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IC46 GENERAL INSURANCE ACCOUNTS PREPARATION – 12

Que. 1 : Q1) Which method resembles Depreciation Fund Method with the major difference the annual investment is made by contributions to an Insurance Policy as premium instead of investment in securities and this method is adopted in the cases of vehicles for the uncertainty of their useful lives?

   1.  a) Revaluation Method

   2.  b) Machine Hour Rate Method

   3.  c) Insurance Policy Method

   4.  d) Depletion Method

Que. 2 : Q2) Commitment provided to accept a specified number of shares irrespective of the number of shares subscribed by the public are known as:

   1.  a) Redemption

   2.  b) Full underwriting

   3.  c) Firm underwriting

   4.  d) None of the above

Que. 3 : Q3) Which book records receipts and disbursements of cash or bank account transactions on daily basis?

   1.  a) Cash book

   2.  b) Purchase day book

   3.  c) Bank receipts day book

   4.  d) Sales day book

Que. 4 : Q4) A lease was acquired with a premium of Rs.2,00,000 on 01.04.2006 for 4 years only. Depreciation under annuity system at 5% p.a. interest is charged. Rupee 1 is present value over 4 years @ 5% p.a. Calculate annual depreciation under Annuity method?

   1.  a) Rs.35285

   2.  b) Rs.49658

   3.  c) Rs.56402

   4.  d) Rs.68975

Que. 5 : Q5) Which among the following rating will have the lowest credit risk?

   1.  a) B

   2.  b) BB

   3.  c) BBB

   4.  d) AA

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