Beruflich Dokumente
Kultur Dokumente
Question Bank
UNIT – I
3. Bank account is
A. personal
B. real
C. nominal
D. none of these above
ANSWER: A
10. According to the going concern concept, a business entity is assumed to have:
A. a long life.
B. a very short life.
C. an indefinite life.
D. a medium life.
ANSWER: A
14. According to which of the following concepts even the owner of the business who provides
capital treated as a creditor of the business?
A. Entity concept.
B. Cost concept.
C. Money measurement concept.
D. Convention of disclosure.
ANSWER: A
16. The basic rule of book keeping, debit the receiver and credit the giver is applicable to:
A. nominal account.
B. real account.
C. personal account.
D. a. drawing account.
ANSWER: C
17. Goods of the value of Rs. 1500 taken by the proprietor for his personal use should be debited to:
A. drawing account.
B. sales account.
C. purchases account.
D. stock account.
ANSWER: A
20. Which of the following accounts will invariably have a debit balance?
A. Bank account.
B. Accounts Receivable account
C. Accounts payable account.
D. Loan account.
ANSWER: B
21. Which of the following accounts will invariably have a credit balance?
A. Discount account.
B. Account payable account.
C. cash
D. Purchases account.
ANSWER: B
23. Which of the following accounts may have a debit or credit balance?
A. Discount Received account.
B. Sales account.
C. Trade expenses account.
D. Loan account.
ANSWER: D
24. Which of the following books should be used to record purchase of furniture on credit?
A. Cash book.
B. Journal proper.
C. Purchases book.
D. Sales book.
ANSWER: B
6. While preparing bank reconciliation statement, cheques paid into bank but not yet cleared are
_________.
a. added to the balance as per cash book to arrive at the balance as per pass book.
b. deducted to the balance as per cash book to arrive at the balance as per pass book.
c. divided to the balance as per cash book to arrive at the balance as per pass book.
d. multiplied to the balance as per cash book to arrive at the balance as per pass
book. ANSWER: B
21. When a bill drawn by A and B endorsed to C is dishonoured on the due date, it is credited in the
books of A to:
a. Bank account.
b. Bills Receivable account.
c. Bank for collection of bills account.
.
D. Cash Account.
ANSWER: B
22. MWhen a bill is drawn by A on B and before the date of maturity, B becomes insolvent then in the
books of A it is debited to:
a. Bills Receivable account.
b. Bank Account.
c. Bs account
d. Bank for collection of bills.
ANSWER: D
1.
2. Explain methods of rectification of accounting errors?
UNIT – III
1. Cancelling the original bill and drawing a fresh acceptance is known as ________.
A. retiring under rebate.
B. Discounting.
C. Renewal.
D. bill sent to bank for collection .
ANSWER: C
9. Nominal account.
a. Personal account.
b. Real account.
c. Representative account.
d. expenses loss
account ANSWER: D
10. When Del credere commission is involved, the consignee will in his books, transfer bad debts to
_____ account.
A. del credere account.
B. ordinary account.
C. special commission.
D. brokerage .
ANSWER: A
11. When Del Credere commission is involved, loss on account of bad debts from credit sale of
consigned goods will generally fall on ________.
A. Consignee.
B. Consignor.
C. both consignor and consignee equally.
D. Endorser.
ANSWER: B
16. Joint bank account is opened, when the system adopted for joint venture transaction is _________.
a. complete record in existing books.
b. partial record in existing books.
c. separate set of the books.
d. no separate set of the books.
ANSWER: C
19. Which is the accounting concept that requires the practice of crediting closing stock to the
trading account?
a. Going concern.
b. Cost.
c. Realization.
d. Matching.
ANSWER: D
20. . Assets in the balance sheet are shown at cost less depreciation rather than their
replacement cost because of the accounting convention ___________.
A. going concern.
B. Matching.
C. Realization.
D. money measurement.
ANSWER: A
21. According to money measurement concept, which one the following will be recorded in the
books of accounts_______.
a. excellent morale of workers.
b. quality control in the business.
c. managing ability of the manager.
d. cost of machinery
ANSWER: D
22. . Contingent liability appears as a footnote in the balance sheet. This is in accordance
with the accounting principle of _________.
A. Disclosure.
B. Materiality.
C. Conservatism.
D. Consistency.
ANSWER: B
23. . The policy of anticipate no profit and provide for all possible losses arises due to convention of
____________.
A. Consistency.
B. Disclosure.
C. Matching.
D. Conservatism.
ANSWER: D
24. Revenue is generally recognized being earned at the point of time when:
a. sale is effected.
b. cash is received.
c. production is completed.
d. goods are delivered.
ANSWER: A
25. Which one of the following arrangements represents the order of liquidity?
a. Cash, Bills Receivable, Stock, Debtors.
b. Cash, Bills Receivable, Debtors, cash, Stock.
c. Cash, Bills Receivable, Debtors, Stock.
d. Cash, Debtors, Bills Receivable, Stock.
ANSWER: B
Answer the following Questions: ( 5 marks)
3.
UNIT – IV
1. Balance sheet is prepared primarily with the following group in view:
A. Owners.
B. Creditors.
C. Government.
D. Management.
ANSWER: A
7. Which one the following entry is not recorded in the residuary journal?
a. Opening entry.
b. Closing entry.
c. Adjustment entry.
d. Credit sales.
ANSWER: D
8. When furniture is sold for cash, the entry should be made in __________.
a. sales book .
b. cash book.
c. Journal.
d. petty cash book..
ANSWER: B
15. The process of transferring the credit and debit items form a journal to their respective accounts in
the ledger is termed as ___________.
a. Balancing .
b. Invoicing.
c. Double entry.
d. Posting.
ANSWER: D
20. Goods worth Rs. 200 returned by Mohan were taken into stock, but no entry was passed, is an error of:
a. commission.
b. Principle.
c. Omission.
d. Compensatory.
ANSWER: C
23. A Cheque received and paid into the bank on the same day id recorded in the ________.
A. a. cash column of the cash book.
B. a. bank column of the cash book.
C. a. both the cash and bank columns of the book.
D. a. the credit balance as per pass book.
ANSWER: B
24. The payment side of the cash book is undercast by Rs. 200.When overdraft as per pass book is
the starting point, to get the overdraft as per cash book___________.
a. Rs. 200 will be deducted.
b. Rs. 200 will be added.
c. Rs. 400 will be added.
d. Rs. 400 will be deducted.
ANSWER: A
25. Which one of the following is not taken into account in adjusting the cash balance?
A. Mistakes in the cash book.
B. Mistakes in the pass book.
C. Bank charges debited in pass book.
D. Interest and dividend credited in pass book.
ANSWER: B
2. What do you mean by income and expenditure account and define the format?
2. What do you mean by “Non Trading Organization”? Brief about its characteristics?
3. Distinguish between Receipts & payments a/c and Income & Expenditure a/c?
.
UNIT – V
1. amount of Rs. 1000 is debited twice in the pass book. When overdraft as per the cash book is
the starting point ___________.
A. An Rs. 1000 will be deducted.
B. Rs. 1000 will be added.
C. Rs. 2000 will be deducted.
D. Rs. 2000 will be added.
ANSWER: B
2. Amount spent on advertisement campaign, the benefit of which is likely to last for three years, is
__________.
A. capital expenditure.
B. deferred revenue expenditure.
C. revenue expenditure.
D. deferred capital
expenditure ANSWER: B
3. Revenue expenditure is intended to benefit _________.
A. current period.
B. future period.
C. past period.
D. both (1) and (2).
ANSWER: A
4. The distinction between capital and revenue is necessary for the preparation of ______.
A. fund flow statement.
B. receipts and payment account.
C. final accounts.
D. cash flow statement.
ANSWER: B
9. Where separate set of books are maintained, the ledger accounts required are:
A. a. Joint venture account and the personal account of the other party.
B. a. Joint bank account, co-venturer capital accounts and joint bank account.
C. a. Joint bank account and joint venture account with the other party.
D. Memorandum joint venture and joint venture account with the
other party. ANSWER: B
10. When A advances money to B in the course of joint venture then A debits such money to
__________.
A. Joint bank account.
B. Joint venture account.
C. Bs personal account.
D. Expenses account
ANSWER: B
11. The account current method in which the days are calculated from the date of transaction to
the commencement date is known as _________.
A. Forward method.
B. Epoch method.
C. Daily balance method
D. Backward method
ANSWER: B
12. The method of account current usually employed by the banker is known as _________.
A. Daily balance method.
B. Red ink interest.
C. Current account.
D. Product method.
ANSWER: A
15. Sales to Benson Rs. 500 posted to his account as Rs. 50 would affect ________.
A. Sales account.
B. Bensons account.
C. Cash account.
D. Purchases account
ANSWER: B
16. Sales to Mr. Gill recorded in purchase journal would affect _________.
A. Sales account.
B. a. Purchases account and sales account.
C. Journal proper.
D. Sales account, purchases account and Mr. Gills account.
ANSWER: B
17. Purchases made on credit not recorded at all would affect ___________.
A. Purchases account.
B. Suppliers account.
C. Purchases account and suppliers account.
D. Wages account.
ANSWER: C
22. A Cheque received and deposited in the bank on the same day is recorded in the _______.
A. cash column of the cash book.
B. bank column of the cash book.
C. credited in the cash book.
D. debited in the cash book
ANSWER: B
3. What are the differences between single entry system and double entry system of book
keeping?
4. What is a “Statement of affairs”? How does it differ from Balance sheet?
2. Calculate the profit made by Mrs. Vandana during the year using statement of affairs method.
Mrs. Vandana runs a small printing firm. She was maintaining only some records, which she thought,
were sufficient to run the business. On April 01, 2004, available information from her records indicated that she
had the following assets and liabilities:
Printing Press Rs. 5, 00,000, Buildings Rs. 2, 00,000, Stock Rs. 50,000, Cash at bank Rs. 65,600,
Cash in hand Rs. 7,980, Dues from customers Rs. 20,350, Dues to creditors Rs. 75,340 and
Outstanding wages Rs. 5,000. She withdrew Rs. 8,000 every month for meeting her personal expenses.
She had also introduced Rs. 15,000 during the year as additional capital. On March 31, 2005 her position
was as follows: Press Rs. 5, 25,000, Buildings Rs. 2, 00,000, Stock Rs. 55,000, Cash at bank Rs. 40,380,
Cash in hand Rs. 15,340, Dues from customers Rs. 17,210, Dues to creditors Rs. 65,680.
3. Problem.
Mrs. Surabhi started business on Jan 01, 2005 with cash of Rs. 50,000, furniture of Rs. 10,000, goods of 2,000
and machinery worth 20,000. During the year she further introduced Rs. 20,000 in her business by opening
a bank account.
From the following information extracted from her books, you are required to prepare final accounts for the
ended December 31, 2005.
Mrs. Surabhi used goods worth 2,500 for private purposes, which is not recorded in the books. Charge
depreciation on furniture 10% and machinery 20% p.a. on Dec. 31, 2005 her debtors were worth 70,000 and
creditors Rs. 35,000, stock in trade was valued on that date at Rs. 25,000.