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QUIZ - 1

1 NO NEGATIVE MARKING
Om Ltd. had assets and liabilities worth Rs.5,00,000 and Rs. 2,50,000 respectively in the beginning of
a financial year. If total liabilities increased by Rs. 33,000 and owners equity decreased by Rs. 58,000
during the year, what was the amount of total assets at the end of the year?
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1 Rs. 5,33,000
2 Rs. 2,50,000
3 Rs. 475,000
4 Rs. 192,000

2 NO NEGATIVE MARKING
Expense means
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1 Incurrence of liabilities
2 Using up of assets
3 Decrease in owners equity
4 All of the above
5 None of the above

3 NO NEGATIVE MARKING
A company borrowed Rs. 5,000 from a National bank. As a result of this transaction
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1 Assets would decrease by Rs. 5,000
2 Liabilities would increase by Rs. 5,000
3 Equity would increase by Rs. 5,000
4 Revenue would increase by Rs. 5,000

4 NO NEGATIVE MARKING
From the following information, calculate the owners equity
Cash Rs. 200
Inventory 500
Rent payable 50
Salaries payable 100
Accounts payable 200
Other assets 300
Sales revenue 2,000
Owners equity ?
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1 Rs 670
2 Rs. 780
3 Rs. 2,750
4 Rs. 650
5 NO NEGATIVE MARKING
Mr. X started a business with Rs. 10,000 of personal savings and Rs. 6,000 from the bank at an
interest rate of 10% per annum . The company earned Rs. 6,000 cash from services provided. The
rent expense is Rs. 450 monthly. The company also paid employees Rs. 4,000 during the month. Did
Xs new business make a profit during the first month of business? If so, how much?
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1 Rs. 550
2 Rs.11,550
3 Rs. 1,500
4 Rs. 5,550

6 NO NEGATIVE MARKING
X Ltd. has plant and machinery worth Rs. 52,75,000. Besides plant and machinery, the company has
other assets. Liabilities and shareholders equity amount to Rs. 10,00,000 and Rs. 50,00,000
respectively. The total assets of the company would be
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1 Equal to Rs. 60,00,000
2 Less than Rs. 60,00,000
3 More than Rs. 60,00,000
4 Rs.7,25,000

7 NO NEGATIVE MARKING
If revenue was Rs. 45,000, expenses were Rs. 37,500 and the owners withdrawals for personal
expenses were Rs. 10,000, the amount of net income or net loss would be
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1 Rs. 45,000 net income
2 Rs. 37,500 net loss
3 Rs. 7,500 net income
4 Rs. 2,500 net loss

8 NO NEGATIVE MARKING
Mr. Xs capital as on 1.4.2010 was Rs. 1,20,000. During the year he introduced additional capital of
Rs. 50,000 but withdrew Rs. 25,000 for personal expenses. His capital stood at Rs. 2,25,000 as on
31.3.2011. His profit or loss during the period was
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1 Rs. 85,000 profit
2 Rs. 4,20,000 loss
3 Rs. 55,000 loss
4 Rs. 80,000 profit
9 NO NEGATIVE MARKING
X purchased a piece of furniture for Rs. 60,000 on which Rs. 25,000 is still to be paid. The furniture
was sold for Rs. 1,20,000 in cash. After receiving the cash, X paid Rs. 25,000 owed. What is the effect
on equity?
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1 Equity would increase by Rs. 1,20,000
2 Equity would increase by Rs. 60,000
3 Equity would increase by Rs. Rs. 35,000
4 Equity would decrease by Rs. 60,000

10 NO NEGATIVE MARKING
A law firm receives Rs. 2,000 retainer fees from a new client at the initial client meeting. The
transaction will
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1 Increase cash balance by Rs. 2000 and increase legal fees revenue by Rs. 2,000
2 Decrease unearned revenue by Rs. 2,000 and increase legal fees revenue by Rs. 2,000
3 Increase cash balance by Rs. 2000 and increase unearned revenue by Rs. 2,000
4 Increase accounts receivable balance by Rs. 2000 and increase legal fees revenue by Rs.
2,000

11 NO NEGATIVE MARKING
During the current period, a company collects Rs. 100 cash on account of accounts receivable from a
customer for a sale last year. How would the receipt of cash impact the following two financial
statements this period?
Income Statement Statement of Cash flows
a) Revenue( + Rs. 100) I Inflow from Investing
b) No impact Inflow from Financing
c) Revenue( Rs. 100) Inflow from Operations
d) No impact Inflow from Operations
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1 A
2 B
3 C
4 D

12 NO NEGATIVE MARKING
Liabilities and Owners equity of X Ltd. at the end of year amount to Rs. 4, 00,000 and Rs. 2, 00,000
respectively. The company has doubled the amount of assets from the beginning to the end of the
year. What is the amount of X Ltd.s assets at the beginning of the year?
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1 Rs. 6,00,000
2 Rs. 1,00,000
3 Rs. 3,00,000
4 Rs. 2,00,000
13 NO NEGATIVE MARKING
13. Total assets, end of period Rs. 40,000
Share Capital at the end 10,000
Retained earnings, beginning of period 15,000
Net income for the period 8,000
Dividends for the period 2,000
How much is total Liabilities, at the end of period?
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1 Rs. 91,000
2 Rs. 99,000
3 Rs. 9,000
4 Rs. 21,000

14 NO NEGATIVE MARKING
A summary of the revenue and expense transactions for 2012 is given below.
Fees earned Rs. 1,65,800
Wages payable 71,500
Miscellaneous expense 2,500
Rent expense 25,000
Wages expense 42,000
Supplies expense 3,500
Unearned revenue 25,000
The profit or loss for the period is
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1 Rs. 92,800 Profit
2 Rs. 60,380 Loss
3 Rs. 83,600 Loss
4 Rs. 46,300 Profit

15 NO NEGATIVE MARKING
The main advantage(s) of company form of business is / are
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1 Limited liability
2 Perpetual existence
3 Ease of raising capital
4 All of the above