Quiznetik

Financial Accounting | Set 12

1. Find the closing stock from the following details. Opening Stock ` 80,000, Purchases ` 1,40,000, Wages ` 60,000, Sales ` 3,20,000, GP on sales 25%

A. 60,000 ;

B. 40,000 ;

C. 45,000 ;

D. 30,000

Correct : B. 40,000 ;

2. Sinking Fund is created for which of these purposes

A. To repay or redeem a long term fixed liability ;

B. To replace a wasting asset ;

C. To replace a depreciable asset ;

D. All the three

Correct : D. All the three

3. Tick the correct statement

A. Petty cash is an expense ;

B. Balance Sheet is also known as a positional statement ;

C. Revaluation A/c is Real A/c ;

D. Depreciation is a process of valuation

Correct : B. Balance Sheet is also known as a positional statement ;

4. A B C are three partners sharing profit and loss in the ration of 2:2:1, B recently obtained MBA degree from Oxford University, accordingly the partner decided to give him a guaranteed profit of ` 60,000. Find the share of profit of B if the firm made a net profit of ` 1,25,000 during 2012-13

A. 60,000 ;

B. 50,000 ;

C. 25,000 ;

D. 40,000

Correct : A. 60,000 ;

5. A firm has a policy of changing depreciation on Plant and Machinery @ 10% under WDV Method. If the book value of Plant and Machinery was ` 81,000 on 31.03.2013. Find the original cost of the plant if the same was purchased on 01.04.2011

A. 80,000 ;

B. 1,00,000 ;

C. 81,000 ;

D. 1,20,000

Correct : B. 1,00,000 ;

6. Closing Stock lying unsold with the consignee is valued at—

A. Cost Price ;

B. Market Price ;

C. Realizable Price ;

D. Least of cost or net realizable value

Correct : D. Least of cost or net realizable value

7. Goods lying with the consignee are shown as—

A. Closing Stock ;

B. Work in Progress ;

C. Stock in Transit ;

D. Suspense A/c

Correct : A. Closing Stock ;

8. Credit balance in Cash Book means—

A. Bank overdraft ;

B. Bank deposit ;

C. FD with Bank ;

D. Cash embezzlement

Correct : A. Bank overdraft ;

9. AB are two partners in a firm, as per the terms of agreement partners drawing will carry interest @ 10%. If A has drawn funds from business as per the details given below. Find the interest for the year ended 31.12.2012 01.04.2012 ` 20,000 01.06.2012 ` 10,000 01.09.2012 ` 20,000

A. 2,500

B. 2,750

C. 1,417

D. 2,000

Correct : B. 2,750

10. ` 5,000 paid as local cartage on material purchased. However this amount was booked under Miscellaneous Expenses A/c instead of on Carriage Inward. Due to this error net profit and loss will—

A. Increase by ` 5,000 ;

B. Decrease by ` 5,000 ;

C. Increase by ` 10,000 ;

D. not be affected at all

Correct : D. not be affected at all

11. If outside liabilities and owners‘ equity are added we get………

A. Total Liabilities ;

B. Net worth ;

C. Shareholders Fund ;

D. Gross Block

Correct : A. Total Liabilities ;

12. Business expenses excludes…

A. Fire insurance premium of office building ;

B. LIC premium on the life of proprietor ;

C. Interest on capital ;

D. Repair of office furniture

Correct : B. LIC premium on the life of proprietor ;

13. Goods received from other co-venturer is debited to ……

A. Joint Venture A/c ;

B. Joint Bank A/c ;

C. Memorandum Joint Venture A/c ;

D. Other Co- venture A/c

Correct : A. Joint Venture A/c ;

14. Which of these is not a function of Financial Accounting

A. To provide financial information to the users of the financial statements

B. To portray gloomy picture of the business in order to evade tax liabilities

C. To keep a systematic record of business transactions

D. To depict a true and fair view of the financial position of the business

Correct : B. To portray gloomy picture of the business in order to evade tax liabilities

15. Drawee is the person…..

A. Who draw a bill of exchange ;

B. Who presents the bill of exchange for payment ;

C. Who accepts the bill of exchange ;

D. Who holds the bill of exchange till maturity

Correct : C. Who accepts the bill of exchange ;

16. Accounting is a/ an –

A. Science ;

B. Art ;

C. Subject matter of sociology ;

D. Subject matter of philosophy

Correct : B. Art ;

17. Trial Balance is prepared to….

A. Check true and fair view of Balance Sheet ;

B. To check arithmetic accuracy of A/cs ;

C. To ensure legal compliance ;

D. To ensure compliance to IFRS

Correct : B. To check arithmetic accuracy of A/cs ;

18. The term PBIT stands for:-

A. Profit before Income Tax ;

B. Profit before Interest and Tax ;

C. Profit before Internal Transfers ;

D. Profit by Income Tax

Correct : B. Profit before Interest and Tax ;

19. …… is a secret reserve usually created to provide for the loss by way of fluctuation in the value of investment

A. Investment Fluctuation Reserve ;

B. Foreign Exchange Fluctuation Fund ;

C. General Reserve ;

D. Capital Reserve

Correct : A. Investment Fluctuation Reserve ;

20. As per the Companies Act, 1956 which of these are allowed to create secret reserves in their books of account

A. Banking Companies ;

B. Insurance Companies ;

C. Electricity Companies ;

D. All the three

Correct : D. All the three

21. An increase in one liability may lead to

A. Increase in another asset ;

B. Decrease in liability ;

C. Both (a) and (b) ;

D. Either (a) or (b)

Correct : D. Either (a) or (b)

22. X draws a 3 months bill of exchange for ` 25,000 upon Y on 23-10-12. Find the due date of the bill.

A. 24-01-13 ;

B. 25-01-13 ;

C. 26-01-13 ;

D. 23-01-13

Correct : C. 26-01-13 ;

23. A is entitled to 10% partner‘s commission before charging such commission. Find the commission payable to A if the net profit before charging such commission amounted to ` 60,000

A. 5,900 ;

B. 6,000 ;

C. 5,000 ;

D. 5,050

Correct : B. 6,000 ;

24. Over statement of sales may lead to-

A. Over statement of profit of current year;

B. Over statements of profit of next year;

C. Under statement of profit of current year ;

D. All the three

Correct : A. Over statement of profit of current year;

25. When Bills Receivable is returned dishonoured by the drawee, which of these A/c is debited by the drawee

A. Drawer A/c ;

B. Bank A/c ;

C. BP A/c ;

D. BR A/c

Correct : C. BP A/c ;

26. A second hand truck was purchased for `75,000, `10,000 was spent on its repair, `2,000 to get the truck registered in the name of the firm and `1,000 as dealers commission. The capitalized value of truck will be-

A. 88,000 ;

B. 87,000 ;

C. 85,000 ;

D. 75,000

Correct : A. 88,000 ;

27. Narrations are usually given at the end of

A. Each journal entry ;

B. Each page ;

C. Each column ;

D. Each account

Correct : A. Each journal entry ;

28. Under which method of depreciation annual depreciation goes on decreasing

A. Reducing balance method ;

B. Straight line method ;

C. Annuity method ;

D. None

Correct : A. Reducing balance method ;

29. Choose the true statement-

A. Income and gain A/cs shows increase on credit side

B. Expenses and losses A/cs shows reduction in balance on debit side

C. Assets A/c can have credit balance also ;

D. Debtors are the owing of the business

Correct : A. Income and gain A/cs shows increase on credit side

30. Which of these is an example of accelerate method of depreciation

A. Written down value method ;

B. Straight line method ;

C. Sinking fund method ;

D. Annuity method

Correct : A. Written down value method ;

31. Which of these items will not be capitalized along with the Asset

A. Installation charges ;

B. Annual repair and maintenance ;

C. Statutory levies ;

D. Freight and insurance

Correct : B. Annual repair and maintenance ;

32. On the debit side of a Sales A/c entry can be for which of these reasons

A. Sales returns ;

B. Discount allowed ;

C. Both ;

D. Additional sales

Correct : C. Both ;

33. The term Imprest system is related to………

A. Petty cash ;

B. Inventory valuation ;

C. Classification of assets ;

D. None

Correct : A. Petty cash ;

34. An office equipment is purchased on 1.1.12 for `1,10,000 having working life of 4 years at the end of which it is expected to have a scrap value of `10,000. Find the difference in depreciation as per Sum of years digit methods and reducing balance method (25% WDV) for the year ending on 31st December 12

A. 25,000 ;

B. 40,000 ;

C. 15,000 ;

D. 10,000

Correct : C. 15,000 ;

35. M draw a 3 months bill of exchange of ` 20,000 on T on 1st April 07. On due date T paid ` 4,000 and requested M to draw another bill of exchange for 2 months. On the due date of second bill of exchange T is declared insolvement and a dividend of 25 paisa in a rupee is expedited to be realized from his assets. Find the amount receivable from T in respect of the outstanding bill of exchange

A. 5,000 ;

B. 4,000 ;

C. 16,000 ;

D. 20,000

Correct : B. 4,000 ;

36. A sends goods costing ` 1,00,000 on consignment to yield a profit of 20% on cost. What is the invoice price

A. 1,37,500 ;

B. 1,25,000 ;

C. 1,20,000 ;

D. None

Correct : C. 1,20,000 ;

37. Under which method of depreciation annual depreciation fluctuate with the volume of production

A. Sum of Years‘ Digit Method ;

B. Production Method ;

C. Written Down Value Method ;

D. None

Correct : B. Production Method ;

38. Who bears noting charges in case of dishonor of a bill of exchange.

A. Drawer ;

B. Drawee ;

C. Both ;

D. Bank

Correct : B. Drawee ;

39. When the goods are returned by the customers within the specified time, they are recorded

A. Initially in the Sale or Return Ledger. Thereafter, in the Sale or Return Day Book

B. Initially in the Sale or Return Day Book. Thereafter, in the Sale or Return Ledger

C. Only in the Sale or Return Day Book

D. Only in the Sale or Return Ledger

Correct : B. Initially in the Sale or Return Day Book. Thereafter, in the Sale or Return Ledger

40. Long term assets being `3,00,000, current Assets `80,000, outside liabilities `1,20,000. Find owners equity-

A. 3,50,000 ;

B. 2,60,000 ;

C. 2,00,000 ;

D. None

Correct : B. 2,60,000 ;

41. A merchant sends out his goods casually to his dealers on approval basis. All such transactions are, however, recorded as actual sales and are passed through the sales book. On 31st March, it was found that 100 articles at a sale price of ` 200 each sent on approval basis were recorded as actual sales at that price. The sale price was made at cost plus 25%. The amount of stock on approval will be amounting

A. 16,000.

B. 20,000.

C. 15,000.

D. None of the above.

Correct : A. 16,000.

42. In the Sale or Return Ledger

A. All the customers are individually debited and the sale or return account is credited with the periodical total of the Sale or Return Day Book,

B. All the customers are debited in total and the sale or return account is credited with the periodical total of the Sale or Return Day Book.

C. All the customers are individually debited and the sale or return account is also credited with the individual total of the Sale or Return Day Book.

D. None of the above.

Correct : A. All the customers are individually debited and the sale or return account is credited with the periodical total of the Sale or Return Day Book,

43. All revenue receipts and expenditure are shown in –

A. Balance Sheet ;

B. Trading and Profit and Loss A/c ;

C. Cash Flow Statement ;

D. Statement of Affairs

Correct : B. Trading and Profit and Loss A/c ;

44. On 1st January 2013 X paid `120,000 being rent upto 31.12.2013. If the accounts are closed on 31.03.12. `90,000 will be shown as –

A. Accrued rent ;

B. Prepaid rent / Expenses ;

C. Accrued expenses ;

D. Accrued income

Correct : B. Prepaid rent / Expenses ;

45. Choose the true statement—

A. Accrued income represent income unearned but realized in cash

B. Accrued income represent income earned but not realized in cash

C. Accrued income A/c is shown on the liability side ;

D. No tax is payable on accrued income

Correct : B. Accrued income represent income earned but not realized in cash

46. Which of these will cause change in working capital

A. Payment of Creditors in cash

B. Realization of amount due from the Debtors

C. Sale of office equipment for cash

D. Providing depreciation on Plant and Machinery

Correct : C. Sale of office equipment for cash

47. Consider the following data pertaining to a firm: Credit balance as per bank column of cash book `13,000; Bank interest on overdraft appeared only in the pass book `2,600; Cheques deposited but not collected by the bank ` 5,000. The balance as per pass book is

A. 20,600 (Dr. balance) ;

B. 18,500 (Dr. balance) ;

C. 18,500 (Cr. balance) ;

D. 15,600 (Dr. balance)

Correct : A. 20,600 (Dr. balance) ;

48. Consider the following data pertaining to a company for the year 2011-2012 : Opening balance of sundry debtors ` 40,000; Credit sales `4,30,000; Cash sales ` 20,000; Cash collected from debtors `4,00,000; Closing balance of sundry debtors ` 50,000 The bad debts of the company during the year are

A. 40,000 ;

B. 35,000 ;

C. 30,000 ;

D. 20,000

Correct : D. 20,000

49. The opening stock of a company is `60,000 and the closing stock is `70,000. If the purchases during the year are `2,00,000 the cost of goods sold will be

A. 2,10,000 ;

B. 2,00,000 ;

C. 1,90,000 ;

D. ) `1,80,000

Correct : C. 1,90,000 ;

50. The balance as per bank statement of a company is `12,000 (Dr.). The company deposited two cheques worth `9,500, out of which one cheque for `2,300 was dishonoured which was not entered in the cash book. The credit balance as per cash book is

A. 21,000 ;

B. 15,300 ;

C. 23,800 ;

D. 9,700

Correct : D. 9,700

51. Which of the following is not a main column of sales or return journal?

A. Goods sent on approval column ;

B. Goods returned column

C. Goods approved column ;

D. Purchase column

Correct : D. Purchase column

52. Which of the following accounting treatments is/are true in respect of accrued commission appearing on the debit side of a Trial Balance?

A. It is shown on the debit side of the Profit and Loss Account

B. It is shown on the credit side of the Profit and Loss Account

C. It is shown on the liabilities side of the Balance Sheet

D. It is shown on the assets side of the Balance Sheet

Correct : D. It is shown on the assets side of the Balance Sheet

53. If a bill is endorsed to a third party, the accounting entry in the books of the endorser, at the time of endorsement involves

A. Credit Endorsee‘s Account

B. Debit Endorsee‘s Account

C. Debit Bills Receivable Account

D. Credit Bills Payable Account

Correct : B. Debit Endorsee‘s Account

54. ————— is the date on which a bill falls due for payment

A. Settlement Date ;

B. Maturity Date ;

C. Payment Date ;

D. Due Date

Correct : B. Maturity Date ;

55. Joint Venture is a partnership —

A. With no firm name ;

B. For indefinite period ;

C. Formed for 5 years ;

D. All the three

Correct : A. With no firm name ;

56. Depreciation amount of a fixed asset represents —

A. Historical cost less residual value ;

B. Historical cost ;

C. Historical cost less cost of disposal;

D. Book Value less scrap value

Correct : A. Historical cost less residual value ;

57. When benefit of a revenue expense extend beyond an accounting year, it is called

A. Revenue Expenditure ;

B. Capital expenditure ;

C. Deferred Revenue Expenditure;

D. Recurring profit

Correct : C. Deferred Revenue Expenditure;

58. The convention that states that the accounting practice should be followed consistently over the years

A. Consistency ;

B. Conservation ;

C. Materiality ;

D. Disclosure

Correct : A. Consistency ;

59. Which of the following is a non-monetary asset?

A. Account Receivable ;

B. Account Payable ;

C. Demand Bank Deposits ;

D. Patents and Trademarks

Correct : D. Patents and Trademarks

60. Accounting for Fixed Assets is related to

A. AS 7 ;

B. AS 14 ;

C. AS 10 ;

D. AS 21

Correct : C. AS 10 ;

61. The maximum amount beyond which a company is not allowed to raise funds, by issue of share is

A. Issued Capital ;

B. Reserve Capital ;

C. Subscribed Capital ;

D. Authorised Capital

Correct : D. Authorised Capital

62. Accounts dealing with transaction relating to persons or an organization is called

A. Personal Account ;

B. Nominal Account ;

C. Real Account ;

D. Representative Personal Account

Correct : A. Personal Account ;

63. An account is said to have a debit balance if —

A. The amount of the debits exceeds the amount of the credits

B. There are more entries on the debit side than on the credit side

C. Its normal balance is debit without regard to the amounts or number of entries on the debit side ;

D. The last entry of the accounting period was posted on the debit side

Correct : A. The amount of the debits exceeds the amount of the credits

64. Residual value is the —

A. value of the asset when it is purchased

B. value of the asset at the end of its useful life

C. cost of the asset ;

D. allocation of the cost

Correct : B. value of the asset at the end of its useful life

65. The document listing the latest balances of all Real and Personal A/c in the ledger on a given date is known as —

A. Trial Balance ;

B. Positional Statement ;

C. Income Statement ;

D. Charter of Accounts

Correct : B. Positional Statement ;

66. A sent some goods to B to be sold on consignment basis. 1/10 of the goods valued ` 25,000 were lost in transit. Find the value of goods sent of consignment basis —

A. 2,50,000 ;

B. 25,000 ;

C. 2,500 ;

D. None

Correct : A. 2,50,000 ;

67. A company sends its cars to dealers on 'sale or return' basis. All such transactions ire however treated like actual sales and are passed through the sales day book. Just before the end of the financial year, two cars which had cost ` 55,000 each have been sent on sale or return and have been debited to customers at ` 75,000 each, cost of goods lying with the customers will be

A. 1,10,000.

B. 35,000.

C. 75,000.

D. None of the above.

Correct : A. 1,10,000.

68. From the following details estimate the capital as on 31.03.2013, Capital as on 01.04.2012 ` 2,05,000. Drawing ` 20,000, Profit during the year ` 25,000

A. 2,05,000 ;

B. 2,25,000 ;

C. 2,10,000 ;

D. 2,00,000

Correct : C. 2,10,000 ;

69. Goods worth ` 10,000 were purchased by B on which the traders allowed ` 500 trade discount and offer to give 5% cash discount if immediate payment is made. The Purchase A/c will be debited by —

A. 10,000 ;

B. 9,800 ;

C. 9,000 ;

D. 9,500

Correct : D. 9,500

70. S issued cheque worth ` 35,000 in March 2013 out of which cheques worth ` 15,000 were presented for payment after by 31st march, 2013. What amount should be added to balance as per pass book

A. 15,000 ;

B. 10,000 ;

C. 25,000 ;

D. None of the above

Correct : A. 15,000 ;

71. Owing of the business are called —

A. Liabilities ;

B. Capital ;

C. Net Worth ;

D. Assets

Correct : A. Liabilities ;

72. ` 8,000 is spent of travelling expenses of the partner to a foreign trip for purchased of an asset to be used for the business is a/an —

A. Capital Expenditure ;

B. Revenue Expenditure ;

C. Revenue Loss ;

D. Capital Loss

Correct : A. Capital Expenditure ;

73. The Capital of X Ltd. was ` 55,000 as on 01.04.2012 which fell to ` 25,000 by the end of 31.03.2013. Find the value of goods sent of consignment basis —

A. Drawings ;

B. Business losses during the period ;

C. Both ;

D. Introduction of new capital

Correct : C. Both ;

74. A trader has credited certain items of sales on approval aggregating ` 60,000 to Sales Account. Of these, goods of the value of `16,000 have been returned and taken into stock at cost ` 8,000 though the record of return was omitted in the accounts. In respect of another parcel of ` 12,000 (cost being `6,000) the period of approval did not expire on the closing date. Cost of goods lying with customers should be

A. 12,000.

B. 54,000.

C. 6,000.

D. None of the above.

Correct : C. 6,000.

75. Cash sales will be recorded in —

A. Sales Day Book ;

B. Cash Book ;

C. Purchase Book ;

D. Return in Ward Book

Correct : B. Cash Book ;

76. Cost of goods sold excludes —

A. Opening Stock ;

B. Closing Stock ;

C. Wages and Salary ;

D. Salesmen Commission

Correct : D. Salesmen Commission

77. From the following details find out the amount to be debited to Profit and Loss A/c as fresh provision for doubtful debts during 2012-13 Debtors ` 30,000 as on 31.03.2013; Bad debt during the year ` 1,500; Provision for bad debts as on 01.04.2012 ` 2,000; Provision for doubtful debts to be kept at 5% of total debtors

A. 1,500 ;

B. 1,000 ;

C. 3,000 ;

D. 2,000

Correct : B. 1,000 ;

78. A of Assam sent goods costing ` 45,000 to K of Kolkata at cost plus 331/3%. 1/5 of the goods were lost in transit and the remaining was sold at profit of 20% on invoice price. Find the value of sales —

A. 54,500 ;

B. 60,000 ;

C. 57,600 ;

D. 55,000

Correct : C. 57,600 ;

79. Two primary qualitative characteristics of Financial Statements are —

A. Understandability and Materiality ;

B. Relevance and Reliability ;

C. Relevance and Understandability ;

D. Materiality and Reliability

Correct : B. Relevance and Reliability ;

80. Profit and loss on Depreciation Investment Fund A/c is transferred to —

A. Profit and Loss A/c ;

B. General Reserve A/c ;

C. Trading A/c ;

D. Capital Reserve A/c

Correct : A. Profit and Loss A/c ;

81. Which of these expenses does not result in cash outflow

A. Depreciation ;

B. Interest on Loan ;

C. Payment on Dividend ;

D. Donation

Correct : A. Depreciation ;

82. AS 31 consulted to IAS –

A. 30 ;

B. 32 ;

C. 39 ;

D. 40

Correct : B. 32 ;

83. Which of these term is not found in a Joint Venture business

A. Del Credere Commission ;

B. Co-venturer ;

C. Joint Bank A/c ;

D. Memorandum Joint Venture A/c

Correct : A. Del Credere Commission ;

84. Going run concern concept is not followed in —

A. Bank Accounts ;

B. Joint Venture Accounting ;

C. Partnership Accounting ;

D. Proprietorship Concerns

Correct : B. Joint Venture Accounting ;

85. Accounting Standard 1 requires the significant Accounting Policies to

A. Be suitable disclosed ;

B. Be circulated to all the shareholders separately ;

C. Be notified ;

D. Be changed from time to time

Correct : A. Be suitable disclosed ;

86. To convert the accounts prepared on cash system of accounting into mercantile system of accounting, which of these adjustments is not necessary

A. Reconciliation of cash with bank

B. Adjustment of prepaid expenses and income received in advance

C. Adjustment of outstanding expenses and income statement

D. Distinction between revenue and capital expenditure/income

Correct : A. Reconciliation of cash with bank

87. Trade discount is given to

A. Boost sales ;

B. Make payment early before due date ;

C. To evade tax ;

D. All the three

Correct : A. Boost sales ;

88. Which types of errors will effect net profit

A. Affecting Nominal Account ;

B. Affecting Personal Account ;

C. Affecting Real Account

D. None

Correct : A. Affecting Nominal Account ;

89. Raw material and components purchased and used at the time of installation of new Plant and Machinery will be debited to

A. Plant and Machinery A/c ;

B. Raw Material Consumed A/c ;

C. Purchase A/c ;

D. Profit ;and Loss A/c

Correct : A. Plant and Machinery A/c ;

90. Under estimation of useful life of a depreciable asset will lead to —

A. Overstatement of profit ;

B. Excess charging of depreciation every year ;

C. Over valuation of assets in Balance Sheet ;

D. Short charging of depreciation every year

Correct : B. Excess charging of depreciation every year ;

91. Which of these expenses are not included in valuation of closing stock lying with the consignee

A. Freight and insurance ;

B. Loading and unloading incurred ;

C. Godown rent ;

D. Custom duties

Correct : C. Godown rent ;

92. X purchased a new plant and machinery for ` 50,000 on 01.01.2012. The machinery was received in the factory on 10.01.2012 and was installed and put to use on 18.01.2012. Depreciation on the plant and machinery will commence from

A. 01.04.2011 ;

B. 01.04.2012 ;

C. 01.01.2012 ;

D. 18.01.2012

Correct : D. 18.01.2012

93. Under sales on return or approval basis, the ownership of goods is passed only

A. When the retailer gives his approval

B. If the goods are not returned within specified period.

C. Both (a) and (b)

D. None of the above

Correct : C. Both (a) and (b)

94. To obtain the amount of credit sales made during an accounting period, which account is generally used in single entry and incomplete records?

A. Payable Account ;

B. Total Revenue Account ;

C. Debtors Account ;

D. Stock Account

Correct : C. Debtors Account ;

95. The receipts and payments account of a non-profit organization is a

A. Nominal Account ;

B. Real Account ;

C. Income Statement Account ;

D. Financial Account

Correct : B. Real Account ;

96. The capital of a non-profit organization is generally known as

A. Equity ;

B. Accumulated Fund ;

C. Finance Reserve ;

D. Cash Fund

Correct : B. Accumulated Fund ;

97. If an employee of the business files a legal suit on business, it is considered in the books as

A. Legal Expense

B. Liability

C. Contingent Asset

D. Contingent Liability

Correct : D. Contingent Liability

98. At the end of the accounting year the capital expenditures are shown in the

A. assets side of the Balance Sheet.

B. liabilities side of the Balance Sheet.

C. debit side of the Profit and Loss A/c.

D. credit side of the Profit and Loss A/c.

Correct : A. assets side of the Balance Sheet.

99. Which of the following is not a method of charging depreciation?

A. Sinking Fund Method

B. Sum of years Digit Method

C. Working hours Method

D. Asset's Life-cycle Method

Correct : D. Asset's Life-cycle Method

100. If average inventory is `1,25,000 and closing inventory is `10,000 less than opening inventory then the value of closing inventory will be

A. 1,35,000

B. 1,15,000

C. 1,30,000

D. 1,20,000

Correct : D. 1,20,000