PC 14

Practice Set-3
1. Costs that change in response to alternative courses of action are called[D1]
a. Relevant costs b. Differential costs
c. Target costs d. Sunk costs
2. Period I: Sales ₹ 20 lakhs; Profit- ₹ 2 lakhs
Period II: Sales ₹ 30 lakhs; Profit ₹ 4 lakhs.
The Profit/Volume ration will be
a. 12% b. 10%
c. 20% d. 15%
3. The measureable value of an alternative use of resources is referred to as:
a. An opportunity cost b. An imputed cost
c. A sunk cost d. None of these
4. Variable costs are conventionally deemed to
a. Be constant per unit of output b. Vary per unit of output as production volume changes
c. Be constant in total when production volume changes
d. Vary, in total, from period to period when production is constant
5. The method of inventory management is particularly suitable in case of perishable materials and in the
period of falling prices
a. Simple Average b. Average Weightage
c. LIFO d. FIFO
6. Pick the correct one
a. Discarded material substances having no value is called scrap
b. Discarded material substances having some value is waste
c. Both A&B
d. None of the given
7. Incorrect about ABC Analysis
a. Category A- 10% of total inventory but 70% of the value of total inventory
b. Category B- 20% of total inventory but 20% of the value of total inventory
c. Category C- 70% of total inventory but 10% of the value of total inventory
d. None of the given
8. The basic research cost should be treated as
a. Product cost b. Production cost
c. Production overhead d. Period cost
9. With regard to break –even charts and break-even analysis, which of the following is true?
a. It is assumed that variable cost fluctuates in direct proportion to output
b. The break-even point is at the intersection of the sales line and the variable cost line
c. A break-even chart shown the maximum profit possible
d. A break-even chart is capable of dealing with any change of product mix
10. Interest on own capital is a
a. Cash cost b. Notional cost
c. Sunk cost d. Part of prime cost
11. Inventory of ₹ 96,000 was purchased during the year. The cost of goods sold was ₹ 90,000 and the ending
inventory was ₹ 18,000. What was the inventory turnover ratio for the year?
a. 5.0 times b. 5.3 times
c. 6.0 times d. 6.4 times
12. If time allowed for a job is 10 hours, time taken for the job is 8 hours and rate of pay is ₹ 2 per hour, the
bonus to the worker is :
a. ₹ 1.20 b. ₹ 2.00
c. ₹ 3.20 d. None of the above

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Prepared by Deepak Kumar Rahi, AAO (LAD/Patna)
13. Juniper Limited‘s budgeted overhead in the last period was ₹ 170,000. Its overhead absorbed and incurred
for the same period were ₹ 180,000 and ₹ 195,000 respectively. What is its amount of over- or under-
absorption of overhead?
a. Under-absorption of ₹ 15,000 b. Under-absorption of ₹ 25,000
c. Over-absorption of ₹ 15,000 d. Over-absorption of ₹ 25,000
14. Annual requirement is 7800 units; consumption per week is 150 units. Unit price ₹ 5, order cost ₹ 10 per
order. Carrying cost ₹ 1 per unit and lead time is 3 week, The Economic order quantity would be:
a. 395 units b. 300 units
c. 250 units d. 150 units
15. If 120 units produced, 100 units were sold @ ₹ 200 per unit. Variable cost related to production & selling
is ₹ 150 per unit and fixed cost is ₹ 5,000. If the management wants to decrease sales price by 10%, what
will be the effect of decreasing unit sales price on profitability of company?
a. Remains constant b. Profits will increased
c. Company will have to face losses d. None of the given options
MCQ 16-19 are based on the following data:
The following is the Income Statement of a Company for last month:
Particular Amount
(i) Sales ₹ 4,000,000
(ii) Less: variable expenses ₹ 1,800,000
(iii) Contribution margin ₹ 2,200,000
(iv) Less: fixed expenses ₹ 7,20,000
(v) Net income ₹ 14,80,000
The company has no beginning or ending inventories. A total of 80,000 units were produced and sold last
month.
16. What is the company's contribution margin ratio?
a. 30% b. 55%
c. 50% d. None of given options
17. What is the company's break-even in units?
a. 48,000 units b. 72,000 units
c. 80,000 units d. None of the given options
18. How many units would the company have to sell to attain target profits of ₹ 600,000?
a. 48,000 units b. 88,000 units
c. 106,668 units d. None of given options
19. What is the company's margin of safety in ₹ ?
a. ₹ 1,600,000 b. ₹ 2,400,000
c. ₹ 25,60,000 d. None of the given options
20. A worker takes 6 hours to complete a job under a scheme of payment by results. The standard time allowed
for the job is 9 hours and wage rate is ₹.15/hour. Wage payable under the Rowan Plan would be
a. ₹ 90 b. ₹ 112.5
c. ₹ 120 d. ₹ 135
21. Which of the following is true with respect to providing depreciation under diminishing balance method[D2]?
(a) The amount of depreciation keeps increasing every year while the rate of depreciation keeps decreasing
(b) The amount of depreciation and the rate of depreciation decrease every year
(c) The amount of depreciation decreases while the rate of depreciation remains the same
(d) The amount of depreciation and the rate of depreciation increases every year
22. The balance of Revaluation Reserve pertaining to an asset that has been disposed off or retired can be
transferred to
(a) General Reserve A/c (b) Profit & Loss A/c
(c) Asset A/c (d) Capital Reserve A/c
23. The creation of provision for doubtful debts given as an adjustment requires
(a) Debit Profit and Loss Account and deduct the provision from debtors
(b) Credit Profit & Loss Account and deduct the provision from debtors
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Prepared by Deepak Kumar Rahi, AAO (LAD/Patna)
 (c) Credit Profit and Loss Account and add the provision to debtors
(d) Debit Profit & Loss Account and add the provision to debtors
24. Profit prior to incorporation is an example of:
a. Capital reserve b. Revenue reserve
c. Secret reserve d. None of these
25. The opening balance of “provision for doubtful debts account” is ₹ 1000 whereas the closing balance of
debtors account is ₹ 100,000. What amount of provision for doubtful debts should be charged to income
statement using a 5% provision for doubtful debts for the current accounting period?
a. ₹ 5000 b. ₹ 4000
c. ₹ 2000 d. ₹ 1000
26. The main objective of providing depreciation is to
(a) Calculate the true profit (b) Show the true financial position in the Balance Sheet
(c) Provide funds for replacement of fixed assets
(d) Both (a) and (b) above
27. The maximum amount beyond which a company is not allowed to raise funds, by issue of share is[D3]
(a) Issued Capital (b) Reserve Capital
(c) Subscribed Capital (d) Authorised Capital
28. If the total of the credit side of the Trading account is more than the total of the debit side, the difference
is the
a. Gross Loss b. Gross Profit
c. Net Loss d. Net Profit
29. If net profit of a firm is ₹ 20000/- and manager is provided a commission @5% on the profit before charging
such commission, the amount of manager commission that to be shown in Profit & Loss Accounts will be
a. ₹ 1000 b. ₹ 1905
c. ₹ 952 d. ₹ 2000
30. Pick the correct one
i. Current ratio is calculated as Current Assets/Current Liabilities
ii. The ideal current ratio is 3:1
iii. Higher the ratio, the greater is the short term solvency of a firm and vice a versa. However, if the ratio
is very high it means the current assets are lying idle.
iv. Lower the ratio means that short term solvency of the firm is not good

a. ii, iii and iv b. i, iii and iv

c. i, ii and iii d. All of the above
31. Calculate liquid or quick ratio from the data given below
Sundry debtors 4,00,000 Stock 160,000 Marketable securities 80,000 Cash 120,000
Prepaid expenses 40,000 Bill payables 80,000 Sundry creditors 160,000
Debentures 2,00,000 Outstanding Expenses 160,000
a. 2:1 b. 1.5:1
c. 1.9:1 d. 1.75:1
32. Qualitative characteristics of financial information are[D4]
i. Reliability ii. Understandability
iii. Relevance iv. Comparability
v. Long-lasting

a. i, ii, iii and iv b. ii, iii, iv and v

c. i, iii, iv and v d. All of the above

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Prepared by Deepak Kumar Rahi, AAO (LAD/Patna)
33. The stakeholder that concerned with ensuring that the money invested in the company/organisation is
generating an adequate return and that the company/organisation is able to pay its debts and remain
solvent
a. Owner b. Shareholder
c. Director/Management d. Bank/Lender
34. Depreciation to Fixed assets is provided keeping in mind
a. Business Entity b. Going Concern
c. Convention of Conservatism d. Convection of Consistency
35. Every transactions has two aspects i.e., debit and credit, under which of the following accounting principles:
a. Cash Accrual Principle b. Revenue Accrual Principle
c. Dual Aspect Principle d. Double Entry Book-keeping System
36. The information which will influence the decision of its user is called
a. Revenue b. Material
c. Accrual d. Consistency
37. All fixed assets are recorded in the books of accounts at their historical price under
a. Conservatism Concept b. Revenue Recognition Concept
c. Principle of Objectivity d. Cost Concept
38. If a firm believes that some of its debtors may ‘default’, it should act on this by making sure that all possible
losses are recorded in the books. This is an example of the
a. Business Entity concept b. Accrual Concept
c. Going Concern Concept d. Conservatism Concept
39. If the Going Concern concept is no longer valid, which of the following is true?
(a) All prepaid assets would be completely written-off immediately
(b) Total contributed Capital and Retained Earnings would remain unchanged
(c) Intangible Assets would continue to be carried at net Amortized historical cost
(d) Land held as an Investment would be valued at its realizable value
40. In the creditors control account, all of the below exist except:
(a) Credit purchases (b) Purchase returns
(c) Cash purchases (d) Cash/cheques paid
41. Mr. Rohit, owner of Rohit Furniture Ltd., owns a personal residence that cost ₹ 6,00,000, but has a market
value of ₹ 9,00,000. During preparation of the financial statement for the business, the entire value of
property was ignored and was not shown in the financial statements. The principle that was followed was
(a) The concept of the Business Entity (b) The concept of the Cost Principle
(c) The concept of Going Concern Principle (d) The concept of Duality Principle
42. A firm purchased goods costing ₹ 1,00,000. He sold goods costing ₹ 50,000 at ₹ 75,000 and the remaining
were sold to a customer cooperative society at the same GP as in the case of direct sales less 20%. Find the
total sales of the firm[D5]
(a) ₹ 1,35,000 (b) ₹ 90,000
(c) ₹ 1,50,000 (d) ₹ 1,40,000
43. Calculate sales from the following
Opening Stock ₹ 50,000, Closing Stock ₹ 40,000, Purchase less returns ₹ 1,90,000, Profit margin is 16.66%
on the sales
(a) ₹ 2,20,000 (b) ₹ 2,40,000
(c) ₹ 1,50,000 (d) ₹ 1,90,000
44. Choose the true statement
(a) Accrued income represent income unearned but realized in cash
(b) Accrued income represent income earned but not realized in cash
(c) Accrued income A/c is shown on the liability side
(d) No tax is payable on accrued income

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Prepared by Deepak Kumar Rahi, AAO (LAD/Patna)
45. Which of the following errors is an error of principle?
(a) Total sales figure was taken as ₹ 19,373 instead of ₹ 19,733
(b) A discount of ₹ 30 allowed to Mr. A was not recorded in the discount allowed account
(c) Legal charges for acquisition of building for ₹ 500 was entered in the Legal Expenses Account
(d) ₹ 1,000 received from Mr. X was posted to the credit of Mr. M
46. Which of the following errors is an error of omission?
(a) Sale of ₹ 100 was recorded in the Purchases Journal
(b) Wages paid to Mohan have been debited to his account
(c) The total of the sales journal has not been posted to the Sales Account
(d) Repairs to buildings have been debited to buildings account
47. From the books of Mr. Nitin, it was observed that cheques amounting to ₹ 2,40,000 were deposited in the
bank, out of which cheques worth ₹ 20,000 were dishonoured and cheques worth ₹ 40,000 are still in the
process of collection. The treatment of this while preparing Bank Reconciliation Statement is
(a) Deduct ₹ 60,000 from bank balance as per pass book
(b) Add ₹ 20,000 and deduct ₹ 40,000 from overdraft balance as per cash book
(c) Deduct ₹ 60,000 from overdraft balance as per pass book
(d) Add ₹ 60,000 from overdraft balance as per pass book
48. Purchase of Fixed Assets on credit is originally recorded in
(a) Purchases Book (b) Ledger
(c) Cash Book (d) Journal Proper
49. The document listing the latest balances of all Real and Personal A/c in the ledger on a given date is known
as
(a) Trial Balance (b) Positional Statement
(c) Income Statement (d) Charter of Accounts
50. Which of the following statements is false?
a. When the bank column of a Cash Book shows a credit balance, it means an amount is due to the bank
b. When Pass Book shows a debit balance, it means overdraft as per Pass Book
c. While preparing Bank Reconciliation Statement, cheques paid into bank but not yet cleared are deducted
from the Debit balance as per Cash Book to arrive at the balance as per Pass Book
d. A Bank Reconciliation Statement is a part of Pass Book
51. Which of the following statements is correct?
(a) The Trial Balance is prepared after preparing the Profit and Loss Account
(b) The Trial Balance shows only balances of Assets and Liabilities
(c) The Trial Balance shows only nominal account balances
(d) The Trial Balance has no statutory importance from the point of view of law
52. As per AS-2, closing stock is generally valued at[D6]
(a) Cost Price (b) Market Price
(c) Cost price or Market price whichever is higher
(d) Cost price or Market price whichever is lower
53. Property, Plant and Equipment are conventionally presented in the Balance Sheet at historical cost-
depreciation portion thereof i.e. net book value in terms of Accounting Standard
a. AS-10 b. AS-06
c. AS-13 d. AS-08
54. Accounting Standards are issued for the purpose of —
a. For improving the reliability of financial statements
b. Harmonizing accounting policies
c. Elimination of non-comparability between financial statements
d. All the three
55. In terms of AS-09 Revenue recognition, the components of revenue are
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Prepared by Deepak Kumar Rahi, AAO (LAD/Patna)
 a. Proceeds from sale of goods and rendering of services
b. Proceeds from sale of goods, rendering of services and interest
c. Proceeds from sale of goods, rendering of services, interest, royalties and dividends
d. Proceeds from sale of goods, rendering of services, interest, royalties, dividends and disposal of assets.
56. In terms of provision given there AS-10 Accounting of Fixed Assets (Property, Plant and Equipment), the
cost of a fixed asset includes
i. Import Duties and other non-refundable taxes
ii. Any expenses before the asset is put to use and commercial production
iii. Professional fees
iv. Loss on deferred payment on a/c of foreign currency liability

a. i, ii and iii b. ii, iii and iv

c. i, iii and iv d. All of the above
57. Pick the incorrect one
a. AS 13- Accounting for Amalgamation b. AS-17- Segment Reporting
c. AS 18-Lease d. AS 22- Accounting for Taxes on Income
58. In accordance with the AS-29 that deals with Provision, Contingent Liabilities and Contingent Assets, pick
the correct one
i. A present obligation is an obligation is a present obligation if, based on the evidence available, its
existence at the balance sheet date is considered Probable, i.e. more likely than not.
ii. An obligation is a possible obligation if, based on the evidence available, its existence at the balance sheet
date is considered Not Probable.
iii. A contingent liability is the liability the existence of which will be confirmed by the occurrence or non-
occurrence of future events not wholly within the control of the enterprise.
iv. In addition to disclosing the Contingent liability in Financial Statement, suitable provision with reliable
estimation should be made in the Financial Statement.

a. i, ii and iii b. ii, iii and iv

c. i, iii and iv d. All of the above.
59. In terms of AS-25 interim financial report means a financial report containing either a complete set of
financial statements or a set of condensed financial statements (as described in this Statement) for an
interim period i.e. a reporting period shorter than a full financial year and consist of following except
a. condensed balance sheet & condensed statement of profit & loss
b. condensed cash flow statement c. selected explanatory notes
d. None of the given
60. Pick the incorrect one in terms of AS-22 Accounting for Taxes on Income
a. Accounting income is the net profit or loss for a period, as reported in the statement of profit and loss,
before deducting income tax expense or adding income tax saving i.e. PBT as per P/L A/c
b. Taxable income or tax loss is he amount of income (loss) for a period, determined in accordance with the
tax laws, based upon which income tax payable or recoverable is determined.
c. Deferred tax are the differences between taxable income and accounting income for a period that
originate in one period and are capable of reversal in one or more subsequent periods such as depreciation
rate/method different as per Accounts and Income tax Calculation
d. Permanent differences are the differences between taxable income and accounting income for a period
that originate in one period and do not reverse subsequently such as Expenditure allowed/disallowed as
per Income Tax Act
61. Pick the correct one with regard to AS- 13 Accounting for investment
a. When acquired by issue of shares or other securities; then the investments should be valued at the fair
value of the issued security. i.e. Issue price determined by statutory authority
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Prepared by Deepak Kumar Rahi, AAO (LAD/Patna)
 b. When acquired by exchange of another asset; then the investments should be valued at fair value of the
asset given up or asset acquired, whichever is more clearly evident.
c. Neither A nor B
d. Both A&B
62. Prime cost is calculated as under[D7]
(a) Manufacturing Cost/Cost of Goods Sold (b) Direct Method plus factory overheads
(c) Direct labour + Direct Material (d) None of the given
63. Which of the following is TRUE regarding the use of blanket rate?
(a) The use of a single blanket rate makes the apportionment of overhead costs unnecessary
(b) The use of a single blanket rate makes the apportionment of overhead costs necessary
(c) The use of a single blanket rate makes the apportionment of overhead costs uniform
(d) None of the given options
64. Weighted average cost per unit is calculated by which of the following formula?
a. Cost of goods issued/number of units issued b. Total Cost/Total Units
c. Cost of goods manufactured/closing units d. Cost of goods sold/total units
65. Where the applied FOH cost is less than the actual FOH cost it is:
(a) Unfavourable variance (b) Favourable variance
(c) Normal variance (d) Budgeted variance
66. While transporting petrol, a little quantity will be evaporated; such kind of loss is termed as
(a) Normal Loss (b) Abnormal Loss
(c) It is incremental loss (d) It cannot be abnormal loss
67. The cost of electricity bill of the factory is treated as:
(a) Fixed cost (b) Variable cost
(c) Step cost (d) Semi variable cost
68. Which of the given is not a method of measurement of Labour Turnover?
(a) Separation method (b) Flux method
(c) Replacement method (d) Product Method
69. The term contribution refers to?
(a) The actual amount of profit made per unit
(b) The difference between sales revenue and variable costs per unit.
(c) The amount of profit which goes towards meeting the overheads of the business.
(d) The budgeted profit per unit.
70. A disadvantage of an hourly wage plan is that it
(a) Provides no incentive for employees to achieve and maintain a high level of production.
(b) Is hardly ever used and is difficult to apply (c) Establishes a definite rate per hour for each employee.
(d) Encourages employees to sacrifice quality in order to maximize earnings.
71. Rent, Lighting and heating, Fire precaution service Air conditioning are apportioned on the basis of
a. Wages of workers b. cost of material
c. value of output units d. Floor Area or Volume
72. The Factory cost will be when
(i) Raw material consumed = Rs 50,00,000 (ii) Direct wages = Rs20,00,000
(iii) Direct expenses = Rs 10,00,000 (iv) Factory expenses 80% of direct wages
(v) O/stock of work in progress = Rs 15,00,000 (vi) C/stock of work in progress = Rs 21,00,000
a. 11100000 b. 9600000
c. 9000000 d. 8000000
73. Number of employees on 1st April 2017: 950, Number of employees on 31st March 2018: 1,050
Number of workers who quit the factory in September 2017: 10,
Number of workers discharged in January 2018: 30
Number of workers engaged in December 2017(Including 120 on account of expansion scheme): 140
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Prepared by Deepak Kumar Rahi, AAO (LAD/Patna)
 The labour turnover under replacement method will be
a. 2% b. 4%
c. 8% d. 12%
74. Task of producing 50 units in 8 hours and the guarantees time wages are ₹ 20/hour. Piece rate is ₹ 4/unit
is payable when task is completed before the standard time. When a worker completes the task in 6 hour,
the wages payable to him under Gantt System would be
a. ₹ 160 b. ₹ 176
c. ₹ 192 d. ₹ 200
75. Daily requirement of an item- 50, order cost- ₹ 50/per order, inventory carrying cost- ₹ 0.02/day and lead
period-32 days, find out the Re-Order level.
a. 1520 b. 1600
c. 1380 d. 1468
76. Standard output is 40 units/hour, standard rate ₹s. 4/hour and working hours is 8 hours. When a worker
produces 240 units in day, the wages as per normal piece rate will
a. ₹ 32 b. ₹ 24
c. ₹ 40 d. ₹ 36
77. Fixed cost - ₹ 500000, Variable Cost- ₹ 10 per unit, Selling Price- ₹ 15 per unit, the profit at output of 150000
units will be
a. ₹ 750000 b. ₹ 250000
c. ₹ 500000 d. ₹ 300000
78. When Sales- ₹ 1,00,000; Total Cost- ₹ 80,000; Fixed Cost- ₹ 20,000 and Net Profit- ₹ 20,000, the Margin of
Safety is
a. ₹ 20000 b. ₹ 40000
c. ₹ 50000 d. ₹ 80000
79. Selling price 20, variable cost is 12 and fixed cost is ₹ 2000000. If both selling price and fixed cost are
decreased by 10% , the revised break-even point will be
a. 200000 units b. 250000 units
c. 275000 units d. 300000 units
80. Standard time/piece is 20 minute and normal rate per hour in a day of 8 hours is ₹ 9. Amar, Akbar and
Anthony produced 23 units, 24 units and 30 units respectively in a day. Their wages under Taylor’s
Differential Plan would be
a. Amar-₹ 72, Akbar-₹ 72 and Anthony-₹ 79.2
b. Amar-₹ 72, Akbar-₹ 79.2 and Anthony-₹ 79.2
c. Amar-₹ 72, Akbar-₹ 79.2 and Anthony-₹ 86.4
d. Amar-₹ 55.2, Akbar-₹ 86.4 and Anthony-₹ 108
81. Janet sells a product for ₹ 6.25. The variable costs are ₹ 3.75. Janet's break-even units are 35,000. What is
the amount of fixed costs?
(a) ₹ 87,500 (b) ₹ 35,000
(c) ₹ 131,250 (d) ₹ 104,750
82. The Committee set for recommending Uniform Format of Accounts for Central Autonomous Bodies
consisted following except[D8]
a. CGA b. representative of CAG
c. representative of Inst. of Chartered Accountants and Inst. of Cost & Works Accountants
d. representative of Indian Bank Association
83. Pick the correct one
i. While finalising the draft format, the two main objectives of the Committee were to provide all necessary
guidelines on one hand and on other hand to facilitate the autonomous organisations in bringing out all the
disclosures and their respective accounting policies.
ii. With this the Committee expected emergence of transparency, uniformity and clarity for both the
autonomous organisations and the Government.

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 iii. The rigidity was avoided as the format did intend to give an overall structure in which the autonomous
organisations were expected to generate necessary information for management, the Government and
other users of the financial information
iv. The committee circulated the draft formats to 362 central autonomous organisation for their comments
in orders to elicit their view on financial reporting, to acclimatize them with new requirement and to
promote acceptability by those who prepare the accounts in autonomous organisations.

a. i, ii and iii b. ii, iii and iv

c. i, ii and iv d. All of the above
84. Pick the correct one
a. Most of the organisations’ accounts were prepared on cash basis and not accrual basis which did not
provide adequate distinction between capital and revenue and also recording of assets and liabilities were
incomplete.
b. The Committee suggested introduction of accrual based accounting system as without the provision of
for depreciation the “True and Fair View” of financial position of an organisation cannot be established.
c. Both A& B
d. None of the given
85. All autonomous bodies should follow one common format for its accounting and presentation of
accounting information effective from
a. 01.01.2000 b. 01.04.2001
c. 01.01.2001 d. 01.04.2000
86. Pick the incorrect one with regard to valuation of inventory
a. Stores and spares including machinery spares at-Cost
b. Raw-materials, semi-finished goods and finished goods-lower of cost and net realisable value
c. The cost are based on FIFO
d. None of the given
87. Deferred Revenue Expenditure should be written over a period of
a. 5 years from the year it is incurred b. 4 years from the year it is incurred
c. 3 years from the year it is incurred d. 2 years from the year it is incurred
88. Which of the following is correct[D9]?
a. Liabilities = Assets + Capital b. Assets = Liabilities – Capital
c. Capital = Assets – Liabilities d. Capital = Assets + Liabilities.
89. When a firm maintains a cash book, it need not maintain
a. Journal Proper b. Purchases (journal) book
c. Sales (journal) book d. Bank and cash account in the ledger
90. Credit balance of bank account column in cash book shows
a. Overdraft b. Cash deposited in our bank
c. Cash withdrawn from bank d. None of these
91. An asset was purchased for Rs.1000000 with the down payment of Rs.200000 and bills accepted for
Rs.800000/-. What would be the effect on the total asset and total liabilities in the balance sheet?
a. Assets increased by Rs.800000 and liabilities decreased by Rs.800000
b. Assets decreased by Rs.800000 and liabilities increased by Rs.800000
c. Assets increased by Rs.1000000 and liabilities increased by Rs.800000
d. Assets increased by Rs.800000 and liabilities increased by Rs.800000
92. Fixed assets are double the current assets and half the capital. The current assets are ₹ 3,00,000 and
investments are Rs.₹ 4,00,000. Then the current liabilities recorded in balance sheet will be
a. ₹ 2,00,000 b. ₹ 1,00,000
c. ₹ 3,00,000 d. ₹ 4,00,000
93. Which of the following is wrong[D10]?
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Prepared by Deepak Kumar Rahi, AAO (LAD/Patna)
 a. All real and personal accounts are transferred to balance sheet
b. Nominal accounts are transferred to P & L account
c. Each account is opened separately in ledger
d. Rent is a personal account, outstanding rent is nominal account
94. The Market price of good declined than the cost price. Then the concept that plays a key role is
a. Realization b. Going concern concept
c. Materiality d. Cost.
95. Which accounting concept specifies the practice of crediting closing stock to the trading account?
a. Cost b. Realisation
c. Going concern d. Matching
96. Deewali advance given to an employee is
a. Revenue Expenditure b. Capital Expenditure
c. Deferred Revenue Expenditure d. None of the given
97. Provision for discount on debtors is calculated on the amount of debtors[D11].
a. Before deducting provision for doubtful debts.
b. After deducting provision for doubtful debts.
c. Before deducting actual debts and provision for doubtful debts.
d. After adding actual bad and doubtful debts.
98. Pick the correct one
a. Minimum paid-up capital for Private Limited Companies should be ₹ 1 lakh whereas for Public Limited
Companies it should be ₹ 5 lakh
b. Minimum paid-up capital for both Private Limited Companies and Public Limited Companies should be
₹ 1 lakh
c. b. Minimum paid-up capital for both Private Limited Companies and Public Limited Companies should be
₹ 5 lakh
d. Minimum paid-up capital for Private Limited Companies should be ₹ 5 lakh whereas for Public Limited
Companies it should be ₹ 10 lakh
99. The maximum managerial remuneration in respect of a company should be
a. Private Limited company- Up-to 11% of net profit, Public Limited Company- Up-to 25% of net profit
b. Private Limited company- Up-to 11% of net profit, Public Limited Company- No restriction
c. Private Limited company- Up-to 25% of net profit, Public Limited Company- Up-to 11% of net profit
d. Private Limited company- No restriction, Public Limited Company- Up-to 11% of net profit
100. A company which controls another company is called a Holding Company and the company so controlled
is called a
a. Parent Company b. Associate Company
c. Resident Company d. Subsidiary Company.

Summary

Cost Dep., Fin. Fundamental Process Standard Uniform

Reserve Statement Format

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Prepared by Deepak Kumar Rahi, AAO (LAD/Patna)
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Prepared by Deepak Kumar Rahi, AAO (LAD/Patna)