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AFM Sample Questions

The document provides sample questions for Modules 1-4 of an accounting fundamentals exam. It includes questions that cover topics such as the accounting process, key accounting concepts, users of accounting information and financial statements, depreciation, inventory valuation methods, accounting equation, differences between financial and managerial accounting, accounting concepts and conventions, branches of accounting, limitations of financial accounting, intangible assets, corporate balance sheets and governance reports, international financial reporting standards, cash flow statements, responsibility accounting, inflation accounting, common size statements, human resource accounting, environmental accounting, foreign exchange accounting, financial statement ratios, analysis of financial statements, and accounting treatments under different standards.

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Kaiwan Patrawala
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226 views

AFM Sample Questions

The document provides sample questions for Modules 1-4 of an accounting fundamentals exam. It includes questions that cover topics such as the accounting process, key accounting concepts, users of accounting information and financial statements, depreciation, inventory valuation methods, accounting equation, differences between financial and managerial accounting, accounting concepts and conventions, branches of accounting, limitations of financial accounting, intangible assets, corporate balance sheets and governance reports, international financial reporting standards, cash flow statements, responsibility accounting, inflation accounting, common size statements, human resource accounting, environmental accounting, foreign exchange accounting, financial statement ratios, analysis of financial statements, and accounting treatments under different standards.

Uploaded by

Kaiwan Patrawala
Copyright
© © All Rights Reserved
Available Formats
Download as DOC, PDF, TXT or read online on Scribd
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AFM sample questions:

Module 1 & 2
1. Describe briefly various steps of accounting process.
2.

Describe briefly various concepts of accounting.


OR:
Explain the following concepts:
i) The Entity Concept
ii) Accrual concept
iii) Realization Concept
OR:
Explain following accounting concepts with clear examples
i. Going Concern Concept
ii. Money Measurement Concept

3. Who are the users of accounting information, and why do the users need accounting
information? How this information helpful to the users?
OR
Discuss the utility and significance of financial statements to various parties interested
in business concern.
4.

Financial Statements are the most important part of financial reporting Discuss the
above statement giving the objectives of financial statement and the contents of the
various components of the financial statements.

5. What do you mean by the term 'depreciation'? What are its causes? Why do firms
provide depreciation?
6. Explain the limitations of Financial Accounting
7. What do you mean by inventory valuation? State different methods of inventory
valuation. Also discuss the impact of each valuation methods on COGS and Profit in
inflated prices and deflated prices.
8. Explain methods of Depreciation on Fixed Assets
9.Discuss the WDV and SLM methods of depreciation. Also mention the major
provisions of the Income Tax Act regarding depreciation.
10. As per the revised Accounting Standard 2 issued by ICAI, FIFO & WAC methods
are recognized methods for inventory valuation. Explain the FIFO & WAC methods of
inventory valuation.

11. What is Accounting Equation? Describe all the possible changes in it, which keeps the
equation true, with hypothetical transactions.
12. Distinguish between Financial Accounting and Management Accounting.
13. What are accounting concepts and conventions? Is there any difference between
them?
14. Define Accounting and explain the objectives of Accounting.
15. Explain various branches of accounting.
16. Explain Advantages and Disadvantages of accounting
17. Vikas is the accountant of a small company making two or three different types of
household tools. He systematically and accurately collects and records all the transactions
of the company, and prepares the statement, so that management knows the annual profit
and the financial position. what more can a good accountant do? Ponders Vikas. From
your understanding of the scope of accounting, advise him in what ways he might be of
service to the management?
(Module 3 & 4)
1.
2.
3.
4.
5.

What are intangible assets? How is goodwill valued?


Give abridged format of a corporate Balance sheet
What are the contents of a corporate Governance report?
Write a brief note on IFRS.
Describe the Provisions of the Companies Act. 1956 regarding accounts of a
company.
6. What are the various tools of financial statement analysis?
7. What is the managerial need of a Cash Flow Statement? How is it prepared?
8. How is Cash Flow Statement interpreted? Explain using imaginary data.
9. Explain Responsibility Accounting.
10. Describe Inflation Accounting
11. What do you understand by Common Size Statement? What is its purpose? Explain
with suitable examples.
12. Describe the progress made by India so far in the field of human resource
accounting.
13. Explain the significance of Environment Accounting in the Indian Context
14. Explain Foreign Exchange Accounting process in detail
15. Explain the various classification of ratios
16. Explain the meaning and objectives of Financial Statement Analysis.
17. distinguish accounting treatment under IASs( now IFRS) , Indian GAAP and US
GAAP
18. Why do we need global standardization of financial reporting? Is it feasible? Is it
required? Why or Why not?

OR
Due to globalization of economies, it is imperative to have uniform global financial
reporting Discuss giving the significance of IFRS.What do you understand by Trend
Analysis? Explain with hypothetical example.
19. What are the merits of introducing environmental accounting and reporting the
results obtained?
20. Explain the role of Human Resource Accounting.
21. Auditors report and Directors report are mandated by Companies Act Discuss
the significance and implication of Auditors report.
22. Define Human Resource Accounting giving its objectives and advantages.
23. Explain Responsibility Accounting giving the various types of responsibility
centres.

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