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Chapter 10 - Muliple-choice questions

1. If a private limited company becomes a listed company, it means that:
   1.   ?    the company is going into liquidation
   2.   ?    the accounts will not comply with accounting standards
   3.   ?    the company will be floated on the stock market
   4.   ?    the company will not be able to issue debentures
2. A reserve is:
   1.   ?    part of the equity of a company
   2.   ?    part of the current assets of a company
   3.   ?    part of the fixed asset of a company
   4.   ?    part of the current liabilities of a company7
3. The financial statements required under international GAAP are:
   1.   ?    profit and loss account, statement of total recognised gains and losses, balance sheet, cash flow statement
   2.   ?    profit and loss account, statement of changes in equity, balance sheet, cash flow statement
   3.   ?    balance sheet, income statement, statement of changes in equity, cash flow forecast
   4.   ?    balance sheet, income statement, statement of changes in equity, cash flow statement
4. A company has authorized share capital of 800,000 shares of 50p each. Only 400,000 have been issued, called up and paid for in full. The called-up share capital fully paid is:
   1.   ?    £50,000
   2.   ?    £100,000
   3.   ?    £200,000
   4.   ?    £400,000
5. If a company has issued 100,000 ordinary shares and the profit available to ordinary shareholders is £5,000, the earnings per share is:
   1.   ?    2p
   2.   ?    5p
   3.   ?    20p
   4.   ?    50p
6. A company has 50,000 shares and the denomination of each share is 25p. A dividend of 15% per share has been proposed. Therefore, the total amount of the proposed dividend is:
   1.   ?    £18,750
   2.   ?    £7,500
   3.   ?    £1,875
   4.   ?    £750