Deck 5: Insurance Claims, Stock Valuation, and Business Dissolution

Question 1

The claim lodged by the business to insurance company on happening the event

A)Claim
B)Loss of claim
C)discharge
D)insurance claim

Answer 1

insurance claim

Question 2

The account prepared to find out the stock as on the date of fire …..

A)Trading a/c
B)Stock a/c
C)Memorandum trading a/c
D)loss of stock a/c

Answer 2

Memorandum trading a/c

Question 3

The insurance claim due to loss of stock is reduced to the proportion that the policy value bears to the value of stock

A)Average clause
B)Minimum clause
C)Maximum clause
D)loss of profit clause

Answer 3

Average clause

Question 4

The insurance policy is less than the value of stock

A)Double insurance
B)re -insurance
C)under insurance
D)over insurance

Question 5

The insurance indemnifies the insured any loss of profit arising from interruption of the normal activity

A)Loss of profit insurance
B)full insurance
C)total insurance
D)fire insurance

Question 6

The claim lodged by the business to the insurance company on happening the event of loss is called …………………..

A)Insurance policy
B)Insurance claim
C)Insurance premium
D)None of these

Question 7

When a fixed asset is destroyed ,the loss of such asset on the date of fire can be ascertained from

A)record
B)accountant
C)books of accounts
D)None of these

Question 8

When stock is destroyed the ………………….. of loss is difficult

A)computation
B)reduction
C)deduction
D)allocation

Question 9

Business concern often suffer …………… due to different reasons .such as fire, theft, flood, strike, etc

A)Normal losse
B)abnormal losses
C)natural losses
D)None of these

Question 10

A set of ……………… is to be followed to file a claim with the insurance company

A)rule
B)policies
C)procedure
D)None of these

Question 11

Salvage value of stock to be ……….. from book value of stock

A)added
B)deducted
C)corrected
D)none of these

Question 12

Average clause is a …………… in the insurance company

A)reserve
B)fund
C)provision
D)none of these

Question 13

Fire insurance policies contain an "…………." to discharge under insurance

A)Total clause
B)net clause
C)Gross clause
D)average clause

Question 14

Fire insurance policies contain an "average clause" to discourage ……………………………..

A)Over insurance
B)fire insurance
C)under insurance
D)None of these

Question 15

Net claim on under insurance is equal to Loss of stock x value of stock On the date of fire

A)Policy value
B)Total value
C)total sales
D)none of these

Question 16

Gross profit on short sales are calculated as

A)Gross profit x operating ratio
B)short sales x gross profit ratio
C)Short sales x net profit ratio
D)short sales x operating ratio

Question 17

Short sales is the difference between …………… and actual sales of dislocated period

A)net sale
B)gross sales
C)standard sales
D)total sales

Question 18

The amount of insurance ………….. to be paid at regular intervals

A)policy
B)claim
C)commission
D)premium

Question 19

At the time of calculating insurance claim , the average clause is ………………. If the value of stock at the date of fire was more than the policy value.

A)applicable
B)obtainable
C)receivable
D)payable

Question 20

On dissolution of firm creditors are paid --------

A)First
B)Second
C)Third
D)Last

Question 21

Realization account is a ---------- account

A)Personal
B)Real
C)Nominal
D)Both real and nominal

Question 22

Firm's debts are paid first out of ----------- assets

A)Partner's
B)Firm's
C)Shareholder's
D)None of these

Question 23

On dissolution, all assets excepting cash are transferred to the ---------- side of realization account

A)Debit
B)Credit
C)Both
D)None of these

Question 24

Loss of realization is borne by the partners in their ------ ratio

A)Capital
B)Sacrificing
C)Profit sharing
D)None of these

Question 25

On dissolution of firm -------- are paid first

A)Investors
B)Owners
C)Creditors
D)Banks