Sect A ion Sl. No.

1 2 3 4 5 6 7 8 9 10 11 Question Outstanding Wages is classified as Option A Capital Expenditure

Name of the Discipline for Question Bank

Finance & Accounts CorreCt Answer B C A A C B C A D B B D C D C D B A

Option B Revenue Expenditure Revenue Expenditure Revenue Expenditure Building general journal Accrued liabilities Raw Material unclaimed dividends Cash Flow Statement Capital reserve account Operating Cycle Cash Payments Interest Coverage ratio

Option C

Option D

Expenses incurred on research and development is an Capital Expenditure example of Share premium is a 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 Inventory does not include Current liabilities do not includes Which of the following is not required to be made under statute? Capital Receipt Land purchase journal Accrued assets Goods in the process of manufacture Prepaid insurance Profit and Loss Account

Deferred Revenue Personal Expenditure Expenditure Deferred Revenue Personal Expenditure Expenditure Deferred Revenue Revenue Receipt Expenditure Plant Cash book Prepaid expenses Capital work in progress Sundry creditors Balance Sheet Securities premium account Fixed capital Cycle Financing activities Debt-equity ratio Furniture Balance sheet Unearned revenue Finished goods Bank Overdraft Fund Flow Statement Profit and loss account Sales Cycle Issue of bonus Shares Return on capital employed Liquidity position Documentary bill Pay back period Advising bank Anticipatory LC

Profit on cancellation or redemption of debentures Capital redemption should be credited to reserve account Average time that elapses between the acquisition of raw materials and final cash realisation refers to Cash Cycle Investment activities Liquidity ratio

12 A short term cash budget does not exhibit 13 Long term solvency is indicated by 14 Current ratio is chiefly used to assess the A bill in which no time for payment is specified is known as Which of the following appraisal criterion does not take 16 into account the remaining cash flows once the initial investment is recovered? . is a person or association of person in whose 17 favour the letter of credit is opened. A letter of credit where a bank other than issuing bank 18 also undertakes to pay is known as 15

levels of inventory effective utilization application of debt piled up in different of capital form Time bill Internal Rate of return Applicant Confirmed LC Usance Bill Accounting rate of return Beneficiary Irrecoverable LC Demand Bill Net Benefit cost ratio Issuing Bank Recoverable LC

Sl. No. 19

Question All outward remittance will be affected at the contractual rate (if forward contract is booked) or at the

Option A TT buying rate Increase the current ratio Current liabilities 7 days Schedule I 30 days Rs. 250000 Clean Liability account

Option B TT Selling Rate Not changing the Current Ratio Quick current Liabilities 14 days Schedule II 21 days Rs. 300000 Qualified Reserve

Option C TT Buying rate+ 0.15% margin Decrease the current ratio Non-Current Liabilities 21 days Schedule III 14 days Rs. 350000 Adverse Capital Expenditure

Option D TT selling rate+ 0.15% margin No impact contingent Liabilities 28 days Schedule Vi 7 days Rs. 500000 Un Qualified Provision

CorreCt Answer B

When current ratio is 2:1 an equal increase in current 20 assets and current liabilities as a satisfactory ratio is current liabilities would 21 Acid test ratio is equal to quick current assets divided by 22 The minimum notices period of statutory meeting is The balance sheet of a company should be in form set 23 out in part 1 of At least _____ days before the Annual General meeting, 24 copies of the balance sheet and profit and loss account are to be sent to the share holders The maximum amount of gratuity payable as per the 25 payment of gratuity act 1972 is . Audit report is one when auditor does not give 26 clean chit about truthfulness and fairness of the financial statement but makes certain reservations 27 Amount set apart to meet losses due to bad debts is a

C B C D B C B D

28 A Cost auditor can be appointed by

Board Resolution

Board Resolution Previous approval with previous of central approval of central Government Govt. The shareholder Patents The CAG Goodwill

Share Holders

The Scope of work of a statutory auditor is determined The management by The value of which one of the following assets increase 30 in the initial years of its life, remains constant thereafter Livestock and finally begins to decline? 29 31 Auditors of a company have to report to the Board of Directors

Law Machinery

D A

Institutional Investors

Individual Investors

Share holders at the AGM

When factory overhead is applied to production, based 32 on actual inputs multiplied by a predetermined application rate the process is known as: 33 Excess direct labour wages will be disclosed in which type of variance?

Normal costing

Actual Costing

Standard Costing Direct Labour efficiency Net Operating Profit

Historical Costing Direct Labour rate (price) P/V Ratio

Yield Marginal Income

Quantity Net Income

D C

34 The contribution margin is also know as:

Sl. No.

Question

Option A

Option B

Option C

Option D

CorreCt Answer

35

A Business telephone bill should normally be classified into which one of the following categories

Fixed Cost

Stepped Fixed Cost

Variable Cost

Semi Variable Cost

Factory worker fringe benefit cost are actually charged Work in progress to: inventory Factory overhead application rates best reflect 37 anticipated fluctuations in sales over several year when Maximum capacity rates are computed using figures based on Economic Order quantity computation does not 38 Annual Demand considered the following 36 39 Deferred liability refers to Debt of liabilities

Direct Labour Normal Capacity Ordering Cost Difference of liabilities

Administrative Expenses Practical Capacity Storage Cost Charging of expenses to next financial year Royalty payment for building, equipments & facilities used in production Companies Not Recorded

Factory overhead Expected Capacity Shortage Cost Deferred Revenue Expenditure

D D D C

40 Which of the following is not R & D Cost

Engineer's Salary relating to R & D

Development Material Proprietorship Firm Recorded at nominal Value

Development Expenditure Partnership & company Recorded at Market Value Should not be disclosed LC opened with the bank 619 1st July 2004 SDC end of the same month Yearly basis 30th April

41 AS-14 is applicable to amalgamation of: 42 Non Monetary assets given free of cost are:

Partnership firm Recorded at fair market value

C B

43 Prior period items should be disclosed in P& L A/c

As a part of head of Separately above account, to which the line the items relates Commitments under capital contracts 225 1st April 2004 Material Cost 7th of the following month Quarterly basis 7th April

Separately below the line Recourse bill discounted with the banks 224 1st July 2003 Profit 14th of the following month Six monthly Basis 14-Apr

Income Tax Which of the following disclosures as contingent liability demand contested is correct on appeal Appointment and remuneration of auditors is governed 45 227 by which section of companies Act: 44 46 47 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 ? 1st April 2003 Labour cost 5th of the following month monthly basis 25th April

A C D B A C A

48 What is the due date of deposit of service tax? For companies, Service tax returns are to be submitted? For HAL, what is the due date of submission of service 50 tax returns for the period oct.07 to mar.08? 49

Sl. No. 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71

Question

Option A

Option B ST 2

Option C ST 3

Option D TR 6 40% of service tax payable on output services 31st March 12.03% 13% per annum CBEC Provident Fund Department TR 6 25th August 1996 2.50% 2.50% 0.5% to 5% 25% of the order value 25% of the order value 0.00% 5.00% Repair Military spares order Firmed Price Quote Spare Price Catalogue 1st April 2007 10%

CorreCt Answer C B D C D B A A B C B D B A D D B A D C A

What is the prescribed form no. for submission of ST 1 service tax returns? Maximum limit for availing CENVAT credit of service tax 10% of service tax for assesses not maintaining separate books of payable on output accounts for taxable & non-taxable services? services What is the due date of service tax payable for the 5th April month of march? As on Date what is the effective rate of service tax 12% alogn with cess? What is the rate of interest payable for delay in deposit 7.5% per annum of service tax? As per service tax rules, what will be the appellant Commissioner authority for appeal against order passed by DY.Commissioner? Central excise Activities of service tax are administered by? Department What is the prescribed form no. for application of ST 1 registration for service tax? Revised Pricing Policy for HAL's Products and services 30th Sept. 1997 are issued by Government of India on: Profit on non-production overhead is admissible at the 10.00% rate of: Profit on Deferred Revenue Expenditure is admissible at 10.00% the rate of: Liquidated Damages for delays in supplies and services 1% to 10% is levied as per FPQ with IAF minimum to maximum range of rates is: Advance for supply of spares over a period of 12 65% of order value months after receipt of RMS Order is paid by Advance for supply of spares within a period of 12 65% of order value months after receipt of RMS Order is paid by As per IAF FPQ policy Profit on warranty cost is 2.50% admissible at the rate of Profit on Bought out end unit under upgrade 10.00% programmes is admissible at the rate of: Repair RMSO means: maintenance spares order Fixed Price FPQ means Quotation Spares Payment SPC Means in FPQ is Cost Effective date for start of claiming warranty cost from 1st April 2004 IAF on supply & servicing on product What is the percentage of redundancy provision as per 1% new FPQ?

20% of service tax 30% of service tax payable on output payable on output services services 7th April 12.24% 10% per annum Commissioner (Appeals) Income Tax Department ST 2 24th August 1995 7.50% 7.50% 1% to 5% 40% of the order value 40% of the order value 5.00% 7.50% Repair maintenance supply order Fixed Payment Quotation Supply Price Cost 1st April 2005 2% 25th April 10.30% 12.36% per annum Excise appellate tribunal Sales Tax Department ST 3 24th August 1996 5.50% 5.50% 0.5% to 10% 35% of the order value 35% of the order value 7.50% 5.50% Repair Military supply order Final Price Quotation Supply Price Catalogue 1st April 2006 5%

Sl. No.

Question

Option A

Option B

Option C

Option D

CorreCt Answer

72 Reduncy provision charge on

Indigenous Indigenous Material Indigenous Material Material + + Imported Material + Imported Material Imported Material + ATF + Freight & + ATF Insurance 2003-04 2.5% 2.5% 7 Hours 30-Jun-06 30-Jun-06 Material Original Equipment manufacturer 2004-05 3.50% 3.50% 7.5 Hour 31-Mar-06 31-Mar-06 Labour Original Equity Manufacturer 2005-06 4.00% 4.00% 8 Hours 30-Jun-07 30-Jun-07 Profit Original Effective Machine Electric Cleaning System 741/07

Imported material

73 74 75 76 77 78 79

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 the For preparation of IAF SPC for financial year 2007-08 exchange rates date applicable for the VOP excludes one of the

2006-07 5% 5% 8.5 Hours 31-Mar-07 31-Mar-07 SALE Operating Equipped Man Electric Clearing System 742/08

B B C B A B D A B D B C C B

80 OEM Stands in respect of purchases 81 ECS Stands for 82 83 84 85 86 CAAA Stands for : 87 Negotiation with the following vender is as per CVC guideline : LTA payable to Grade III / IV Officers : V.L. can be accumulated maximum upto ____ days in respect of Officers : MHR in respect of FPQ Stands for : RFQ Stands for : CAR Stands for : As per allotment of IAF budget major head 2078 is not for repair & Overhaul MSR Stands for :

Electronic Cleaning Electronic System Clearing System 741/05 Machine subcontracting request Machine Hour Rate Request for Quality Capital Appropriation Report Corporate Account Adjustment Advice L 1 Vendor Rs 2500 240 days 741/06 Material subcontracting request Material Hour Rate Request for Quantity Capital Appropriation Request Central Account Adjustment Advice L 2 Vendor Rs 3000 300 days

Manpower subMoney Supply Report contracting request Man hour Rate Request for Quotation Capital Allotment Request Control Account Adjustment Adhoc L1 & L2 Vendor Rs.4000 340 days Maximum Hour Rate Repair for Quotation Corporate Appropriation Request Control Account Adjustment Advice All vendors Rs 4500 un limited

88 89 90

A D B

Sl. No. 91

Question

Option A Rs 100000 1% Rs 20000 Rs. 5000

Option B Rs 135000 1.50% Rs 30000 Rs.3500

Option C Rs185,000 2% Rs 50000 Rs 2500 2 year (Previous year and current Year) Deferred Revenue Expenditure Rs 1 Crores Rs 100 Lacs Computer Software Market Rates F 50.00% Hybrid Office Equipment Rs. 10000 Advances Wg. Average Value 50.00%

Option D Rs 180000 3% Rs 60000 Rs 1500 current year

CorreCt Answer C D C A B

As per Income Tax Act upto which amount Tax is exempt for ladies for the assessment year 2009-10 What % Education Cess is levied upon for the 92 assessment year 2009-10 : Income Tax rebate under Sec 80 U for physically 93 handicapped person for the assessment year 2009-10 94 95 Amount of Gift payable at the time of superannuation : The Budget is projected in a _______ year time frame :

3 year (current 2 year (current year year, Next Year & & Next Year) Forecast year) Revenue Expenditure Rs 50 Lacs Rs 50 Lacs Documentation Fear Rates 16.21% 5.00% Cash Communication Equipment Rs. 7500 Cash & Bank Estimated realizable Value 25.00%

Expenditure like Tooling, Project Management which 96 are identifiable to a specific Project / Programme are Capital Expenditure treated as: In Capital Budget Proposals, Cost Benefit Analysis for 97 Fresh Sanctions exceeding Rs._______ to be furnished Rs.10 Lacs in the prescribed format : Separate Board Papers should be submitted in case of 98 Rs.10 Lacs projection of Fresh Sanction in Capital Budget : Intangible Assets is not one amongst the following : 99 License Fees 100 Freak Rates relates to : Unbelievably High/Low Rates 31.7% 1.5% Accrual Computer Rs. 5000 Debtors Actual Cost

Material Expenditure

Rs 5 Cores Rs 200 Lacs Non Standard Equipment MES Rates 7% 100% Mercantile Office Machinery Rs. 15000 Inventories Historical cost 75% Total Strength of the worker & officers on the close of the year Rs 5000

A D D C A D A A C B B C

101 Rate of Depreciation charged on Computers : 102 Provision for Non-Moving items are to be made : Disclosure is not required if the following system of 103 accounting is followed : LAN/WAN equipment are capitalised under which head 104 : HAL's Accounting Policy w.r.t. charging off of fixed 105 assets @ 100% upto which amount : Franking Machine balances are shown under which 106 head in Balance Sheet : Scrap is valued at : 107 108

Professional Development Scheme is paid at the 10.0% percentage of Basic Pay : As per Corporate Office Instructions dated 29.10.05, Average Strength provision for Vacation leave is done as per : of the worker & 109 officers on the close of the year When Fixed Cost is Rs. 10000/- and P/V ratio is 50% , 110 Rs 20000 the break-even point will be

No. of employees Actuarial Valuation of officers retiring Rs 40000 Rs 50000

Sl. No.

Question

Option A No Interest

Option B No Maturity Value

Option C Coupen for payment of interest

Option D Interest on Maturity 14500-350-18700 Long Term Bonus Agreement Government Tax 40% 31st March Securities and Forward Act Service Tax

CorreCt Answer A D A C B B D C

111 Zero coupon bonds carry: 112 Present scale of pay in HAL at grade V level LTBA 113 114 Name of new tax intro in Finance Act 2005 : 115 Rate of tax of Fringe Benefit on medical expenses Date of filing of Annual return of F.B.T. is : 116 117 SFA

14000-350-18250 14500-350-18250 15000-350-18700 Long Term Long Term Long Term Budget Business Banking Agreement Agreement Agreement Income Tax Trade Tax Fringe Benefit Tax 10% 20% 30% 31st July Stock and Furniture Act Cenvate excise Duties Cash advance & loan mode to third party Spouse Interim Audit 31st October Securities and Furniture Act Sales Tax 31st December Stock and Forward Act Trade Discount

Which of the following should be included in the cost of 118 purchase as per AS-2 Which of the following are cash flows from operating activities : 119

120 As per AS-18 relative does not include 121 Continuous audit

122 The scope of interim audit falls with in the preview of Final Audit 123 Interim audit is conducted between two _____ audit Continuous audit 124 Internal Check is a part of the whole system of Internal audit Where the provisions of the companies act are violated, Central 125 the auditors must report the same to the Government Which type of audit is more suitable where there is no 126 Continuous audit satisfactory system of internal check 127 An auditor of a company is appointed for a period of One year Who is responsible of introducing and maintaining 128 internal control relating to accounting system in a Management company?

Cash receipts from the sale of Cash proceeds from Cash proceeds from goods and the issue of shares sale of Fixed Assets rendering of services Sister Brother in law Son Audit at the year Internal Audit Regular audit end Partial audit Efficiency audit Internal control Costs audits Final Audit Phase Audit Internal Control Annual Control Continuous audit Board of Directors Managing Directors Periodical Audit Two Years Auditor Balance Sheet audit Three Years Government Share holders Management Audit Five years Company Law Board

C D A C B D A A A

129 Audit report along with annual accounts is given by

Statutory Auditors

Internal Auditors

Government Auditors

Secretarial Auditors

130 Management audit is ordered by the

Worker of a company

Government

Board of Director

Securities exchange board of India

Sl. No. 131

Question

Option A internal audit obligatory Revenue nature Same basis of valuation

Option B Statutory audit Mandatory Capital nature Different basis of valuation Shown at net book value

Option C Continuous audit optional Deferred Revenue Expenditure Same basis for each category of fixed assets Shown at net realize value

Option D Management Audit Voluntary Personal Loss Same basis of depreciation

CorreCt Answer A A C

In so far as a company is concerned which of the following pairs not correctly matched? Loss caused by theft of cash by cashier during business 132 hours is a loss of 133 In a financial statement, separate items of fixed assets may be shown at

134 135 136 137 138 139 140 141 142 143

An item of fixed assets which has retired from active Not shown in the use and is held for disposal is financial statement

According to Accounting Standard 10 gross book value Fair market value Historical cost of a fixed assets may be Actual Cost or According to Accounting Standard 2 inventory is to be Historical cost sales value, which valued at ever is less The power to interpret the hal traveling allowance rule Director GM of the Division (inland),2007 is vested to (Personnel) Category "C" for the purpose of HAL TA/DA rules, 2007 GR-I/II/III GR-VII and above means Composite DA for Grade-IV is 1000 850 How many additional increments are given to Grade-IV Four Five officers recently One month current Two month Transfer Grant payable to Grade-V on transfer is basic pay current basic pay Maximum Vacational Leave can be accumulated by an 300 days 240 days officer Annual rate of Increment for Grade-IV officer is Rs.300 Rs.400

shown at lower of net book value and net realize value Historical Cost of Revaluation amount revaluation amount Historical cost or net Net realizable value realizable value which ever is less Director Finance GR-IV/V/VI 700 Six Two month Basic Pay + DA 290 days Rs.250 Chairman Scale 1 to 10 600 Seven Rs.30,000.00 250 days Rs.350 Grade-II and above officers only Basic+DA Complex Office 9 9 NIL AS-29 Rs.125.00 Crs cash activities

D D D A C C B B A D B C B A D D D A B

144 Attendance Bonus is payable to 145

Grade-I officer only Scale 1 to 10 only Scale V to 10 only Rs.5000 RPFC 12 12 Rs.15 Lakhs AS-10 Rs.120.50 Crs Financing activities Rs.6500 Corporate Office 50 10 Rs.20 Lakhs AS-1 Rs.100.50 Crs Investing activities

Personal Salary for the purpose of Pension Scheme, Current Basic Pay 1995 is Division where the Pension to the employee as per Pension Scheme-1995 146 employee last is payable by served Which DOP clause deals with award of contract without 147 7 calling Tenders 148 Which DOP clause deals with Provisioning of Material 149 11

As per clause 1 of DOP, Power delegated to GM under Rs.10 Lakhs New Project involving capital Provisions, Contingent Liabilities and Contingent Assets 150 AS-26 is dealt by 151 Authorised capital of the HAL is Rs.160.00 Crs Dividend paid in Cash Flow statement will be shown 152 Operating activities under

Sl. No. 153

Question

Option A

Option B Financing activities Financing activities Financing activities 3 times Rs.100 per day of attendance one spells Employee benefit Employee benefit Accounting Method Chairman Chairman 5 5 Sales

Option C Investing activities Investing activities Investing activities 1 time Rs.20 per day of attendance three spells Foreign currency transaction Foreign currency transaction Foreign currency transaction GM GM 7 6 Purchase

Option D cash activities cash activities cash activities any no of times Rs.50 per day of attendance Four Spells Depreciation Depreciation Depreciation MD MD 9 23 Other Income

CorreCt Answer B C C A B A A A B A A A C A

Interest paid on Long term Loan in Cash Flow Operating activities Statement will be shown under Purchase of Fixed Assets in Cash Flow statement will 154 Operating activities be shown under Dividend received in Cash Flow Statement will be 155 Operating activities shown under How many times the salary advance can be taken by 156 2 times the employee in a calendar year 157 Rate of canteen subsidy W.E.F. Dec-2006 158 Joining time of transfer can be taken in 159 Accounting policy 9 deals with 160 Accounting policy 2 deals with 161 Accounting policy 1 deals with Rs.500 Per month two spells Disposal of Scrap Fixed Assets Disposal of Scrap

162 Capital Budget is approved by Board of Director 163 Performance Budget is approved by Board of Directors In which Schedule Reserve and Surplus is shown in 164 2 annual accounts In which Schedule Depreciation Reserve is shown in 165 2 annual accounts Direct 166 Schedule 19 of Annual accounts deals with Expenses/Amortisa tion Cash & Bank Balance is shown in Schedule _____ of Annual Account

167

10

12

16

08

168 Schedule 24 of Annual Accounts deals with 169 Which accounting standard the company HAL is not complying with due to nature of business

Explanatory Notes AS-17 Segment reporting 20 days 12% 1996-97 2006-09 Concurrently with Statutory Audit BOD

Sales AS-3 Cash flow statement 10 days 10% 1994-95 2005-08 After Statutory Audit CAG

Purchases AS-7 Construction contracts 50% of Balance 8.67% 2001-02 2007-10 After adoption of Accounts by AGM MOD

Other Expenses AS-28 Impairment of Assets 7days 20% 1995-96 2007-11 As and when approved by MAB AGM

A A B A D A B A

170 Minimum Vacation Leave can be encashed for 171 Employers Contribution to Provident Fund & Pension Fund is @

172 The new Pricing Policy "FPQ" was implemented from 173 Current block of 4 year for LTC is 174 CAG's Audit under Sec 619(3) will be done 175 Annual Accounts of HAL is to be adopted by

Sl. No. 176 177 178 179 180

Question 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

Option A 83 83 83 83 81 70 70

Option B 81 81 81 81 60 60 60

Option C 60 60 60 60 84 84 84

Option D 84 84 84 84 62 62 62

CorreCt Answer A B C C D A B

In cost books, which Account Head ___ is operated for stock in Trade In cost books, which Account Head ___ is operated for 181 Cost of Sales In cost books, which Account Head ___ is operated for 182 W.I.P 183 FAD-19 is prepared to

Reconcile the Reconcile the InterBalance with CO Divisional Accounts Only Director's Report Book Keeping section Book Keeping section 24 Company Secretary, Director (Finance), Chairman, Statutory Auditors Change in WIP/SIT/Disposal Scrap Change in WIP/SIT/Disposal Scrap Change in WIP/SIT/Disposal Scrap Current Liabilites 16.21%

184 Which report form part of the Annual Accounts 185 Fixed Asset register and Depreciation Schedule is prepared by

186 LC register is prepared by 187 How many Schedules are formed parts of the Annual Accounts

Reconcile the Balance with Complex Office Only Statutory Auditor's General Manager's Report Report Bills Receivables Cash Office Section Bills Receivables Cash Office Section 23 22

B & C Only

A&B Payroll Section Foreign Bills Section 25

D A D A

188 Annual Account of the Company are signed by

All Directors

Director Finance Only

Chairman Only

189 Schedule 23 of the Annual Accounts Deals with

Interest on WC

Deferred Debts

Salaries & Wages

190 Schedule 20 of the Annual Accounts Deals with

Interest on WC

Deferred Debts

Salaries & Wages

191 Schedule 21 of the Annual Accounts Deals with 192 Contingent Liabilities are shown in 193 As per Company's Policy, the Rate of Depreciation for CNC machines are charged @

Interest on WC Notes to Accounts 31.7%

Other Expenses Profit & Loss Accounts 7.42%

Salaries & Wages Long term Liabilites 11.31%

C B A

Sl. No. 194 195 196 197 198

Question 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 ASRate of Warranty Charged from IAF on Engines is

Option A 16.21% 16.21% 16.21% 18 2.5% 2.5% 2.5% SBI

Option B 31.7% 31.7% 31.7% 29 5% 5%

Option C 7.42% 7.42% 7.42% 01 7.5% 7.5%

Option D 11.31% NIL 11.31% 09 10% 10%

CorreCt Answer B D C B C B A A B A C A A C A A B D B C C C A A

199 Rate of Warranty Charged from IAF on Accessories is 200 Rate of Warranty Charged from IAF on Air Frames is 201 Lead Bank of HAL's consortium is Furnishing of Previous years Figures in Annual 202 Accounts are 203 204 205 206 207 208 209 210 211 212 213 214 215 216 217

5% 7.5% 10% PNB ICICI HDFC A Statutory Management By Convention Audit Requirement Requirement Choice Actuarial valuation Valuation is made Valuation is made Valuation is made by Provision for Vacation leave is made on the basis of at CO by Division by Complex Office Internal Auditors Policy on Idle Hours Sales is Discontinued from 1995-96 2005-06 2006-07 2004-05 Differential Sales arising on finalisation of prices are As a current year Prior period sales Prior Period Income Current year Income shown sales in SCH-16 in SCH-17 in SCH-17 Who is the payment authority in respect of sales made AO(DAD) AFLE CRI CRE to IAF Who Sign the Form Q-423 AO(DAD) AFLE CRI CRE Which bank is not in the list of Consortium Banking ICICI SBI PNB IOB The value of the non-convertible bond-series III is 360 Crs 120 Crs 400 Crs 500 Crs Both at Complex The Cash Management System is controlled centrally At Complex Level At CO Level At Division Level and CO Level The Journal Voucher above Rs.5,00,000 can be Grade-I Grade-II Grade-III Grade-IV & above approved by The Ist Stage Payment under FPQ system in repair and 35% 65% 60% 40% overhaul task is Combied with any Casual Leave can be combined with Vacation Leave Sick Leave Cannot Combine leave Union Representative under TA/DA rules are treated as Category-D Category-B Category-C Category-E per with Rate of Daily Allowance for I/II/III officer while on $400 $300 $275 $250 business visit in abroad is in ($) TA/DA claims should be submitted within _____ from 15 days 30 days 07 days 20 days the date of return journey Maximum Amount reimbursable on Ayurvedic / Rs.1000 Rs.2000 Rs.3000 No limit Homeopathic treatment is

Sl. No.

Question

Option A

Option B

Option C

Option D

CorreCt Answer

218 Power delegated to GM to write off shortage of cash is

Rs.500

Rs.1000

Rs.2000

No limit

Rs.10000 in each Power delegated to GM to write off of dues to the case maximum of 219 company such as Sundry Debtors, Loan and Advances Rs.2 Lakhs in a year Power delegated to GM for reimbursement of medical 220 Rs.20000 expenses in relaxation of rules is Who is the approved authority for Movement order for 221 GM travel outside India 222 Debit Balance of RIT should be shown in Schedule 3 LIFO inventory method was used in 1st year, FIFO in 223 2nd year and Weighted Average in 3rd year. Which Cost Principle accounting principle is violated? An accounting convention which provides that when 224 doubt, choose the solution least likely to overstate Consistency assets and income is 225 Money measurement concept of accounting theory is Remain constant based on the assumption that the value of money will

Rs.100000

Rs.2000000

No limit

Rs.10000 MD 12 Consistency

Rs.30000 FD 1 Materiality

No limit Chairman 9 Going concept

B D B B

Materiality

Convervatism

Continuity

Fluctuate

Decrease

Go up

The written down value of a plant is Rs 6000 (Original value being Rs. 10000). It is sold for Rs. 12000 during Capital Profit = Rs. Revenue Profit = 226 the current financial year. Which one or the following is 6000 Rs. 6000 true in the regard?

Capital profit = Rs. 12000

Capital profit = Rs. 2000 and Revenue Profit Rs. 4000

227

228 229 230 231

Goods with Goods held by the customers for Stock should not include business as approval on sale or consignee return basis If operating expenses exceed gross profit, the excess is Non-Operating Operating income Operating Loss referred to as:expenses Goods in the Items held as fixed Stock in trade does not includes Raw Material process of assets manufacture Market value of investments is shown as a footnote to Consistency Disclosure Materiality Concept balance sheet is according to Concept concept Overstating Current Overstating Understating Current ratio may be increased by Assets Current Liabilities Current Assets Goods held as security

Goods sold but not yet delivered Non-Operating income Finished goods Going concept B&C

B C B A

Sl. No.

Question

Option A Management is ploughing back profits Operating ratio

Option B Management is not reinvesting profits Operating profit ratio

Option C

Option D

CorreCt Answer B A A

232 A high pay out ratio indicates that 233 234 Which of the following ratio is a favourable indication if it is low

Company is earning Earning per share is high profits high Inventory turnover ratio ROI Voting rights

In calculating the earning per share (EPS) the net profit Number of equity is divided by shares In computing the return on capital employed the profit figure to be taken into account is The return on capital employed shows how well the management has used the funds supplied by Net profit after taxes + interest Equity share holders

Number of Number of equity + preference shares preference shares Net profit before taxes Equity & preference shareholders

235

Net profit after Net profit after taxes taxes, interest and + preference dividend interest+Depreciation Shareholders & creditors Debtors Turnover Ratio

236 237

C D

238

239 240 241

The following methods are useful in management of Economic order Baumol's Model Miller - Orr Model A&B cash Quantity Certificate of Deposits (CD's) have following features. 1. Time deposit with the Banks A,C & D A,B,C & D B&D A,B & C 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 IV IIX VI V are defined When at least two bank come together to finance Participation Joint lending Consortium lending Joint Venture Lending requirements of a unit jointly and spreading the risk as lending well as return. The arrangement is called The method ignores cash generation beyond period Accounting rate of Pay back method NPV IRR when cash inflow exceeds investment return

C C A

A project with capital expenditure of Rs. 500000 is expected to produce the profit (after deducting 242 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 244 reinvested in another project at a predetermined rate of interest 243 245 The salient feature of deep discount bonds (DDBs) dose not include

24%

20%

22%

25%

1 PI method

0 NPV DDBs are issued discount to face value bond

2 Terminal Value

5 Pay back period Difference between sale price and original cost is investors profit

A C

It carries a fixed rate of interest

These are zero interest bonds

Sl. No.

Question

Option A

Option B

Option C

Option D

CorreCt Answer B

If the financial institution may like to keep margin of 25% on assets. If the tangible assets are 80% while 246 intangible assets are 20%. Then maximum finance that fIs will give be Share of pulkit limited are traded at Rs 90 each. 247 Divident per share is Rs.18. Groth rate is 6%. Calculate the cost of capital 248 In . Rate a certain percentage of interest will be of variable nature over and above the fixed rate of interest

75%

60%

100%

80%

20%

6%

14%

26%

Fixed Interest Scrip dividend Interest on securities Rs 75000

Variable Interest Equity Dividend Rent Rs 100000

Floating Interest Ordinary Dividend Salaries Rs 110000

Mixed Interest Bonus Dividend Professional Payment Rs 135000

C A C B D

249 Bonus shares are also called as Form 16 of Income tax Act is certificate of tax deduction 250 on: Maximum amount of rebate allowed under 80 C of 251 Income Tax the assessment year 2009 -10 252 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

194C

194D

194E

194J D

253

194C

194D

194E

194J

Finance & Accounts Difficulty Level 1 2 2 1 1 3 2 1 1 1 2 2 2 1 2 2 1 1

Difficulty Level 2

2 2 1 2 2 1 1 1

2 2

2 2

Difficulty Level

3 2 2 2

3 3

2 1 2 3 2 2 3

Difficulty Level 3 3 2 1 3 3 1 3 3 2 2 2 2 2 3 3 1 1 1 2 2

Difficulty Level

1 2 2 1 2 2 2 1 1 3 2 2 1 1

1 2 1

Difficulty Level 2 2 2 2 2

2 2 2 2 3 2 2 1 1 1 2 1

Difficulty Level 3 2 1 1 2 2 1 1

1 2 2 3 3 1 1 3 1

Difficulty Level 2 2 2

1 3 2 1 2 2 2 1 1 1 1 1 2 3 3 3 3 3 3

Difficulty Level 3 2 2 2 2 2 2 2 2 2 2 2 1 1

1 2 2 2 2 3 3 3

Difficulty Level 3 3 3 3 3 3 3

1 1 1 1

1 1 3

Difficulty Level 3 3 3 3 3 3 3 1 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2

Difficulty Level

2 2 2 2

1 1 2 2

Difficulty Level 3 3 3

3 3

3 3 2

2 1

Difficulty Level 2

2 2 2 2 2

Sect A ion Sl. No. 1 2 3 4 5 6 7 8 Question Who is called the father of the Financial Accounting. How many accounts does a business transaction affect? Marginal costs Which of the following ratios are used for measuring profitability of business? Sales X P/V ratio - Profit Goods lost by fire, fully insured covered credit will be given to How would the date of balance sheet be properly worded? Which of following is a real account ? Option A Father Luca Paciolo Just one Are determined easily Acid test Variable cost Insured claim account As on Dec. 31.2009 Salaries

Name of the Discipline for Question Bank

Finance & Accounts CorreCt Answer A B B C C C A D

Option B Necols Gearg Atleast Two Help in pricing the product ROI contribution Trading Account Dec. 31,2009 Shares and debentures of companies Auditing 25% factory cost With change in prices

Option C Games Peela Only Two Used in valuation stock Net profit ratio Fixed cost Sales Account

Option D Edward Jones Two or Three are sunk cost Debit equity ratio Profit Purchase Account

For the year ended For the period ended Dec.31, 2009 Dec.31, 2009 Debetors Account Bank Account Management consultancy services 33.33% cost of production With change in time Adjustment account Furniture Cost of purchase Depletion Unit Method Share holders contract of warranty Company law board's approval

9 10

Which area of accounting has gained much practice in Public Accounting recent years ? 20% Prime cost Every time

Tax services 30% fixed cost With output produced Memorandum account Vehicles Sale Diminishing Balance Method Govt. Contract of partnership Special resolution

D D B C A B B C B B C

If profit are 25% of selling price, what is the precentage of profit to cost ? direct materials used plus direct labour plus factory 11 overhead is called 12 Variable cost varies 13 14 15 16 17 18 19

Which account is generally used for rectification of error rectification Suspense Account ? account Plant and Which of the following Assets does not depreciate ? Land Machinery Opening Stock+ Purchase +Direct Expences -Closing Cost of goods Credit sales Stock = sold In which one of the following methods of charging Fixed Instalment Depreciationfund depreciation shall the balance never be induced to zero methods Method ? Physical verification of fixed assets is the primary Auditor Management responsibility of the Contract of contract of Insurance is a guarantee indemnity The Article of Association of a company can be altered Central Govt Ordinary resolution be approval

Sl. No.

Question

Option A

Option B

Option C

Option D

CorreCt Answer

20 Doctrine of ' Indoor Management ' Implies -

Outsiders are entitled to believe Outsiders should Outsiders should that everything Outsiders should not check each and have no access to done by the check each and every every transaction the transaction of company within its transaction of the of the company the company. 4 walls has been company done in aregular way Uncalled Capital Source of Fixed Capital Issued capital No liability as to repayment Capital reserve Reserve Capital

21

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 ? The preference shares which give the holder the right to share In the residual profits are known as -

22 23

24 "The principle of conservatism "implies -

25 Contra entry is recorded in 26 A Company can invest money in another only if it so authorised by its

27 A letter of credit signifies A sale of Rs. 2000/- wrongly entered in the purchase book -

28

29 Internal author is appointed by the 30 Minimun wages by fixed by The principle of "unity of command" is strictly observed 31 in 32 "Self actualisation " need refers to the 33 The first auditors should appointed A Govt. Co. is one in which not less - of the paid up capital is held by Govt.

No liablity as to No right to vote payment of dividend Cumulative convertible Participating Non Cumulative preference share preference share preference share preference share Appropriate Business recording of transaction should Disclosure of all business be recorded in such Disclosure of all material transaction at a way that profit material transactions information appropriate or should not be proper time. overstated Three column Double coulmn Simple cash book All cash book cash book cash book Memorandum of Articles of Auditors Company secretary association assocation Exporter Banker agreeing to Importer agreeing ti letter containing of sanctioning a accept and pay on a credit deal conditions of credit credit deal due date decreases the increases the decreases the No impact gross profit by gross profit by gross profit by 2000/2000/4000/Shareholder of the Institute of internal Board of directors of Statutory auditor company auditors of india the company Trade unions Employees State Govt. Court of law line and staff functional semi-govermental line organisation organisation organisation orgnisation Need for food Need for safety Need for lave Need to grow Within and with the Within and with Within and with the registration of the incorporation commencement of company of company business 52% Public company Current assets 51% Private company Loss assets 100% Company limited by guarantee Fictious assets Within and with the starting 1st finanical year 32% Small company Intangible assets

D C

B B D

C D C A D A

34

B B C

35 A statutory meeting need not be held by -36 Assets which appear in the book but have no market value

Sl. Question No. 37 Working capital can be used for the purchase of -38 Annual general meeting can be called by the -39 A letter of credit is opened on behalf of -40 A public company having a share capital 41 The interval between two annual general meeting should not be more than -

Option A Plant

Option B Furniture

Option C Stock Managing Director

Option D Machinery Non - executive director A bank should not issue a prospectus 20 months

CorreCt Answer C B B C C

Company secretary Board Directors An exporter Must issue a prospectus 12 months A price which is paid for the last consignments.

An importer A buying agent Can't file a May file a statement statement in lieu in lieu of prospectus of prospectus 18 months 15 months

42 In the LIFO method, the closing stock is valued at -

A price which is An average price of paid for the earlier all this consignments consignments

Base price

43

Project engineering Ltd. Has an adverse current ratio which one of the following would improve this ratio -

Sale of fixed assets Collectionof some Use of cash to pay for the current of the current off some long term account accountvarriables debts Acceptance Loan instalment payable in the current year Operating loss Temporary bank overdraft Non - operating expenses

Collection from sundry debtors Arrears of preference dividend Non operating income Debentures and share capital Rs. 50 Lacs AS 9 Accounting for investment Accounting for investment Valuation of inventory Land Contingent liability P& L Adjustment Account Collection Account Stock Index in New York

44 Which one of the following os 'not' a current liability ? 45

D B

If the operating expenses exceed gross profit the Operating income excess is referred to as --

46 Capital gearing ratio denotes the relationship between -- Assets and capital 47 Maximum limit of EMD is fixed at : 48 Valuation of inventory is dealt with in 49 Accounting standard 13 deals in 50 Accounting standard 6 deals in 51 Accounting standard 9 deals in 52 Accounting standard 10 deals with the following fixed assets Rs. 10 Lacs AS 2 Accounting for fixed assets Accounting for fixed assets Accounting for fixed assets Mines Salaries

Equity shareholders Loan and capital funds and long term borrowed funds Rs. 20 Lacs AS 5 Depreciation accounting Depreciation accounting Cash flow statement Forest Investment in share Realization account Real Account Stock Index in London Rs. 30 Lacs AS 6 Revenue recognition Revenue recognition Revenue recognition Plantations Debtors account Capital account Nominal Account Analyzing profit ratio in terms of profit margin and turnover ratios

D D A D B C D B D B C

53 Which of the following is a real account 54

When a partner retires, decrease in the value of a Liability account liability is credit to 55 Realisation account is a Personal account 56 Du-point system refers to Stock index in USA

Sl. No.

Question

Option A

Option B

Option C

Option D

CorreCt Answer

57 A letter of credit is

A guarantee to A guarantee by a A short term credit by A short term credit honour the bills of bank to discount all the bank to an by a bank to an an exporter drawn the bills of an exporter against a importer within stipulated exporter confirmed order term Capital flow Sundry Debtors Net Current Assets Sales Turnover Ratio Total Assets Outside Liabilities Decrease Current ratio Hawala Bank Overdraft Net Fixed assets plus current assets Current Ratio Total Profit Remain unchanged Debtors Turnover Ratio Convertibility of Capital Account Contingent liabilities Fixed AssetsLiablities Debtors Turnover Ratio Total Turnover First Increase then decrease Net Loss ratio

58 59

. is a technique for laundering the money to Convertibility of avoid the official channels of banking and tax payment Revenue Account Which of the following items is not taken into account Sundry Creditors while computing current ratio? Fixed Assets Acid Test Ratio Fixed Assets Current Assets Increase Quick ratio

C D C D B C A A A D B C A A D C B

60 Gross Capital employed is equal to 61 Credit Sales / Average debtors gives 62 Net Worth of business means 63 Sales of inventory for cash will cause the current ratio 64 The immediate solvency ratio is 65 Which of the following items result in cash flow? 66 Which of the following is not a cash inflow? 67 Which of the following is a non-current liability 68 A person can be director in up to 69 Maximum limit of members in a private company are 70 The first directors of a company are appointed by 71 Auditors of Government companies are appointed by 72 A public company may have maximum director is 73 First Auditor of a company are appointed by 74 An Annual General meeting is required to be held within.. months from the close of accounts

Issue of shares for Transfer to Goodwill written off Salaries Outstanding cash general reserve Purchases of fixed Sales of Fixed Cash from business Issue of debenture assets assets operations Bills Payable Sundry Creditors Bank Overdraft Long term Loans 10 Companies 15 Companies 20 Companies 25 Companies 7 Member 15 Member 50 Member Unlimited Promoter CAG 5 Member in statutory meeting 3 month The memorandum of association Board of Director 7 Central Government 6 month Central Government ICAI 10 Board of Director 9 month Employee of the companies Share Holders 12 ICAI 12 month

75

The interval between two Annual general meeting should not be more than

15 month

6 month

9 month

12 month

76

A company can invest money in another company only if it is so authorized by its

Article of Association

Memorandum of Association

Auditors

Company Secretary

Sl. No.

Question

Option A

Option B

Option C An unlimited Company

Option D Statutory Corporation

CorreCt Answer D

77 Reserve Bank of India is a

A Company limited A Company by Guarantee limited by Shares A resolution of the board of Directors A resolution of the board of Directors The management Mad Dog The use of the previous years figures as the standard

78 Article of Association can be altered by

79 Share capital of a company may be reduced by

An ordinary Obtaining permission A special resolution resolution of the from the company law in general meeting general meeting board A special resolution An ordinary subject to resolution of the A Special resolution confirmation by general meeting court The shareholder Watch Dog The use of predetermined levels of price and performance as the standards Closing Rate Interest/ Profit after tax Liquid Assets/ Total Liabilities Profit Distributed to profit retained Non Fixed price Contracts Consistancy Freight on Board Use the Assets Income from other sources 194 227 Rs 40 Lacs The CAG Thirsty Dog The use of fixed budgeting The Statutory auditor Greedy Dog The use of ideal cost which are useful control aids

80 Internal Auditor is appointed by 81 An Auditor is like a

A B

82 Standard Costing implies

As per AS-11 " Accounting for the effect of change in foreign exchange rate" at the balance sheet date, 83 monetary items e.g. Debtors, creditors should be reported using 84 Price earning ratio is equal to 85 Current ratio is equal to: 86 Pay out ratio means the ratio of

Average Rate Interest/ Profit before tax Current assets / Current Liabilities Debtors to creditors Cost plus contracts & Fixed price Contracts Going concern Free on Board Own the Assets Salary 191 226 Rs 30 Lacs

Exchange Rate on the date of transaction Market price / EPS Current assets / total Liabilities Earning that are distributed through dividends Fee based contracts Conservation Form of Balance Sheet Own and Use the Assets Capital gains 195 228 Rs 60 Lacs

Spot Rate

Price/Earning Total Assets / Total Liabilities Interest payment to dividends Market rate contracts Materiality Freight on Bill Sub let the asset Income from Buisness 192 230 Rs 80 Lacs

C A C

87 AS-7 is applicable to contractors engaged in 88 89 Which of the following is not a fundamental accounting assumption F.O.B. Stands for :

A C A B B D A B

90 A lease agreement grants lessee the right to The amount of interest received on securities is taxable in Income Tax Act vide the head: TDS on salaries is governed under section of Income 92 Tax Act Qualification & Disqualification of Auditors is governed 93 by section of companies Act: Tax Audit is required when the total sales, turnover of 94 gross receipts in business for the financial year exceeds : 91

Sl. No. FCRA stands for 95 IFAC 96 GATT 97 GAAP 98

Question

Option A Foreign Control Regulation Act International Federation of Accountants General Agreement on Taxes & Tariff

Option B Foreign Currency Regulation Act Indian Federation of Accountants General Agreement on Taxes & Trade Generally Accepted Accounting Principles

Option C Foreign Contribution Regulation Act Indian Foreign of Accountants General Acceptance on Tariff & Trade

Option D Foreign Currency Repatriation Act International Foreign of Accountants General Agreement on Tariff & Trade

CorreCt Answer C

Generally Accepted Accounting Policies

General Accepted Accounts Practices

General Accepted Audit Practices

Accounting rate of return 99 IAASB 100 101 IASC headquarters is in : 102 Which of the following is true at break even point? Except in special cases, the retiring auditor is automatically 104 Internal Audit is 103

Profit after Tax / Book Value of Investment Indian Auditing & Assurance Standard Board New york Sales revenue = variable cost Re-appointment Statutory Audit Audit on behalf of management

Profit before Tax / Profit before Tax / Profit after Tax / Book Value of Market Value of Fixed Assets Investment Investment International International Indian Accounting & Auditing & Accounting & Assurance Assurance Assurance Standard Standard Board Standard Board Board Vieana London South Africa Profit = Fixed Sales Revenue= Contribution = Fixed Cost+Variable Total Cost Cost Cost Variable Cost Dismissed Annual Audit Systematic appraisal of management's objectives and procedures Errors of principles Employee of the company Board of Directors Disqualified Internal Control Audit of management accounting Fraudulent manipulation of accounts General Meeting Any Director Suspended Half yearly audit

B C D A C

105 Management audit means

Statutory Audit

106 107

Under or over valuation of assets and liabilities are due to A vacancy caused by the resignation of an statutory auditor is filled by

Clerical errors The managing Director The managing Director

Errors of ommissions Company Law Board General Meeting

C C D

108 A company auditor may be removed by

109

A company Auditor can attend general meeting of the company as a matter of

Right

Duty

He cannot attend the general meeting

Proxy

Sl. No.

Question

Option A

Option B

Option C

Option D

CorreCt Answer

110 Audit in depth refers to

Audit of each and every item

Intensive audit of Audit of a few items Detailed audit of each a few items selected at random and every items Checking a representative sample of items Either civil or criminal Verify and report on the state of affairs of the business SEBI Legal Cost of acquiring land for extension Amount borrowed from a bank

111 Test checking implies 112 The liability of auditors can be

Checking only a few items in detail Only Civil Verify and Value assets as per company's Act Preference shareholders Cost of extension of factory building Amount realized from sale of investments

Checking each and every item Only criminal Verify liabilities and report to registrar of companies Central Government Cost of painting the old building Divident received on investments

Checking of items alternatively Civil and / or criminal

C D

113 The primary objective of audit is to

Appoint auditors

114 Special audit can be ordered by 115 Which of the following are of revenue nature?

Debenture holders Purchase of freehold land Compensation received from Municipal Corporation

B B

116 Which of the following receipts is of revenue nature?

117 Depreciation as the term is used in accounting means 118 The term depletion is used in relation to 119 Cost of conversion is made up of

120 Net realizable Value means

Physical Decline in the Allocation of the Making a provision for deterioration of a market value of cost of fixed asset the replacement of fixed asset an assets over its useful life the fixed assets Fixed Assets Wasting Assets Current Assets Intangible Assets Direct Direct Direct Material+Direct Direct Wages+All Wages+Production Material+Direct wages+Direct Wages+Production types of overhead overhead+Direct expenses Overhead Expenses Sales less cost Sales less sales Sale less gross Sales less cost of incurred return profit margin purchase necessarily to make the sale Fixed assets minus current liabilities Commodity Units Purchase Price Fixed assets minus current Assets Monetary Units Current assets plus Total Liabilities minus current liabilities current liabilities Production Units

C B C

121 Long term liabilities are:122 Accounting records transaction in terms of 123 Cost of purchase of raw material is

D B D

Sales Units Purchase Purchase Purchase Price + price+taxes+freight Price+duties and taxes+freight inward inward-discounts and tax paid there on duly draw backs Market prices of the assets Replacement cost of the assets Future Cost

124

According to Accounting Standard-6 relating depreciation is to be provided on the basis of

to

Historical cost of the assets

Sl. No. 125

Question Accounting standard - 6 relating to depreciation is not applicable to

Option A

Option B

Option C

Option D

CorreCt Answer C

Building

Plant & Machinery Engaged in manufacturing business Historical cost Convention of conservatism AS-10 AS-10 Segment reporting Cash Flow Statement Cash Flow Statement Cash Flow Statement AS-15 120 Crs Going Concern Concept Capital Reserve Sales Book Current Liabilities Rs 54500

Live stock

Patents

126

Listed on a Accounting standard-6 relating to depreciations is recognized stock recommended for use by companies exchange Cost less depreciation Convention of full disclosure AS-1 AS-1 Prior period transaction Valuation of Inventories Segment reporting Segment reporting

127 Gross book value of a fixed assets is its 128 Contingent liability is shown due to 129 Disclosure of Accounting Policies is dealt by 130 Cash Flow statement is dealt by 131 Accounting standard 17 deals with 132 Accounting standard 2 deals with 133 AS-5 deals with 134 AS-26 deals with 135 Accounting for Fixed Assets is dealt by 136 The Value of the non-convertible bond-series III is 137 138 139 140 141

Engaged in All type of business manufacturing or undertaking trading business Historical cost less accumulated Fair market value depreciation Convention of Duel aspect concept materiality AS-2 AS-29 AS-3 AS-29 Accounting for Earning per share lease Construction Impairment of Assets contracts Prior period items Prior period items AS-09 400 Crs Matching Concept Secret reserve Cash Book Fixed Assets Rs 39500 Impairment of Assets Intangible Assets AS-06 500 Crs Duel aspect concept General Reserve Petty Cash Book Capital Account Rs 49500

B A A C B A C D A A D C D B D

142 143

AS-10 360 Crs Money The fundamental accounting equation ASSETS = measurement LIABILITIES is the format expression of Concept Charging of capital expenditure to revenue results in Revenue reserve The "IMP REST SYSTEM" is used in relation to Purchase Book "Bank Overdraft " should be classified as :Current assets What is the cost of goods sold when:- Opening stock = Rs 44500 Rs. 5000, Closing Stock = Rs 2500, Purchases Rs. 47000 What is the amount of purchase when:- Opening stock Rs 200000 = Rs. 35000, Closing Stock = Rs 15000, cost of good sold Rs 220000 Cost of goods sold = Rs 240000, Gross loss= 25% of Rs. 180000 sales Amount of sales? Full disclosure Convention of conservation Net profit and capital employed Shareholder's investment Operating Ratio

Rs 240000 Rs 192000 Conservation Convention of disclosure Investment and profit Interest on working Capital Operating profit ratio

Rs 270000 Rs 144000 Industrial practice Convention of materiality Turnover and capital employed Interest on fixed assets Stock turnover ratio

Rs 170000 Rs 150000 Consistency Accrual concept Interest and Investment Interest on Investment ROI

A B B B A A C

144 Provision for bad debts is made under the principle of 145 Window dressing is prohibited due to 146 ROI is the ratio between 147 ROE takes into account 148 Higher the ratio the more favourable it is. This does not apply to:-

Sl. No.

Question

Option A

Option B

Option C

Option D

CorreCt Answer

149 The most rigorous test of liquidity is

Current ratio

Acid ratio test

Absolute measure

Stock turnover ratio

150 ROE (Return on Equity) is computed as Given Current Ratio=2:1 151 Working Capital=Rs.60000 amount of Current Liabilities? Given Current Ratio=2:1 152 Working Capital=Rs.60000 amount of Current Assets? 153 Net What is the Net What is the

Net Profit/Sales

Cost of Sales/Capital Employed Rs.60000

Net Profit afterTax and pref. dividend/sh holder fund Rs.120000

Operating net Profit/Shareholders funds Rs.90000

Rs.30000

Rs.30000

Rs.60000

Rs.120000

Rs.90000

Ritesh is interested in investing for growth in the market High gross profit High net profit ratio price of shares he should invest in a company withratio Issue of equity capital in exchange of land and building will cause the return on propriety ratio to Collection of cash from debtors will cause the current ratio to Quick Net working What is the amount of

High pay out ratio

Low pay out ratio A, B and C depending on earlier level of propriety ratio. increase by two times

154

Increase

Decrease

Have no effect

155

Increase

Decrease

Have no effect

Given Current Ratio=2.5% Ratio =1.5% 156 capital =Rs.60000 Current Liabilities?

Rs.40000 Debentures as well as other long term loans

Rs.30000

Rs.50000

Rs.60000

157 In computing debt/equity ratio, debt means -

158 In debt/equity ratio equity includes Given stock turnover ratio = 8 times Average stock =Rs.10000 159 Selling price =Rs.25% above cost What is the amount of gross profit? Which of the following are non-operating incomes? 1. Sale of merchandise 2. Interest 160 income 3. Dividend income 4. Profit on the sale of old assets

Short term as well Term loans as long term creditors Equity and Equity and Equity and preference Only equal capital preference + all preference capital + all reserves reserves - losses Short term creditors Rs.2000 Rs.4000 Rs.20000 Rs.12000

1, 2 & 3

1,2 & 4

2,3 & 4

1,3 & 4

Sl. No.

Question

Option A

Option B

Option C

Option D

CorreCt Answer

Gross profit may be increased by 1. Increasing selling price 2. 161 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 162 following would improve this ratio ? ABC Ltd. Provided the following data for 2007 Current ratio =2.5:1 Net 163 working capital =Rs.300000 Current assets and current liabilities of this firm are respectively : If the cost of goods sold is Rs.1 Lakh the value of opening & closing stock is Rs.20000 & 164 Rs.30000 respectively The stock turnover ratio will be 165 Gross capital employed is equal to 166 Higher the ratio the lower the profitability is applicable to 167 168 169

1&3

1,3 & 4

1&2

1,2 & 4

Sales of fixed assets for cash

Collection of some of the current assets receivable Rs.500000 & Rs.200000

Use of cash to pay off some long term debts

Collection from sundry debtors

Rs.300000 & Rs.150000

Rs.500000 & Rs.100000

Rs.300000 & Rs.100000

3.3 times

4 times

5 times

2.3 times

Fixed Assets Gross profit ratio

Net Current Assets Net profit ratio

Net Fixed assets Net Current Assetsplus current assets Net Current Liabilites Operating ratio Return on investment Bills receivable collected Debenture converted into equity capital Equity capital + preference capital + reserves - losses cannot be known from the given information IRR Intangible assets Balance sheet (liability side) Creditors meeting Books and ledger Current asset

C C D B D

Which of the following transaction has no effect on the Machinery Motor car sold for Preference shares current ratio ? purchased for cash cash redeemed Which of the following transaction change the current Purchase of goods ratio for cash Plant acquire on account Sold goods on credit

In calculating the return on shareholders fund the Equity capital + Equity capital + Preference capital denominator is Reserve & surplus preference capital When the operating ratio is 81.5 the ratio of operating profit to sales will be 191.50% 18.50% 181.5% NPV Flotting assets Balance Sheet (Assets side ) Extra ordinary meeting Prospectus Current liability

170 171

B A D A A B B

. Method is based on accounting profit instead ARR PB Method of cash flow 172 Goodwill should be classified as a Current assets liquid assets Depreciation on machinery amounting to Rs. 25000 is Profit & Loss A/C -- Profit & Loss A/C-173 appearing in the trial balance of a firm. When preparing Dr.Side Cr. Side final Accounts,it should be shown in -Which meeting is held only once during the life time of annual general 174 Statutory meeting a company ? meeting 175 Which of the following documents contains rules and regulations for internal management of the company ? memorandum of association Fixed asset articles of assocation Long term liablity

176 Debenture is a

Sl. No.

Question

Option A Taxable in all cases Every transaction is recorded twice Shares trading account Historical cost

Option B Taxable in few cases No error remains in the books of accounts Goodwill

Option C Taxable in smaller cities

Option D Taxable only whencertain conditions are fullfilled Every transaction is recorded singly Patents Manufacturing Account Either of the above Errors are not quickly located and final accounts are to be prepared without delay Audit & Govt.companies by their own staff

CorreCt Answer D

177 House rent allowances are --

178 Trial balance is a proof that -179 Best example for near money -180 A reserve is a charge against -181 In the financial statement, the fixed assets appear at --

Books are authentically and correctly written Bill of exchange P & L appropriation Profit & Loss A/C a/c Value appraised Current value by competent value Debit side of trial balance is short Auditing of companies by persons appointed by the government Secretary to the company 5 loyal subordinates excise duty Procedure Selling cheaper abroad and dearer at home Bills payable Re-investment of earnings Conservation Credit side of trial balance is short

A C C D

182 Suspence account is required when --

There are errors

183 Govt. audit means --

Auditing of the accounts of government depts

Audit under the provisions of law

184 185

Under the law the inspector who does the inspection of Board of Directors the company's accounts has to submit his report to the -- of the company If a supervisor has two subordinates, what is the total number of relations among them -4 Hardworking subordinates to the Revenue duty Policy A form of price discriination at home Bills receivable Earning of black money

Central Govt. 6 Centralised works and less irresponsibility Specific duty Rule Selling in the foreign market below cost Sales Return Unclaimed dividends Cost principle

share holders 7 Repetitive work and clear responsibility Ad-valorem duty Strategy selling the produt at a lower price in a foreign market Misc.expenditure Transferring a part of profits to reserves Full disclosure Govt.company P&l a/c only

C C C C C B B B B B B

186 Span of management may be larger in case of -When custom duty is levied according measurement of goods. It is known as -188 No smoking in the factory' is an example of -187 189 Dumping means 190 Which of the following accounts will usually have a credit balance ?

191 Ploughing back of profits means 192

Stock valuation at cost or market price which ever is Materiality less is based on principle of -Which one of the following types of registered Company limited 193 companies will be the most appropriate for the by share promotion of science, culture,religion etc-194 Closing stock appearing in trial balance will be taken to Trading a/c only

Company limited Unlimited company by guarantee Balance Sheet only Trading a/c and balance sheet

Sl. Question No. 195 Budgeting is a technique of --

Option A

Option B

Option C Planning It is invisible and intangible There has been overdraft Works cost

Option D Improving efficiency It exists only in contemplation of law There is undeposited cash in hand Proportional change in cost for change in production Rs. 7850/Secretarial Auditor checking of invenotry items only Total assets minus total liabilities Repair & Maintenance 45 days of the meeting Fixed Expenditure Tax evasion An error of principle Weighted Average method Clerical errors Freight inward Increase in capital account Tax authorities flotting assets Permanence Rising & Falling prices

Control Cost reduction It does not the It can't be used in 196 A company is called an artificial person because-shapeof a natural the court of law persons The cashier must If the bank a/c at the end opf the accounting period has It indicactes an 197 have manipulated a credit balance of Rs. 848/- how would you explain it ? error in recording cash 198 The term "Marginal cost "refer to -The trial balance shows a debit total of Rs. 8000/-. 199 However, in recording a receipt of Rs. Of being debited. What will be the credit total of the trial balance ? 200 Audit report along with annual accounts is given by201 Test checking implies -Additional cost Conversion cost

CorreCt Answer A D

Rs. 7700/Statutory Auditor Checking only a few items in detail

Rs. 8150/Internal Auditor Checking each and every item

Rs. 8300/Govt. Auditor Checking representative sample of items Current assets minus fixed liabilities

C A C

202 Owner's equity stands for -203 Major repairs of plant and machinery is -204 205 206 207 208 209 210 211 212 213 214

Fixed assets minus Fixed asset minus fixed liabilities current liablity Revenue expenditure 21 days of the meeting

D C B B A D C D C A A C D B

deferred revenue Capital expenditure expenditure 30 days of the 40 days of the Minutes of company meeting should be prepared within meeeting meeting Expenses to painting of the factory building is treated Revenue Deferred revenue Capital expenditure as -expenditure expenditure Burden of tax can be reduced by-Tax planning Tax avoidance Tax erosion Purchase of office furniture Rs. 2500 has been debited An error of A compensating A clerical error to general expenses account it is -omission error When prices are showing a rising trend which method Simple average FIFO LIFO of inventory valuation will result in lower income and method lower valuation of inventory ? compensating Errors of whole Preparation of trail balance helps deduction of -Error of principle error omission An expenses of Rs. 300/- paid as cartage of a new Cash a/c Cartage a/c Machine a/c machine purchased should be debited to -Increase in asset Decrease in asset Increase in a "Debit " may signify -account account liability account Customers of the Proprietors of Bank reconciliation statement is prepared by-Bank bank business Assets very easily convertible into cash are -Current Assets Fixed assets Liquid assets Assets in the balance sheet of a company are arranged Liquidity Market value Book value in the order of -Rising prices falling prices Constant prices

215 FIFO is advisable in case of --

Sl. No.

Question

Option A Formal communication Source of fund Redemption of redeemable preference shares Cash a/c

Option B Informal communication Application fund Redemption of redeemable debentures Creditors a/s Excise duty Journal Budget Manual Cash a/c-- to supense a/c Financial position of all accounts Cash a/c Unsecured Loans

Option C Both formal and informal communication No flow of fund

Option D This term is not used in relation to communication Increase in fund

CorreCt Answer B B D B B D C C B A C

216 " Grapevine " is a term used in relation to -217 Purchase of furniture results into -218 Capital Redemption Reserve account is available for-

Re-organisation of Issue of bonus shares share capital Bills payable Customs duty Bank a/c Financial Budget Rent a/c--Dr to suspense a/c Profits and loss of the firm Discount A/c Bills receivable VAT Cash Book Capital Budget Suspense a/c-- dr to rent a/c Net profits earned by the firm Purchase A/c

219 Bills payable dishonoured during a year credited to-Duty charged on goods manufactured within the country 220 Octroi is called 221 Cash sales are recorded in Sales book 222 Cash budget is a Functional Budget Rent paid was credited to rent account. The rectifying Rent a/c-- Dr to 223 entry is -cash a/c 224 Balance Sheet of a firm show the-When cash discount is allowed by creditors to the bussiness debit is given to -Under what heading is the 'Provision for Tax' shown in 226 the liability side of a Companies Balance Sheet 225 Balance in all accounts creditros A/c Secured loans

Current Liabilities & Reserves and Suplus Provisions the profit and loss account or balance sheet

the balance sheet Depreciation is appearing in the trial balance of a the profit and loss the profit and loss as deduction from 227 company. While making final accounts, it should be account and account the asset shown in :balance sheet concerned 228 229 230 231 232 233 234 235

Amount spent on increasing the seating capacity in a Revenue Deferred revenue Development Capital expenditure cinema hall is a expenditure expenditure Expenditure Cartage paid on the purchase of a new machine is Cartage Account P & L Account Machine a/c Capital Account debited to Which of the assets is usually assumed not to Land Building Plant Furniture depreciate A business entity has assets of Rs. 28000 and liabilites 32000 26000 20000 6000 of Rs. 8000, Owner's equity in this case is Personal account Real Account Nominal Account Individual Account Bank Loan Account is a In order to determine the amount of sales, to which of Sales book Sales Account Journal Total Debtor Amount the following records one should refer Subscription collect in advance by a publisher should Accrued interest Accrued liabilities Unearned revenue Prepaid Expenses be classifed as A three year premium paid on a fire insurance policy Accrued asset Accured Liability Unearned revenue Prepaid Expenses should be classified as Cash Low Assets Cash Stock in Trade High Cost of Maintenance Net Working Capital Advance Payments Idle Assets Gross Working Capital Furniture Higher Sales Profit

A C A C A B C D D C B

236 The term current asset does not include 237 Low asset turnover may indicate 238 The meaning of Fund in fund flow statement is

Sl. No. 239 240 241 242 243 244 245 246

Question If the material is priced at the value that is realizable at the time of issue such a pricing method is Commercial paper are issued in multiples of Assets appearing in the books but having no value are known as The maximum notice period for statutory meeting is Every company is required to hold a baord meeting The liability of share holders of a public company is limited to the Which of the following documents defines the scope of the company's activities Depreciation was not recorded because to do so would result in a net loss for the period. Indicate the accounting principle that is violated

Option A Standard Price Mehtod Rs. 4 Lakhs Wasting Assets 21 days Every month Paid up value of shares memorandum of association

Option B Replacement Method Rs. 6 Lakhs Intangiable Assets 14 days Ever fortnight Nominal Value of Shares articles of assocation

Option C LIFO Method Rs. 10 Lakhs Current Assets 7 days Every Quarter Extent of their private Assets Prospectus

Option D FIFO Method Rs. 5 Lakhs Fictitious Asset 28 days Every Six months Amount Called up Annual Report

CorreCt Answer B D D A C B A C

247 What is M.A.T. as per Income Tax Act

Cost Principle Minimum Alternate Tax

Consitency Maximum Alternate Tax

Full Disclosure Conservatism Moderate Alternate Tax Money Alternate Tax

Finance & Accounts Difficulty Level 3 2 1 1 1 2 3 1

2 1 2 1 1 2 3 2 1 3 3

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2 1

3 3 2

1 3 1 3 3 2

1 1 2

Difficulty Level 3 3 1 2 2

3 3

2 2 2 3 3 3 3 2 2 2 3

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1 2 2 1 2 2 1 1 2 1 2 1 1 1 1 1 2

Difficulty Level 1

1 1

3 1 3

3 1 1 2 1 2 2 1

Difficulty Level 2

1 2 3 1 1

3 2 3

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1 2

2 2

3 2 3

3 3 3

Difficulty Level 1

3 3 3 3 1 1 2 2 2 2 1 1 1 1 1

1 2 2 1 2 2 2

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2 3 2 2 2

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Difficulty Level 2

1 2 2 1

3 3 2 2 3 3 1 3 3 2 3

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2 1 1

3 2 3 1 1 3 3 2 1 1 2 1 2 2

Difficulty Level 3 2 3 2 1 1 2 2 1 2 3

2 2 2 2 2 2 2 2 2 2 3

Difficulty Level 2 3 3 3 2 2 2 3 2