TRB COMMERCE QUESTION ANSWERS -TRB Study Materials Day 1

TRB COMMERCE QUESTION ANSWERS 61-70

Answers are bold in letters for better understanding/reference and easy hand on answers.

60. The type of process loss that should not affect the cost of inventory value is
A) abnormal loss B) normal loss
C) seasonal loss D) standard loss.

61. Is there any arbitrary cuts or increase in budget estimation in zero-base budgeting ?
A) Yes B) No
C) Sometimes D) Irrelevant.

62. Which of the following statements is /are correct ?
Statement I : Fixed expenses are estimated on the basis of past records
Statement II : Variable expenses are estimated on the basis of budgeted output.
Of these :
A) Statement I is correct, but not Statement II
B) Both the statement are correct
C) Statement II is correct, but not Statement I
D) Both the statement are wrong.

63. What do you mean by gestation period ?
A) Time taken to make capital decisions
B) Time taken to select an investment proposal
C) Time taken to get return
D) None of these.

64. The minimum rate of return below which a project would not be recommended is called
A) Profit point B) Break-even point
C) Cut-off point D) None of these.

65. Excess working capital may result in
A) liberal credit policy B) defective credit policy
C) bad debts D) all of these.

66. If the net profit for a period is Rs. 50,000 after crediting a gain on sale of asset Rs. 5,000 and debiting depreciation of Rs. 20,000 on fixed assets, the funds from operation will be
A) Rs. 70,000 B) Rs. 75,000
C) Rs. 65,000 D) Rs. 55,000.

67. “Budget is only a management tool. It is not a substitute for management.” The above statement is
A) correct
B) wrong
C) correct depending upon the situation
D) incomplete.

68. What is the accepted standard for current ratio ?
A) 2 : 1 B) 1 : 2
C) 2 : 3 D) 1 : 3.

69. Which of the following statements is true ?
Statement I : Interpretation is impossible without analysis
Statement II : Analysis without interpretation is possible but has no value. Of these :
A) Statement I is true B) Statement II is true
C) Both are true D) Both are false.

70. The technique of zero-base budgeting was introduced in 1961 in
A) USA B) UK
C) France D) India.

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