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MB131 - 2004 - 01 (January)

MB131 - 2004 - 01 (January)

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Published by nilshalin
ICFAI GROUP B PAST QUESTION PAPER
ICFAI GROUP B PAST QUESTION PAPER

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Published by: nilshalin on Nov 19, 2009
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02/02/2012

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Question PaperFinancial Accounting (MB131) : January 2004
Section A : Basic Concepts (30 Marks)
 
This section consists of questions with serial number 1 - 30.
 
Answer all questions.
 
Each question carries one mark.
1.
Which of the following represent(s) personal accounts in accounting parlance?a. Sundry creditorsb. Bank accountc. Outstanding wagesd. Prepaid insurancee. All of the above.
< Answer >
 
2.
Which of the following methods of valuation of inventory is based on the assumption that costs arecharged against revenue in the order in which they occur?a. FIFO methodb. LIFO methodc. Weighted average methodd. Moving average methode. Base stock method.
< Answer >
 
3.
Which of the following is
not
an item of revenue expenditure?a. Interest on deposits acceptedb. Annual insurance premium on inventoryc. Customs duty paid in connection with the import of equipmentd. Repairs and maintenance on machinerye. Expenditure on assets like paper weight and pin cushion.
< Answer >
 
4.
Which of the following errors will cause a mismatch in the trial balance?a. Errors of complete omissionb. Compensating errorsc. Errors of principled. Recording dual aspects of a transaction more than oncee. Errors of partial omission.
< Answer >
 
5.
AB & Co. purchased a machine for Rs.10,00,000 on April 1, 2002. The salvage value of the machine isRs.40,000. The useful life of the machine is 8 years. If the firm intends to depreciate the machinery onstraight-line method, the rate of depreciation will bea. 16%b. 15%c. 14%d. 12.5%e. 12%.
< Answer >
 
6.
If the purchases day book of a firm is overcast, it willa. Increase gross profit and reduce net profitb. Reduce gross profit and increase net profitc. Reduce gross profit as well as net profitd. Increase gross profit as well as net profite. Reduce gross profit but will not have any impact on net profit.
< Answer >
 
7.
Which of the following is
true
when a debtor pays his dues?a. The asset side of the balance sheet will decreaseb. The asset side of the balance sheet will increasec. The liability side of the balance sheet will increased. The liability side of the balance sheet will decrease
< Answer >
 
 
e. There is no change in total assets or total liabilities.
8.
Withdrawal of goods from stock by the owner of the business for personal use should be recorded bydebitinga. Drawings account and crediting cash accountb. Drawings account and crediting purchases accountc. Capital account and crediting drawings accountd. Purchases account and crediting drawings accounte. Stock account and crediting capital account.
< Answer >
 
9.
The cost price of a machine is Rs.1,20,000 and the depreciated value of the machine after 3 years willbe Rs.66,000. If the company charges depreciation under straight-line method, the rate of depreciationwill bea. 25%b. 20%c. 18%d. 15%e. 12%.
< Answer >
 
10.
Consider the following data pertaining to a firm:The balance as per pass book isa. Rs.20,600 (Dr. balance)b. Rs.18,500 (Dr. balance)c. Rs.18,500 (Cr. balance)d. Rs.15,600 (Dr. balance)e. Rs.20,600 (Cr. balance).Credit balance as per bank column of cash book Rs.13,500Bank interest on overdraft appeared only in the pass book Rs.2,100Cheques deposited but not collected by the bank Rs.5,000
< Answer >
 
11.
Consider the following data pertaining to a company for the year 2002-2003:The bad debts of the company during the year area. Rs.40,000b. Rs.35,000c. Rs.30,000d. Rs.25,000e. Rs.20,000.Opening balance of sundry debtors Rs. 45,000Credit sales Rs.4,25,000Cash sales Rs. 20,000Cash collected from debtors Rs.4,00,000Closing balance of sundry debtors Rs. 50,000
< Answer >
 
12.
The opening stock of a company is Rs.40,000 and the closing stock is Rs.50,000. If the purchasesduring the year are Rs.2,00,000 the cost of goods sold will bea. Rs.2,10,000b. Rs.2,00,000c. Rs.1,90,000d. Rs.1,80,000e. Rs.1,50,000.
< Answer >
 
13.
The balance as per bank statement of a company is Rs.12,500 (Dr.). The company deposited twocheques worth Rs.8,500, out of which one cheque for Rs.2,800 was dishonoured which was not enteredin the cash book. The credit balance as per cash book isa. Rs.21,000b. Rs.15,300c. Rs.23,800d. Rs. 9,700
< Answer >
 
 
e. Rs. 4,000.
14.
During the year 2002-03, the profit of a business before charging manager’s commission wasRs.1,89,000. If the manager’s commission is 5% on profit after charging his commission, then the totalamount of commission payable to manager isa. Rs.10,000b. Rs. 9,450c. Rs. 9,000d. Rs. 8,500e. Rs. 9,947.
< Answer >
 
15.
Which of the following statements is
true
?a. The losses from the sale of capital assets need not be deducted from the revenue to ascertain netincomeb. Going concern concept requires that always non-monetary assets should be valued and recorded atmarket valuec. According to consistency concept, the results of one accounting period of a business cannot becompared with that of in the pastd. In terms of conservatism concept all probable losses must be considered in computation of incomee. The system of recording transactions based on dual concept is double accounting system.
< Answer >
 
16.
Which of the following ratios indicates the short-term liquidity of a business?a. Inventory turnover ratiob. Debt-equity ratioc. Acid test ratiod. Proprietary ratioe. Net profit ratio.
< Answer >
 
17.
Which of the following should be
deducted
in the Balance Sheet of a company from the share capital tofind out paid-up capital?a. Calls-in-advanceb. Calls-in-arrearsc. Share forfeitured. Discount on issue of sharese. Share premium.
< Answer >
 
18.
Which of the following statements is
false?
 a. The forfeited shares should not be issued at a premiumb. At the time of forfeiture of shares, share premium should not be debited with the amount of premium already receivedc. Shares can be issued at a discount only after one year from the commencement of businessd. Share premium cannot be utilized to redeem preference sharese. The loss on re-issue of shares cannot be more than the gain on forfeiture of those shares.
< Answer >
 
19.
Which of the following accounting treatments is/are
true
in respect of accrued commission appearingon the debit side of a trial balance?a. It is shown on the debit side of the profit and loss accountb. It is shown on the credit side of the profit and loss accountc. It is shown on the liabilities side of the balance sheetd. It is shown on the assets side of the balance sheete. Both (b) and (d) above.
< Answer >
 
20.
The maximum amount beyond which a company is
not
allowed to raise funds by issue of shares isa. Issued capitalb. Reserve capitalc. Nominal capitald. Subscribed capitale. Paid-up capital.
< Answer >
 
21.
The discount allowed on re-issue of forfeited shares is debited to
< Answer >
 

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