b) Borrowed Funds.

c) Borrowings from Bank.

d) None of these.

Answer: B

Question96: Debentures are shown in the Balance Sheet of a company under the head of

a) Non-current Liabilities.

b) Current Liabilities.

c) Share Capital.

d) None of these.

Answer: A

Question97: Debentureholders are

a) owners of the company.

b) lenders of the company.

c) vendors of the company.

d) customers of the company.

Answer: B

Question98: When debentures of Rs. 1,00,000 are issued as Collateral Security against a loan of Rs. 1,50,000, the entry for issue of debentures will be :

a) Credit Debentures Rs. 1,50,000 and debit bank A/c Rs. 1,50,000

b) Debit Debenture Suspense A/c Rs. 1,00,000 and Credit Bank A/c Rs. 1,00,000

c) Debit Debenture Suspense A/c Rs. 1,00,000 and Credit Debentures A/c Rs. 1,00,000.

d) Debit Cash A/c Rs. 1,50,000 and Credit Bank A/c Rs. 1,50,000

Answer: C

Question99: Interest on debentures issued as a collateral security is paid on :

a) Nominal value of debentures

b) No interest is paid

c) Face value of debentures

d) Paid up value of debentures

Answer: B

Question100: Loss on Issue of Debentures is written off:

a) In the year of the issue of debentures

b) During the life of the debentures

c) Within 3 years of the issue of debentures

d) In the year of redemption of debentures

Answer: A

Question101: Which of the following is Correct with respect to debentures?

a) They can be issued on credit.

b) They can be issued for consideration other than cash.

c) They cannot be issued as collateral security.

d) They can be issued partly on credit and partly in cash.

Answer: B

Question102: Discount on issue of debentures account is a

• a) Fictitious Asset
• b) Current Asset
• c) Fixed Asset
• d) Current liability

Answer: Fictitious Asset

Question103: Securities Premium received on debentures is a

• a) Capital Profit
• b) Current Asset
• c) Capital Loss
• d) None of the options

Answer: Capital Profit

Question104: Shareholders get dividend, Debenture holders will get

• a) Interest
• b) Shares
• c) Bonus
• d) Profit

Answer: Interest

Question105: Debenture is acknowledgment of debt and a contract for the repayment of principal amount with

• a) Interest
• b) Premium
• c) Dividend
• d) None of the options

Answer: Interest

Question106: debentures can be issued under the ________ of company

• a) Common seal
• b) Rules & Principles
• c) Companies Act
• d) None of the options

Answer: Common seal

Question107: A debenture is

• a) An external equity
• b) Owners equity
• c) An internal equity
• d) Payment of Profit

Answer: An external equity

Question108: At the time of liquidation the payment to debenture holders is made on the priority bases before the

• a) Payment of Share Capital
• b) Payment of Dividend
• c) Payment of Profit
• d) Payment of Profit

Answer: Payment of Share Capital

Question109: A Company can issue its debentures a

• a) All of the options
• b) At Par
• c) At Premium
• d) At Discount

Answer: All of the options

Question110: Non-Convertible Debentures

• a) Cannot be converted into shares
• b) Cannot be redeemed
• c) Cannot not be issued
• d) None of the options

Answer: Cannot be converted into shares

Question111: Debenture holders do not have right for

• a) All of the options
• b) Dividend
• c) Profit
• d) Voting Right

Answer: All of the options 

 

Question112: When a company issue its debentures at discount, the amount of discount is considered as a:

• a) Capital loss
• b) Normal Loss
• c) Capital gain
• d) Reserve & Surplus

Answer: Capital loss

Question113: Debenture forms part of

• a) Loan
• b) Capital
• c) Fund
• d) None of the options

Answer: Loan

Question114: Is payable even if there are no profits

• a) Interest.
• b) Dividend
• c) Commission
• d) Secured

Answer: Interest.

Question115: Debentures payable to a holder of certificate is called

• a) Bearer.
• b) Unregistered
• c) Secured
• d) None of the options

Answer: Bearer.

Question116: Debentures payable to person whose name appears both on Debenture Certificate and companys register is called

• a) Registered.
• b) Unregistered
• c) Bearer
• d) None of the options

Answer: Registered.

Question117: Debentures which have the charge on the property of the company is

• a) Secured.
• b) Unsecured
• c) Registered
• d) None of the options

Answer: Secured.

Question118: Debenture which are repayable only on the happening of an event of winding up is called

• a) Both
• b) Irredeemable
• c) Perpetual
• d) None of the options

Answer: Both

Question119: Types of debentures on the basis of security

• a) Both
• b) Secured debentures
• c) Unsecured debentures
• d) None of the options

Answer: Both

Question120: Types of debentures on the basis of redemption

• a) Both
• b) Redeemable
• c) Non-Redeemable
• d) None of the options

Answer: Both

NCERT MCQ ON  Accounting for Share Capital:

Question1: Minimum number of members in a Private Company

• a) 2
• b) 5
• c) 7
• d) 1

Answer: 2

Question2: Minimum number of members in a Public Company

• a) 7
• b) 2
• c) 5
• d) 3

Answer: 7

Question3: Maximum number of members in a Private Company

• a) 50
• b) 60
• c) 70
• d) 100

Answer: 50

Question4: Maximum number of members in a Public Company

• a) Any Number of members
• b) 50
• c) 60
• d) None of the options

Answer: Any Number of members

Question5: Minimum Capital of a Private Company

• a) 1 Lakh
• b) 2 Lakh
• c) 3 Lakhs
• d) None of the options

Answer: 1 Lakh

Question6: Interest on calls in advance

• a) 6% P.A
• b) 5% P.A
• c) 9% P.A
• d) No Interest

Answer: 6% P.A

Question7: Interest on calls in arrear

• a) 5% P.A
• b) 6% P.A
• c) 9% P.A
• d) No Interest

Answer: 5% P.A

Question8: Minimum subscription in case of public company

• a) 90% of the entire issue
• b) 75% of the entire issue
• c) 50% of the entire issue
• d) None of the options

Answer: 90% of the entire issue

Question9: Minimum application money in case of public limited company

• a) 5% of the nominal face value
• b) 10% of the nominal face value
• c) 15% of the nominal face value
• d) None of the options

Answer: 5% of the nominal face value

Question10: Minimum Capital of a Public Company

• a) 5 Lakh
• b) 1 Lakh
• c) 2 Lakh
• d) None of the options

Answer: 5 Lakh

 

Question11:  Maximum Rate of discount

• a) 10% of the nominal value of share
• b) 5% of the nominal face value
• c) 15% of the nominal face value
• d) None of the options

Answer: 10% of the nominal value of share

Question12: Issue of share at a discount

• a) Section 79
• b) Section 78
• c) Section 76
• d) None of the options

Answer: Section 79

Question13: Issue of share at a premium

• a) Section 78
• b) Section 79
• c) Section 76
• d) None of the options

Answer: Section 78

Question14: Which of the following statement is false:

• a) A shareholder is the agent of the company
• b) A company is a legal entity quite distinct from its members.
• c) A company can buy its own share
• d) Same person can agent and creditor of the company

Answer: A shareholder is the agent of the company

Question15: Which of the following are the characteristics of a company

• a) Liability of the members is limited upto the face value of shares held by them
• b) It is a voluntary association of persons.
• c) A company is a separate body can sue and be sued in its own name
• d) All of the above

Answer: Liability of the members is limited upto the face value of shares held by them

Question16: Formed by special act of the legislature or parliament Called

• a) Statutory Company
• b) Guarantee company
• c) Chartered companies
• d) None of the options

Answer: Statutory Company

Question17: Liability of the member is limited upto the amount he guaranteed to contribute in the event of winding up.

• a) Guarantee company
• b) Statutory Company
• c) Chartered companies
• d) None of the options

Answer: Guarantee company

Question18: Incorporated under special charter by the king or sovereign

• a) Chartered companies
• b) Statutory Company
• c) Guarantee company
• d) None of the options

Answer: Chartered companies

Question19: Minimum number of directors in Pvt. Ltd company

• a) 2
• b) 3
• c) 4
• d) No limit

Answer: 2

Question20: Minimum number of directors in Ltd company

• a) 3
• b) 2
• c) 4
• d) No limit

Answer: 3

Question21: Which of the following capital is not shown in companys balance sheet:

• a) Reserve Capital
• b) Authorised capital
• c) Issued and Subscribed capital
• d) Called and paid up capital

Answer: Reserve Capital

Question22: Permission from central government to issue share capital is required if Nominal capital exceeds

• a) 1 Crore
• b) 2 Crore
• c) 1 Lakh
• d) 2 Lakh

Answer: 1 Crore

Question23: A company is said to be Deemed Public company if its Annual Turnover exceeds

• a) 25 Crores.
• b) 20 Crore
• c) 30 Crore
• d) None of the options

Answer: 25 Crores.

Question24: Share application and allotment account is a:

• a) Personal account
• b) Real account
• c) Nominal account
• d) None of the options

Answer: Personal account

Question25: Securities premium account is shown on the liabilities side of the balance sheet under the head:

• a) Reserves and surplus
• b) Share capital
• c) Current liabilities
• d) None of the options

Answer: Reserves and surplus

Question26: Discount of issue of share shows debit balance and hence shown on the assets side of the balance sheet under the head

• a) Miscellaneous expenditure.
• b) Reserves and surplus
• c) Share capital
• d) Current liabilities

Answer: Miscellaneous expenditure.

Question27: As per section 78 of the companies act, amount collected as premium on securities cannot be utilised for:

• a) Purchase of fixed assets
• b) Writing off preliminary expenses
• c) Buy back of its own shares
• d) Premium payable on redemption of preference shares

Answer: Purchase of fixed assets

Question28: The portion of the authorised capital which can be called-up only on the liquidation of the company is called

• a) Reserve capital
• b) Authorised capita
• c) Issued capital
• d) Called up capital

Answer: Reserve capital

Question29: Penalty for delay in refunding application money

• a) 0.15
• b) 0.06
• c) 0.05
• d) 0.2

Answer: 0.15

Question30: Which of the following statement is false?

• a) A company can raise funds beyond its Authorised capital.
• b) Declared dividend should be classified in the balance sheet as a current liability.
• c) Dividends are usually paid as a percentage of paid-up-capital.
• d) As per the companies act, only preference shares which are redeemable within 20 years can be issued.

Answer: A company can raise funds beyond its Authorised capital

Question31: Which of the following statements are correct?

• a) Paid-up-capital = called-up-capital – calls in arrear
• b) Subscribed capital is that part of capital which is offered to the public for subscription.
• c) Issued capital is that part of authorised capital which is applied by the public and allotted by company.
• d) None of the options

Answer: Paid-up-capital = called-up-capital – calls in arrear

Question32: Which of the following is not a statistical book of a company?

• a) Register of debenture holders
• b) Share application and allotment book
• c) Register of share warrants
• d) Register of shares and debentures transferred

Answer: Register of debenture holders

Question33: Which of the following is not a statutory book of a company?

• a) Agenda book
• b) Annual returns
• c) Minutes book
• d) Register of fixed deposits

Answer: Agenda book

Question34: Securities premium once received cannot be cancelled.

• a) True
• b) False
• c) Both
• d) None of the options

Answer: True

Question35: Technique used for marketing a public offer of equity shares of a company is called book building process.

• a) True
• b) False
• c) Both
• d) None of the options

Answer: True

Question36: As per SEBI guidelines, A new company without any track record can issue share at a premium.

• a) False
• b) True
• c) Both
• d) None of the options

Answer: False

Question37: Share capital suspense account is opened when:

• a) When application money is received but balance sheet is prepared before allotment of shares.
• b) Balance sheet is not tallied
• c) When dividend is declared but not paid
• d) When shares are forfeited

Answer: When application money is received but balance sheet is prepared before allotment of shares.

Question38: A new company set up by existing companies with five year track record can issue share at premium provided:

• a) All of the options
• b) Participation of existing companies are not less that 50%
• c) Prospectus contains justification for issue price
• d) The issue price is made applicable to all new investors uniformly.

Answer: All of the options

Question39: Issue of share at a discount must be authorised by a resolution passed by the company in general meeting and duly sanctioned by the

• a) Central government.
• b) State government.
• c) Local government
• d) None of the options

Answer: Central government

Question40: A company can issue share at a discount if

• a) All of the options
• b) One year have been elapsed since the date at which the company was allowed to commence business
• c) Shares issued at a discount must belong to a class of shares already issued
• d) Issue must take place within two must after the date of sanction by the court or within extended time

Answer: All of the options

Question41: Maximum number of members in a private company is :

a) 7

b) 200

c) 20

d) No Limit

Answer: B

Question42: Capital of a Company is divided in units which is called :

a) Debenture

b) Share

c) Stock

d) Bond

 Answer: B

Question43: Shareholders receive from the company :

a) Interest

b) Commission

c) Profit

d) Dividend

Answer: D

Question44: Voluntary return of shares for concellation by the shareholders is called

a) Cancellation of shares

b) Forfeiture

c) Surrender of shares

d) None of these

Answer: C

Question45: If the Premium on the forfeited shares has already been received, then Securities Premium A/c should be :

a) Credited

b) Debited

c) No treatment

d) None of these

Answer: C

Question46: Balance of share forfeiture account is shown in the balance sheet under the head

a) Share Capital Account

b) Reserve and Surplus

c) Current Liabilities and Provisions

d) Unsecured Loans

Answer: A

Question47: 700 shares of Rs. 10 each were reissued as Rs. 9 paid up for Rs.7 per share. Entiy for reissue will be :

a) Bank A/c                Dr.    4,900

Share Discount A/c     Dr.    1,400

          To Share Capital A/c              6,300

b) Bank A/c               Dr.      4,900

          To Share Capital A/c              4,900

c) Bank A/c                Dr.     4,900

Share Forfeiture A/c     Dr.    1,400

           To Share Capital A/c             6,300

d) Bank A/c                Dr.     4,900

Share Forfeiture A/c    Dr.      2,100

            To Share Capital A/c             7,000

Answer: C

Question48: A Ltd. forfeited 2,000 shares of Rs.10 each fully called up for non-payment of final call of Rs.2 per share. 1,200 of these shares were reissued at Rs.7 per share, fully paid up. What is the amount to be transferred to Capital Reserve Account?

a) Rs. 7,600

b) Rs. 1,200

c) Rs. 12,400

d) Rs. 6,000

Answer: D

Question49: Using information given in above question, what is the net balance in Share Forfeiture Account:

a) Rs.9,600

b) Rs.6,400

c) Rs. 16,000

d) Rs.2,800

Answer: B

Question50: Maximum limit of Premium on shares is:

a) 5%

b) 10%

c) No Limit

d) 100%

Answer: C

Question51: When a company issues shares at a premium, the amount of premium should be received by the company :

a) Along with application money

b) Along with allotment money

c) Along with calls

d) Along with any of the above

Answer: D

Question52: Amount of securities premium can be utilised for:

a) Writing off the preliminary expenses of the company

b) Issuing bonus shares to the shareholders of the company

c) Buy-back of its own shares

d) All of the above

Answer: D

Question53: Which shareholders are returned their capital after some specified time :

a) Redeemable Preference Shares

b) Irredeemable Preference Shares

c) Cumulative Preference Shares

d) Participating Preference Shares

Answer: A

Question54: The following statements apply to equity/preference shareholders. Which one of them applies only to preference sharehoders?

a) Shareholders risk the loss of investment

b) Shareholders bear the risk of no dividends in the event of losses

c) Shareholders usually have the right to vote

d) Dividends are usually given at a set amount in every financial year.

Answer: D

Question55: Unless otherwise stated, a preference share is always deemed to be :

a) Cumulative, participating and non-convertible

b) Non-cumulative, non-participating and non-convertible

c) Cumulative, non-participating and non-convertible

d) Non-cumulative, participating and non-convertible

Answer: C

Question56: A company has  _______

a) Separate Legal Entity

b) Perpetual Existence

c) Limited Liability

d) All of the Above

Answer: D

Question57: Shareholders are :

a) Customers of the Company

b) Owners of the Company

c) Creditors of the Company

d) None of these

Answer: B

Question58: Who are the real owners of a company?

a) Government

b) Board of Directors

c) Equity shareholders

d) Debentureholders

Answer: C

Question59: Authorised capital of a Company is divided into 5,00,000 shares of Rs. 10 each. It issued 3,00,000 shares. Public applied for 3,60,000 shares. Amount of issued capital will be :

a) Rs.30,00,000

b) Rs.36,00,000

c) Rs.50,00,000

d) Rs.6,00,000

Answer: A

Question60: A Company invited applications for 1,00,000 shares and it received applications for 1,50,000 shares. Applications for 30,000 shares were rejected and the remaining were allotted shares on prorata basis. How many shares an applicant for 3,000 shares will be allotted :

a) 2,500 Shares

b) 3,600 Shares

c) 4,500 Shares

d) 2,000 Shares

Answer: A

Question61: E Ltd. had allotted 10,000 shares to the applicants of 14,000 shares on pro-rata basis. The amount payable on application was Rs.2. F applied for 420 shares. The number of shares allotted and the amount carried forward for adjustment against allotment money due from F will be :

a) 60 shares; Rs.120

b) 340 shares; Rs.160

c) 320 shares, Rs.200

d) 300 shares; U40

Answer: D

Question62: Using information given in Q. 117, what is the net balance left in Share Forfeiture Account:

a) Rs. 1,400

b) Rs. 1,500

c) Rs.900

d) Rs. 1,000

Answer: D

Question63: P Ltd. forfeited 150 shares of Rs.10 each, issued at a premium of Rs.2, for non-payment of the final call of Rs.3. Out of these, 100 shares were re-issued at Rs. 11 per share. How much amount would be transferred to capital reserve?

a) Rs.700

b) Rs.500

c) Rs. 1,200

d) Rs.300

Answer: A

Question64: XY Limited issued 2,50,000 equity shares of Rs. 10 each at a premium of Rs.1 each payable as Rs.2.5 on application, Rs.4 on allotment and balance on the first and final call. Applications were received for 5,00,000 equity shares but the company allotted to them only 2,50,000 shares. Excess money was applied towards amount due on allotment. Last call on 500 shares was not received and shares were forfeited after due notice. This is a case of:

a) Over subscription

b) Pro-rata allotment

c) Forfeiture of Shares

d) All of the above

Answer: D

Question65: 800 shares of Rs.10 each issued at 20% premium were forfeited for non-payment of allotment money of Rs.5 (including premium) and first & final of Rs.3 per share. Share Forfeiture Account will be credited with :

a) Rs. 1,600

b) Rs.2,400

c) Rs.3,200

d) Rs.4,800

Answer: C

Question66: 800 shares of Rs.10 each issued at 30% premium (to be paid on allotment) were forfeited for non-payment of Rs.2 per share on first call and Rs.2 per share on final call. Share Forfeiture Account will be credited with :

a) Rs.2,400

b) Rs.4,800

c) Rs.3,200

d) Rs.7,200

Answer: B

Question67: A Company forfeited 300 shares of Rs.10 each, Rs.8 per share called up, on which X had paid application and allotment money of Rs.6 per share. Share Forfeiture Account will be credited with :

a) Rs. 600

b) Rs. 1,800

c) Rs. 1,200

d) Rs.2,400

Answer: B

Question68: For what purpose securities premium reserve account cannot be utilized?

a) Amortization of preliminary expenses

b) Distribution of dividend

c) Issue of fully paid bonus shares

d) Buy Back of own shares

Answer: B

Question69: Premium on the issue of shares should be shown :

a) On the Assets side of balance sheet

b) On the Equity & Liabilities side of balance sheet

c) In profit & loss Statement

d) None of the Above

Answer: B

Question70: A Company issued 50,000 shares of Rs.20 each at 5% premium. Rs.10 were payable on application and balance on allotment. What will be the allotment amount?

a) Rs.5,00,000

b) Rs.4,75,000

c) Rs.5,50,000

d) Rs.5,25,000

Answer: C

Question71: Equity shares cannot be issued for the purpose of:

a) Cash Receipts

b) Purchase of assets

c) Redemption of debentures

d) Distribution of dividend

Answer: D

Question72: A Company may issue

a) Equity Shares

b) Preference Shares

c) Equity and Preference both shares

d) None of the Above

Answer: C

Question73: A company cannot issue :

a) Redeemable Equity Shares

b) Redeemable Preference Shares

c) Redeemable Debentures

d) Fully Convertible Debentures

Answer: A

Question74: Authorised Capital of a Company is mentioned in :

a) Memorandum of Association

b) Articles of Association

c) Prospectus

d) Statement in lieu of Prospectus

Answer: A

Question75: In case of private placement of shares, the lock in period is :

a) 1 Year

b) 2 Years

c) 3 Years

d) None of the above

Answer: C

Question76: A Company is

• a) All of the options
• b) Has separate legal identity
• c) Has Perpetual existence
• d) Has Common seal

Answer: All of the options

Question77: Restricts the right to transfer of shares for

• a) Private company
• b) Limited company
• c) Both
• d) None of the options

Answer: Private company

Question78: Prohibits any invitation to public to subscribe for shares and Debentures for

• a) Private company
• b) Limited company
• c) Both
• d) None of the options

Answer: Private company

Question79: Prohibits any invitation or acceptance of deposits from persons other than its members , directors or their relatives for

• a) Private company
• b) Limited company
• c) Both
• d) None of the options

Answer: Private company

Question80: As per section 617 is a company in which more than 50% of paid up capital is held by Central or State Government or both, Called

• a) Government Company
• b) Private company
• c) Limited company
• d) Foreign Company

Answer: Government Company

Question81: Section 591of Act states this type of company is incorporated outside India but has established business in India, Called

• a) Foreign Company
• b) Government Company
• c) Private company
• d) Limited company

Answer: Foreign Company

Question82: Authorised Capital is also known as

• a) Nominal or registered Capital
• b) Share capital.
• c) Called up Capital
• d) None of the options

Answer: Nominal or registered Capital

Question83: Which is the maximum amount of capital a company can issue

• a) Authorised Capital
• b) Share capital.
• c) Called up Capital
• d) None of the options

Answer: Authorised Capital

Question84: Which is part of authorized capital

• a) Issued Capital
• b) Paid up capital
• c) Called up Capital
• d) None of the options

Answer: Issued Capital

Question85: Capital raised by issue of shares is called

• a) Share capital.
• b) Authorised Capital
• c) Called up Capital
• d) None of the options

Answer: Share capital.

Question86: It cannot exceed authorized capital .

• a) Issued Capital
• b) Paid up capital
• c) Share capital.
• d) None of the options

Answer: Issued Capital

Question87: Subscribed Capital is part of

• a) Issued Capital
• b) Share capital.
• c) Paid up capital
• d) Called up Capital

Answer: Issued Capital

Question88: It is that part of uncalled capital which the company reserve to be called only upon winding up of company

• a) Reserve Capital
• b) Share capital.
• c) Called up Capital
• d) Called up Capital

Answer: Reserve Capital

Question89: Capital Reserve is

• a) Not available for distribution
• b) Available for distribution
• c) Both
• d) None of the options

Answer: Not available for distribution

Question90: How many classes of shares

• a) 2
• b) 3
• c) 4
• d) 5

Answer: 2

Question91: Classes of shares is

• a) Both
• b) Preference shares
• c) Equity shares
• d) None of the options

Answer: Both

Question92: Preference shares : are shares which get preferential right in respect of

• a) Both
• b) Right of dividend
• c) Repayment of capital on winding up
• d) None of the options

Answer: Both

Question93: Shares can be issued

• a) Both
• b) for cash
• c) for consideration other than cash
• d) None of the options

Answer: Both

Question94: Terms of issue of share

• a) All of the options
• b) Issue of shares at Par
• c) Issue of shares at Premium
• d) Issue of shares at Discount

Answer: All of the options

Question95: First instalment paid along with application is called

• a) Application money
• b) Allotment Money
• c) Both
• d) None of the options

Answer: Application money

Question96: When Second instalment paid

• a) On allotment
• b) On Application
• c) Both
• d) None of the options

Answer: On allotment

Question97: Issues Of Shares At Premium means Issue Of Share At

• a) More than face value
• b) Face Value
• c) Discount Value
• d) Premium value

Answer: More than face value

Question98: Issue Of Shares For Cash At Par Means shares are issued

• a) Face Value
• b) Premium value
• c) Discount Value
• d) None of the options

Answer: Face Value

Question99: Issue Of Shares At Discount, Rate of discount should not be more than

• a) 0.1
• b) 0.05
• c) 0.12
• d) None of the options

Answer: 0.1

Question100: Issue Of Shares At Discount, Sanction from company Law board must be obtained and shares must be issued within

• a) 2 Months of permission
• b) 3 Months of permission
• c) 4 Months of permission
• d) None of the options

Answer: 2 Months of permission

NCERT MCQ ON Index Numbers:

Question1 : Whose formula is considered ideal for the construction of index number?
(a) Paasche’s formula
(b) Laspeyer’s formula
(c) Fisher’s formula
(d) None of these

Answer : C

Question2 : Fisher’s Ideal index is the:
(a) Mean of Laspeyre’s and Paasche’s indexes
(b) Median of Laspeyre’s and Paasche’s indexes
(c) Geometric mean of Laspeyre’s and Paasche’s indexes
(d) None of the above

Answer : C

Question 3: Price Relatives = Current Year Price /?×100
(a) Reference year price
(b) Periodic year price
(c) Base year price
(d) Both (a) and (c)

Answer : D

Question4 : In notation _P01, 1 stand for:
(a) current year
(b) reference year
(c) both (a) and (b)
(d) none of these

Answer : A 

Question5 : _p01=Σ_p1_q0/Σ_pq0×100 is the formula of:
(a) Laspeyre’s Method
(b) Paasche’s Method
(c) Fisher’s Method
(d) none of these

Answer : A

Question6 : Fisher’s method of calculating index numbers is based on:
(a) arithmetic mean
(b) harmonic mean
(c) geometric mean
(d) none of these

Answer : C

Question7 : Fisher’s index number is considered ideal because:
(a) it is based on variable weights
(b) it satisfies Time Reversal Test
(c) it satisfies Factor Reversal Test
(d) all of these

Answer : D

Question 8: Consumer Price Index is also known as:
(a) Industrial Production Index
(b) Cost of Living Index
(c) Wholesale Price Index
(d) none of these

Answer : B

Question 9: The Paasche’s index number is based on:
(a) Base year quantities
(b) Current year quantities
(c) Average of current and base years
(d) None of the above

Answer : B

Question10 : Index number for the base period is always taken as:
(a) 100
(b) 50
(c) 1
(d) 200

Answer : A

Question11 : Indices calculated by the chain base method are free from:
(a) Seasonal variations
(b) Errors
(c) Percentages
(d) Ratios

Answer : A

Question12 : Index numbers helps in _____
(a) studying the trends
(b) deflating values
(c) policy formation
(d) All of these

Answer : D

Question13 : A monthly price index that uses the price changes in consumer goods and services for measuring the changes in consumer prices over time is known as the
(a) CPI
(b) Laspeyres Index
(c) Paasche Index
(d) IIP

Answer : A

Question 14: The aggregate index formula using base period quantities is known as:
(a) Laspeyre’s index
(b) Fisher’s Ideal index
(c) Bowley’s index
(d) Paasche’s index

Answer : A

Question15 : Cost of living index is known as …………
(a) cost price index
(b) consumer price index
(c) both
(d) none

Answer : B

Question16 : From the following which is not a problem in the construction of Index numbers?
(a) selection of base
(b) understanding of the purpose
(c) selection of commodities
(d) selection of price

Answer : D

Question17 : The index used to measure changes in total money value is called:
(a) Price index
(b) Quantity index
(c) Value index
(d) None of the above

Answer : C

Question18 : ____ mean importance assigned to different commodities included in the index
(a) Price
(b) Weights
(c) Both
(d) None

Answer : B

Question19 : We use price index numbers:
(a) To measure and compare prices
(b) To compare prices
(c) To measure prices
(d) None of these

Answer : A

Question20 : The best average for constructing an index number is:
(a) Harmonic Mean
(b) Arithmetic Mean
(c) Geometric Mean
(d) None of these

Answer : C

Question21 : Most widely used weighted index is:
(a) Laspeyres Index
(b) Paasche’s Index
(c) Fisher’s ideal Index
(d) Marshall-Edgeworth Index

Answer : A

Question22 : Commodities which show considerable price fluctuations could be best measured by a _________
(a) price index
(b) quantity index
(c) value index
(d) quality

Answer : B

Question23 : _____ in which current year quantities are used
(a) Fisher’s
(b) Paasche’s
(c) None
(d) Laspeyre’s

Answer : B

Question24 : The factor reversal test is satisfied by:
(a) Fisher’s Ideal Index
(b) Marshall-Edgeworth Method
(c) Simple GM of price relatives
(d) All of the above

Answer : A

Question25 : In chain base method, the base period is:
(a) Fixed
(b) Not fixed
(c) Constant
(d) Zero

Answer : B

Question26 : If the index of prices is estimated to be 112 in 2018, it means that in comparison to the base year, prices in 2018 are higher by:
(a) 12%
(b) 12 × 2 = 24%
(c) 112%
(d) none of these

Answer : A

Question 27: Purchasing power of money is:
(a) Reciprocal of price index number
(b) Equal to price index number
(c) Unequal to price index number
(d) All of the above

Answer : A

Question28 : A weighted aggregate price index where the weight for each item is its current-period quantity is called the
(a) Aggregate index
(b) Laspeyres Index
(c) Paasche Index
(d) Consumer Price Index

Answer : C

Question29 : Circular test is an extension of:
(a) Time reversal test
(b) Factor reversal test
(c) Circular test
(d) Unit test

Answer : A

Question30 : A composite price index where the prices of the items in the composite are weighted by their relative importance is known as the
(a) price relative
(b) weighted aggregate price index
(c) none of the above
(d) CPI

Answer : B

Question31 : If all the values are of equal importance, the index numbers are called:
(a) Weighted
(b) Unweighted
(c) Composite
(d) Value index

Answer : B

Question 32: Index numbers are expressed in
(a) Percentage
(b) Average
(c) Both
(d) None

Answer : A

Question33 : ______ are devices for measuring differences in the magnitude of a group of related variables
(a) Mean
(b) Time numbers
(c) Standard deviation
(d) Index numbers

Answer : D

Question34 : The industrial development of a country is reflected by ……………
(a) index of cost of living
(b) All
(c) index of industrial production
(d) weighted price index

Answer : C

Question 35: An index that is designed to measure changes in quantities over time is known as the
(a) Time index
(b) None of the above
(c) Paasche index
(d) Quantity index

Answer : D

Question36 : Base year is also known as:
(a) current year
(b) reference year
(c) periodic year
(d) both (a) and (c)

Answer : B

 

NCERT MCQ ON Correlation:

Question1 : When the relation of three or more variables is studied simultaneously, it is called:
(a) simple correlation
(b) partial correlation
(c) multiple correlation
(d) none of these

Answer  :  C

Question2 : When coefficient of correlation lies between +0.25 and + 0.75, it is called:
(a) perfect degree of correlation
(b) high degree of correlation
(c) moderate degree of correlation
(d) low degree of correlation

Answer  :  C

Question3 : Coefficient of correlation lies always between:
(a) 0 and +1
(b) -1 and 0
(c)-1 and+1
(d) none of these

Answer  :  C

Question4 : Rank correlation is a superior method of analysis in case of ____ distribution.
(a) qualitative
(b) quantitative
(c) frequency
(d) none of these

Answer  :  A

Question5 : When two variables change in a constant proportion, it is called:
(a) linear correlation
(b) non-linear correlation
(c) partial correlation
(d) none of these

Answer  :  A

Question6 : A scatter diagram:
(a; Is a statistical test
(b) Must be linear
(c) Must be curvilinear
(d) Is a graph of x and y values

Answer  :  D

Question7 : Maximum value of rank correlation coefficient is:
(a) 0
(b) +1
(c) -1
(d) None of these

Answer  :  B

Question8 : The correlation coefficient will be -1 if the slope of the straight line in a scatter diagram is:
(a) Positive
(b) Negative
(c) Zero
(d) None of these

Answer  :  B

Question9 : In a ‘negative’ relationship
(a) As x increases, y increases
(b) As x decreases, y decreases
(c) As x increases, y decreases
(d) Both (a) and (b)

Answer  :  C

Question10 : Scatter diagram helps us to:
(a) Find the nature of correlation between two variables
(b) Obtain the mathematical relationship between two variables
(c) Compute the extent of correlation between two variables
(d) Both (a) and (c)

Answer  :  A

Question11 : The lowest strength of association is reflected by which of the following correlation coefficients?
(a) 0.95
(b) – 0.60
(c) -0.35
(d) 0.29

Answer  :  D

Question12 : Relation between price and demand is:
(a) positive
(b) negative
(c) one to one
(d) no relationship

Answer  :  B

Question 13: If the relationship between x and y is positive, as variable y decreases, variable x:
(a) Increases
(b) Decreases
(c) Remains same
(d) Changes linearly

Answer  :  B

Question 14: Kari Pearson’s coefficient is defined from:
(a) Ungrouped data
(b) Grouped data
(c) Both (a) and (b)
(d) None of these

Answer  :  A

Question15 : When r = 1, all the points in a scatter diagram would lie:
(a) On a straight line directed from lower left to upper right
(b) On a straight line
(c) On a straight line directed from upper left to lower right
(d) Both (a) and (b)

Answer  :  A

Question16 : The highest strength of association is reflected by which of the following correlation coefficients?
(a) -1.0
(b) -0.95
(c) 0.1
(d) 0.85

Answer  :  A

Question17 : When two variables change in the same direction, then such a correlation is called:
(a) negative
(b) positive
(c) no correlation
(d) all of these

Answer  :  B

Question18 : There is a high degree of negative correlation between ‘overweight’ and ‘life expectancy’. A correlation coefficient consistent with the above statement is:
(a) r = 0.80
(b) r = 0.20
(c) r = -0.20
(d) r = -0.80

Answer  :  D

Question19 : Correlation coefficient is __________ of the units of measurement.
(a) Independent
(b) Dependent
(c) Both (a) and (b)
(d) None of these

Answer  :  A

Question20 : The correlation between sale of cold drinks and day temperature is:
(a) Positive
(b) Negative
(c) Zero
(d) None of these

Answer  :  A

Question21 : There is a high direct association between measures of ‘cigarette smoking’ and ‘lung damage’. The correlation coefficient consistent with the above statement is:
(a) 1
(b) Any value
(c) – 1
(d) (b) or (c)

Answer  :  A

Question 22: The correlation between ages of husbands and wives is:
(a) Positive
(b) Negative
(c) Zero
(d) None of these

Answer  :  B

Question23 : Simple correlation is called:
(a) linear correlation
(b) Nonlinear correlation
(c) Both (a) and (b)
(d) None of these

Answer  :  A

Question24 : For finding the degree of agreement about beauty between two judges in a beauty contest, we use:
(a) Coefficient of correlation
(b) Coefficient of rank correlation
(c) Scatter diagram
(d) Coefficient of concurrent deviation

Answer  :  B

Question25 : If all the plotted points in a scatter diagram lie on a single line, then the correlation is:
(a) Perfect positive
(b) Perfect negative
(c) Both (a) and (b)
(d) Either (a) or (b)

Answer  :  D

Question 26: Correlation coefficient is dependent on the choice of both origin and the scale of observations,
(a) True
(b) False
(c) Both (a) and (b)
(d) none of these

Answer  :  B

Question 27: The correlation between sale of woolen garments and day temperature is:
(a) Positive
(b) Negative
(c) Zero
(d) None of these

Answer  :  B

Question 28: The correlation between shoe-size and intelligence is:
(a) Zero
(b) Negative
(c) Positive
(d) None of these

Answer  :  A

Question29 : What are the limits of the correlation coefficient?
(a) -1 and 1
(b) No limit
(c) 0 and 1, including the limits
(d) -1 and 1, including the limits

Answer  :  D

Question30 : If r is the correlation coefficients between the two variables, then:
(a) -1 ≤ r ≤ 0
(b) 1≤ r ≤ 2
(c) -1 ≤ r ≤ 1
(d) 0 ≤ r ≤ 1

Answer  :  C

 

NCERT MCQ ON Measures of Dispersion:

Question1 : Which is the relative measure of dispersion?
(a) Range
(b) Mean deviation
(c) Coefficient of standard deviation
(d) None of these

Answer :  C

Question2 : Which of the following is a unitless measure of dispersion?
(a) Standard deviation
(b) Mean deviation
(c) Coefficient of variation
(d) Range

Answer :  C

Question3 : If the first quartile is 104 and quartile deviation is 8, the third quartile is:
(a) 130
(b) 120
(c) 136
(d) 146

Answer :  B

Question4 : If all the observations are multiplied by 5, then
(a) New S.D. would be also multiplied by 5
(b) New S.D. would be increased by 5
(c) New S.D. would be half of the previous S.D
(d) New S.D. would be decreased by 5

Answer :  A

Question 5: Which of the following formulae is used to find out inter quartile range?
(a) a1−Q3 /2
(b) Q1+Q3 /2
(c) Q3 − Q1
(d) Q3 + Q1

Answer :  C

Question6 : Coefficient of variation is a percentage expression of:
(a) mean deviation
(b)quartile deviation
(c) standard deviation
(d)none of these

Answer :  C

Question7 : Which of these is the merit of standard deviation?
(a) Standard deviation is based on all values of the series
(b) Standard deviation shows little effect of changes in the sample
(c) In the estimation of standard deviation, more importance is given to difficult and extreme value
(d) Both (a) and (b)

Answer :  D

Question8 : Standard Deviation is
(a) Absolute measure
(b) Relative measure
(c) Both (a) and (b)
(d) None of these

Answer :  A

Question9 : In the calculation of standard deviation, deviations are taken only from the value of the series.
(a) mean
(b) mode
(c) median
(d) quartile

Answer :  A

Question10 : Which of the following equations is correct?
(a) Variance = σ
(b) Variance = σ2
(c) Variance = σ4
d) Variance = √σ×2

Answer :  B

Question 11: The standard deviation of a set of 50 observations is 8. If each observation is multiplied by 2, then the new value of standard deviation will be:
(a) 4
(b) 8
(c) 16
(d) none of the above

Answer :  C

Question12 : Which measures of dispersion is the quickest to compute?
(a) Mean deviation
(b) Quartile deviation
(c) Standard deviation
(d) Range

Answer :  D

Question13 : Which one is difficult to compute?
(a) Relative measures of dispersion
(b) Absolute measures of dispersion
(c) Both (a) and (b)
(d) Range

Answer :  A

Question 14:  The most commonly used measure of dispersion is
(a) Coefficient of variation
(b) Standard deviation
(c) Range
(d) Quartile deviation

Answer :  B

Question15 : Mean deviation can be calculated by using:
(a) mean
(b)mode
(c) median
(d) all of these

Answer :  D

Question16 : “Root-Mean Square Deviation from Mean” is
(a) Standard deviation
(b) Quartile deviation
(c) Both (a) and (b)
(d) None of these

Answer :  A

Question17 : The measure of dispersion which ignores signs of the deviations from a central value is:
(a) Quartile deviation
(b) Range
(c) Standard deviation
(d) Mean deviation

Answer :  D

Question18 : Which of the following is not a measure of dispersion?
(a) Variance
(b) Mean deviation
(c) Standard deviation
(d) Mode

Answer :  D

Question19 : The standard deviation of 25 numbers is 40. If each of the numbers is increased by 5, then the new standard deviation will be:
(a) 40
(b) 45
(c) 41.5
(d) None of these

Answer :  A

Question20 : The standard deviation of a set of 50 observations is 6.5. If value of each observation is increased by 5, then the standard deviation is:
(a) 2.5
(b) 6.5
(c) 3.5
(d) none of the above

Answer :  B

Question21 : Semi-interquartile range is also known as
(a) Mean deviation
(b) Standard deviation
(c) Quartile deviation
(d) Quartile range.

Answer :  C

Question22 : If mean and coefficient of variation of a set of data is 10 and 5, respectively, then the standard deviation is:
(a) 10
(b) 0.5
(c) 5
(d) none of the above

Answer :  B

Question23 : A set of values is said to be relatively uniform if it has:
(a) High dispersion
(b) Zero dispersion
(c) Little dispersion
(d) Negative dispersion

Answer :  C

Question24 : Which measure of dispersion has a different unit other than the unit of measurement of values?
(a) Mean deviation
(b) Range
(c) Standard deviation
(d) Variance

Answer :  D

Question25 : Which measure is based on only the central fifty per cent of the observations?
(a) Mean deviation
(b) Quartile deviation
(c) Standard deviation
(d) All these measures

Answer :  B

Question26 : Which measure of dispersion is based on the absolute deviations only?
(a) Quartile deviation
(b) Mean Variation
(c) Standard deviation
(d) Range

Answer :  B

Question27 : Quartile deviation is called
(a) Inter quartile range
(b) Quartile range
(c) Both (a) and (b)
(d) None of these

Answer :  A

Question28 : Which measure of dispersion is not affected by the presence of extreme observations?
(a) Standard deviation
(b) Mean deviation
(c) Range
(d) Quartile deviation

Answer :  D

Question29 : The range of the following set of observations 2, 3, 5, 9, 8, 7, 6, 5, 7, 4, 3 is:
(a) 6
(b) 7
(c) 5.5
(d) 11

Answer :  B

Question30 : Which one is an absolute measure of dispersion?
(al Standard Deviation
(b) Mean Deviation
(c) Range
(d) All these measures

Answer :  D

Question31 : If the minimum value in a set is 9 and its range is 57, the maximum value of the set is:
(a) 33
(b) 66
(c) 48
(d) None of these

Answer :  B

Question32 : Which of the following measures of dispersion can attain a negative value?
(a) Range
(b) Mean deviation
(c) Standard deviation
(d) Variance

Answer :  A

Question33 : The measure of variation which is mostly affected by extreme items is:
(a) Range
(b) Quartile deviation
(c) Standard deviation
(d) Mean deviations

Answer :  A

Question34 : Coefficient of variation is
(a) Absolute measure
(b) Relative measure
(c) Both (a) and (b)
(d) None of these

Answer :  B

Question35 : The range represents the
(a) Difference between highest and lowest value
(b) Middle number
(c) Highest number
(d) Lowest number

Answer :  A

Question36 : For comparison of two different series, the best measure of dispersion is:
(a) Mean deviation
(b) Range
(c) Standard deviation
(d) Coefficient of variation

Answer :  D

Question37 : The appropriate measure of dispersions for open – end classification is:
(a) Mean deviation
(b) Standard deviation
(c) Quartile deviation
(d) All these measures

Answer :  C

NCERT MCQ ON Measures of Central Tendency:

Question1 : Which of the following is a type of mathematical average?
(a) Median
(b) Partition value
(c) Mode
(d) None of these

Answer :  D

Question2 : Change of origin and scale is used for calculation of the:
(a) Arithmetic mean
(b) Geometric mean
(c) Weighted mean
(d) Lower and upper quartiles

Answer :  A

Question3 : Arithmetic mean of these items 5, 7, 9, 15, 20 is:
(a) 10
(b) 10.2
(c) 11.2
(d) 12

Answer :  C

Question4 : Arithmetic mean of these items: 10,15, X, 20, 30 is 20. Find out the missing item.
(a) 10
(b) 15
(c) 5
(d) 25

Answer :  D

Question 5: While computing the arithmetic mean of a frequency distribution, the each value of a class is considered equal to:
(a) Class mark
(b) Lower limit
(c) Upper limit
(d) Lower class boundary

Answer :  B

Question 6: Arithmetic mean of a series is 15 and if 5 is added in all the items of this series, the new arithmetic mean will be:
(a) 5
(b) 20
(c) 18
(d)10

Answer :  B

Question7 : Which of the following is not a measure of central tendency?
(a) Mean
(b) Mode
(c) Standard deviation
(d) Median

Answer :  C

Question8 : Which is not a method to find arithmetic mean?
(a) Direct method
(b) Short-cut method
(c) Step-deviation method
(d) Karl Pearson’s method

Answer :  D

Question 9: The sample mean is a:
(a) Parameter
(b) Statistic
(c) Variable
(d) Constant

Answer :  B

Question10 : Assumed mean is taken in which method?
(a) Direct method
(b) Step-deviation method
(c) Karl Pearson’s method
(d) Spearman’s method

Answer :  B

Question11 : The sum of deviations taken from mean is:
(a) Always equal to zero
(b) Some times equal to zero
(c) Never equal to zero
(d) Less than zero

Answer :  A

Question12 : Sum of deviations of different values from arithmetic mean is always equal to:
(a) zero
(b) one
(c) less than one
(d) more than one

Answer :  A

Question13 : Which of the following statements is always true?
(a) The mean has an effect on extreme scores
(b) The median has an effect on extreme scores
(c) Extreme scores have an effect on the mean
(d) Extreme scores have an effect on the median

Answer :  C

Question 14:  Mean of 0.3, 5, 6, 7, 9,12, 0.6 is:
(a) 4.9
(b) 5.7
(c) 5.6
(d) None of these

Answer :  B

Question15 :  Simple average is sometimes called:
(a) Unweighted average
(b) Weighted average
(c) Relative average
(d) None of these

Answer :  A

Question16 :  For a certain distribution, if ∑(X -20) = 25, ∑(X- 25) =0, and ∑(X-35) = -25, then is equal to:
(a) 20
(b) 25
(c) -25
(d) 35

Answer :  B

Question17 :  __________ is used when the sum of deviations from the average should be least.
(a) Mean
(b) Mode
(c) Median
(d) None of these

Answer :  A

Question18 :  The population mean µ is called:
(a) Discrete variable
(b) Continuous variable
(c) Parameter
(d) Sampling unit

Answer :  C

Question19 :  The total of all the observations divided by the number of observations is called:
(a) Arithmetic mean
(b) Geometric mean
(c) Median
(d) Harmonic mean

Answer :  A

Question20 :  Mean should be:
(a) Simple
(b) Based upon all items
(c) Rigidly defined
(d) Ail the above

Answer :  A

Question21 :  The algebraic sum of deviations of 8,1,6 from the A.M. viz., 5 is:
(a) -1
(b) 0
(c) 1
(d) None of these

Answer :  B

Question22 :  The sum of the squares of the deviations of the values of a variable is least when the deviations are measured from:
(a) Harmonic mean
(b) Geometric mean
(c) Median
(d) Arithmetic mean

Answer :  D

Question23 :  Average value of given variables is known as:
(a) Median
(b) Mean
(c) Mode
(d) Index Number

Answer :  B

Question24 :  The elimination of extreme scores at the bottom of the set has the effect of:
(a) Lowering the mean
(b) Raising the mean
(c) No effect
(d) None of the above

Answer :  B

Question25 :  Measures of central tendency are known as:
(a) Difference
(b) Averages
(c) Both
(d) None of these

Answer :  B

Question 26:  The arithmetic mean is highly affected by:
(a) Moderate values
(b) Extremely small values
(c) Odd values
(d) Extremely large values

Answer :  D

Question27 :  The A.M. of 1,3, 5, 6, x, 10 is 6. The value of x is:
(a) 10
(b) 11
(c) 12
(d) None of these

Answer :  B

Question28 :  Step deviation method or coding method is used for computation of the:
(a) Arithmetic mean
(b) Geometric mean
(c) Weighted mean
(d) Harmonic mean

Answer :  A

Question29 :  The values of all items are taken into consideration in the calculation of:
(a) Median
(b) Mode
(c) Mean
(d) None of these

Answer :  C

Question 30:  Sum of the deviations about mean is:
(a) Zero
(b) Minimum
(c) Maximum
(d) One

Answer :  A

Question31 :  Scores that differ greatly from the measures of central tendency are called:
(a) Raw scores
(b) The best scores
(c) Extreme scores
(d) Z-scores

Answer :  C

Question32 :  Measures of central tendency for a given set of observations measures:
(a) The scatterness of the observations
(b) The central location of the observations
(c) Both (a) and (b)
(d) None of these

Answer :  B

Question33 :  If there are two groups containing 30 and 20 observations and having 50 and 60 as arithmetic means, then the combined arithmetic mean is:
(a) 51
(b) 54
(c) 53
(d) 52

Answer :  B

Questio34n :  If a constant value is added to every observation of data, then arithmetic mean is obtained by:
(a) Subtracting the constant
(b) Adding the constant
(c) Multiplying the constant
(d) Dividing the constant

Answer :  B

Question35 :  The mean of 12 numbers is 24. If 5 is added in every number, the new mean is:
(a) 25
(b) 84
(c) 29
(d) None of these

Answer :  C

Question36 :  Sum of square of the deviations about mean is:
(a) Maximum
(b) Minimum
(c) Zero
(d) None of these

Answer :  B

Question37 :  The measure of central tendency listed below is:
(a) The raw score
(b) The mean
(c) The range
(d) Standard deviation

Answer :  B

Question38 :  __________ average is obtained by dividing the total of set of observations by their number.
(a) Weighted
(b) Simple
(c) Both (a) and (b)
(d) Neither (a) nor (b)

Answer :  B

Question39 :  Any measure indicating the centre of a set of data, arranged in an increasing or decreasing order of magnitude, is called a measure of:
(a) Skewness
(b) Symmetry
(c) Central tendency
(d) Dispersion

Answer :  C

Question40 :  The elimination of extreme scores at the top of the set has the effect of:
(a) Lowering the mean
(b) Raising the mean
(c) No effect
(d) Difficult to tell

Answer :  A

NCERT MCQ ON Presentation of Data:

Question1 : The process of presenting data in the form of a table is called:
(a) organisation
(b) classification
(c) presentation
(d) tabulation

Answer : D

Question2 :  Series in which frequencies are continuously added corresponding to each class interval in the series
(a) Cumulative frequency series
(b) Frequency
(c) Deviation
(d) Mid value

Answer : A

Question3 : ‘Stub’ of a table is the
(a) Right part of the table describing the columns
(b) Left part of the table describing the columns
(c) Right part of the table describing the rows
(d) Left part of the table describing the rows

Answer : D

Question4 :  Classification data based on the geographical differences of the data is
(a) Qualitative
(b) Quantitative
(c) Spatial
(d) Chronological

Answer : C

Question5 : Whether classification is done first or tabulation`
(a) Classification follows tabulation
(b) Classification precedes tabulation
(c) Both are done simultaneously
(d) No criterion

Answer : B

Question6 :  Arrangement of data according to some logical order is termed as
(a) Collection series
(b) Sample series
(c) Statistical series
(d) None

Answer : C

Question7 : The principal component of a table is:
(a) table number
(b) title
(c) head note
(d) all of these

Answer : D

Question8 : Which of the following is a basis of classification of a table?
(a) Purpose
(b) Construction
(c) Originality
(d) All of these

Answer : D

Question9 : The frequency distribution of two variables is known as
(a) Univariate distribution
(b) Sub- multivariate distribution
(c) Bivariate distribution
(d) Multivariate distribution

Answer : C

Question10 : Complex table may be classified as:
(a) general purpose and special purpose table
(b) original and derived
(c) double, treble and manifold table
(d) none of these

Answer : C

Question 11: In temporal classification, data are classified on the basis of:
(a) location
(b) time
(c) originality
(d) purpose

Answer : B

Question12 : Sub-divided bar diagram is used to:
(a) Study relation between different components
(b) Compare different components of a variable
(c) Either (a) or (b)
(d) Both (a) and (b)

Answer : D

Question 13: In tabulation, source of the data, if any, is shown in the:
(a) Source Note
(b) Body
(c) Stub
(d) Caption

Answer : A

Question14 :  Series of statistical data with one variable only is called
(a) None
(b) Discrete
(c) Continuous
(d) Individual Series

Answer : D

Question15 : The most accurate mode of data presentation is:
(a) Diagrammatic method
(b) Tabulation
(c) Textual presentation
(d) None of these

Answer : B

Question 16: The column heading of a table are known as:
(a) Stubs
(b) Sub-titles
(c) Reference notes
(d) Captions

Answer : D

Question 17:  There are two class interval 0-10 and 10-20 , if a student score 10 marks then he should be included in which class interval
(a) 10-20
(b) Not be included in these intervals
(c) Both the 0-10 and 10-20
(d) 0-10

Answer : A

Question18 : The headings of the rows given in the first column of a table are called:
(a) Stubs
(b) Titles
(c) Captions
(d) Prefatory notes

Answer : A

Question19 : Table is the consequence of:
(a) classification
(b) organisation
(c) presentation
(d) tabulation

Answer : D

Question20 : Which of the following refer to geometric form of data presentation?
(a) Bar diagrams
(b) Histogram
(c) Pie diagrams
(d) Both (a) and (c)

Answer : D

Question21: Which of the following statements is not true for tabulation`
(a) Complicated data can be presented
(b) Facilitates comparison between rows and not columns
(c) Statistical analysis of data requires tabulation
(d) Diagrammatic representation of data requires tabulation

Answer : B

Question22 : The other name of pie diagram is:
(a) circular diagram
(b) bar diagram
(c) histogram
(d) polygon

Answer : A

Question 23:  Average value of the upper and lower limits
(a) Class interval
(b) Mid-value
(c) Class limits
(d) Class

Answer : B

Question24 : Diagrams which show total values of a set of data simultaneously are known as:
(a) percentage bar diagrams
(b) differential bar diagrams
(c) deviation bar diagrams
(d) multiple bar diagrams

Answer : B

Question25 : Which of the following statements is correct?
(a) Bars may be vertical or horizontal
(b) Breadth of the bars remains the same
(c) All bars are based on some common base line
(d) All of these

Answer : D

Question26 :  Mid-point is used to calculate the following except
(a) Median
(b) Dispersion
(c) Frequency graphs
(d) Averages

Answer : A

Question27 : Diagrams which are used to compare the net deviation of related variables with respect to time and location are:
(a) deviation bar diagrams
(b) simple bar diagrams
(c) multiple bar diagrams
(d) pie diagrams

Answer : A

Question 28: The most attractive method of data presentation is:
(a) Diagrammatic
(b) Textual
(c) Tabular
(d) Either (a) or (b)

Answer : A

Question29 :  The class mid-point is equal to
(a) The ratio of the upper class limit and the lower class limit
(b) The average of the upper class limit and the lower class limit
(c) The product of upper class limit and the lower class limit
(d) None of these

Answer : B

Question30 : Which of the following are titles of the rows of a table?
(a) Title
(b)Stub
(c) Caption
(d) None of these

Answer : B

Question31 :  Series in which data are presented in a way that exact measurement of items are clearly shown
(a) Frequency Array
(b) Frequency Distribution
(c) None
(d) Both

Answer : A

Question32 : In a bar diagram, the bars are:
(a) Horizontal
(b) Vertical
(c) Either (a) or (b)
(d) None of the above

Answer : C

Question33 : For tabulation, ‘caption’ is:
(a) The lower part of the table
(b) The main part of the table
(c) The upper part of the table
(d) The upper part of a table that describes the column and sub-column

Answer : D

Question 34:  The series in which lower limit of the class interval or the upper limit of last class interval is missing
(a) Cumulative frequency
(b) Exclusive
(c) Open-end series
(d) Frequency array

Answer : C

Question35 : Diagrammatic representation of data is done by:
(a) Pictures
(b) Charts
(c) Diagrams
(d) All these

Answer : D

Question36 : The most appropriate diagram to represent the data relating to the monthly expenditure on different items by a family is:
(a) Histogram
(b) Pie diagram
(c) Frequency polygon
(d) Line graph

Answer : B

Question37 :  The data recorded according to standard of education like illiterate, primary, secondary, graduate, technical etc, will be known as _______ classification
(a) Quantitative classification
(b) Geographical Classification
(c) Qualitative classification
(d) Chorological Classification

Answer : C

Question38 : When for some countries, the magnitudes are small and for other, the magnitudes are very large, to portray the data, it is preferred to construct:
(a) Deviation bar diagram
(b) Duo-directional bar diagram
(c) Broken-Scale bar diagram
(d) Any of the above

Answer : C

Question39 : Details are shown by:
(a) Charts
(b) Tabular presentation
(c) Both (a) and (b)
(d) None of these

Answer : B

Question 40: ________ of the data refers to the arrangement of figures in such a form that comparison of the mass of similar data may be facilitated and further analysis may be possible
(a) Organization
(b) Collection
(c) Interpretation
(d) Analysis

Answer : A

NCERT MCQ ON Organisation of Data :

Question1 : The characteristic of a fact that can be measured in the form of numbers is called:
(a) frequency
(b) variable
(c) attribute
(d) none of these

Answer :  B

Question2 : Frequency of a variable is always:
(a) A fraction
(b) In percentage
(c) An integer
(d) None of these

Answer :  C

Question 3:  A series showing the sets of all values in classes with their corresponding frequencies is known as:

(a) Grouped frequency distribution
(b) Cumulative frequency distribution
(c) Simple frequency distribution
(d) None of the above

Answer :  A

Question 4: A series in which every class interval excludes items corresponding to its upper limit is called:
(a) exclusive series
(b) inclusive series
(c) both (a) and (b)
(d) none of these

Answer :  A

Question5 : An open-end series is that series in which:
(a) lower limit of the first class interval is missing
(b) upper limit of the last class interval is missing
(c) both (a) and (b)
(d) none of these

Answer :  C

Question 6: According to tally bar method, which of the following symbols indicate the frequency of five?
(a) IIII
(b) II
(c) III
(d) None of these

Answer :  D

Question7 : The Frequency distribution of a continuous variable is known as:
(a) Grouped frequency distribution
(b) Simple frequency distribution
(c) Either (a) or (b)
(d) Both (a) and (b)

Answer :  A

Question8 : In an ordered series, the data are:
(a) In descending order
(b) In ascending order
(c) Either (a) or (b)
(d) None of these

Answer :  C

Question9 : In a series, the number of times an item occurs is known as:
(a) number
(b) class frequency
(c) frequency
(d) cumulative frequency

Answer :  C

Question 10: The difference between upper limit and lower limit of a class is known as:
(a) range
(b) magnitude of a class interval
(c) frequency
(d) class limits

Answer :  B

Question11 : Which of the following equations is correct?
(a) s = r + n
(b) s = r – n
(c) s = r × n
(d) s = rn
[s = Size of the class; r = Range; n = Number of classes]

Answer :  D

Question 12: Drinking habit of a person is:
(a) An attribute
(b) A discrete variable
(c) A variable
(d) A continuous variable

Answer :  A

Question13 : An attribute is:
(a) A qualitative characteristic
(b) A measurable characteristic
(c) A quantitative characteristic
(d) All these

Answer :  A

Question14 : Nationality of a student is:
(a) An attribute
(b) A discrete variable
(c) A continuous variable
(d) Either (a) or (c)

Answer :  A

Question 15: Why is it true that classes in frequency distributions are all inclusive`
(a) No data point falls into more than one class
(b) There are always more classes than data point
(c) All data fit into one class or another
(d) All of these

Answer :  C

Question16 : The value exactly at the middle of a class-interval is called:
(a) Class mark
(b) Mid-value
(c) Both (a) and (b)
(d) None of these

Answer :  C

Question17 : The lower-class boundary is:
(a) An upper limit to Lower Class Limit
(b) A Lower limit to Lower Class Limit
(c) Both (a) and (b)
(d) None of these

Answer :  B

Question18 : Mutually exclusive classification is usually meant for:
(a) An attribute
(b) A continuous variable
(c) A discrete variable
(d) Any of these

Answer :  B

Question 19: For the construction of a grouped frequency distribution, we take:
(a) Class boundaries
(b) Class limits
(c) Both (a) and (b)
(d) None of these

Answer :  B

Question :20 Tally marks determines:
(a) Class width
(b) Class boundary
(c) Class limit
(d) Class frequency

Answer :  A

Question 21: The number of observations falling within a class is called:
(a) Density
(b) Frequency
(c) Both (a) and (b)
(d) None of these

Answer : B

Question22 : Which of the following is the objective of classification?
(a) Simplification
(b) Briefness
(c) Comparability
(d) All of these

Answer :  D

Question23 : Classification of data on the basis of time period is called:
(a) geographical classification
(b) chronological classification
(c) qualitative classification
(d) quantitative classification

Answer :  B

Question24 : A series showing the sets of all distinct values individually with their frequencies is known as:
(a) Grouped frequency distribution
(b) Simple frequency distribution
(c) Cumulative frequency distribution
(d) None of these

Answer :  B

Question 25: Annual income of a person is:
(a) A continuous variable
(b) A discrete variable
(c) An attribute
(d) Either (b) or (c)

Answer :  B

Question26 : Upper limit of any class is:
(a) Same
(b) Different
(c) Both (a) and (b)
(d) None of these

Answer :  B

Question 27: In inclusive class-intervals of a frequency distribution:
(a) Upper limit of each class-interval is included
(b) Lower limit of each class-interval is included
(c) Both (a) and (b)
(d) None of these

Answer :  C

Question28 : In exclusive class intervals of a frequency distribution:
(a) Upper limit of each class-interval is excluded
(b) Lower limit of each class-interval is excluded
(c) Both (a) and (b)
(d) None of these

Answer :  A

Question 29: For determining the class frequencies, it is necessary that these classes are:
(a) Mutually exclusive
(b) Not mutually exclusive
(c) Independent
(d) None of these

Answer :  A

Question30 : The upper limit of class-intervals is considered for calculating:
(a) ‘Less than’ cumulative frequency
(b) ‘More than’ cumulative frequency
(c) Relative frequency
(d) None of these

Answer :  A

Question31 : In an individual series, each variate value has:
(a) Same frequency
(b) Frequency one
(c) Varied frequency
(d) Frequency two

Answer :  B

Question32 : A grouped frequency distribution with uncertain first or last class is known as:
(a) Exclusive class distribution
(b) Inclusive class distribution
(c) Open end distribution
(d) Discrete frequency distribution

Answer :  B

Question33 : Class-interval is measured as:
(a) Half of the sum of lower and upper limit
(b) The sum of the upper and lower limit
(c) Half of difference between upper and lower limit
(d) The difference between upper and lower limit

Answer :  D

Question34 : The data given as 5, 7,12,17, 79, 84, 91 will be called as:
(a) A continuous series
(b) A discrete series
(c) An individual series
(d) Time series

Answer :  C

Question 35: Most extreme values which are never included in a class-interval are called:
(a) Class-interval
(b) Class limits
(c) Cass boundaries
(d) None of these

Answer :  C

Question36 : The class marks of a distribution are 26, 31,36, 41,46 and 51. Then the first-class interval is:
(a) 23.5-28.5
(b) 23-28
(c) 22.5-27.5
(d) None of these

Answer :  A

Question 37: Mutually exclusive classification:
(a) Excludes the upper-class limit but includes the lower-class limit
(b) Excludes both the class limits
(c) Includes the upper-class limit but excludes the upper-class limit
(d) Either (b) or (c)

Answer :  B

Question38 : In the construction of a frequency distribution, it is generally preferable to have classes of
(a) Equal width
(b) Unequal width
(c) Maximum width
(d) None of these

Answer :  A

Question39 : Classes with zero frequencies are called:
(a) Class
(b) Empty class
(c) Nil class
(d) None of these

Answer :  B

Question 40: For the mid-values given: 25, 34, 43, 53, 61,70, the first class of the distribution is:
(a) 25-34
(b) 24.5-34.5
(c) 20-30
(d) 20.5-29.5

Answer :  D