Correct : C. when both parties are in need of funds.
2. Balance of X's account in creditors ledger is transferred to X's account in debtors
ledger, in this case
Correct : B. X's account in creditors ledger will be debited.
3. Ground rent or surface rent means
Correct : D. Fixed rent payable in addition to minimum rent
4. Accounting standard in India are issued by
Correct : C. The Institute of Chartered Accountants of India
5. As on 31st March, 2017 debtors and additional bad debts are ` 8,00,000 and ` 10,000 respectively. If the provision for bad debts is made at 5% on debtors then amount of such provision will be
Correct : C. 39,500
6. Income and Expenditure Account is a
Correct : A. Nominal Account
7. Creditors ledger adjustment account is opened in
Correct : A. General Ledger
8. Receipts and Payments account is a
Correct : B. Real Account
9. A resource owned by the business with purpose of using it for generating future profit, is
known as
Correct : B. Asset
10. Outward Invoice issued is a source document of
Correct : B. Sales Book
11. Which of the following is of capital nature?
Correct : D. Wages paid for installation of machinery
12. If any stock is taken by a co-venturer, it will be treated as
Correct : A. an income of the joint venture.
13. Contingent liability would appear
Correct : D. as a note in Balance Sheet.
14. Income statement of a Charitable Institution is known as
Correct : C. Income and Expenditure Account
15. Which of the following account is mainly prepared at the time of dissolution of the
firm
Correct : C. Realization A/c
16. Advertisement expenses are apportioned among departments in the proportion of
Correct : A. sales of each department
17. In Hire Purchase system cash price plus interest is known as
Correct : C. Hire purchase price of asset
18. __________ is similar to the Profit and loss A/c
Correct : A. Income and Expenditure A/c
19. Kuntal draws a bill on shyam for ` 7,000.Kuntal endorsed it to Ram. Ram endorsed it
to Rahim. The payee of the bill will be:
Correct : D. Rahim
20. Bad debts are apportioned among departments in the proportion of
Correct : B. Number of units sold by each department
21. Which of the following is not a Fundamental Accounting Assumption?
Correct : D. Materiality
22. ________ is equal to estimated selling price less the estimated costs of completion
and the estimated costs necessary to make the sale.
Correct : A. Net Realizable value
23. _______ are investments which are held beyond the current period as to sale or
disposal.
Correct : A. Non-current Investments
24. An obligation which may or may not materialize is a/an _______________.
Correct : C. Contingent Liability
25. ________________ voucher denotes payment of cash.
Correct : A. Cash Payment
26. Which of the following is an example of Capital Expenditure?
Correct : D. None of the above.
27. Which of the following errors is not disclosed by a Trial Balance?
Correct : D. All of the above
28. ___________ is specially suited to mines, oil wells, quarries, sandpits and similar assets
of a wasting character.
Correct : A. Depletion
29. The following account has a credit balance
Correct : B. Loans A/c
30. From the following details estimate the capital as on 31.03.2017. Capital as on
01.04.2016 - `4,10,000. Drawings `40,000, Profit during the year ` 50,000
Correct : C. 4,20,000
31. A and B purchased a piece of land for ` 30,000 and sold it for `60,000 in 2016.
Originally A had contributed `12,000 and B `8,000. The profit on venture will be
Correct : A. 30,000
32. AB Ltd. has signed at 31st December, 2017 the Balance Sheet date, a contract where the Total Revenue is estimated at ` 15 Crores and Total Cost is estimated at ` 20 Crores. No work began on the contract. Is the Contractor required to give any accounting effect for the year ended 31st December, 2017?
Correct : A. Recognize expected loss of `5 Crores
33. Which of the following item does not match with receipts and payments account?
Correct : C. It records revenue transactions only
34. Which of the following is/ are the basic features of a Joint Venture
Correct : D. All of the above
35. Excess of hire purchase price over cash price is known as
Correct : C. Interest
36. Which of the following is/are revenue expenditure?
Correct : D. All of Above
37. AS-9 is related to
Correct : A. Revenue Recognition
38. The person to whom bill is endorsed is known as __________.
Correct : A. Endorsee
39. Which of the following is/are feature/features of Income and Expenditure Account?
Correct : D. All of the above
40. The debts which are not bad is known as
Correct : A. Good debt
41. A transaction without immediate cash settlement is known as
Correct : B. Credit Transaction;
42. _________ liabilities represent proprietor’s equity, i.e. all thoseamount which are
entitled to the proprietor
Correct : C. Internal;
43. Goods are transferred from Department X to Department Y at a price so as to include a profit of 33.33% on cost. If the value of closing stock of Department Y is ` 48,000, then the amount of stock reserve on closing stock will be
Correct : A. 12,000
44. Bad debts Recovered `1,000. It will be
Correct : D. Credited to bad debts recovered A/c
45. Which of the following purpose is served from the preparation of Trial Balance?
Correct : D. All of the above.
46. _________ contains the transactions relating to goods that are returned by us to our
creditors
Correct : B. Return Outward;
47. The basic principles of ____ concept is that business is assumed to exist for an
indefinite period
Correct : A. Going Concern;
48. Capital Profit arises from which of the following?
Correct : D. All of the above.
49. Which of the following cannot be detected by Trial Balance?
Correct : D. All of the above.
50. The concept that business is assumed to exist for an indefinite period and is not
established with the objective of closing down is referred to as
Correct : B. Going Concern concept
51. In the hire purchase system interest charged by vendor is calculated on the basis of
Correct : A. Outstanding cash Price
52. Goods are transferred from Department A to Department B at a price so as to include a profit of 33.33% on cost. If the value of closing stock of Department Y is `36,000, then the amount of stock reserve on closing stock will be
Correct : B. 9,000
53. Bad debts Recovered `750. It will be
Correct : D. Credited to bad debts recovered A/c
54. Which of the following is a function of journal:
Correct : D. All of the above
55. The out flow of funds to acquire an asset that will benefit the business for more than one accounting period is referred to as —
Correct : C. Capital expenditure
56. The cost of a Fixed Assets of a business has to be written off over its
Correct : D. Estimated Economic Life
57. Receipts and Payments Account records
Correct : D. Both the revenue and capital nature receipts and payments
58. Excess of minimum rent over royalty is known as
Correct : C. Short workings
59. If any transaction is not recorded in the primary books the same is recorded in
_______
Correct : A. Journal Proper
60. Which of the following is not a feature of Trial Balance
Correct : D. All the transactions are primarily recorded in this book, hence it is the primary book of entry.
61. The person in whose favour the bill is endorsed is known as __________.
Correct : A. Endorsee
62. Which of the following is/ are the basic features of a Joint Venture
Correct : D. All of the above.
63. The following account has a credit balance
Correct : B. Purchase Returns A/c
64. When Sales = `3,60,000, Purchase = ` 3,20,000, Opening Stock = `68,000 and rate of the Gross Profit is 20% on cost, the Closing Stock would be
Correct : D. None of the above
65. As per AS – 1, which of the following is not a Fundamental Accounting Assumptions?
Correct : A. Conservatism
66. Name the book in which, entries are recorded on the basis of debit notes issued.
Correct : D. Purchase Return Book
67. Name the principle involved in the classification of Assets as Fixed and Current
Correct : B. Going Concern Principle
68. If a fixed amount is withdrawn on the first day of every month of calendar year by a partner in partnership firm, then for what period the interest on the total amount of drawings will be calculated?
Correct : C. 6.5 months
69. Del credere commission is allowed to consignee
Correct : D. for undertaking risk of bad debts
70. Any change in the accounting policy relating to inventories which has a material effect in the current or later periods should be disclosed. This is in accordance with the accounting principle of:
Correct : C. Consistency
71. Depreciation is a process of
Correct : C. Allocation
72. An amount spent in connection with obtaining a License for starting the factory is
Correct : B. Capital Expenditure
73. According to AS-15 (Revised) superannuation scheme which has relevance only to
the final salary and number of years of service is
Correct : A. Defined Benefit Scheme
74. Expenditures in respect of certain types of assets whose usefulness does not expires
in the year of their occurrence but generally expires in the near future are called
Correct : C. Deferred Revenue Expenditure
75. The main objective of average clause contained in a fire insurance policy is to
Correct : D. Encourage full Insurance and Discourage under Insurance
76. Short working can be recouped out of
Correct : B. Excess of Actual Royalty over Minimum Rent
77. AS-6 (revised) is applicable to which one of the following assets?
Correct : D. Plant and Machinery
78. According to AS-3 (Revised) interest and dividends received in the case of a manufacturing enterprise should be classified as cash flow from
Correct : C. Investing Activities
79. Provision for bad and doubtful debts is created in anticipation of actual bad debts on
the basis of:
Correct : B. Conservatism Concept;
80. The out flow of funds to acquire an asset that will benefit the business for more than one accounting period is referred to as:
Correct : C. Capital Expenditure;
81. Goods are sent to the Branch at cost plus 25%. The loading on invoice price is:
Correct : A. 20%;
82. Actuarial valuation relates to:
Correct : C. Insurance Company;
83. Survey expenses for marine insurance claim must be
Correct : A. Added to claim;
84. A profit on sale of furniture of a club will be taken to
Correct : C. Income and Expenditure Account;
85. Realisation Account is a:
Correct : D. Nominal Account.
86. Bank shows the provision for income tax under the head
Correct : B. Other liabilities and provisions;
87. Bank Reconciliation Statement is:
Correct : C. A separate statement
88. Income & Expenditure A/c shows subscriptions `10,000; Subscriptions accrued in the beginning of the year and at the end of the year were `1,000 and `1,500 respectively. The figure of subscription received appear in receipts and payments account will be:
Correct : A. 9,500
89. A non-performing asset is:
Correct : C. An asset that ceases to generate income
90. Which of the following is not a Qualitative characteristicof Financial Statement?
Correct : A. Cost Principle
91. Name the book in which, entries are recorded on the basis of credit notes issued.
Correct : C. Sales Return Book
92. Exception to consistency principle is
Correct : D. Prudence Principle
93. The balance in consignment account shows
Correct : C. Profit/ loss on consignment
94. Provision for bad debts is
Correct : C. Personal account
95. The business is treated as distinct and separate from its owners on the basis of the
Correct : D. Business entity concept
96. Due to retrospective effect on revision of salary of employees, the arrears of salary
relating to past years, payable in current year is
Correct : C. Ordinary item requiring separate disclosure
97. Discount given in the Sales - Invoice itself is
Correct : B. Trade discount
98. Canteen expenses are apportioned among departments in the proportion of
Correct : D. Departmental No. of employees
99. Both cash and credit transactions are recorded, on the basis of
Correct : D. Accrual Concept
100. Which of the following book is both a journal and a ledger?