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1. The ________ concept means that similar items in a set of accounts should be given similar accounting treatment and it
should be applied from one period to another.
a. going concern b. prudence c. consistency d. materiality
2. ________ concept is built around the fact that every time something is given, someone (or something) else receives it.
a. prudence b. accrual c. consistency d. duality
3. state hich accounting concept the accountant should follo in dealing ith the folloing! although the sales have not yet
actually ta"en place. #ome reliable customers of the company have placed several large orders that are li"ely to be e$tremely
profitable.
a. consistency b. conservatism c. historical cost d. realisation
%. &an" account is a
a. nominal account b. personal account c. real account d. valuation account
'. (iability arises because of
a. only cash transactions b. only credit transactions
c. cash as ell as credit transactions d. none of the above
). The rebate on bill retired is actually calculated at a fi$ed percentage per annum on the face value of the bill for
a. une$pired period for the bill b. e$pired period of the bill
c. tenor of the bill d. none of the above
*. +ccommodation bill is also called ,
a. trade bill b. promissory note c. -ite bill d. ban" note
.. the due date of a bill is 2) /anuary and 2' /anuary is also a public holiday. 0hen does the bill fall due1
a. 2) /anuary b. 2* /anuary c. 2% /anuary d. 2' /anuary
2. The cost of a fi$ed asset less its accumulated depreciation is e3ual to the _____ value
a. capitali4ed b. boo" c. scrap d. mar"et
15. the trial balance shos that the provision for depreciation on vehicles account has a credit balance of rs. 25,555. this
represents the _____
a. current year depreciation b. boo" value of vehicles at the end of the accounting period
c. amount of cash set aside to replace the vehicles in future d. the accumulated depreciation at the end of the accounting
period before any ad6ustments
11. +ccounting has been referred to as the ______ of business.
a. boo" "eeping b. language c. record d. blood
12. +ccounting is the recording of ________ happening
a. present b. past c. past and present d. past and future
13. 7ebenture
a. can be forfeited for non payment of calls money
b. cannot be forfeited for non payment of calls money as per the provision of section 122 of the companies +ct, 12')
c. can be forfeited under special circumstances d. can be forfeited after ta"ing court permission
1%. 8a"ed debentures are
a. secured by a charge upon some or all assets of the company
b. not secured by any charge upon any assets
c . secured by a charge upon fi$ed assets of the company
d. secured by a charge upon current assets of the company
1'. &earer debentures are transferable
a. to a registered debentureholder b. by delivery
c. only to e3uity shareholders d. none of the above
1). the debentures hich are not repayable during the life time of the company is called ______ debentures.
a. redeemable b. convertible c. perpetual d. bearer
1*. 9 ltd issued 15: debentures of ;s. 25,55,555 at .: discount redeemable at par. +ssume that the debentures are
redeemable by draing method in the folloing manner!
<ear end =ace value (;s.)
2 2,55,555
3 %,55,555
% ),55,555
' .,55,555
the discount on issue of debentures ill be ritten off in the 1
st
and 2
nd
year as
a. ;s. %5,555> rs. %5,555 b. ;s. %5,555> rs. 3),555
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c. ;s. 3),555> rs. 2.,555 d. rs. 2.,555> rs. 1),555
1.. /ournal is a
a. memorandum record b. primary record c. secondary record d. none of the above
12. the process of transferring the accounts from the 6ournal to the ledger is called_______
a. /ournalising b. posting c. &alancing d. casting
25. - has 6ust started up a business. Ae introduced ;s. %,55,555 of his on savings, e3uipment ;s. 1,55,555and obtained a
ban" loan of rs. %5,555.
0hat is the correct balance of -Bs capital account folloing the transactions1
a. ;s. %,55,555 b. ;s. ',%5,555 c. rs. ',55,555 d. rs. %,%5,555
21. + commission of 25: on net profit after charging such commission is calculated as
a. 1C) of the net profit before charging commission b. 1C.' of the net profit before charging commission c. D of the net
profit before charging commission d. 1C3 of the net profit before charging commission
22. Epon death, the amount of 6oint life policy should be distributed
a. amongst all partners in the old ratio b. amongst continuing partners in the old ratio
c. to the e$ecutors of the deceased d. amongst continuing partners in the ne ratio
23. 0hen a partner dies, the 6oint life policy is ________
a. revalued b. realised c. surrendered d. distributed
2%. 0hen the premium paid is shon in the profit and loss account, the ______ profit is reduced
a. gross b. divisible c. net d. capital
2'. =rom the folloing, calculate the amount due to the e$ecutors of a deceased partner!
;s.
?apital account balance 12,555
#hare of reserve ),555
#hare of 6oint life policy 35,555
#hare of goodill *,'55
;evaluation loss 2,*'5
+mount paid to the e$ecutors 35,555
a. ;s. '','55 b. ;s. 22,*'5 c. ;s. '2,*'5 d. ;s. 25,2'5
2). 0hat entry ould the ?ustomer pass hen he accepts the goods purchased on approval basis1
a. 7r. Furchase aCc G ?r. #upplier aCc b. 7r. Furchase aCc G ?r. Furchase on approval basis aCc
c. 7r. Furchase aCc G ?r. #uspense aCc d. 8o entry.
2*. H?um-InterestJ 7ebenture means debenture purchased-
a. after the interest period including interest b. after the interest period e$cluding interest
c. after the interest period e$cluding interest d. ithin the interest period including interest
2.. 0hich of the folloing is not a difference beteen (I=K G =I=K1
a. ;ecommendation by +#-2 b. Laluation of ?losing #toc"
c. Mffect on the 3uantity of stoc" left d. 7ifference in Frofit.
22. #chedule LI provides that ,
a. &alance #heet should be shon first and a Frofit and (oss +ccount shall be anne$ed to it.
b. Frofit and (oss +ccount should be shon first and &alance #heet shall be anne$ed to it.
c. &alance #heet and Frofit and (oss +ccount can be shon in any order.
d. &alance #heet and Frofit and (oss +ccount need not be shon to #hareholders
35. 0hich the folloing bodies is responsible for the frameor" of +#1
a. +ccounting #tandards &oards of ? G +N b. I?+I
c. +ccounting #tandards &oards of I?+I d. @inistry of =inance.
31. + ithdraal of ?ash from business by the Froprietor should be credited to ,
a. Froprietor +ccount b. ?apital +ccount c. draing +ccount d. ?ash +ccount.
32. 8et ;esult of the activities of a 8on Frofit @a"ing Krganisation is "non as-
a. Frofit or (oss b. Income or (oss c. #urplus or 7eficit d. Frofit or 7eficit
33. 0hat is the treatment hen ;s. ',555 is incurred on upgradation of computer by installing 152% @& ;+@1
a. ?apital M$penditure of ;s. '555 b. 7eferred ;evenue M$penditure of ;s. '555
c. 7eferred ?apital M$penditure of ;s. '555 d. ;evenue M$penditure of ;s. '555
3%. +n increase in one liability ill lead to-
a. Increase in +sset b. Increase in another (iability also c. Increase in ?apital d. +ll of the above.
3'. 0hat is +mended ?ash &oo" in the conte$t of &;#1
a. ;ectified ?ash &oo" having to columns b. ;ectification of ?ash &oo" before preparation of &;#
c. ;ectification of ?ash &oo" after preparation of &;# d. ;ectified ?ash &oo" having three columns
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3).0hat is the /ournal Mntry for 7epreciation hen Frovision for 7epreciation e$ists1
a. 7r. 7epreciation aCc G ?r. +sset aCc b. 7r. F G ( aCc G ?r. 7epreciation aCc
c. 7r. 7epreciation aCc G ?r. Frovision for 7epreciation aCc d. 7r. F ( aCc G ?r. Frovision for 7epreciation aCc
3*. 0here separate /L boo"s are maintained, hat is the /ournal Mntry for purchase of goods1
a. 7r. Furchase aCc G ?r. /oint &an" aCc b. 7r. /oint &an" aCc G ?r. Furchase aCc
c. 7r. /oint &an" aCc G ?r /oint Lenturer aCc d. 7r. /oint Lenture aCc G ?r. /oint &an" aCc
3.. 1,555 #eing @achines costing ;s. 2'5 each ere sent on consignment. =reight paid by ?onsignor G ?onsignee as ;s.
1,'55 G ;s. 2,'55 respectively. Nodon ;ent paid ;s. '55 per month and Nodon as used for * months. 25 machines
ere destroyed beyond repair at the ?onsigneeBs end. 0hat is the total value of the 25 machines destroyed1
a. ;s. ',5'5 b. ;s. ',535 c. ;s. ',5.5 d. ;s. ',1'5
32. Noods costing ;s. 1,55,555 are consigned at 25: on invoice price. 0hat is its load1
a. ;s. 1,2',555 b. ;s. 2',555 c. ;s. *',555 d. ;s. 25,555
%5. 0here separate set of boo"s are maintained for /L, hat is the /ournal Mntry, hen ?o-Lenturer (+) ta"es a part of
stoc"1
a. 7r. + aCc G ?r. /oint Lenturer aCc b. 7r. /oint Lenture aCc G ?r, + aCc
c. 7r. + aCc G ?r. #toc" aCc d. 7r. #toc" aCc G ?r. + aCc
%1. ?an 7ebentures be purchases from the open mar"et1
a. 8o b. <es, ithout any permission
c. #M&I Fermission should be obtained d. ;&I Fermission should be obtained
%2. 0hich +# has been ithdraal by I?+I1
a. +# 2. b. +s 2) c. +# . d. +# )
%3. 0hat ould be the treatment hen ;s. 1',555 is incurred on maintenance of Flant G @achinery for a particular year1
a. ?apital M$penditure of ;s. 1',555 b. 7eferred ;evenue M$penditure of ;s. 1',555
c. 7eferred ?apital M$penditure of ;s. 1',555 d. ;evenue M$penditure of ;s. 1',555
%%. 0hat is the /ournal Mntry for investment of amount of 7epreciation 1
a. 7r. 7epreciation aCc G ?r. &an" aCc b. 7r. #in"ing =und aCc G ?r. &an" aCc
c. 7r. #in"ing =und Investment aCc G ?r. &an" aCc d. 7r. &an" aCc G ?r. #in"ing =und Investment aCc
%'. 0hat is the full form of #M&I1
a. #hare M$change &oard of India b. #ecurities M$change &oard of India
c. #ecurity Mncashment &oard of India d. #hare Marned &oard of India.
%). The rule H7ebit all M$penses and (osses> ?redit all Incomes and NainsJ applies to-
a. ;eal +ccounts b. Fersonal +ccounts c. 8ominal +ccounts d. #uspense +ccounts
%*. 0hich of these is not a feature of ?onsignment1
a. There is Frincipal and +gent relationship beteen the ?onsigner and ?onsignee
b. ?onsignor presents Froforma Invoice to the ?onsignee
c. The property in the goods passes on to the ?onsignee after transfer of the goods.
d. ?onsignor reimburse all the e$penses to the ?onsignee.
%.. The minimum number of member in Fublic ?ompany is ,
a. * b. . c. % d. 2
%2. 0hich of the these are the basic types of error1
a. Mrror of Frinciple G ?ompensating Mrror b. Mrror of Frinciple G Mrror of ?ommission
c. Mrror of Frinciple G Mrror of Kmission d. ?lerical Mrrors
'5. Noods sold to + ;s. %5,555> Noods purchased from + ;s. 33,555. Transfer entry is re3uired for-
a. ;s. *,555 b. ;s. %5,555 c. ;s. 33,555 d. ;s. *3,555.
'1. 0hat is &;#1
a. #tatement to verify the negative balance of &an" &oo" b. #tatement to reconcile the difference beteen the ?ash
&oo" and Fass &oo" c. #tatement to reconcile the difference beteen the ?ash ?olumn and ?ash &oo" d.
#tatement to verify the balance of Fetty ?ash &oo"
'2. 0ho is oner of ?ompany1
a. #hareholders b. Fromoter c. 7irector d. Fartner
'3. +ccording to #ection )1*, a ?ompany of hich not less thanO.of Faid Ep #hare ?apital held by ?entral Novernment, is
a Novernment ?ompany.
a. %1: b. '5: c. 155: d. '1:
'%. 0hich among the folloing is not a method to +ccount for P#ale on +pproval P basis1
a. Krdinary #ale @ethod b. @ulticolumn /ournal @ethod
c. #eparate 7ay &oo"s @ethod d. ?olumnar #ale 7ay &oo" @ethod
''. 0hat is an Mrror1
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a. Intentional mista"es b. Enintentional mista"e c. @ista"e under influence d. +ll of the above.
'). 0hat is /oint Lenture1
a. M$port , Import business b. #hort duration business
c. (ong duration business d. Fermanent business establishment
'*. The net effect of all the 8ominal +ccounts is transferred to-
a. Frofit G (oss +ccount b. Trading +ccount c. ?apital +ccount d. &alance #heet.
'.. 0hat do you mean by P=inancial #tatementB in India1
a. Frofit G (oss +Cc, &alance #heet, ?ash =lo #tatement, #chedules and 8otes forming part of +ccounts.
b. Frofit G (oss +ccount, &alance #heet
c. Trial &alance, Frofit G (oss +Cc, &alance #heet d. Trial &alance, &alance #heet
'2. The ma6or guidelines for selection of +ccounting Folicies are-
a. Frudence, #ubstance over =orm, @ateriality b. Noing ?oncern, +ccrual, ?onservatism
c. @atching, 7ual +spect, ?onservatism d. 7ual aspect, conservatism, @ateriality
)5. Ao ould (oss by =ire in the Nodon valued at ;s. ',55,555 be treated in the boo"s of account1
a. ?apital M$penditure b. ;evenue M$penditure
c. 7eferred ?apital M$penditure d. 7eferred ;evenue M$penditure
)1. The e$pression P7issolution of =irmB and P7issolution of FartnershipB have the same meaning and are used
interchangeably.
a. True, as the =irm as a hole is closed don in both the cases.
b. =alse, as the =irm as a hole is not closed don in late case.
c., Fartly True d. 8one of the above.
)2. + 0arranty is a stipulation essential to the main purpose of the contract.
a. True b. Fartly True c. =alse d. 8one of the above
)3. 0hich of the folloing statement in false1
a. Nenerally a #tranger to a contract cannot sue. b. + verbal promise to pay a time barred debt s valid. c. ?ompleted
gifts need no consideration. d. 8o consideration is necessary to create an agency.
)%. #ometimes, a person finds certain goods belonging to some other persons. In such a case, the =inder-
a. become the oner of the goods and can use them
b. is under a duty to trace the true oner and return the goods
c. can sell the perishable goods if true oner cannot be found. d. both (b) and (c)
)'. +, & and ? are under a /oint Fromise to pay 7 ;s. 35,555. ? is unable to pay anything and + is compelled to pay hole.
Ao much can + recover from &1
a. ;s. 35,555 b. ;s. 1',555 c. ;s. 15,555 d. 8othing at all
)). + invites & for coffee in a restaurant and & accepts the invitation. Kn the appointed date, & goes there but + is not found.
In this case-
a. & has no remedy against + b. & has to ait for another invitation from +
c. & can sue + for not honouring his ords d. + has to invite & again, to perform the promise.
)*.#eller has right of re-sale here-
a. Noods are perishable b. #eller has reserved such right c. #eller gives notice of re-sale d. +ll of these.
).. 9 and < contract to marry each other at a particular date. &ut prior to the scheduled time 9 turns lunatic, The contract
becomes-
a. Loid b. Lalid c. Loidable d. Illegal
)2. In the absence of agreement to the contrary all Fartners are-
a. 8ot entitled to share profits b. Mntitled to share in capital ratio
c. Mntitled to share e3uality d. Mntitled to share in ratio presented by the ;egistrar
*5. The #pecial 7amages, i.e. the damages hich arise due to special or unusual circumstances ,
a. are not recoverable altogether b. are illegal being punitive in nature
c. cannot be claimed as a matter of right d. can be claimed as a matter of right.
*1. In hich form of the contract, the property in the goods passes to the &uyer immediately1
a. +greement to #ell b. Aire Furchase c. #ale d. Instalment to sell.
*2. + rong representation hen made ithout any intention to deceive the other party amounts to-
a. ?oercion b. Endue Influence c. @isrepresentation d. =raud
*3. + buys from & bales of a specified cotton delivery in 7ecember, at ;s. 1,2'5 per bale. Kn the date of delivery, the price is
;s. 1,555 per bale. In this case, + may avoid the contract.
a. True b. Fartly True c. =alse d. 8one of the above.
*%. +n agreement in restraint of marriage, i.e. hich prevents a person from marrying, is-
a. void b. valid c. voidable d. contingent.
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*'. Lalid ?ontracts-
a. are made by free consent b. are those here the parties to the contract are competent to enter into an agreement
d. have laful consideration G laful ob6ect d. all of the above.
*). 0here the &uyer rongfully neglects or refuses to accept and pay for the goods-
a. #eller may sue &uyer for damages for non-acceptance
b. #eller cannot sue &uyer for damages for non-acceptance
c. #eller can sue &uyerBs &an"er for damages
d. #eller can sue &uyerBs #olicitors for fraud.
**. +n Kffer may lapse by-
a. ;evocation b. ?ounter Kffer c. ;e6ection of Kffer by Kfferee. d. +ll of these
*.. + rites to &, HI am illing to sell my car as it is today for ;s. *',555J. & replies, !I can buy it for ;s. )',555J. + "eeps
3uiet . #ubse3uently , & rites- HI ill buy the car at ;s. >*',555J. There is a binding promise in this case.
a. True b. Fartly True c. =alse d. 8one of the above.
*2. 0here a Fartnership agreement provide neither for the duration nor for the determination of the Fartnership, it s called
a. Fartnership for a fi$ed term b. Fartnership at ill c. Mither (a) or (b) d. neither (a) nor (b)
.5. @, a shop"eeper, sold a Television set to 8, ho purchased it in good faith. The set had some manufacturing defect and
it did not or" after a fe days in spite of repairs. In this case, the television as not merchantable as it as not fit for
ordinary vieing purpose. In this case-
a. &uyer has no right to re6ect the television . b. &uyer has the right to re6ect the television and to have refund of the
price. c. Mither (a) or (b) d. &oth (a) and (b)
.1. ?an a time-barred debt be ad6usted by a ?reditor, here the 7ebtor ma"es the payment ithout indicating the debt to be
ad6usted1
a. <es, in such a case the ?reditor is at liberty to ma"e such ad6ustment
b. 8o, as a time-barred debt cannot be recovered
c. <es, if the ?ourt directs so
d. 8o, the ?ourt ill set aside such ad6ustment
.2. In an +uction #ale, if the #eller ma"es use of pretended bidding to raise the price, then the sale is-
a. valid b. void c. voidable d. illegal
.3. 9 and < buy 255 bales of cotton, agreeing to share the same beteen them. There is a valid partnership beteen $ and <.
a. <es b. 8o c. Fartly <es d. 8one of the above.
.%. 0here the e$istence of a ;etiring Fartner as not "non, he is not liable for debts incurred by the =irm after his
retirement even if public notice of his retirement as not given.
a. True b. Fartly True c. =alse d. 8one of above.
.'. 0hich one of the folloing is not true1
a. 7ocument shoing title is different from document of title.
b. &ill of (ading is a 7ocument of title to goods.
c. #pecific Noods can be identified and agreed upon at the time of the contract of #ale.
d. 8one of the above.
.). ?onditions and 0arranties may be-
a. M$press b. Implied c. Mither (a) or (b). d. 8either (a) nor (b)
.*. Is it compulsory for a @inor ho has attained ma6ority to give public notice that he has elected either to become or not to
become a Fartner in the =irm1
a. <es b. 8o c. Fartly <es d. 8one of the above
... The term HNoodsJ under #ale of Noods +ct, 1235 does not include-
a. Noodill b. +ctionable ?laims c. #toc" and #hares d. Aarvested ?rops.
.2. Kn the face of tic"et for a 6ourney, the ords, H=or conditions see bac"J are printed in small print. The passenger-
a. is bound by the conditions hether he ta"es care to read them or not b. is not bound by the conditions
c. may not ta"e note of the conditions d. may claim that he has not seen the conditions.
25. 0here the Fromisee has to apply to the Fromisor for performance, such application should be made at a proper time and
place. 0hat is proper time and place is a-
a. 3uestion of fact b. 3uestion of la c. 3uestion of general custom d. not a 3uestion at all.
21. 9 invites < (a famous =ilm +ctor) to his daughterBs engagement and dinner party. < accepts the invitation and promise to
attend. 9 made special arrangement for < at the party but he did not turn up. 9 enraged ith <Bs behaviour, anted to sue for
loss incurred in ma"ing special arrangements.
a. 9 has no remedy against < b. 9 has to conduct the engagement party again and invite <
c. 9 can sue < for not honouring his ords d. 9 has to invite < again, to perform the promise.
22. The phrase HQuantum @eruiitJ literally means-
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a. +s much as earned b. The fact in itself c. + contract for the sale d. +s much as gained
23. ;etiring Fartner continues to be liable for acts of the =irm done-
a. up to the date of admission of a ne Fartner b. up to the date of giving public notice of retirement
c. up to the close of the financial year in hich he retires. d. all of the above.
2%. ( offered to ta"e a house on lease for a period of 3 years at ;s. 1 (a"h p.a. if the house as Hput through repairs and
rooms ere handsomely decoratedJ. Aere, there is no offer since-
a. there is no legal obligation b. there is no communication of offer
c. the terms of offer is too vague d. the offer is conditional.
2'. 0hich of these statements does not reflect the mutual agency principle in Fartnership1
a. The Fartners is both an +gent and Frincipal
b. + Fartner can, by his act bind other partners and is in turn bound by acts of other Fartners.
c. +ll Fartners should actively participate in the business d. &usiness may be managed by one or more Fartners.
2). Mvery partner is bound to attendOOOOOOO.to his duties, in the conduct of the business.
a. #ystematically b. 7iligently c. #incerely d. Mffectively.
2*. If #ales-Ta$ had been deposited ith respect to an item on hich, there as no levy, the depositor C assessee is-
a. not entitled to refund from the government b. entitled to refund from the Novernment
c. entitled to charge the same from customers d. entitled to refund from the ?ourt
2.. =ailure by a minor to give public notice ithin si$ months ill have the folloing effect-
a. The Fartners =irm stands dissolved b. @inor automatically becomes Fartners
c. @inor automatically ceases to be a partner d. the Fartnership becomes an illegal association.
22. 0here consent is obtained by fraud, the 7efrauded party has the folloing remedies-
a. Ae can rescind the contract ithin a reasonable time. b. Ae can insist on the performance of the contract upon a
condition that he shall be put on the position in hich he ould have been if the representations made had been true.
c. Ae can sue for damages d. +ll of the above.
155. 0hen no consideration is paid by the &uyer for the good received from the #eller it is called-
a. #ale b. &arter c. Nift d. &ailment
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+ns. 1? 27 3d %& '& )+ *? .? 2& 157 11& 12& 13& 1%& 1'& 1)? 1*+ 1.& 12& 25?
21+ 22+ 23& 2%? 2'& 2)+ 2*7 2.? 22+ 35? 317 32? 33+ 3%+ 3'& 3)? 3*7 3.?
32& %5+ %1& %2& %37 %%?
%'& %)? %*? %.+ %27 '5? '1& '2+ '37 '%7 ''& ')& '*? '.+ '2+ )5& )1& )2?
)3& )%7
)'& ))+ )*7 ).+ )2? *5? *1? *2? *3? *%+ *'7 *)+ **7 *.? *2& .5& .1+ .2?
.3&
.%+ .'7 .)? .*& ..& .2+ 25+ 21+ 22+ 23& 2%? 2'? 2)& 2*& 2.& 227 155?
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