Question 1

� Which of the following is a long term

liability?

a) Accruals on year end cost

b) House Building Loan

c) Bank Overdraft

d) Dividend Payable

Question 2

� Clinic ‘The Cure’ purchased a machine of Rs 5, 00,000

and incurred Rs 10,000 on freight.

� On the way it paid taxes 10% on cost out of which a

reimbursement of 8% would be availed since the clinic

is operating in North-East region.

� If the life of the asset is expected to be 20 yrs find out

the depreciation to be charged annually.

Question 3

� Which of the following is revenue

expenditure?

a) Spending on computer hardware

b) Spending on building

c) Spending on car

d) Spending on wages & salaries

Question 4

� Balance of current assets overcurrent liabilities is known as

a) Net Assets

b) Working Capital

c) Trading Assets

d) Assets on place

Question 5

� Calculate the equity of a firm with the followingbalances:

�Fixed assets – 250000,

�Loan – 1, 15,000

�Inventory- 65000

�Deferred revenue – 5000

�Reserve & Surplus – 1, 50,000

Question 6

� Patents, Goodwill and Trademarksare example of

a) Intangible assets

b) Intangible liabilities

c) Current Assets

d) Tangible Assets

Question 7

� Suppliers who provide goods and services to business on credit are known as

a) Trade debtors

b) Sundry creditors

c) Sundry debtors

d) Financers

Question 8

� Which of the followings action wouldnot improve the profit margin?

a) Change to a supplier of cheaper inventory

b) Increase the selling price of products

c) Reduce the credit limit to customers

d) Reduce the advertisement expenses

Question 9

�Which of the followings is arepresentative account?

a) Capital Account

b) Building Account

c) Revenue Account

d) SBI Loan

Question 10

� Retained Profit is calculated as

a) Profit after Tax less dividend

b) Gross Profit less overheads

c) Operating profit plus dividends

d) Sales less cost of sales

Question 11

�Matching concept relates to thepreparation of :

(a) Profit & Loss Account

(b) Balance Sheet

(c) Cash Flow Statement

(d) Funds Flow Statement

Question 12

� Which of the followings is true

a) Economic Profit > Accounting Profit

b) Economic Profit = Accounting Profit

c) Economic Profit < Accounting Profit

d) None of the above

Question 13

� Profit and Loss Account is prepared fora period of one year by following :

(a) Cost concept

(b) Periodicity concept

(c) Consistency concept

(d) Conservatism concept

Question 14

� Give a transaction that

a) Increase in one asset, decrease in

other asset and increase in capital.

b) Increase in capital and decrease in

liability.

Question 15�Ascertain the equities from the

following :

�Capital- Rs.62,000

�Income- Rs.38,000

�Creditors- Rs.18,000

�Bank O.D.- Rs.7,000

�Bills payable- Rs.8,000

�Expenses- Rs.32,000

Question 16

�Both liabilities and owner's equity will increase by :

(i) Purchase of assets on credit,

(ii) Drawing of goods by the proprietor,

(iii) Further investment by the proprietor,

(iv) None of these.

Question 17

�Which of the followings are examples of Fictitious Assets

a) Preliminary Expenses

b) Goodwill

c) Discount on issue of Shares

d) Court Case against an Insurance company

Question 18

�Due to which principle, the capital contributed by the owners is shown as liability ?

a) Consistency

b) Legal Entity

c) Cost

d) Dual Aspect

Question 19

� A Profit of Rs 20000 is

a) A Transaction

b) An Event

c) Both a Transaction & Event

d) Neither Transaction nor Event

Question 20

�From following figures Calculate the commission of a broker for the year 2008

�Commission Received Rs 67000

�Commission accrued Rs 13000

�Commission received in advance Rs 8000

�Commission accrued for 2007 Rs 10000

Question 21

�The resources of an enterprise is called

a) Liabilities

b) Assets

c) Capital

d) All the above

Question 22

�Name the asset that comes firstunder the order of liquidity

Question 23

�Ascertain the cost of goods sold from the following figures.

Rs.

� Opening Inventory 850

� Purchases 30,700

� Purchase Returns 2,000

� Freight Expenses 4,800

� Godown Expenses 5,200

� Closing Inventory 9,000

Question 24

�What would be the impact of the following transactions on the financial statements?

a) Surf Excel worth of Rs 5,000 is taken by the

office manager of HUL

b) HUL distributed surf excel pouch of Rs

500000 as free sample

Question 25

MV of share of a company having following balances is Rs 50. Would you opt for it?

Share Capital 50000 Shares

500000 Intangible Assets

800000

Reserve 2000000 Fixed Assets 2500000

Bank Loan 1000000 Current Assets 300000

Sundry Crs 300000 Fictitious Assets

200000

* * Rs 3,00,000 of Intangible Assets have no market ValueRs 3,00,000 of Intangible Assets have no market Value