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B Com Exam  >  B Com Tests  >  Financial Analysis and Reporting  >  Test: Analysis of Investment Decisions - B Com MCQ

Test: Analysis of Investment Decisions - B Com MCQ


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10 Questions MCQ Test Financial Analysis and Reporting - Test: Analysis of Investment Decisions

Test: Analysis of Investment Decisions for B Com 2024 is part of Financial Analysis and Reporting preparation. The Test: Analysis of Investment Decisions questions and answers have been prepared according to the B Com exam syllabus.The Test: Analysis of Investment Decisions MCQs are made for B Com 2024 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Test: Analysis of Investment Decisions below.
Solutions of Test: Analysis of Investment Decisions questions in English are available as part of our Financial Analysis and Reporting for B Com & Test: Analysis of Investment Decisions solutions in Hindi for Financial Analysis and Reporting course. Download more important topics, notes, lectures and mock test series for B Com Exam by signing up for free. Attempt Test: Analysis of Investment Decisions | 10 questions in 10 minutes | Mock test for B Com preparation | Free important questions MCQ to study Financial Analysis and Reporting for B Com Exam | Download free PDF with solutions
Test: Analysis of Investment Decisions - Question 1
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What is the purpose of the "Cash in Savings" account in a business's current assets?

Detailed Solution for Test: Analysis of Investment Decisions - Question 1
The "Cash in Savings" account is used to deposit surplus cash that doesn't have an immediate purpose. This cash is placed in an interest-earning savings account to generate additional income for the business.
Test: Analysis of Investment Decisions - Question 2
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Which account tracks the value of improvements made to leased facilities in a business?

Detailed Solution for Test: Analysis of Investment Decisions - Question 2
The "Leasehold Improvements" account tracks the value of improvements made to facilities that a business leases. These improvements are amortized over their useful lifespan.
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Test: Analysis of Investment Decisions - Question 3
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Which type of asset is considered to have an indefinite useful life and cannot be amortized?

Detailed Solution for Test: Analysis of Investment Decisions - Question 3
Goodwill is an intangible asset that arises when a company acquires another for more than the value of its tangible assets. It reflects intangible value such as reputation and customer base and is not amortized unless it becomes impaired or its useful life becomes determinable.
Test: Analysis of Investment Decisions - Question 4
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When should a business test for impairment of its intangible assets?
Detailed Solution for Test: Analysis of Investment Decisions - Question 4
Intangible assets should be tested for impairment whenever circumstances suggest that their carrying amount may not be recoverable. This should be done at least once a year or more frequently if needed.
Test: Analysis of Investment Decisions - Question 5
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Which method is commonly used for amortizing intangible assets with finite useful lives?
Detailed Solution for Test: Analysis of Investment Decisions - Question 5
The straight-line method is commonly used for amortizing intangible assets with finite useful lives. It evenly spreads the amortization expense over the asset's useful life.
Test: Analysis of Investment Decisions - Question 6
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Which account tracks the cumulative amount by which a building's value decreases over time?
Detailed Solution for Test: Analysis of Investment Decisions - Question 6
The "Accumulated Depreciation — Buildings" account tracks the cumulative amount by which the value of a building is reduced over its useful lifespan due to depreciation.
Test: Analysis of Investment Decisions - Question 7
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What type of asset is a patent?
Detailed Solution for Test: Analysis of Investment Decisions - Question 7
A patent is an intangible asset that provides the holder with exclusive rights to make, use, and sell a product or service. It falls under the category of intangible assets.
Test: Analysis of Investment Decisions - Question 8
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What is the purpose of the "Accounts Receivable" account in current assets?
Detailed Solution for Test: Analysis of Investment Decisions - Question 8
The "Accounts Receivable" account is used to track customers who have purchased products or services on credit, allowing the business to manage outstanding receivables.
Test: Analysis of Investment Decisions - Question 9
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Which type of asset is "Cash on Hand"?
Detailed Solution for Test: Analysis of Investment Decisions - Question 9
"Cash on Hand" is a current asset. It refers to the cash kept at retail stores or in the office for immediate cash needs.
Test: Analysis of Investment Decisions - Question 10
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What is the primary purpose of the "Goodwill" account in a business's assets?
Detailed Solution for Test: Analysis of Investment Decisions - Question 10
The "Goodwill" account is used to reflect the intangible value of a company's reputation, customer base, and other non-tangible assets that arise when one company acquires another for more than its tangible assets' value.
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