The 'Going Concern' evaluation period as per SA 570 is: MCQ with Answer and Explanation

Question Report Error

The 'Going Concern' evaluation period as per SA 570 is:

A. Not defined

B. 6 months

C. Indefinite

D. At least 12 months from the balance sheet date

Answer: Option D

Solution (By JKExamLibrary)

Management assesses going concern for at least 12 months from the reporting date.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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The concept of 'Materiality' implies that:

A. All transactions are material

B. Only material items need to be disclosed as per accounting standards

C. Only large companies follow materiality

D. All items must be disclosed irrespective of amount

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Correct Answer: Option B

Explanation:
Materiality means that items of significant value or nature should be disclosed; trivial items may be ignored.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Under GST, the Reverse Charge Mechanism (RCM) means:

A. Liability to pay tax shifts from the supplier to the recipient of goods/services

B. The government pays tax to the supplier

C. The tax rate is negative

D. Exports are tax-free

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Correct Answer: Option A

Explanation:
Normally, the supplier collects and pays GST. Under RCM, the buyer/recipient is directly liable to pay the tax to the government.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Cost Accounting defines 'Cost Centre' as:

A. A person, location, or item of equipment for which costs may be ascertained for control

B. The total profit of the organization

C. A unit of product ready for sale

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Correct Answer: Option A

Explanation:
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This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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