## SEBI Grade A Commerce & Accountancy Practice Question

Practice Questions Set for SEBI Grade-A 2022. SEBI Grade A Commerce & Accountancy Practice Question Set with answers Phase I & Phase II (General Stream). SEBI Grade A Study Material, Books, PDFs, Free Notes, and Mock Test for of Commerce Accountancy. As we all know that The Security Exchange Board of India (SEBI) has released the SEBI Grade A 2022 Notification for the recruitment of 120+ Assistant Managers across the country.

If you are preparing for SEBI Grade A 2022, you will come across a section on “Commerce & Accountancy”. In this post, you will get sample questions for SEBI Grade A Commerce & Accountancy section. If you prepare this thoroughly, you can very easily crack SEBI Grade A 2022. If you want to crack SEBI Grade A 2020 exam then you should buy Before starting preparation for this exam you will aware of SEBI Grade A Previous Year PapersThese questions are important for SEBI Grade A Exam.

## SEBI Grade-A 2022: Commerce & Accountancy Practice Question | Set-2

1. The ratios that refer to the ability of the firm to meet the short term obligations out of its short term resources

A.

B. Leverage Ratio

C. Activity Ratio

D. Profitability Ratio

E. None of these

Explanation: The ratios that refer to the ability of the firm to meet the short term obligations out of its short term resources is known as Liquidity ratio.

2. The following is (are) the current liability (ies)

A. Bills payable

B. Outstanding expenses

C. Bank Overdraft

D. All of the above

E. None of these

Correct Answer –D. All of the above

Explanation:Bills payable, Outstanding expenses and Bank Overdraft are the current liabilities.

3. Return on Investment Ratio (ROI) =

A. (Gross profit / Net sales) x 100

B. (Gross profit x Sales / Fixed assets) x 100

C. (Net profit / Sales) x 100

D. (Net profit / Total assets) x 100

E. None of these

Correct Answer –D. (Net profit / Total assets) x 100

Explanation:Return on Investment Ratio (ROI) = (Net profit / Total assets) x 100.Return on Investment (ROI) is a performance measure used to evaluate the efficiency of an investment or compare the efficiency of a number of different investments.

4.Rs.5000 spent on maintenance of computer is

A. Deferred capital expenditure

B. Capital expenditure

C. Revenue expenditure

D. All of the above

E. None of these

Correct Answer – C. Revenue expenditure

Explanation: Rs.5000 spent on maintenance of computer is Revenue expenditure. A revenue expenditure is a cost that will be an expense in the accounting period when the expenditure takes place.

5. “Treating a revenue expenditure as a capital expenditure” is an example of

A. Compensating error

B. Error of principle

C. Error of omission

D. Error of commission

E. None of these

Correct Answer – B. Error of principle

Explanation:“Treating a revenue expenditure as a capital expenditure” is an example of Error of principle. An error of principle is an accounting mistake in which an entry is recorded in the incorrect account, violating the fundamental principles of accounting. An error of principle is a procedural error, meaning that the value recorded was the correct value but placed incorrectly.

6. Which of the following is not a financial statement?

A. Profit and loss account

B. Profit and loss appropriation account

C. Balance sheet

D. Trial Balance

E. None of these

Correct Answer – D. Trial Balance

Explanation:Trial Balance is not a financial statement. Trial Balance is a list of closing balances of ledger accounts on a certain date and is the first step towards the preparation of financial statements. It is usually prepared at the end of an accounting period to assist in the drafting of financial statements.

7. Which of the following inventory valuation methods show higher profits during the period of rising prices?

A. FIFO

B. LIFO

C. Weighted average cost method

D. Simple average method

E. None of these

Explanation: FIFO-First In First Out

8. The main objective of providing depreciation is to

A. Calculate the true net profit

B. Compute the actual cash profit

C. Create funds for replacement of fixed assets

D. Reduce tax burden

E. None of the above

Correct Answer – C. Create funds for replacement of fixed assets

Explanation:The main objective of providing depreciation is to Create funds for replacement of fixed assets. The main objective of charging depreciation is to accumulate adequate fund to replace old asset with the new one after the useful life. Depreciation is charged to fixed assets which helps to show the current value of the asset.

9. Which of the following is not an item of revenue expenditure?

A. Interest on deposits accepted

B. Annual insurance premium on inventory

C. Customs duty paid in connection with the import of equipment

D. Repairs and maintenance on machinery

E. None of the above

Correct Answer –C. Customs duty paid in connection with the import of equipment

Explanation:Customs duty paid in connection with the import of equipment is not an item of revenue expenditure. Customs duty paid on import of raw materials. It is capital expenditure.

10. One of the Fundamental accounting assumption is

A. Materiality

B. Going concern

D. Dual aspect

E. None of these

Correct Answer – B. Going concern

Explanation:One of the Fundamental accounting assumption is Going concern. Going concern is an accounting term for a company that has the resources needed to continue operating indefinitely until it provides evidence to the contrary.

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## SEBI Grade A (Assistant Manager) 2022 Preparation Book (VOL. I) of Commerce & Accountancy, Management, and Finance 