50 MULTIPLE CHOICE QUESTION WITH ANSWERS FINANCIAL REPORTING UNDER INDIAN ACCOUNTING STANDARDS (IND AS)
Ind AS 32 provides guidance on:
a) Financial Instruments: Presentation
b) Financial Instruments: Recognition and Measurement
c) Financial Instruments: Disclosures
d) Financial Instruments: Fair Value Measurement
Answer: a) Financial Instruments: Presentation
Which Ind AS deals with provisions, contingent liabilities, and contingent assets?
a) Ind AS 16
b) Ind AS 37
c) Ind AS 19
d) Ind AS 40
Answer: b) Ind AS 37
Ind AS 23 prescribes the accounting treatment for:
a) Borrowing Costs
b) Income Taxes
c) Financial Instruments
d) Revenue
Answer: a) Borrowing Costs
Which of the following is an example of an adjusting event after the reporting period under Ind AS 10?
a) A major acquisition of a subsidiary
b) Changes in tax rates enacted after the reporting period
c) Settlement of a court case that confirms an existing obligation
d) Announcement of a plan to discontinue an operation
Answer: c) Settlement of a court case that confirms an existing obligation
Ind AS 101 requires entities to prepare an opening balance sheet at:
a) The end of the first reporting period
b) The beginning of the earliest comparative period
c) The end of the earliest comparative period
d) The date of transition to Ind AS
Answer: d) The date of transition to Ind AS
Ind AS 110 deals with:
a) Consolidated Financial Statements
b) Interim Financial Reporting
c) Related Party Disclosures
d) Earnings Per Share
Answer: a) Consolidated Financial Statements
Which Ind AS provides guidance on accounting for insurance contracts?
a) Ind AS 104
b) Ind AS 19
c) Ind AS 41
d) Ind AS 39
Answer: a) Ind AS 104
Under Ind AS 7, which of the following is NOT an operating activity?
a) Receipts from customers
b) Payments to suppliers
c) Purchase of equipment
d) Payments to employees
Answer: c) Purchase of equipment
Ind AS 38 deals with:
a) Intangible Assets
b) Investment Property
c) Inventories
d) Provisions
Answer: a) Intangible Assets
Which of the following is a requirement under Ind AS 1 for presenting financial statements?
a) To be presented in compliance with Ind AS
b) To include a description of the significant accounting policies
c) To disclose comparative information for all amounts reported in the financial statements
d) All of the above
Answer: d) All of the above
Ind AS 24 requires disclosure of transactions with:
a) Key management personnel
b) Significant shareholders
c) Joint ventures
d) All of the above
Answer: d) All of the above
Ind AS 40 requires investment property to be measured:
a) At fair value
b) At cost
c) At cost less accumulated depreciation and impairment losses
d) Either a) or c)
Answer: d) Either a) or c)
Ind AS 12 requires the recognition of deferred tax assets when:
a) It is probable that future taxable profit will be available
b) It is certain that future taxable profit will be available
c) There are no temporary differences
d) The entity has a history of losses
Answer: a) It is probable that future taxable profit will be available
Which of the following is classified as a financing activity under Ind AS 7?
a) Payment of dividends
b) Sale of equipment
c) Interest received
d) Payment for purchase of inventory
Answer: a) Payment of dividends
Ind AS 36 requires an entity to test for impairment of an asset:
a) Annually
b) When there is an indication that the asset may be impaired
c) Both a) and b)
d) Never
Answer: c) Both a) and b)
Ind AS 116 deals with:
a) Leases
b) Borrowing Costs
c) Employee Benefits
d) Inventories
Answer: a) Leases
Under Ind AS 115, an entity should recognize revenue when:
a) Control of the promised goods or services is transferred to the customer
b) Payment is received
c) Goods are shipped
d) An order is placed
Answer: a) Control of the promised goods or services is transferred to the customer
Ind AS 29 deals with:
a) Financial Reporting in Hyperinflationary Economies
b) Accounting Policies
c) Interim Financial Reporting
d) Non-current Assets Held for Sale
Answer: a) Financial Reporting in Hyperinflationary Economies
Ind AS 107 requires entities to disclose:
a) Information about the significance of financial instruments for financial position and performance
b) Information about risks arising from financial instruments
c) Both a) and b)
d) Neither a) nor b)
Answer: c) Both a) and b)
Ind AS 34 requires an entity to:
a) Prepare interim financial reports for each quarter
b) Prepare interim financial reports for each half-year
c) Prepare interim financial reports when required by law
d) Prepare interim financial reports when required by stock exchanges
Answer: c) Prepare interim financial reports when required by law
Ind AS 113 provides guidance on:
a) Revenue Recognition
b) Fair Value Measurement
c) Consolidation
d) Operating Segments
Answer: b) Fair Value Measurement
Under Ind AS 16, subsequent expenditure on an item of property, plant, and equipment is:
a) Recognized as an asset if it enhances future economic benefits
b) Expensed immediately
c) Amortized over its useful life
d) Recognized in equity
Answer: a) Recognized as an asset if it enhances future economic benefits
Which Ind AS provides guidance on the accounting for revenue from contracts with customers?
a) Ind AS 16
b) Ind AS 109
c) Ind AS 115
d) Ind AS 113
Answer: c) Ind AS 115
Ind AS 19 deals with:
a) Revenue Recognition
b) Employee Benefits
c) Financial Instruments
d) Income Taxes
Answer: b) Employee Benefits
Which of the following is NOT a financial statement under Ind AS 1?
a) Statement of Comprehensive Income
b) Statement of Financial Position
c) Statement of Changes in Equity
d) Statement of Liquidity
Answer: d) Statement of Liquidity
Ind AS 7 requires cash flows to be classified into which categories?
a) Operating, Financing, and Investing
b) Operating, Financing, and Tax
c) Operating, Investing, and Tax
d) Operating, Investing, and Financing
Answer: d) Operating, Investing, and Financing
Ind AS 19 requires an entity to recognize a liability for employee benefits when:
a) Employees become eligible for benefits
b) Employees are hired
c) Benefits are paid to employees
d) Benefits are promised to employees
Answer: d) Benefits are promised to employees
Ind AS 24 requires an entity to disclose transactions with:
a) Significant suppliers
b) Key management personnel
c) Major customers
d) Government authorities
Answer: b) Key management personnel
Ind AS 8 requires changes in accounting policies to be applied:
a) Retrospectively
b) Prospectively
c) When required by management
d) When required by auditors
Answer: a) Retrospectively
Under Ind AS 2, inventories are measured at:
a) Fair value
b) Net realizable value
c) Historical cost or net realizable value, whichever is lower
d) Historical cost or fair value, whichever is higher
Answer: c) Historical cost or net realizable value, whichever is lower
Which Ind AS deals with the accounting for income taxes?
a) Ind AS 12
b) Ind AS 16
c) Ind AS 24
d) Ind AS 40
Answer: a) Ind AS 12
Ind AS 36 requires impairment testing of goodwill to be performed:
a) Annually
b) Bi-annually
c) Whenever there is an indication of impairment
d) Only when there is a loss
Answer: c) Whenever there is an indication of impairment
Which Ind AS deals with financial instruments: recognition and measurement?
a) Ind AS 101
b) Ind AS 107
c) Ind AS 109
d) Ind AS 113
Answer: c) Ind AS 109
Ind AS 101 requires an entity to apply Ind AS retrospectively, except in certain situations where it allows:
a) Prospective application
b) Immediate application
c) Modified retrospective application
d) No application
Answer: c) Modified retrospective application
Ind AS 21 deals with:
a) Income Taxes
b) The Effects of Changes in Foreign Exchange Rates
c) Borrowing Costs
d) Employee Benefits
Answer: b) The Effects of Changes in Foreign Exchange Rates
Ind AS 23 requires borrowing costs that are directly attributable to the acquisition, construction, or production of a qualifying asset to be:
a) Expensed immediately
b) Amortized over the life of the asset
c) Capitalized as part of the cost of that asset
d) Deferred to future periods
Answer: c) Capitalized as part of the cost of that asset
Which Ind AS provides guidance on the presentation of financial statements?
a) Ind AS 1
b) Ind AS 7
c) Ind AS 10
d) Ind AS 16
Answer: a) Ind AS 1
Ind AS 37 requires provisions to be recognized when:
a) There is a probable obligation
b) There is a possible obligation
c) There is a future obligation
d) There is no obligation
Answer: a) There is a probable obligation
Ind AS 101 requires an entity to disclose the nature and effect of the changes in accounting policies in:
a) The notes to the financial statements
b) The statement of cash flows
c) The management discussion and analysis
d) The auditor’s report
Answer: a) The notes to the financial statements
Which Ind AS deals with revenue recognition?
a) Ind AS 1
b) Ind AS 18
c) Ind AS 24
d) Ind AS 40
Answer: b) Ind AS 18
Ind AS 111 deals with:
a) Business Combinations
b) Joint Arrangements
c) Revenue from Contracts with Customers
d) Insurance Contracts
Answer: b) Joint Arrangements
Under Ind AS 40, investment property is initially measured at:
a) Historical cost
b) Fair value
c) Amortized cost
d) Replacement cost
Answer: b) Fair value
Ind AS 16 requires depreciation of property, plant, and equipment to be:
a) Based on historical cost
b) Based on fair value
c) Based on revalued amount
d) Based on useful life
Answer: d) Based on useful life
Which Ind AS provides guidance on accounting for leases?
a) Ind AS 17
b) Ind AS 19
c) Ind AS 27
d) Ind AS 37
Answer: a) Ind AS 17
Ind AS 27 deals with:
a) Separate Financial Statements
b) Consolidated Financial Statements
c) Joint Arrangements
d) Business Combinations
Answer: a) Separate Financial Statements
Ind AS 33 requires entities to disclose:
a) Key management personnel compensation
b) Segment information
c) Earnings per share
d) Related party transactions
Answer: c) Earnings per share
Ind AS 34 requires interim financial statements to include:
a) A statement of comprehensive income
b) A statement of financial position
c) A statement of changes in equity
d) All of the above
Answer: d) All of the above
Which of the following is NOT a component of other comprehensive income under Ind AS?
a) Dividends received
b) Actuarial gains and losses on defined benefit plans
c) Foreign currency translation differences
d) Changes in fair value of available-for-sale financial assets
Answer: a) Dividends received
Ind AS 28 deals with:
a) Investments in Associates and Joint Ventures
b) Financial Instruments: Presentation
c) Fair Value Measurement
d) Disclosure of Interests in Other Entities
Answer: a) Investments in Associates and Joint Ventures
Ind AS 103 relates to:
a) Business Combinations
b) Revenue from Contracts with Customers
c) Borrowing Costs
d) Earnings Per Share
Answer: a) Business Combinations
