A Name of the Discipline for Question Bank Finance & Question Option A Option B Option C Option D 1 Outstanding Wages is classified as B 2 C 3 Share premium is a Revenue Receipt A 4 Land Building Plant Furniture A 5 Cash book Balance sheet C 6 Accrued assets Prepaid expenses Unearned revenue B 7 Inventory does not include Raw Material Finished goods C 8 Current liabilities do not includes Sundry creditors Bank Overdraft A 9 Balance Sheet D 10 B 11 Cash Cycle Sales Cycle B 12 A short term cash budget does not exhibit Cash Payments D 13 Long term solvency is indicated by Liquidity ratio C 14 Current ratio is chiefly used to assess the D 15 Time bill Usance Bill Demand Bill Documentary bill C 16 Pay back period D 17 Applicant Beneficiary Issuing Bank Advising bank B Sect ion Sl. No. CorreCt Answer Capital Expenditure Revenue Expenditure Deferred Revenue Expenditure Personal Expenditure Expenses incurred on research and development is an example of Capital Expenditure Revenue Expenditure Deferred Revenue Expenditure Personal Expenditure Capital Receipt Revenue Expenditure Deferred Revenue Expenditure Which of the following assets is usually assumed not to depreciate? Purchase of machinery for business on cash is recorded in purchase journal general journal Taxes owed but payable in the following period' should be classified as Accrued liabilities Goods in the process of manufacture Capital work in progress Prepaid insurance unclaimed dividends Which of the following is not required to be made under statute? Profit and Loss Account Cash Flow Statement Fund Flow Statement Profit on cancellation or redemption of debentures should be credited to Capital redemption reserve account Capital reserve account Securities premium account Profit and loss account Average time that elapses between the acquisition of raw materials and final cash realisation refers to Operating Cycle Fixed capital Cycle Investment activities Financing activities Issue of bonus Shares Interest Coverage ratio Debt-equity ratio Return on capital employed effective utilization of capital application of debt levels of inventory piled up in different form Liquidity position A bill in which no time for payment is specified is known as Which of the following appraisal criterion does not take into account the remaining cash flows once the initial investment is recovered? Internal Rate of return Accounting rate of return Net Benefit cost ratio …………. is a person or association of person in whose favour the letter of credit is opened.
Transcript
A Name of the Discipline for Question Bank Finance & Accounts
Question Option A Option B Option C Option D
1 Outstanding Wages is classified as Capital Expenditure Personal Expenditure B 1
2 Capital Expenditure Personal Expenditure C 2
3 Share premium is a Capital Receipt Revenue Receipt A 2
4 Land Building Plant Furniture A 1
5 purchase journal general journal Cash book Balance sheet C 1
7 Inventory does not include Raw Material Finished goods C 2
8 Current liabilities do not includes Prepaid insurance Sundry creditors Bank Overdraft A 1
9 Balance Sheet Fund Flow Statement D 1
10 B 1
11 Cash Cycle Operating Cycle Fixed capital Cycle Sales Cycle B 2
12 A short term cash budget does not exhibit Cash Payments Financing activities D 2
13 Long term solvency is indicated by Liquidity ratio Debt-equity ratio C 2
14 Current ratio is chiefly used to assess the application of debt Liquidity position D 1
15 Time bill Usance Bill Demand Bill Documentary bill C 2
16 Pay back period D 2
17 Applicant Beneficiary Issuing Bank Advising bank B 1
Section
Sl. No.
CorreCt Answer
Difficulty Level
Revenue Expenditure
Deferred Revenue Expenditure
Expenses incurred on research and development is an example of
Revenue Expenditure
Deferred Revenue Expenditure
Revenue Expenditure
Deferred Revenue Expenditure
Which of the following assets is usually assumed not to depreciate?Purchase of machinery for business on cash is recorded in Taxes owed but payable in the following period' should be classified as
Goods in the process of
manufacture
Capital work in progress
unclaimed dividends
Which of the following is not required to be made under statute?
Profit and Loss Account
Cash Flow Statement
Profit on cancellation or redemption of debentures should be credited to
Capital redemption reserve account
Capital reserve account
Securities premium account
Profit and loss account
Average time that elapses between the acquisition of raw materials and final cash realisation refers to
Investment activities
Issue of bonus Shares
Interest Coverage ratio
Return on capital employed
effective utilization of capital
levels of inventory piled up in different
formA bill in which no time for payment is specified is known asWhich of the following appraisal criterion does not take into account the remaining cash flows once the initial investment is recovered?
Internal Rate of return
Accounting rate of return
Net Benefit cost ratio
…………. is a person or association of person in whose favour the letter of credit is opened.
Question Option A Option B Option C Option DSl. No.
27 Amount set apart to meet losses due to bad debts is a Liability account Reserve Capital Expenditure Provision D 1
28 A Cost auditor can be appointed by Board Resolution Share Holders C 2
29 The management The shareholder The CAG Law D 2
30 Livestock Patents Goodwill Machinery A 2
31 Auditors of a company have to report to the Board of Directors Individual Investors D 1
32 Normal costing Actual Costing Standard Costing Historical Costing C 3
33 Yield Quantity D 2
34 The contribution margin is also know as: Marginal Income Net Income Net Operating Profit P/V Ratio C 2
A letter of credit where a bank other than issuing bank also undertakes to pay is known as
All outward remittance will be affected at the contractual rate (if forward contract is booked) or at the
TT Buying rate+ 0.15% margin
TT selling rate+ 0.15% margin
When current ratio is 2:1 an equal increase in current assets and current liabilities as a satisfactory ratio is current liabilities would
Increase the current ratio
Not changing the Current Ratio
Decrease the current ratio
Quick current Liabilities
Non-Current Liabilities
The balance sheet of a company should be in form set out in part 1 ofAt least _____ days before the Annual General meeting, copies of the balance sheet and profit and loss account are to be sent to the share holdersThe maximum amount of gratuity payable as per the payment of gratuity act 1972 is………. Audit report is one when auditor does not give clean chit about truthfulness and fairness of the financial statement but makes certain reservations
Previous approval of central
Government
Board Resolution with previous
approval of central Govt.
The Scope of work of a statutory auditor is determined byThe value of which one of the following assets increase in the initial years of its life, remains constant thereafter and finally begins to decline?
Institutional Investors
Share holders at the AGM
When factory overhead is applied to production, based on actual inputs multiplied by a predetermined application rate the process is known as:
Excess direct labour wages will be disclosed in which type of variance?
Direct Labour efficiency
Direct Labour rate (price)
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
35 Fixed Cost Variable Cost Semi Variable Cost D 3
36 Direct Labour Factory overhead D 3
37 Maximum capacity Normal Capacity Practical Capacity Expected Capacity D 2
39 Deferred liability refers to Debt of liabilities C 2
40 Which of the following is not R & D Cost C 3
41 AS-14 is applicable to amalgamation of: Partnership firm Companies C 3
42 Non Monetary assets given free of cost are: Not Recorded B 3
43 Prior period items should be disclosed in P& L A/c A 2
44 A 2
45 227 225 224 619 C 1
46 1st April 2003 1st April 2004 1st July 2003 1st July 2004 D 2
47 Labour cost Material Cost Profit SDC B 3
48 What is the due date of deposit of service tax? A 2
49 For companies, Service tax returns are to be submitted? monthly basis Quarterly basis Six monthly Basis Yearly basis C 2
50 25th April 7th April 14-Apr 30th April A 3
A Business telephone bill should normally be classified into which one of the following categories
Stepped Fixed Cost
Factory worker fringe benefit cost are actually charged to:
Work in progress inventory
Administrative Expenses
Factory overhead application rates best reflect anticipated fluctuations in sales over several year when rates are computed using figures based onEconomic Order quantity computation does not considered the following
Difference of liabilities
Charging of expenses to next
financial year
Deferred Revenue Expenditure
Engineer's Salary relating to R & D
Development Material
Royalty payment for building,
equipments & facilities used in
production
Development Expenditure
Proprietorship Firm
Partnership & company
Recorded at fair market value
Recorded at nominal Value
Recorded at Market Value
As a part of head of account, to
which the items relates
Separately above the line
Separately below the line
Should not be disclosed
Which of the following disclosures as contingent liability is correct
Income Tax demand contested
on appeal
Commitments under capital
contracts
Recourse bill discounted with the
banks
LC opened with the bank
Appointment and remuneration of auditors is governed by which section of companies Act:
What is the effective date of implementation of service tax on maintenance & repair transaction of HAL ?
As per service tax rules following is deducted from value realized to arrive at taxable value of services ?
5th of the following month
7th of the following month
14th of the following month
end of the same month
For HAL, what is the due date of submission of service tax returns for the period oct.07 to mar.08?
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
51 ST 1 ST 2 ST 3 TR 6 C 3
52 B 3
53 5th April 7th April 25th April 31st March D 2
54 12% 12.24% 10.30% 12.03% C 1
55 7.5% per annum 10% per annum 12.36% per annum 13% per annum D 3
56 Commissioner CBEC B 3
57 Activities of service tax are administered by? A 1
58 ST 1 ST 2 ST 3 TR 6 A 3
59 30th Sept. 1997 24th August 1995 24th August 1996 25th August 1996 B 3
60 10.00% 7.50% 5.50% 2.50% C 2
61 10.00% 7.50% 5.50% 2.50% B 2
62 1% to 10% 1% to 5% 0.5% to 10% 0.5% to 5% D 2
63 65% of order value B 2
64 65% of order value A 2
65 2.50% 5.00% 7.50% 0.00% D 3
66 10.00% 7.50% 5.50% 5.00% D 3
67 RMSO means: B 1
68 FPQ means Firmed Price Quote A 1
69 SPC Means in FPQ is Supply Price Cost D 1
70 1st April 2004 1st April 2005 1st April 2006 1st April 2007 C 2
What is the prescribed form no. for submission of service tax returns?Maximum limit for availing CENVAT credit of service tax for assesses not maintaining separate books of accounts for taxable & non-taxable services?
10% of service tax payable on output
services
20% of service tax payable on output services
30% of service tax payable on output
services
40% of service tax payable on output
servicesWhat is the due date of service tax payable for the month of march?As on Date what is the effective rate of service tax alogn with cess?What is the rate of interest payable for delay in deposit of service tax?As per service tax rules, what will be the appellant authority for appeal against order passed by DY.Commissioner?
Commissioner (Appeals)
Excise appellate tribunal
Central excise Department
Income Tax Department
Sales Tax Department
Provident Fund Department
What is the prescribed form no. for application of registration for service tax?Revised Pricing Policy for HAL's Products and services are issued by Government of India on:Profit on non-production overhead is admissible at the rate of:Profit on Deferred Revenue Expenditure is admissible at the rate of:Liquidated Damages for delays in supplies and services is levied as per FPQ with IAF minimum to maximum range of rates is:Advance for supply of spares over a period of 12 months after receipt of RMS Order is paid by
40% of the order value
35% of the order value
25% of the order value
Advance for supply of spares within a period of 12 months after receipt of RMS Order is paid by
40% of the order value
35% of the order value
25% of the order value
As per IAF FPQ policy Profit on warranty cost is admissible at the rate ofProfit on Bought out end unit under upgrade programmes is admissible at the rate of:
Repair maintenance spares order
Repair maintenance supply order
Repair Military supply order
Repair Military spares order
Fixed Price Quotation
Fixed Payment Quotation
Final Price Quotation
Spares Payment Cost
Supply Price Catalogue
Spare Price Catalogue
Effective date for start of claiming warranty cost from IAF on supply & servicing on product
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
71 1% 2% 5% 10% A 2
72 Reduncy provision charge on Imported material A 3
73 2003-04 2004-05 2005-06 2006-07 B 1
74 2.5% 3.50% 4.00% 5% B 2
75 2.5% 3.50% 4.00% 5% C 2
76 7 Hours 7.5 Hour 8 Hours 8.5 Hours B 1
77 30-Jun-06 31-Mar-06 30-Jun-07 31-Mar-07 A 2
78 30-Jun-06 31-Mar-06 30-Jun-07 31-Mar-07 B 2
79 VOP excludes one of the Material Labour Profit SALE D 2
80 OEM Stands in respect of purchases A 1
81 ECS Stands for B 1
82 741/05 741/06 741/07 742/08 D 3
83 Money Supply Report B 2
84 MHR in respect of FPQ Stands for : Machine Hour Rate Man hour Rate Maximum Hour Rate C 2
85 Request for Quality Repair for Quotation C 1
86 B 1
87 D 1
88 L 1 Vendor L 2 Vendor L1 & L2 Vendor All vendors A 1
89 Rs 2500 Rs 3000 Rs.4000 Rs 4500 D 2
What is the percentage of redundancy provision as per new FPQ?
Indigenous Material + Imported
Material
Indigenous Material +
Imported Material + ATF
Indigenous Material + Imported Material + ATF + Freight &
Insurance
What is the base year for the FPQ's approved by MOD in 2007?What is agreed %age for escalation on imported material with IAF for western materials?What is agreed %age for escalation on imported material with IAF for Russian materials?As per new FPQ approved how many working hours considered for one person for one day?For preparation of IAF FPQ for financial year 2007-08 exchange rates date applicable for theFor preparation of IAF SPC for financial year 2007-08 exchange rates date applicable for the
Original Equipment manufacturer
Original Equity Manufacturer
Original Effective Machine
Operating Equipped Man
Electronic Cleaning System
Electronic Clearing System
Electric Cleaning System
Electric Clearing System
As per allotment of IAF budget major head 2078 is not for repair & OverhaulMSR Stands for : Machine sub-
contracting request
Material sub-contracting
request
Manpower sub-contracting request
Material Hour Rate
RFQ Stands for : Request for Quantity
Request for Quotation
CAR Stands for : Capital Appropriation
Report
Capital Appropriation
Request
Capital Allotment Request
Corporate Appropriation
RequestCAAA Stands for :
Corporate Account Adjustment Advice
Central Account Adjustment
Advice
Control Account Adjustment Adhoc
Control Account Adjustment Advice
Negotiation with the following vender is as per CVC guideline :LTA payable to Grade – III / IV Officers :
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
90 240 days 300 days 340 days un limited B 1
91 Rs 100000 Rs 135000 Rs185,000 Rs 180000 C 2
92 1% 1.50% 2% 3% D 2
93 Rs 20000 Rs 30000 Rs 50000 Rs 60000 C 2
94 Amount of Gift payable at the time of superannuation : Rs. 5000 Rs.3500 Rs 2500 Rs 1500 A 2
95The Budget is projected in a _______ year time frame :
99 License Fees Documentation Computer Software D 2
100 Freak Rates relates to : Fear Rates Market Rates MES Rates C 2
101 Rate of Depreciation charged on Computers : 31.7% 16.21% F 7% A 3102 Provision for Non-Moving items are to be made : 1.5% 5.00% 50.00% 100% D 2
103 Accrual Cash Hybrid Mercantile A 2
104 Computer Office Equipment Office Machinery A 1
105 Rs. 5000 Rs. 7500 Rs. 10000 Rs. 15000 C 1
106 Debtors Cash & Bank Advances Inventories B 1
107 Scrap is valued at : Actual Cost Wg. Average Value Historical cost B 2
108 10.0% 25.00% 50.00% 75% C 1
109 Actuarial Valuation C 2
V.L. can be accumulated maximum upto ____ days in respect of Officers :As per Income Tax Act upto which amount Tax is exempt for ladies for the assessment year 2009-10What % Education Cess is levied upon for the assessment year 2009-10 :Income Tax rebate under Sec 80 U for physically handicapped person for the assessment year 2009-10
2 year (current year & Next Year)
3 year (current year, Next Year &
Forecast year)
2 year (Previous year and current
Year)Expenditure like Tooling, Project Management which are identifiable to a specific Project / Programme are treated as:
Revenue Expenditure
Deferred Revenue Expenditure
In Capital Budget Proposals, Cost Benefit Analysis for Fresh Sanctions exceeding Rs._______ to be furnished in the prescribed format :Separate Board Papers should be submitted in case of projection of Fresh Sanction in Capital Budget :Intangible Assets is not one amongst the following : Non Standard
EquipmentUnbelievably
High/Low Rates
Disclosure is not required if the following system of accounting is followed :LAN/WAN equipment are capitalised under which head :
Communication Equipment
HAL's Accounting Policy w.r.t. charging off of fixed assets @ 100% upto which amount :Franking Machine balances are shown under which head in Balance Sheet :
Estimated realizable Value
Professional Development Scheme is paid at the percentage of Basic Pay :As per Corporate Office Instructions dated 29.10.05, provision for Vacation leave is done as per :
Average Strength of the worker & officers on the
close of the year
No. of employees of officers retiring
Total Strength of the worker & officers on the close of the year
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
110 Rs 20000 Rs 40000 Rs 50000 Rs 5000 A 2
111 Zero coupon bonds carry: No Interest No Maturity Value Interest on Maturity A 3
112 Present scale of pay in HAL at grade V level 14000-350-18250 14500-350-18250 15000-350-18700 14500-350-18700 D 2
113LTBA
A 1
114 Name of new tax intro in Finance Act 2005 : Income Tax Trade Tax Fringe Benefit Tax Government Tax C 1115 Rate of tax of Fringe Benefit on medical expenses 10% 20% 30% 40% B 2
116 31st July 31st October 31st December 31st March B 2
117 SFA D 1
118 Sales Tax Trade Discount Service Tax C 1
119 B 2
120 As per AS-18 relative does not include Spouse Sister Brother in law Son C 1
122 The scope of interim audit falls with in the preview of Final Audit Partial audit Efficiency audit Internal control A 2123 Interim audit is conducted between two _____ audit Continuous audit Costs audits Final Audit Phase Audit C 3124 Internal Check is a part of the whole system of Internal audit Internal Control Annual Control Continuous audit B 3
125 Board of Directors Managing Directors Share holders D 1
127 An auditor of a company is appointed for a period of One year Two Years Three Years Five years A 3
128 Management Auditor Government Company Law Board A 1
129 Audit report along with annual accounts is given by Statutory Auditors Internal Auditors Secretarial Auditors A 1
When Fixed Cost is Rs. 10000/- and P/V ratio is 50% , the break-even point will be
Coupen for payment of interest
Long Term Business
Agreement
Long Term Banking
Agreement
Long Term Budget Agreement
Long Term Bonus Agreement
Date of filing of Annual return of F.B.T. is :
Stock and Furniture Act
Securities and Furniture Act
Stock and Forward Act
Securities and Forward Act
Which of the following should be included in the cost of purchase as per AS-2 Cenvate excise
Duties
Which of the following are cash flows from operating activities : Cash advance &
loan mode to third party
Cash receipts from the sale of goods and the rendering of
services
Cash proceeds from issue of
shares
Cash proceeds from sale of Fixed Assets
Audit at the year end
Where the provisions of the companies act are violated, the auditors must report the same to the
Central Government
Which type of audit is more suitable where there is no satisfactory system of internal check
Who is responsible of introducing and maintaining internal control relating to accounting system in a company?
Government Auditors
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
130 Management audit is ordered by the Government Board of Director C 1
131 A 2
132 Revenue nature Capital nature Personal Loss A 2
133 C 2
134 D 1
135 Fair market value Historical cost Revaluation amount D 3
136 Historical cost Net realizable value D 2
137 GM of the Division Director Finance Chairman A 1
138 GR-I/II/III GR-VII and above GR-IV/V/VI Scale 1 to 10 C 2
139 Composite DA for Grade-IV is 1000 850 700 600 C 2
140 Four Five Six Seven B 2
141 Transfer Grant payable to Grade-V on transfer is Rs.30,000.00 B 1
142 300 days 240 days 290 days 250 days A 1
143 Annual rate of Increment for Grade-IV officer is Rs.300 Rs.400 Rs.250 Rs.350 D 1
144 Attendance Bonus is payable to Grade-I officer only Scale 1 to 10 only Scale V to 10 only B 1
145 Current Basic Pay Rs.5000 Rs.6500 Basic+DA C 1
146 R P F C Corporate Office Complex Office B 2
147 7 12 50 9 A 3
148 Which DOP clause deals with Provisioning of Material 11 12 10 9 D 3
149 Rs.10 Lakhs Rs.15 Lakhs Rs.20 Lakhs NIL D 3
150 AS-26 AS-10 AS-1 AS-29 D 3
Worker of a company
Securities exchange board of India
In so far as a company is concerned which of the following pairs not correctly matched?
internal audit - obligatory
Statutory audit - Mandatory
Continuous audit - optional
Management Audit - Voluntary
Loss caused by theft of cash by cashier during business hours is a loss of
Deferred Revenue Expenditure
In a financial statement, separate items of fixed assets may be shown at
Same basis of valuation
Different basis of valuation
Same basis for each category of
fixed assets
Same basis of depreciation
An item of fixed assets which has retired from active use and is held for disposal is
Not shown in the financial statement
Shown at net book value
Shown at net realize value
shown at lower of net book value and net
realize valueAccording to Accounting Standard 10 gross book value of a fixed assets may be
Historical Cost of revaluation amount
According to Accounting Standard 2 inventory is to be valued at
Actual Cost or sales value, which
ever is less
Historical cost or net realizable value which
ever is lessThe power to interpret the hal traveling allowance rule (inland),2007 is vested to
Director (Personnel)
Category "C" for the purpose of HAL TA/DA rules, 2007 means
How many additional increments are given to Grade-IV officers recently
One month current basic pay
Two month current basic pay
Two month Basic Pay + DA
Maximum Vacational Leave can be accumulated by an officer
Grade-II and above officers only
Personal Salary for the purpose of Pension Scheme, 1995 is
Pension to the employee as per Pension Scheme-1995 is payable by
Division where the employee last
servedWhich DOP clause deals with award of contract without calling Tenders
As per clause 1 of DOP, Power delegated to GM under New Project involving capitalProvisions, Contingent Liabilities and Contingent Assets is dealt by
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
151 Authorised capital of the HAL is Rs.160.00 Crs Rs.120.50 Crs Rs.100.50 Crs Rs.125.00 Crs A 3
152 Operating activities Investing activities cash activities B 3
153 Operating activities Investing activities cash activities B 3
154 Operating activities Investing activities cash activities C 2
155 Operating activities Investing activities cash activities C 2
156 2 times 3 times 1 time any no of times A 2
157 Rate of canteen subsidy W.E.F. Dec-2006 Rs.500 Per month B 2
158 Joining time of transfer can be taken in two spells one spells three spells Four Spells A 2
159 Accounting policy 9 deals with Disposal of Scrap Employee benefit Depreciation A 2
160 Accounting policy 2 deals with Fixed Assets Employee benefit Depreciation A 2
161 Accounting policy 1 deals with Disposal of Scrap Depreciation B 2
162 Capital Budget is approved by Board of Director Chairman GM MD A 2163 Performance Budget is approved by Board of Directors Chairman GM MD A 2
164 2 5 7 9 A 2
165 2 5 6 23 C 1
166 Schedule 19 of Annual accounts deals with Sales Purchase Other Income A 1
167 10 12 16 08 B 1
168 Schedule 24 of Annual Accounts deals with Explanatory Notes Sales Purchases Other Expenses A 1
169 A 2
170 Minimum Vacation Leave can be encashed for 20 days 10 days 50% of Balance 7days B 2
171 12% 10% 8.67% 20% A 2
172 The new Pricing Policy "FPQ" was implemented from 1996-97 1994-95 2001-02 1995-96 D 2
173 Current block of 4 year for LTC is 2006-09 2005-08 2007-10 2007-11 A 3
Dividend paid in Cash Flow statement will be shown under
Financing activities
Interest paid on Long term Loan in Cash Flow Statement will be shown under
Financing activities
Purchase of Fixed Assets in Cash Flow statement will be shown under
Financing activities
Dividend received in Cash Flow Statement will be shown under
Financing activities
How many times the salary advance can be taken by the employee in a calendar year
Rs.100 per day of attendance
Rs.20 per day of attendance
Rs.50 per day of attendance
Foreign currency transaction
Foreign currency transaction
Accounting Method
Foreign currency transaction
In which Schedule Reserve and Surplus is shown in annual accountsIn which Schedule Depreciation Reserve is shown in annual accounts
Direct Expenses/Amortisa
tion
Cash & Bank Balance is shown in Schedule _____ of Annual Account
Which accounting standard the company HAL is not complying with due to nature of business
AS-17 Segment reporting
AS-3 Cash flow statement
AS-7 Construction contracts
AS-28 Impairment of Assets
Employers Contribution to Provident Fund & Pension Fund is @
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
174 CAG's Audit under Sec 619(3) will be done B 3
175 Annual Accounts of HAL is to be adopted by BOD CAG MOD AGM A 3
176 83 81 60 84 A 3
177 83 81 60 84 B 3
178 83 81 60 84 C 3
179 83 81 60 84 C 3
180 81 60 84 62 D 3
181 70 60 84 62 A 3
182 70 60 84 62 B 3
183 FAD-19 is prepared to B & C Only A 1
184 Which report form part of the Annual Accounts Director's Report A & B D 1
185 Cash Office Payroll Section A 1
186 LC register is prepared by Cash Office Foreign Bills Section D 1
187 24 23 22 25 A 1
188 Annual Account of the Company are signed by All Directors Chairman Only A 1
189 Schedule 23 of the Annual Accounts Deals with Interest on WC Deferred Debts Salaries & Wages A 1
190 Schedule 20 of the Annual Accounts Deals with Interest on WC Deferred Debts Salaries & Wages D 1
191 Schedule 21 of the Annual Accounts Deals with Interest on WC Other Expenses Salaries & Wages C 1
Concurrently with Statutory Audit
After Statutory Audit
After adoption of Accounts by AGM
As and when approved by MAB
In cost books, Account Head ________ is credited when materials are issued for production
In cost books, Account Head ________ is credited when Labour & Overhead are expended on work orders
In cost books, Account Head ________ is debited when materials are issued for production
In cost books, Account Head ________ is debited when Labour & Overhead are expended on work orders
In cost books, which Account Head ___ is operated for stock in TradeIn cost books, which Account Head ___ is operated for Cost of SalesIn cost books, which Account Head ___ is operated for W.I.P
Reconcile the Inter-Divisional Accounts
Reconcile the Balance with CO
Only
Reconcile the Balance with
Complex Office Only
Statutory Auditor's Report
General Manager's Report
Fixed Asset register and Depreciation Schedule is prepared by
Book Keeping section
Bills Receivables Section
Book Keeping section
Bills Receivables Section
How many Schedules are formed parts of the Annual Accounts
Company Secretary, Director
(Finance), Chairman,
Statutory Auditors
Director Finance Only
Change in WIP/SIT/Disposal
ScrapChange in
WIP/SIT/Disposal Scrap
Change in WIP/SIT/Disposal
Scrap
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
192 Contingent Liabilities are shown in Current Liabilites Notes to Accounts Long term Liabilites B 1
193 16.21% 31.7% 7.42% 11.31% A 3
194 16.21% 31.7% 7.42% 11.31% B 3
195 16.21% 31.7% 7.42% NIL D 3
196 16.21% 31.7% 7.42% 11.31% C 3
197 18 29 01 09 B 3
198 Rate of Warranty Charged from IAF on Engines is 2.5% 5% 7.5% 10% C 3
199 Rate of Warranty Charged from IAF on Accessories is 2.5% 5% 7.5% 10% B 3
200 Rate of Warranty Charged from IAF on Air Frames is 2.5% 5% 7.5% 10% A 3201 Lead Bank of HAL's consortium is SBI PNB ICICI HDFC A 1
202 By Convention Audit Requirement B 2
203 Provision for Vacation leave is made on the basis of A 2
204 Policy on Idle Hours Sales is Discontinued from 1995-96 2005-06 2006-07 2004-05 C 2
205 A 2
206 AO(DAD) AFLE CRI CRE A 2
207 Who Sign the Form Q-423 AO(DAD) AFLE CRI CRE C 2208 Which bank is not in the list of Consortium Banking ICICI SBI PNB IOB A 2209 The value of the non-convertible bond-series III is 360 Crs 120 Crs 400 Crs 500 Crs A 2
210 The Cash Management System is controlled centrally At Complex Level At CO Level At Division Level B 2
211 Grade-I Grade-II Grade-III Grade-IV & above D 2
212 35% 65% 60% 40% B 2
213 Casual Leave can be combined with Vacation Leave Sick Leave Cannot Combine C 2
214 Category-D Category-B Category-C Category-E C 2
215 $400 $300 $275 $250 C 2
216 15 days 30 days 07 days 20 days A 2
217 Rs.1000 Rs.2000 Rs.3000 No limit A 2
Profit & Loss Accounts
As per Company's Policy, the Rate of Depreciation for CNC machines are charged @As per Company's Policy, the rate of depreciation for Computers are charged @As per Company's Policy, the rate of Depreciation Land Charged @As per Company's Policy, the rate of Depreciation for Plant, Machinery and equipments are charged @Warranty Provision in the books of Accounts is made as per AS-
Furnishing of Previous years Figures in Annual Accounts are
A Statutory Requirement
Management Choice
Actuarial valuation at CO
Valuation is made by Division
Valuation is made by Complex Office
Valuation is made by Internal Auditors
Differential Sales arising on finalisation of prices are shown
As a current year sales
Prior period sales in SCH-16
Prior Period Income in SCH-17
Current year Income in SCH-17
Who is the payment authority in respect of sales made to IAF
Both at Complex and CO Level
The Journal Voucher above Rs.5,00,000 can be approved byThe Ist Stage Payment under FPQ system in repair and overhaul task is
Combied with any leave
Union Representative under TA/DA rules are treated as per withRate of Daily Allowance for I/II/III officer while on business visit in abroad is in ($)TA/DA claims should be submitted within _____ from the date of return journeyMaximum Amount reimbursable on Ayurvedic / Homeopathic treatment is
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
218 Power delegated to GM to write off shortage of cash is Rs.500 Rs.1000 Rs.2000 No limit A 2
219 Rs.100000 Rs.2000000 No limit A 2
220 Rs.20000 Rs.10000 Rs.30000 No limit B 2
221 GM MD FD Chairman D 2
222 Debit Balance of RIT should be shown in Schedule 3 12 1 9 B 2
223 Cost Principle Consistency Materiality Going concept B 2
224 Consistency Materiality Convervatism Continuity C 3
225 Remain constant Fluctuate Decrease Go up A 2
226 D 2
227 Stock should not include D 2
228 Operating income Operating Loss B 1
229 Stock in trade does not includes Raw Material Finished goods C 1
230 Materiality Concept Going concept B 2
231 Current ratio may be increased by B & C A 2
Power delegated to GM to write off of dues to the company such as Sundry Debtors, Loan and Advances
Rs.10000 in each case maximum of Rs.2 Lakhs in a
yearPower delegated to GM for reimbursement of medical expenses in relaxation of rules isWho is the approved authority for Movement order for travel outside India
LIFO inventory method was used in 1st year, FIFO in 2nd year and Weighted Average in 3rd year. Which accounting principle is violated?An accounting convention which provides that when doubt, choose the solution least likely to overstate assets and income is
Money measurement concept of accounting theory is based on the assumption that the value of money will
The written down value of a plant is Rs 6000 (Original value being Rs. 10000). It is sold for Rs. 12000 during the current financial year. Which one or the following is true in the regard?
Capital Profit = Rs. 6000
Revenue Profit = Rs. 6000
Capital profit = Rs. 12000
Capital profit = Rs. 2000 and Revenue
Profit Rs. 4000
Goods held as security
Goods held by the business as
consignee
Goods with customers for
approval on sale or return basis
Goods sold but not yet delivered
If operating expenses exceed gross profit, the excess is referred to as:-
Non-Operating expenses
Non-Operating income
Goods in the process of
manufacture
Items held as fixed assets
Market value of investments is shown as a footnote to balance sheet is according to
Consistency Concept
Disclosure concept
Overstating Current Assets
Overstating Current Liabilities
Understating Current Assets
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
232 A high pay out ratio indicates that B 3
233 Operating ratio ROI A 3
234 Voting rights A 3
235 A 3
236 C 3
237 Baumol's Model Miller - Orr Model A & B D 3
238 A,C & D A,B,C & D B & D A,B & C B 1
239 IV IIX VI V C 3
240 Joint lending Consortium lending Joint Venture Lending C 3
241 Pay back method NPV IRR A 2
242 24% 20% 22% 25% A 2
243 1 0 2 5 A 2
244 PI method NPV Terminal Value Pay back period C 1
245 A 3
Management is ploughing back
profits
Management is not reinvesting
profits
Company is earning high profits
Earning per share is high
Which of the following ratio is a favourable indication if it is low
Operating profit ratio
Inventory turnover ratio
In calculating the earning per share (EPS) the net profit is divided by
Number of equity shares
Number of preference shares
Number of equity + preference shares
In computing the return on capital employed the profit figure to be taken into account is
Net profit after taxes + interest
Net profit before taxes
Net profit after taxes, interest and
preference dividend
Net profit after taxes +
interest+Depreciation
The return on capital employed shows how well the management has used the funds supplied by
Equity share holders
Equity & preference
shareholders
Shareholders & creditors
Debtors Turnover Ratio
The following methods are useful in management of cash
Economic order QuantityCertificate of Deposits (CD's) have following features.
1. Time deposit with the Banks 2. Easily transferable from one party to another 3. Can be issued in multiples of Rs.5 Lakhs. 4. Minimum investment Rs.25 Lakhs. In which schedule of company's act depreciation rates are definedWhen at least two bank come together to finance requirements of a unit jointly and spreading the risk as well as return. The arrangement is called
Participation lending
The method ignores cash generation beyond period when cash inflow exceeds investment
Accounting rate of return
A project with capital expenditure of Rs. 500000 is expected to produce the profit (after deducting depreciation) for 4 year is 40000,80000,90000,30000. Calculate accounting rate of return
A project offering a profitability index greater than ………. Must offer a NPV which is positive.In which method it is assumed that each cash flow is reinvested in another project at a predetermined rate of interest
The salient feature of deep discount bonds (DDBs) dose not include
It carries a fixed rate of interest
DDBs are issued discount to face
value bond
These are zero interest bonds
Difference between sale price and original cost is investors profit
Question Option A Option B Option C Option DSl. No.
249 Bonus shares are also called as Scrip dividend Equity Dividend Ordinary Dividend Bonus Dividend A 2
250 Rent Salaries Professional Payment C 2
251 Rs 75000 Rs 100000 Rs 110000 Rs 135000 B 2
252194C 194D 194E 194J
D 2
253194C 194D 194E 194J
D 2
If the financial institution may like to keep margin of 25% on assets. If the tangible assets are 80% while intangible assets are 20%. Then maximum finance that fIs will give be
Share of pulkit limited are traded at Rs 90 each. Divident per share is Rs.18. Groth rate is 6%. Calculate the cost of capital
In ……. Rate a certain percentage of interest will be of variable nature over and above the fixed rate of interest
Form 16 of Income tax Act is certificate of tax deduction on:
Interest on securities
Maximum amount of rebate allowed under 80 C of Income Tax the assessment year 2009 -10
Which section of the Income Tax Act deals with TDS on payment to professionals & Technical Services
Which section of the Income Tax Act deals with TDS on payment to professionals & Technical Services
A Name of the Discipline for Question Bank Finance & Accounts
Question Option A Option B Option C Option D
1 Who is called the father of the Financial Accounting. Necols Gearg Games Peela Edward Jones A 3
2 Just one Atleast Two Only Two Two or Three B 2
3 Marginal costs are sunk cost B 1
4 Acid test ROI Net profit ratio Debit equity ratio C 1
5 Sales X P/V ratio - Profit Variable cost contribution Fixed cost Profit C 1
6 Trading Account Sales Account Purchase Account C 2
7 Dec. 31,2009 A 3
8 Which of following is a real account ? Salaries Debetors Account Bank Account D 1
9 Public Accounting Auditing Tax services D 2
10 20% 25% 30% 33.33% D 1
11 Prime cost factory cost fixed cost cost of production B 2
12 Variable cost varies Every time With change in time C 1
13 Suspense Account Adjustment account A 1
14 Which of the following Assets does not depreciate ? Land Vehicles Furniture B 2
15 Credit sales Sale Cost of purchase B 3
16 C 2
17 Auditor Management Govt. Share holders B 1
18 Insurance is a - contract of warranty B 3
19 Ordinary resolution Special resolution C 3
Section
Sl. No.
CorreCt Answer
Difficulty Level
Father Luca Paciolo
How many accounts does a business transaction affect?
Are determined easily
Help in pricing the product
Used in valuation stock
Which of the following ratios are used for measuring profitability of business?
Goods lost by fire, fully insured covered credit will be given to -
Insured claim account
How would the date of balance sheet be properly worded?
As on Dec. 31.2009
For the year ended Dec.31, 2009
For the period ended Dec.31, 2009
Shares and debentures of
companies
Which area of accounting has gained much practice in recent years ?
Management consultancy services
If profit are 25% of selling price, what is the precentage of profit to cost ?direct materials used plus direct labour plus factory overhead is called -
With change in prices
With output produced
Which account is generally used for rectification of error ?
In which one of the following methods of charging depreciation shall the balance never be induced to zero ?
Fixed Instalment methods
Depreciationfund Method
Diminishing Balance Method
Depletion Unit Method
Physical verification of fixed assets is the primary responsibility of the -
Contract of guarantee
contract of indemnity
Contract of partnership
The Article of Association of a company can be altered be -
Central Govt approval
Company law board's approval
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
20 Doctrine of ' Indoor Management ' Implies - C 2
21 Uncalled Capital Issued capital Capital reserve Reserve Capital D 3
22 No right to vote D 2
23 C 1
24 "The principle of conservatism "implies - C 3
25 Contra entry is recorded in Simple cash book All cash book B 3
26 Auditors Company secretary B 3
27 A letter of credit signifies - D 2
28 No impact C 1
29 Internal author is appointed by the Statutory auditor D 3
30 Minimun wages by fixed by - Trade unions Employees State Govt. Court of law C 1
31 line organisation A 3
32 "Self actualisation " need refers to the - Need for food Need for safety Need for lave Need to grow D 3
33 The first auditors should appointed A 2
34 52% 51% 100% 32% B 1
35 A statutory meeting need not be held by -- Public company Private company Small company B 1
36 Current assets Loss assets Fictious assets Intangible assets C 2
Outsiders should check each and
every transaction of the company
Outsiders should have no access to the transaction of
the company.
Outsiders are entitled to believe
that everything done by the
company within its 4 walls has been done in aregular
way
Outsiders should not check each and every
transaction of the company
The protion of uncalled capital which may be called up only at the time of winding up of the company is called -
Which of the following is not a feature of equity share capital ?
Source of Fixed Capital
No liability as to repayment
No liablity as to payment of
dividendThe preference shares which give the holder the right to share In the residual profits are known as -
Cumulative preference share
convertible preference share
Participating preference share
Non Cumulative preference share
Appropriate recording of
business transaction at appropriate or proper time.
Disclosure of all material
information
Business transaction should
be recorded in such a way that profit should not be overstated
Disclosure of all material transactions
Three column cash book
Double coulmn cash book
A Company can invest money in another only if it so authorised by its
Memorandum of association
Articles of assocation
Importer agreeing ti a credit deal
Exporter sanctioning a
credit deal
letter containing of conditions of credit
Banker agreeing to accept and pay on
due date
A sale of Rs. 2000/- wrongly entered in the purchase book -
decreases the gross profit by
2000/-
increases the gross profit by
2000/-
decreases the gross profit by
4000/- Shareholder of the
company Institute of internal auditors of india
Board of directors of the company
The principle of "unity of command" is strictly observed in -
line and staff organisation
functional organisation
semi-govermental orgnisation
Within and with the registration of
company
Within and with the incorporation
of company
Within and with the commencement of
business
Within and with the starting 1st finanical
year
A Govt. Co. is one in which not less - of the paid up capital is held by Govt.
Company limited by guarantee
Assets which appear in the book but have no market value
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
37 Working capital can be used for the purchase of -- Plant Furniture Stock Machinery C 3
38 Annual general meeting can be called by the -- Board Directors Managing Director B 3
39 A letter of credit is opened on behalf of -- An exporter An importer A buying agent A bank B 1
40 A public company having a share capital C 2
41 12 months 18 months 15 months 20 months C 2
42 In the LIFO method, the closing stock is valued at - Base price B 1
43 B 3
44 Which one of the following os 'not' a current liability ? Acceptance D 3
45 Operating income Operating loss B 3
46 Assets and capital Loan and capital D 2
47 Maximum limit of EMD is fixed at : Rs. 10 Lacs Rs. 20 Lacs Rs. 30 Lacs Rs. 50 Lacs D 248 Valuation of inventory is dealt with in AS 2 AS 5 AS 6 AS 9 A 2
49 Accounting standard 13 deals in D 3
50 Accounting standard 6 deals in B 3
51 Accounting standard 9 deals in Valuation of inventory C 3
52 Mines Forest Plantations Land D 3
53 Which of the following is a real account Salaries Debtors account Contingent liability B 2
54 Liability account Capital account D 2
55 Realisation account is a Personal account Real Account Nominal Account Collection Account B 2
56 Du-point system refers to Stock index in USA C 3
Company secretary Non - executive director
Must issue a prospectus
Can't file a statement in lieu
of prospectus
May file a statement in lieu of
prospectus
should not issue a prospectus
The interval between two annual general meeting should not be more than -
A price which is paid for the last consignments.
A price which is paid for the earlier
consignments
An average price of all this
consignments
Project engineering Ltd. Has an adverse current ratio which one of the following would improve this ratio -
Sale of fixed assets for the
current account
Collectionof some of the current
accountvarriables
Use of cash to pay off some long term
debts
Collection from sundry debtors
Loan instalment payable in the current year
Temporary bank overdraft
Arrears of preference dividend
If the operating expenses exceed gross profit the excess is referred to as --
Non - operating expenses
Non operating income
Capital gearing ratio denotes the relationship between --
Equity shareholders funds and long term
borrowed funds
Debentures and share capital
Accounting for fixed assets
Depreciation accounting
Revenue recognition
Accounting for investment
Accounting for fixed assets
Depreciation accounting
Revenue recognition
Accounting for investment
Accounting for fixed assets
Cash flow statement
Revenue recognition
Accounting standard 10 deals with the following fixed assets
Investment in share
When a partner retires, decrease in the value of a liability is credit to
Realization account
P& L Adjustment Account
Stock Index in London
Analyzing profit ratio in terms of
profit margin and turnover ratios
Stock Index in New York
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
57 A letter of credit is B 1
58 Capital flow Hawala C 1
59 Sundry Creditors Sundry Debtors Bank Overdraft Contingent liabilities D 2
60 Gross Capital employed is equal to Fixed Assets C 2
61 Credit Sales / Average debtors gives Acid Test Ratio Current Ratio D 1
62 Net Worth of business means Total Profit Total Turnover B 2
63 Sales of inventory for cash will cause the current ratio Increase Decrease Remain unchanged C 2
64 The immediate solvency ratio is Quick ratio Current ratio Net Loss ratio A 1
65 Which of the following items result in cash flow? Goodwill written off Salaries Outstanding A 1
66 Which of the following is not a cash inflow? Issue of debenture A 2
67 Which of the following is a non-current liability Bills Payable Sundry Creditors Bank Overdraft Long term Loans D 168 A person can be director in up to 10 Companies 15 Companies 20 Companies 25 Companies B 269 Maximum limit of members in a private company are 7 Member 15 Member 50 Member Unlimited C 1
70 The first directors of a company are appointed by Promoter A 1
71 Auditors of Government companies are appointed by CAG Board of Director ICAI Share Holders A 172 A public company may have maximum director is 5 7 10 12 D 1
73 First Auditor of a company are appointed by Board of Director ICAI C 1
74 3 month 6 month 9 month 12 month B 2
75 15 month 6 month 9 month 12 month A 2
A short term credit by a bank to an
importer
A guarantee to honour the bills of an exporter drawn within stipulated
term
A guarantee by a bank to discount all
the bills of an exporter
A short term credit by the bank to an
exporter against a confirmed order
…………. is a technique for laundering the money to avoid the official channels of banking and tax payment
Convertibility of Revenue Account
Convertibility of Capital Account
Which of the following items is not taken into account while computing current ratio?
Net Current Assets
Net Fixed assets plus current assets
Fixed Assets-Liablities
Sales Turnover Ratio
Debtors Turnover Ratio
Fixed Assets - Current Assets
Total Assets - Outside Liabilities
First Increase then decrease
Debtors Turnover Ratio
Issue of shares for cash
Transfer to general reserve
Purchases of fixed assets
Sales of Fixed assets
Cash from business operations
The memorandum of
association
Central Government
Employee of the companies
Member in statutory meeting
Central Government
An Annual General meeting is required to be held within…….. months from the close of accounts
The interval between two Annual general meeting should not be more than
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
76 Auditors Company Secretary A 1
77 Reserve Bank of India is a Statutory Corporation D 1
78 Article of Association can be altered by C 2
79 Share capital of a company may be reduced by A Special resolution C 2
80 Internal Auditor is appointed by The management The shareholder The CAG The Statutory auditor A 1
81 An Auditor is like a Mad Dog Watch Dog Thirsty Dog Greedy Dog B 1
82 Standard Costing implies B 3
83 Average Rate Closing Rate Spot Rate B 2
84 Price earning ratio is equal to Market price / EPS Price/Earning C 3
85 Current ratio is equal to: A 1
86 Pay out ratio means the ratio of C 3
87 AS-7 is applicable to contractors engaged in Market rate contracts A 3
88 Going concern Consistancy Conservation Materiality C 1
89 Free on Board Freight on Board Freight on Bill A 1
90 A lease agreement grants lessee the right to Own the Assets Use the Assets Sub let the asset B 2
91 Salary Capital gains B 1
92 191 194 195 192 D 2
93 226 227 228 230 A 2
A company can invest money in another company only if it is so authorized by its
Article of Association
Memorandum of Association
A Company limited by Guarantee
A Company limited by Shares
An unlimited Company
A resolution of the board of Directors
An ordinary resolution of the general meeting
A special resolution in general meeting
Obtaining permission from the company law
board
A resolution of the board of Directors
An ordinary resolution of the general meeting
A special resolution subject to
confirmation by court
The use of the previous years figures as the
standard
The use of predetermined
levels of price and performance as the standards
The use of fixed budgeting
The use of ideal cost which are useful
control aids
As per AS-11 " Accounting for the effect of change in foreign exchange rate" at the balance sheet date, monetary items e.g. Debtors, creditors should be reported using
Exchange Rate on the date of transaction
Interest/ Profit before tax
Interest/ Profit after tax
Current assets / Current Liabilities
Liquid Assets/ Total Liabilities
Current assets / total Liabilities
Total Assets / Total Liabilities
Debtors to creditors
Profit Distributed to profit retained
Earning that are distributed through
dividends
Interest payment to dividends
Cost plus contracts & Fixed price
Contracts
Non Fixed price Contracts
Fee based contracts
Which of the following is not a fundamental accounting assumptionF.O.B. Stands for : Form of Balance
SheetOwn and Use the
Assets The amount of interest received on securities is taxable in Income Tax Act vide the head:
Income from other sources
Income from Buisness
TDS on salaries is governed under section of Income Tax ActQualification & Disqualification of Auditors is governed by section of companies Act:
Question Option A Option B Option C Option DSl. No.
101 IASC headquarters is in : New york Vieana London South Africa C 2
102 Which of the following is true at break even point? D 3
103 Re-appointment Dismissed Disqualified Suspended A 1
104 Internal Audit is Statutory Audit Annual Audit Internal Control Half yearly audit C 1
105 Management audit means Statutory Audit B 2
106 Clerical errors Errors of ommissions C 3
107 General Meeting Company Law Board C 2
108 A company auditor may be removed by Board of Directors Any Director General Meeting D 3
Tax Audit is required when the total sales, turnover of gross receipts in business for the financial year exceeds :
Foreign Control Regulation Act
Foreign Currency Regulation Act
Foreign Contribution
Regulation Act
Foreign Currency Repatriation Act
International Federation of Accountants
Indian Federation of Accountants
Indian Foreign of Accountants
International Foreign of Accountants
General Agreement on Taxes & Tariff
General Agreement on Taxes & Trade
General Acceptance on Tariff & Trade
General Agreement on Tariff & Trade
Generally Accepted
Accounting Policies
Generally Accepted
Accounting Principles
General Accepted Accounts Practices
General Accepted Audit Practices
Profit after Tax / Book Value of
Investment
Profit before Tax / Book Value of
Investment
Profit before Tax / Market Value of
Investment
Profit after Tax / Fixed Assets
IAASBIndian Auditing &
Assurance Standard Board
International Auditing & Assurance
Standard Board
Indian Accounting & Assurance
Standard Board
International Accounting &
Assurance Standard Board
Sales revenue = variable cost
Profit = Fixed Cost+Variable
Cost
Sales Revenue= Total Cost -
Variable Cost
Contribution = Fixed Cost
Except in special cases, the retiring auditor is automatically
Audit on behalf of management
Systematic appraisal of
management's objectives and
procedures
Audit of management accounting
Under or over valuation of assets and liabilities are due to
Errors of principles
Fraudulent manipulation of
accountsA vacancy caused by the resignation of an statutory auditor is filled by
The managing Director
Employee of the company
The managing Director
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
109 Right Duty Proxy A 2
110 Audit in depth refers to B 1
111 Test checking implies C 1
112 The liability of auditors can be Only Civil Only criminal Civil and / or criminal D 2
113 The primary objective of audit is to Appoint auditors C 2
114 Special audit can be ordered by SEBI Debenture holders B 2
115 Which of the following are of revenue nature? B 2
116 Which of the following receipts is of revenue nature? B 2
117 Depreciation as the term is used in accounting means C 3
118 The term depletion is used in relation to Fixed Assets Wasting Assets Current Assets Intangible Assets B 2
119 Cost of conversion is made up of C 3
120 Net realizable Value means B 3
121 Long term liabilities are:- D 3
122 Accounting records transaction in terms of Commodity Units Monetary Units Production Units Sales Units B 3
A company Auditor can attend general meeting of the company as a matter of
He cannot attend the general meeting
Audit of each and every item
Intensive audit of a few items
Audit of a few items selected at random
Detailed audit of each and every items
Checking only a few items in detail
Checking each and every item
Checking a representative
sample of items
Checking of items alternatively
Either civil or criminal
Verify and Value assets as per company's Act
Verify liabilities and report to registrar of companies
Verify and report on the state of affairs
of the business
Preference shareholders
Central Government
Cost of extension of factory building
Cost of painting the old building
Legal Cost of acquiring land for
extension
Purchase of freehold land
Amount realized from sale of investments
Divident received on investments
Amount borrowed from a bank
Compensation received from
Municipal Corporation
Physical deterioration of a
fixed asset
Decline in the market value of
an assets
Allocation of the cost of fixed asset over its useful life
Making a provision for the replacement of
the fixed assets
Direct Material+Direct
Wages+Production Overhead
Direct Wages+All types of overhead
Direct Wages+Production overhead+Direct
Expenses
Direct Material+Direct wages+Direct
expenses
Sales less sales return
Sales less cost incurred
necessarily to make the sale
Sale less gross profit margin
Sales less cost of purchase
Fixed assets minus current liabilities
Fixed assets minus current
Assets
Current assets plus current liabilities
Total Liabilities minus current liabilities
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
123 Cost of purchase of raw material is Purchase Price D 3
124 Future Cost A 2
125 Building Plant & Machinery Live stock Patents C 1
126 D 3
127 Gross book value of a fixed assets is its Historical cost Fair market value B 3
128 Contingent liability is shown due to Duel aspect concept A 3
129 Disclosure of Accounting Policies is dealt by AS-1 AS-10 AS-2 AS-29 A 3130 Cash Flow statement is dealt by AS-1 AS-10 AS-3 AS-29 C 3
131 Accounting standard 17 deals with Earning per share B 1
132 Accounting standard 2 deals with Impairment of Assets A 1
133 AS-5 deals with Segment reporting Prior period items Impairment of Assets C 2
134 AS-26 deals with Segment reporting Prior period items Intangible Assets D 2
135 Accounting for Fixed Assets is dealt by AS-10 AS-15 AS-09 AS-06 A 2136 The Value of the non-convertible bond-series III is 360 Crs 120 Crs 400 Crs 500 Crs A 2
137 Matching Concept Duel aspect concept D 1
138 Charging of capital expenditure to revenue results in Revenue reserve Capital Reserve Secret reserve General Reserve C 1139 The "IMP REST SYSTEM" is used in relation to Purchase Book Sales Book Cash Book Petty Cash Book D 1140 "Bank Overdraft " should be classified as :- Current assets Current Liabilities Fixed Assets Capital Account B 1
141 Rs 44500 Rs 54500 Rs 39500 Rs 49500 D 1
142 Rs 200000 Rs 240000 Rs 270000 Rs 170000 A 1
143 Rs. 180000 Rs 192000 Rs 144000 Rs 150000 B 2
144 Provision for bad debts is made under the principle of Full disclosure Conservation Industrial practice Consistency B 2
Purchase Price+duties and tax paid there on
Purchase Price + taxes+freight
inward
Purchase price+taxes+freight
inward-discounts and duly draw backs
According to Accounting Standard-6 relating to depreciation is to be provided on the basis of
Historical cost of the assets
Market prices of the assets
Replacement cost of the assets
Accounting standard - 6 relating to depreciation is not applicable to
Accounting standard-6 relating to depreciations is recommended for use by companies
Listed on a recognized stock
exchange
Engaged in manufacturing
business
Engaged in manufacturing or trading business
All type of business undertaking
Cost less depreciation
Historical cost less accumulated depreciation
Convention of full disclosure
Convention of conservatism
Convention of materiality
Prior period transaction
Segment reporting
Accounting for lease
Valuation of Inventories
Cash Flow Statement
Construction contracts
Cash Flow StatementCash Flow Statement
The fundamental accounting equation ASSETS = LIABILITIES is the format expression of
Money measurement
Concept
Going Concern Concept
What is the cost of goods sold when:- Opening stock = Rs. 5000, Closing Stock = Rs 2500, Purchases Rs. 47000What is the amount of purchase when:- Opening stock = Rs. 35000, Closing Stock = Rs 15000, cost of good sold Rs 220000Cost of goods sold = Rs 240000, Gross loss= 25% of sales Amount of sales?
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
145 Window dressing is prohibited due to Accrual concept B 1
146 ROI is the ratio between A 2
147 ROE takes into account A 2
148 Operating Ratio Stock turnover ratio ROI C 2
149 The most rigorous test of liquidity is Current ratio Acid ratio test Absolute measure Stock turnover ratio C 2
150 ROE (Return on Equity) is computed as Net Profit/Sales C 3
151 Rs.30000 Rs.60000 Rs.120000 Rs.90000 B 2
152 Rs.30000 Rs.60000 Rs.120000 Rs.90000 C 2
153 High net profit ratio High pay out ratio Low pay out ratio D 3
154 Increase Decrease Have no effect B 3
155 Increase Decrease Have no effect increase by two times C 3
156 Rs.40000 Rs.30000 Rs.50000 Rs.60000 A 2
157 In computing debt/equity ratio, debt means - Term loans A 3
158 In debt/equity ratio equity includes - Only equal capital C 3
159 Rs.2000 Rs.4000 Rs.20000 Rs.12000 C 2
Convention of conservation
Convention of disclosure
Convention of materiality
Net profit and capital employed
Investment and profit
Turnover and capital employed
Interest and Investment
Shareholder's investment
Interest on working Capital
Interest on fixed assets
Interest on Investment
Higher the ratio the more favourable it is. This does not apply to:-
Operating profit ratio
Cost of Sales/Capital
Employed
Net Profit afterTax and pref.
dividend/sh holder fund
Operating net Profit/Shareholders
funds
Given Current Ratio=2:1 Net Working Capital=Rs.60000 What is the amount of Current Liabilities?Given Current Ratio=2:1 Net Working Capital=Rs.60000 What is the amount of Current Assets?
Ritesh is interested in investing for growth in the market price of shares he should invest in a company with-
High gross profit ratio
Issue of equity capital in exchange of land and building will cause the return on propriety ratio to -
A, B and C depending on earlier
level of propriety ratio.
Collection of cash from debtors will cause the current ratio to -
Given Current Ratio=2.5% Quick Ratio =1.5% Net working capital =Rs.60000 What is the amount of Current Liabilities?
Debentures as well as other long term
loans
Short term creditors
Short term as well as long term
creditors
Equity and preference capital
Equity and preference + all
reserves - losses
Equity and preference + all
reserves
Given stock turnover ratio = 8 times Average stock =Rs.10000 Selling price =Rs.25% above cost What is the amount of gross profit?
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
160 1, 2 & 3 1,2 & 4 2,3 & 4 1,3 & 4 C 3
161 1 & 3 1,3 & 4 1 & 2 1,2 & 4 A 3
162 A 3
163 B 2
164 3.3 times 4 times 5 times 2.3 times B 1
165 Gross capital employed is equal to Fixed Assets C 2
166 Gross profit ratio Net profit ratio Operating ratio Return on investment C 3
167 D 2
168 B 2
169 Preference capital D 2
170 191.50% 18.50% 181.5% B 1
171 ARR PB Method NPV IRR A 2
172 Goodwill should be classified as a Current assets liquid assets Flotting assets Intangible assets D 1
173 A 1
174 Statutory meeting Creditors meeting A 2
Which of the following are non-operating incomes? 1. Sale of merchandise 2. Interest income 3. Dividend income 4. Profit on the sale of old assets Gross profit may be increased by - 1. Increasing selling price 2. Increasing Cost of Sales 3. Increasing sales of items with higher gross margin 4. sales by giving extra discount
Pvt. Ltd. Has an adverse current ratio. Which one of the following would improve this ratio ?
Sales of fixed assets for cash
Collection of some of the
current assets receivable
Use of cash to pay off some long term
debts
Collection from sundry debtors
ABC Ltd. Provided the following data for 2007 Current ratio =2.5:1 Net working capital =Rs.300000 Current assets and current liabilities of this firm are respectively :
Rs.300000 & Rs.150000
Rs.500000 & Rs.200000
Rs.500000 & Rs.100000
Rs.300000 & Rs.100000
If the cost of goods sold is Rs.1 Lakh the value of opening & closing stock is Rs.20000 & Rs.30000 respectively The stock turnover ratio will be -
Net Current Assets
Net Fixed assets plus current assets
Net Current Assets-Net Current Liabilites
Higher the ratio the lower the profitability is applicable to
Which of the following transaction has no effect on the current ratio ?
Machinery purchased for cash
Motor car sold for cash
Preference shares redeemed
Bills receivable collected
Which of the following transaction change the current ratio
Purchase of goods for cash
Plant acquire on account
Sold goods on credit
Debenture converted into equity capital
In calculating the return on shareholders fund the denominator is
Equity capital + Reserve & surplus
Equity capital + preference capital
Equity capital + preference capital +
reserves - losses
When the operating ratio is 81.5 the ratio of operating profit to sales will be
cannot be known from the given
information…………. Method is based on accounting profit instead of cash flow
Depreciation on machinery amounting to Rs. 25000 is appearing in the trial balance of a firm. When preparing final Accounts,it should be shown in --
Profit & Loss A/C -- Dr.Side
Profit & Loss A/C--Cr. Side
Balance Sheet (Assets side )
Balance sheet (liability side)
Which meeting is held only once during the life time of a company ?
annual general meeting
Extra ordinary meeting
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
175 Prospectus Books and ledger B 1
176 Debenture is a Fixed asset Long term liablity Current liability Current asset B 1
177 House rent allowances are -- D 2
178 Trial balance is a proof that -- A 1
179 Best example for near money -- Shares Goodwill Bill of exchange Patents C 2
180 A reserve is a charge against -- trading account Profit & Loss A/C C 2
181 In the financial statement, the fixed assets appear at -- Historical cost Current value Either of the above D 1
182 Suspence account is required when -- There are errors D 2
183 Govt. audit means -- A 2
184 Central Govt. share holders C 3
185 4 5 6 7 C 3
186 Span of management may be larger in case of -- loyal subordinates C 2
187 Revenue duty excise duty Specific duty Ad-valorem duty C 2
188 No smoking in the factory' is an example of -- Policy Procedure Rule Strategy C 3
189 Dumping means B 3
190 Bills receivable Bills payable Sales Return Misc.expenditure B 1
191 Ploughing back of profits means B 3
192 Materiality Conservation Cost principle Full disclosure B 3
Which of the following documents contains rules and regulations for internal management of the company ?
memorandum of association
articles of assocation
Taxable in all cases
Taxable in few cases
Taxable in smaller cities
Taxable only whencertain
conditions are fullfilled
Every transaction is recorded twice
No error remains in the books of
accounts
Books are authentically and correctly written
Every transaction is recorded singly
P & L appropriation a/c
Manufacturing Account
Value appraised by competent
value
Debit side of trial balance is short
Credit side of trial balance is short
Errors are not quickly located and final
accounts are to be prepared without
delay
Auditing of the accounts of
government depts
Auditing of companies by
persons appointed by the
government
Audit under the provisions of law
Audit & Govt.companies by
their own staff
Under the law the inspector who does the inspection of the company's accounts has to submit his report to the --
Board of Directors of the company
Secretary to the company
If a supervisor has two subordinates, what is the total number of relations among them --
Hardworking subordinates
Centralised works and less
irresponsibility
Repetitive work and clear responsibility
When custom duty is levied according to the measurement of goods. It is known as --
A form of price discriination at
home
Selling cheaper abroad and
dearer at home
Selling in the foreign market
below cost
selling the produt at a lower price in a foreign market
Which of the following accounts will usually have a credit balance ?
Earning of black money
Re-investment of earnings
Unclaimed dividends
Transferring a part of profits to reserves
Stock valuation at cost or market price which ever is less is based on principle of --
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
193 Unlimited company Govt.company B 2
194 Trading a/c only P&l a/c only B 3
195 Budgeting is a technique of -- Control Cost reduction Planning Improving efficiency A 2
196 A company is called an artificial person because-- D 2
197 C 1
198 The term "Marginal cost "refer to -- Additional cost Conversion cost Works cost D 1
212 Bank reconciliation statement is prepared by-- Bank Tax authorities A 2
213 Assets very easily convertible into cash are -- Current Assets Fixed assets Liquid assets flotting assets C 1
Which one of the following types of registered companies will be the most appropriate for the promotion of science, culture,religion etc--
Company limited by share
Company limited by guarantee
Closing stock appearing in trial balance will be taken to -
Balance Sheet only
Trading a/c and balance sheet
It does not the shapeof a natural
persons
It can't be used in the court of law
It is invisible and intangible
It exists only in contemplation of law
If the bank a/c at the end opf the accounting period has a credit balance of Rs. 848/- how would you explain it ?
The cashier must have manipulated
cash
It indicactes an error in recording
There has been overdraft
There is undeposited cash in hand
Proportional change in cost for change in
production
The trial balance shows a debit total of Rs. 8000/-. However, in recording a receipt of Rs. Of being debited. What will be the credit total of the trial balance ?
Checking only a few items in detail
Checking each and every item
Checking representative
sample of items
checking of invenotry items only
Fixed assets minus fixed liabilities
Fixed asset minus current liablity
Current assets minus fixed
liabilities
Total assets minus total liabilities
Revenue expenditure
deferred revenue expenditure
Repair & Maintenance
Minutes of company meeting should be prepared within -
21 days of the meeting
30 days of the meeeting
40 days of the meeting
45 days of the meeting
Expenses to painting of the factory building is treated as --
Revenue expenditure
Deferred revenue expenditure
Purchase of office furniture Rs. 2500 has been debited to general expenses account it is --
An error of omission
A compensating error
When prices are showing a rising trend which method of inventory valuation will result in lower income and lower valuation of inventory ?
Simple average method
Weighted Average method
compensating error
Errors of whole omission
An expenses of Rs. 300/- paid as cartage of a new machine purchased should be debited to --
Increase in asset account
Decrease in asset account
Increase in a liability account
Increase in capital account
Customers of the bank
Proprietors of business
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
214 Liquidity Market value Book value Permanence D 2
215 FIFO is advisable in case of -- Rising prices falling prices Constant prices B 2
216 " Grapevine " is a term used in relation to -- B 3
217 Purchase of furniture results into -- Source of fund Application fund No flow of fund Increase in fund B 2
218 Capital Redemption Reserve account is available for- D 3
219 Bills payable dishonoured during a year credited to-- Cash a/c Creditors a/s Bills payable Bills receivable B 2
220 Octroi Excise duty Customs duty VAT B 1
221 Cash sales are recorded in Sales book Journal Bank a/c Cash Book D 1222 Cash budget is a Functional Budget Budget Manual Financial Budget Capital Budget C 2
236 The term current asset does not include Cash Stock in Trade Advance Payments Furniture D 2
Assets in the balance sheet of a company are arranged in the order of --
Rising & Falling prices
Formal communication
Informal communication
Both formal and informal
communication
This term is not used in relation to
communication
Redemption of redeemable
preference shares
Redemption of redeemable debentures
Re-organisation of share capital
Issue of bonus shares
Duty charged on goods manufactured within the country is called
Rent paid was credited to rent account. The rectifying entry is --
Rent a/c-- Dr to cash a/c
Cash a/c-- to supense a/c
Rent a/c--Dr to suspense a/c
Suspense a/c-- dr to rent a/c
Balance in all accounts
Financial position of all accounts
Profits and loss of the firm
Net profits earned by the firm
When cash discount is allowed by creditors to the bussiness debit is given to --Under what heading is the 'Provision for Tax' shown in the liability side of a Companies Balance Sheet
Current Liabilities & Provisions
Depreciation is appearing in the trial balance of a company. While making final accounts, it should be shown in :-
the profit and loss account
the balance sheet as deduction from
the asset concerned
the profit and loss account and
balance sheet
the profit and loss account or balance
sheet
Amount spent on increasing the seating capacity in a cinema hall is a
Revenue expenditure
Deferred revenue expenditure
Development Expenditure
Cartage paid on the purchase of a new machine is debited to Which of the assets is usually assumed not to depreciateA business entity has assets of Rs. 28000 and liabilites of Rs. 8000, Owner's equity in this case is
In order to determine the amount of sales, to which of the following records one should referSubscription collect in advance by a publisher should be classifed asA three year premium paid on a fire insurance policy should be classified as
Question Option A Option B Option C Option DSl. No.
CorreCt Answer
Difficulty Level
237 Low asset turnover may indicate Low Assets Idle Assets Higher Sales C 2
238 The meaning of Fund in fund flow statement is Cash Profit B 3
239 LIFO Method FIFO Method B 2
240 Commercial paper are issued in multiples of Rs. 4 Lakhs Rs. 6 Lakhs Rs. 10 Lakhs Rs. 5 Lakhs D 3
241 Wasting Assets Current Assets Fictitious Asset D 3
242 The maximum notice period for statutory meeting is 21 days 14 days 7 days 28 days A 3243 Every company is required to hold a baord meeting Every month Ever fortnight Every Quarter Every Six months C 2
244 Amount Called up B 2
245 Prospectus Annual Report A 2
246Cost Principle Consitency Full Disclosure Conservatism
C 3
247 What is M.A.T. as per Income Tax Act Money Alternate Tax A 2
High Cost of MaintenanceNet Working
CapitalGross Working
CapitalIf the material is priced at the value that is realizable at the time of issue such a pricing method is
Standard Price Mehtod
Replacement Method
Assets appearing in the books but having no value are known as
Intangiable Assets
The liability of share holders of a public company is limited to the
Paid up value of shares
Nominal Value of Shares
Extent of their private Assets
Which of the following documents defines the scope of the company's activities
memorandum of association
articles of assocation
Depreciation was not recorded because to do so would result in a net loss for the period. Indicate the accounting principle that is violated
