1.

Financial Accounting-IKeeping the log of financial information in books of original entries is

called
a) Recording b) summarizing
c) Grouping d) Processing
Answer:a) Recording
2. For which step of accounting process the accountants of business entity prepare financial
statements?
a) Identification of economic event b) Communication of financial information
c) Recording financial information d) Making decisions about business
Answer: b) Communication of financial information
3. Financial accounting provides financial information to all of the following external users
except:
a) Government agencies b) investors
c) Creditors d) Managers
Answer: d) Managers
4. Bookkeeping mainly concerns with which part of accounting process?
a) Analysing b) Preparing financial statements
c) Recording financial information d) Auditing the books of accounts
Answer: c) Recording financial information
5. Identify the correct sequence of accounting process
a) Communicating→Recording→Identifying b)
Recording→Communicating→Identifying
c) Identifying→communicating→recordingd) Identifying→recording→communicating
Answer: c) Identifying→communicating→recording
6. In accounting an Economic event is referred to as:
a) Cash b) Bank statement
c) Transaction d) Exchange of money
Answer: c) Transaction
7. The accounting process involves in recording:
a) Quantifiable economic event b) Non quantifiable economic event
c) All of them d) None of them
Answer: a) Quantifiable economic event
8. What will be debited, if Mohn commenced business with cash?
a) Cash account b) Capital
c) Drawings account d) Proprietor account
Answer: a) Cash account
9. __________ is the art of recording, classifying and summarizing the transactions and events
of a business and interpreting the results thereof.
a) Book-keeping b) Accounting
c) Management d) Auditing
Answer: b) Accounting
10. An amount of Rs. 200 received from Mr. "P" but credited to Mr. "Q" would affect:
a) Accounts of P & Q b) Only Cash Account
c) Only P’s account d) Only Q’s account
Answer: a) Accounts of P & Q
11. In accounting consignment means.
a) Goods forwarded from one place to another. b) Goods forwarded by a person to
another.
c) Goods sent by its owner to his agent. d) Goods sent by its owner to his agent for the
purpose by sale.
Answer: d) Goods sent by its owner to his agent for the purpose by sale.
 12. Goods sent on consignment should be debited by consignor to:
a) Consignment A/c b) Goods sent on consignment A/c
c) Consignees A/c d) Consignors A/c
Answer: a) Consignment A/c
13. In the books of consignor the balance of the consignment stock account would be shown:
a) As an asset in the balance sheet. b) As liability in the balance sheet.
c) On the credit side of trading account. d) On the credit side of consignment account.
Answer: d) On the credit side of consignment account.
14. On the dispatch of goods, the entry in the books of consignee would be:
a) Consignment A/c will be debited and goods sent on consignment A/c will be credited. b)
Consignment A/c debit and consignee A/c credit
c) No entry d) None of above
Answer: c) No entry
15. The consignor is:
a) Principal b) Agent
c) Debtor d) None of them
Answer: a) Principal
16. Joint Venture account is a :
(a) Personal Account (b) Real Account (c) Nominal Account (d) none
Joint Bank account is a :
(a) Personal Account (b) Real Account (c) Nominal Account (d) none
17. The partners to joint venture are called
(a) Co-venturers (b) Partners (c) Principal and agent (d) Friends
18. If separate set of books is maintained and discount is received at the time of purchase of
goods then such a discount will be treated as :
(a) Income of Joint Venture hence credited to joint venture account (b) Expense of Joint venture
hence debited to joint venture account (c) Will not be recorded in books of account (d) Credited to
co-venturer account
19. What is the nature of Joint Venture with co-venture’s A/c : (a) Nominal Account (b) Real
Account (c) Personal account (d) None
20. X spending a sum of 10,000 on account of joint venture, will be credited to ____________
account in case of the records being maintained in the books of X : (a) Memorandum J.V. (b)
Joint Venture (c) Co-Venturers (d) Cash
6. When purchases are made for the joint venture out of joint bank account, the ….. account is
debited. (a) Joint venture (b) Expenses (c) Joint Bank (d) None
When unsold stock is taken away by a Co–venturer, the ………. Account is debited. (a) stock with joint
venture (b) Co–venturer’s capital (c) Joint Bank (c) None
8. Shares of a company taken over by A and B under underwriting contract, when sold by them will
be credited to ……….. account. (a) sharing holding (b) joint venture (c) both (d) None
9. The account opened in the books of X, who is in joint venture with Y under Memorandum Joint
venture method, is headed as …………. Account. (a) Joint venture (b) joint venture with Y (c) Joint
Bank (d) None
10. X spending a sum of 2,000 on account of Joint venture, will be debited to …………….. account in
case of the records being maintained in books of X. (a) Joint venture (b) Cash (c) Co-coventurer (d)
None
21. What does a credit balance of income & expenditure account show at the end of a year?
a) Surplus b) Loss
c) Deficit d) Gross profit
Answer: a) Surplus
22. The name of the account prepared by a non trading concern to calculate the balance ofcash
or balance at bank is called:
a) bank account b) bank statement
c) income & expenditure account d) Receipts and payments account.
Answer: d) Receipts and payments account.
23. The difference between total assets and total liabilities of a club is known as:
a) capital b) working capital
c) accumulated fund d) total capital
Answer: c) accumulated fund
24. The subscription details of a club are given below:-
Received during the year Rs. 1080
Subscription in advance on 1-1-2003 Rs. 300
Subscription in advance on 31-12- 2003 Rs.50
What amount will be entered in the income & expenditure account for the year ended 31st
December 2003?
a) Rs.1330 b) Rs.830
c) Rs.1080 d) Rs.1380
Answer: a) Rs.1330
25. The following details are available:
Subscription arrears on 1-1-2003 Rs. 200
Subscription received during the year Rs. 2080
Subscription in advance on 31-12-2003 Rs. 150
Subscription in advance on 1-1-2003 Rs. 300
What is the amount to be shown in the income & expenditure account for the year ended 31st
December 2003?
a) Rs 3180 b) Rs 1880
c) Rs 2030 d) Rs 2230
Answer: c) Rs. 2030
26. Which should be considered as capital receipt of a club?
a) Donation b) Sale of news paper
c) Sale of Furniture d) Sale of bar items
Answer: a) Donation
27. Which of the following items will not appear in the balance sheet of a club?
a) Subscription received for the current year. b) Subscription received for the next
year.
c) Subscription outstanding during the year. d) Insurance prepaid
Answer: d) Insurance prepaid
28. How are the subscriptions paid in advance recorded in a club’s balance sheet?
a) A current asset. b) A current liability.
c) A fixed asset. d) Added to accumulated fund.
Answer: b) A current liability.
29. Which of the following will not be entered in income & expenditure account?
a) Sale of old newspaper. b) Loss on sale of an asset.
c) Payment of honorarium. d) Amount received from sale of Furniture.
Answer: d) Amount received from sale of Furniture.
30. The subscription account is classified as?
a) Income account b) Expenses Account
c) Assets d) Liabilities
Answer: a) Income account
31. In single entry system profit is calculated as follows:
a) Opening Capital + Drawing + Fresh Capital- Endingcapital b) Capital at the end –
Drawing – Fresh capital- Opening capital
c) Capital at the end + Drawing –Fresh capital-Openingcapital d) None of the above
Answer: c)Capital at the end + Drawing –Fresh capital-Opening capital
32. In single entry system only accounts are opened:
a) Personal A/c b) Real A/c
c) Nominal A/c d) Real & Nominal A/c
Answer: a) Personal A/c
33. Single entry system cannot be a maintained by:
a) Joint stock company b) Partnership A/c
c) Sole-tradership A/c d) All of these
Answer: a) Joint stock company
34. Single entry system of book – keeping is generally followed by:
a) Small business b) Non – trading
c) Large business d) None of the above
Answer: a) Small business
35. A statement of assets and liabilities prepared under the single entry system is called:
a) Balance sheet b) Financial statement
c) Cash statement d) Statement of affairs
Answer: d) Statement of affairs
36. Net worth of an organization means the excess of its total assets over total:
a) Expenses b) Incomes
c) Liabilities d) Both (a) and (b)
Answer: c) Liabilities
37. Which one of is most likely to have the lowest rate of stock turn:
a) Jeweler b) Green grocer
c) Super market d) News agent
Answer: a) Jeweler
38. If a store’s markup is 25% the margin must be:
a) 5% b) 15%
c) 10% d) 20%
Answer: d) 20%
39. If the rate of G.P on sale is 20% and cost of goods, sold is Rs. 100,000, then amount of G.P
will be equal to:
a) Rs. 20,000 b) Rs. 25,000
c) Rs. 35,000 d) Rs. 15,000
Answer: b) Rs. 25,000
40. Bad-debts written off always affect the:
a) Debtors A/c b) Creditor
c) Cash A/c d) None of these
Answer: a) Debtors A/c
41. Depreciation means ………..in assets.
a) Increase b) Decrease
c) Decline d) All three
Answer: b) Decrease
42. The main object of providing depreciation is:
a) To calculate true profit. b) To show true financial position.
c) To reduce tax. d) To provide funds for replacement.
Answer: a) To calculate true profit.
43. Depreciation arises because of:
a) Fall in the market value of an asst. b) Physical wear and tear.
c) Fall in the value of money. d) None of them.
Answer: b) Physical wear and tear.
 44. Depreciation is a process of:
a) Valuation b) Allocation
c) Both valuation and allocation d) None of them.
Answer: a) Valuation
45. Under the straight line method of providing depreciation it:
a) Increase every year. b) Remain constant every year.
c) Decreases every year d) None of them.
Answer: b) Remain constant every year.
46. Under the diminishing balance method depreciation it:
a) Increases every year. b) Decreases every year.
c) Remain constant every year. d) None of them.
Answer: b) Decreases every year.
47. Under the fixed installment method of providing depreciation it is calculated on:
a) Original cost b) on balance amount
c) On scrap value d) None of them
Answer: a) Original cost
48. Under the diminishing balance method, depreciation is calculated on:
a) Scrap value b) On original value
c) On book value d) None of them
Answer: c) On book value
49. The amount of depreciation charged on a machinery will be debited to:
a) Machinery account b) Depreciation account
c) Cash account d) Repair account
Answer: b) Depreciation account
50. Loss on sale of plant and machinery should be written off against:
a) Share premium b) Depreciation fund account
c) Sale account d) Profit & loss account
Answer: b) Depreciation fund account

Business Organisation
51. Which of the following cannot be classified as an objective of business?
a) Investment b) Productivity
c) Innovation d) Profit earning
ANS: a) Investment

52. What is the advantage of sole proprietorship?

a) Small capital b) Hasty decision
c) Limited capital d) Limited managerial ability
ANS: c) Limited capital

53. The agreement of partnership

a) Must be oral b) Must be in writing

c) Must be writing in the stamp paper d) Can be either oral or in writing

ANS: c) Must be writing in the stamp paper

54. Partnership may come into existence

a) By the operation of law b) By an express agreement
c) By an express or implied agreement d) By inheritance of property
ANS: b) By an express agreement
 55. Management of a Joint stock company is entrusted to.
a) The Registrar of companies b) The Board of Directors
c) The shareholder d) The debenture holders
ANS: b) The Board of Directors

56. Registration is compulsory in the case of

a) A Sole trader b) A partnership
c) A joint stock company d) A joint Hindu family business
ANS: c) A joint stock company

57. In a co-operative society

a) One share one vote principle is followedb) One man one vote principle is
followed
c) A member must have 2 votes d) Shares are transferable.
ANS: b) One man one vote principle is followed

58. Co-operative society can be started

a) Only in villages b) In towns and villages
c) Only in cities d) Only in State headquarters
ANS: b) In towns and villages

59. The most suitable form of organisation for operating defence industries is
a) Government Company b) Public corporation
c) Departmental organisation d) Board organization
ANS: c) Departmental organisation

60. . The share capital of the government company must not be less than
a) 75% b) 60%
c) 95% d) 51%
ANS: d) 51%
61. Registration of partnership is
a) compulsory b) optional
c) not necessary d) upto the opinion of partners
ANS: b) Optional

62. In partnership there exists a relationship of

a) principal and agent b) owner and servant
c) employer and employee. d) Bailor and Bailee
ANS: a) principal and agent

63. Registration of a joint stock company is

a) Compulsory b) Optional
c) Compulsory for public limited companies and optional for private limited companies
d) Optional for public limited companies and compulsory for private limited companies
ANS: a) Compulsory

64. The minimum number of members for a public limited company is

a) 2 b) 3
c) 7 d) 10
ANS: c) 7
65. The liability of shareholders of a private limited company is limited to
a) the paid up value of the shares b) amount remaining unpaid on the shares
c) the extent of private assets d) amount called up
ANS: b) amount remaining unpaid on the shares

66. A private limited company can commence business

a) immediately on receiving the certificate of incorporation
b) only after the certificate of commencement of business is received
c) on getting name approval from the Registrar
d) on filing all the documents necessary for formation with the Registrar
ANS: a) immediately on receiving the certificate of incorporation
67. The existence of a company comes to a close
a) on the death of all its promoters b) on death of all the directors of the
Board
c) on transfer of shares by most of its original members d) none of the above
ANS: d) none of the above

68. Table A of the Companies Act is a

a) model minutes book b) model form of balance sheet
c) model of Articles of Association d) model of memorandum of association
ANS: b) model form of balance sheet

69. Which of the following documents define the scope of a company’s activities?
a) Memorandum of Association b) Articles of Association
c) Prospectus d) Statutory Declaration
ANS: a) Memorandum of Association

70. Which of the following is created by a Special Act of Parliament or in State Assemblies?
a) Chartered company b) Foreign company
c) Government company d) Statutory company
ANS: d) Statutory company
71. Public can also subscribe to the share capital of
a) Public corporation b) Departmental undertaking
c) Government company d) None of these
ANS: c) Government company

72. In a government company the share capital of the government must not be less than
a) 51% b) 60%
c) 75% d) 90%
ANS: a) 51%

73. The size of business units is measure by

a) Market share b) Turnover
c) Capital employed d) All of the Above
ANS: d) All of the Above

74. GATT agreement is closely connected with

a) Capital b) Globalisation
c) Market d) Borrowings
ANS: b) Globalisation
75. ______________ a combining of business firms engaged in different phases of the
manufacture and distribution of a product into an interacting whole.
a) Vertical Combination b) Horizontal Combination
c) Lateral Combination d) None of these
ANS: a) Vertical Combination

76. ______________________this type of combination is one that involves companies within

the same industry that have been previously competitors.
a) Horizontal Combination b) Vertical Combination
c) Lateral Combination d) None of these
ANS: a) Horizontal Combination

77. Location of plant is an important factor in ________

a) entrepreneurial decision b) business function
c) profit maximization d) customer convenience
ANS: a) entrepreneurial decision

78. The first systematic theory of industrial location was propounded by________
a) Alfred weber b) F W Taylor
c) Sargent Florence d) Henry Fayol
ANS: a) Alfred weber

79. The secondary factor of plant location is otherwise called as _________

a) agglomerative factor b) transport factor
c) industrial factor d) market factor
ANS: a) agglomerative factor

80. Location factor depends on __________

a) no of workers in region b) no of workers throughout the country
c) proximity of market d) plant facility
ANS: c) proximity of market
81. SIPCOT has its industrial complex in __________
a) Ooty b) Bargur
c) Trichy d) Chidambaram
ANS: b) Bargur

82. When one company holds or buys more than 50%of the share in another company is known
as_____
a) holding company b) subsidiary company
c) complete consolidation d) amalgamation
ANS: a) holding company

83. Expansion of GATT is ________

a) general agreement on tariff and trade b) general agreement on trade and
tariff
c) general agreement on tax and trade d) None of the Above
ANS: a) general agreement on tariff and trade

84. Competition act was enacted in the year ______

a) 2000 b) 2001
c) 2002 d) 2003
 ANS: c) 2002
85. FDI stands for ________
a) foreign direct investment b) foreign direct investors
c) foreign directorate investment d) None of the Above
ANS: a) foreign direct investment

86. Expansion of SEBI_________

a) securities exchange board of India b) securities and Exchange board of
India
c) Securities External Bank of India d) None of the Above
ANS: a) securities exchange board of India

87. Integration of main activity or process with ancillary activities and services is
known______________
a) circular combination b) label combination
c) diagonal combination d) None of these
ANS: c) diagonal combination

88. The companies act enacted in ______

a) 1954 b) 1955
c) 1956 d) 1966
ANS: c) 1956

89. WTO headquarters situated in _____

a) India b) Japan
c) Geneva d) Singapore
ANS: c) Geneva

90. LDC stands for_____

a) Least Distance Countries b) Least developed countries
c) local development council d) least developing countries
ANS: b) Least developed countries
91. One of the impelling causes of business combination is
a) Desire for business b) Wasteful organisation
c) Influence of tarrifs d) Rationalisation
ANS: b) Wasteful organization

92. When three sugar mills combine it is an example of

a) Horizontal Combination b) Vertical Combination
c) Lateral Combination d) Circular Combination
ANS: a) Horizontal Combination

93. Amalgamation is a form of

a) Trade association b) Federation
c) Partial Consolidation d) Complete Consolidation
ANS: d) Complete Consolidation

94. MRTP Act does not apply to

a) Private Ltd. Company b) Public Ltd. Company
c) Govt. Company d) Sole Proprietory Business
ANS: c) Govt. Company
 95. Chamber of commerce is a form of
a) Association b) Federation
c) Partial Consolidation d) Complete Consolidation
ANS: a) Association

96. The sole trader is a/an ___________ of his business

a) manager b) monarch
c) Leader d) agent
ANS: b) monarch

97. The co-operative societies act was introduced during the year
a) 1912 b) 1914
c) 1922 d) 1902
ANS: a) 1912

98. The first stock exchange was setup in India in

a) Chennai b) Delhi
c) Mumbai d) Calcutta
ANS: c) Mumbai

99. RBI is a
a) Statutory Co. b) Banking Co.
c) Financial Co. d) Central Co.
ANS: a) Statutory Co.

100. LIC is a
a) Limited Corporation b) Statutory Company
c) Unlimited Company d) Govt. Company
ANS: b) Statutory Company

Business Economics
101. Demand forecasting can be categorized on the basis of
a) the level of forecasting b) time period
c) nature of goods d) All the above
Answer: All the above
102. Which is not a statistical method in forecasting?
a) Trend analysis b) consumer survey
c) Regression method d) least square method
Answer: consumer survey
103. In economic decision every variable influences every other variable in underlying assumption
of :
a) Delphi techniques b) Multi collinearity
c) Simultaneous equation method d) Correlation.
Answer: Simultaneous equation method
104. A time series can be calculated through
a) leading series b) coincident series
c) logging series d) all the above.
Answer: all the above.
105. A simultaneous equation model may consists of all the following except
a) Endogenous variables b) Undefined equation
 c) Exogenous variables d) Structural equations.
Answer: Undefined equation
The law which studies the direct relationship between price and quantity supplied of a
commodity is
a) Law of demand b) Law of variable proportion
c) Law of supply d) None of the above
Answer: Law of supply
106. When price rises, quantity supplied
a) expands b) falls
c) increases d) Unchanged.
Answer: expands
107. In case of perfectly inelastic supply the supply curve will be
a) rising b) vertical
c) horizontal d) falling.
Answer: vertical
108. When a percentage in price results in equal change in quantity supplied, it is called,
a) elastic supply b) perfectly inelastic
c) elasticity of supply d) unitary elastic supply.
Answer: unitary elastic supply.
109. When supply of a commodity decreases on a fall in its price, its is called
a) Expansion of supply b) Increase in supply
c) Contraction of supply d) Decrease in supply.
Answer: Contraction of supply
110. Which utility approach suggests that utility can be measured and quantified?
a) ordinal b) Cardinal
c) both a &b d) Diminishing marginal utility.
Answer: Cardinal
111. -------of a commodity is the additional utility derived by a consumer, by consuming one more
unit of that commodity.
a) Marginal utility b) Total utility
c) Average utility d) maximum utility
Answer: Marginal utility
112. At what point does total utility starts diminishing?
a) when marginal utility is positive b) when it remains constant
c) when marginal utility is increasing d) when marginal utility is negative.
Answer: when marginal utility is negative.
113. Consumer’s surplus is also known as
a) indifference surplus b) elasticity of supply
c) buyer’s surplus d) indifference surplus
Answer: buyer’s surplus
114. Which of the following is called Gossen’s first law?
a) Law of substitution b) Law of equal- marginal utility
c) Law of diminishing marginal d) None of the above
Answer: Law of diminishing marginal
115. Which utility measuring approach, is utility ranked in order of preference, but not
measured?
a) Cardinal. b) Ordinal.
c) Both a & b d) Variable approach.
Answer: Ordinal.
116. Which shows various combinations of two products that give same amount of satisfaction?
a) Iso-cost curve. b) Marginal utility curve.
 c) Iso-quant. d) Indifference curve.
Answer: Indifference curve.
117. Indifference curve slopes,
a) Downward to the right b) Upward to the right
c) Downward to the left d) Upward to the left
Answer: Downward to the right
118. The process of capital formation includes,
a) Capital of savings b) Mobilization of savings
c) Investment of savings d) All the above
Answer: All the above
119. When the output produced is maximum for the given level of input the firms achieve
a) Maximum profit b) Technical efficiency
c) Economic efficiency d) None of these
Answer: Technical efficiency
120. Business economics is a science which deals with the application of ----------------- in business
practices.
a) Economic theory b) Commerce theory
c) Macro theory d) None of these
Answer: Economic theory
121. -------------------- means the process of choosing one action from two or more alternatives
available.
a) Choice b) Decision making
c) Option making d) All the above
Answer: Decision making
122. A Firm’s profitability depends much on its ----------------- of production.
a) Price b) Charge
c) Cost d) All the above
Answer: Charge
123. Generally, ----------------- are the primary measure of the success of any business
a) Loss b) Profit
c) Profit and loss d) Break even point
Answer: Profit and loss
124. The guiding principle of business economics is not -----------------but avoiding loss.
a) Profit maximization b) Loss maximization
c) Profit minimization d) Loss minimization
Answer: Profit maximization
125. The law of demand states that there is an ------------- relationship between price and quantity
demanded.
a) Converse b) Inverse
c) Discuss d) None of these
Answer: Inverse
126. A ------------------ along the demand curve is caused by a change in the price of the good only.
a) Movement b) Progress
c) Growth d) All the above
Answer: Movement
127. Assuming that bread and jam are complements. If the price of jam increase, the equilibrium
quantity for bread will--------------
a) Increase b) Neutral
c) Decrease d) Constant
Answer: Decrease
128. ---------------- goods are those which can replace each other in use.
 a) Fact b) No replace
c) Substitute d) None of these
Answer: Substitute
129. There is a direct relationship between ------------- of the consumer and his demand.
a) Expenses b) Losses
c) Gains d) Income
Answer: Income
130. The IC analysis explains the demand for inferior goods and solves
a) Veblen effect b) Giffen paradox
c) Speculative effect d) All the above
Answer: Giffen paradox
131. The book “Value and capital” was written by
a) JR Hicks b) RGD Allen
c) Alfred Marshall d) Thorsteinveblen
Answer: JR Hicks
132. Which of the following is considered production in economics?
a) Driving for pleasure b) Teaching for a fee
c) Boating for recreation d) Donating Blood
Answer: Teaching for a fee
133. In which stage of production would a rational producer like to operate
a) Stage MP is maximum b) II State-Both MP and AP are decreasing but positive
c) III stage-MP is negative d) Either Stage II or III
Answer: II State-Both MP and AP are decreasing but positive
134. In the short-run, when the output of a firm increases, its average fixed cost will
a) Increase b) Decrease
c) Remains constant d) None of the above
Answer: Remains constant.
135. Perfect competition has the following features except
a) Homogenous Products b) Perfect Knowledge
c) Selling and transport cost occurs d) Free entry and exit.
Answer: Selling and transport cost occurs
136. Markets are being classified on the basis of
a) Demand and Supply b) Time
c) Situation d) All of the above
Answer: All of the above
137. There is a single seller of a commodity which has no close substitutes can be termed as
a) Pure monopoly b) Duopoly
c) Monopoly d) Pure oligopoly
Answer: Pure monopoly
138. A firm that produces substitute goods can adopt the following pricing strategy
a) Transfer Pricing b) Full costing
c) Going rate pricing d) Customary pricing
Answer: Going rate Pricing.
139. When demand is slack and market is highly competitive the following method of pricing may
be adopted
a) Full cost pricing b) Marginal cost pricing
c) Peak load pricing d) Penetration pricing
Answer: Marginal cost pricing.
140. Factor endowments are unevenly distributed among the countries of world due to
a) Geographical and climate factor b) Technical development
c) Physical factors d) All of the above
 Answer: All the above.
141. Who propounded the general equilibrium theory of international trade?
a) Bertilohlin b) Heckscher
c) Both A & B d) None of these
Answer: Both A & B
142. Which is not included in the components of foreign trade?
a) Balance of trade b) Volume of trade
c) Composition of trade d) Direction of trade
Answer: Balance of trade.
143. If the value of visible exports is greater than that of the value of visible imports, then it said
to be.
a) Unfavorable BOT b) Favorable BOT
c) BOP surplus d) BOP deficit.
Answer: Favorable BOT
144. Which is not a type of BOP disequilibrium?
a) Cyclical b) Structural
c) Seasonal d) Secular
Answer: Seasonal
145. Which is not an invisible item in foreign trade?
a) Banking services b) Insurance charges
c) Shipping freight d) Merchandise items.
Answer: Merchandise items.
146. Which is not the function of the govt?
a) Maintenance of law and order b) Defending the country life and property
c) Welfare and development d) Profit motive
Answer: Profit motive
147. The important fiscal means by which resources can be raised for the public exchequer are
a) Taxation b) Borrowing from the public
c) Credit creation d) All of the above
Answer: All of the above.
148. Which is not a direct tax?
a) Income tax b) Wealth tax
c) Gift tax d) Excise duties.
Answer: Excise duties.
149. Which is not an indirect tax?
a) Wealth tax b) Excise duties
c) Customers duties d) Sales tax
Answer: Wealth tax
150. which are the main sources of revenue of the govt?
a) Fees and fines b) Raffle scheme
c) Special assessment d) All the above
Answer: all the above.

Financial Accounting-II
151. The partnership may come to an end due to the:
a) Death of a partner b) Insolvency of partner
c) By giving notice d) All of the above
Answer: d) All of the above
152. In case of retirement of a partner full goodwill is credited to the accounts of:
a) All partners b) Only retiring partner
c) Only remaining partner d) None of the above
 Answer: a) Only retiring partner
153. The accounting procedure at the retirement of partner is valued:
a) Revaluation of assets and liabilities b) Ascertaining his share of good will
c) Finding the amount due to him d) All of above
Answer: d) All of the above
154. If the remaining partner want to continue the business, after the retirement of a
partner, a new partnership agreement:
a) Necessary b) Not necessary
c) Optioned d) None of above
Answer: a) Necessary
155. Amount due to outgoing partner is shown in the balance sheet as his:
a) Liability b) Asset
c) Capital d) Loan
Answer: d) Loan
156. The loss or gain an account of revaluation at the time of retirement of a partner is
shared by:
a) Remaining partners b) Retiring partner
c) All partners d) None of above
Answer: c) All partners
157. On the retirement of a partner any reserve being should be transferred to the
capital account of:
a) All partners in the old profit sharing ratio b) Remaining partners in the
new profit sharing ratio
c) Neither the retiring partner, nor the remaining partner d) None of above
Answer: a) All partners in the old profit sharing ratio
158. Revaluation account is operated to find out gain or loss at the time of:
a) Admission of a partner b) Retirement of a partner
c) Death of a partner d) All of above
Answer: d) All of above
159. An account operated to ascertain the loss or gain at the time of retirement or
death of a partner is called:
a) Realization account b) Revaluation account
c) Execution account d) Deceased partner A/c
Answer: b) Revaluation account
160. Partners equity is effected due to:
a) Retirement of a partner b) Admission of a partner
c) Death of a partner d) All of above
Answer: d) All of above
161. Joint life policy reserve is transferred to ---------------- a/c at the time of dissolution of
firm.
a) Realisation a/c b) Revaluation a/c
c) Profit and loss a/c d) Capital a/c
Answer: a) Realisation a/c
162. Third party Liabilities are transferred to realisation a/c at -------------------.
a) Agreed value b) Book value
c) Market value d) present value
Answer: b) Book value
163. Balance of realization A/c is transferred to the capital A/c of the partners in:
a) Capital ratio b) Interest ratio
c) Equally d) Profit sharing ratio
Answer: d) Profit sharing ratio
164. Realisation account is prepared ,at time of
a) Admission of a partner b) Retirement of a partner
c) Death of a partner d) Dissolution of firm
Answer: d) dissolution of firm
165. In case of insolvency, any balance remaining unpaid to the creditors will be
transferred to
a) Deficiency account Insolvency account
c) Capital account Profit and loss account
Answer: a) Deficiency account
166. As per Garner Vs Murray rule, the amount irrecoverable from insolvent partner
whose capitatl account shows debit balance, is distributed to solvent partners in the
a) Profit sharing ratio b) Equally
c) Capital ratio d) At the ratio agreed among them
Answer: c) Capital ratio
167. Unrecorded asset takenover by partner is
a) Debited to partner’s capital A/C b) Credited to partner’s capital A/C
c) Debited to Realisation A/C d) Credited to cash A/C
Answer: a) Debited to partner’s capital A/C
168. Dissolution expenses are ------------------.
a) Debited to cash A/C b) Credited to capital a/c
c) Debited to Realisation A/C d) Credited to realisation a/c
Answer: c) debited to realisation a/c
169. When Garner Vs Murray rule is not applicable, the amount irrecoverable from
insolvent partner whose capitatl account shows debit balance, is distributed to solvent
partners’ capital accounts in the
a) Profit sharing ratio b) Equally
c) Capital ratio d) Current account ratio
Answer: a) Profit sharing ratio
170. At the time of dissolution of firm, provision for depreciation is transfered to
a) Realisation A/C b) cash A/C
c) partner’s capital A/C d) Asset a/c
Answer: a) Realisation A/C
171. Under Debtors and stock System, the Branch Account is
a) Real Account b) Nominal Account
c) Personal Account d) None of the above
Answer: a) Real Account
172. When branch 'A' sends goods to branch 'B' in the books of branch 'A' debit is given
too
a) head office account
b) branch 'B' account
c) sales return account d) None of the above
Answer: a) head office account
173. Goods sent by the head office to the branch but not received by the branch before
the close of financial year are credited by head office to
a) .branch account b) trading account
c) goods sent to branch account d) goods-in-transit account
Answer: a) branch account
174. When a branch purchases fixed assets and the asset account is to be kept in the
books of head office, the branch makes the following entry.
a) debits head office credits bank
b) debits branch credits head office
 c) debits head office credits branch asset d) debits branch asset credits bank

Answer: a) debits head office credits bank

175. In the case of highly autonomous branches which make use of local currency
substantially the method of translation most suitable is
a) Temporal method b) Current/Non-current method
c) Closing rate method d) Opening rate method.
Answer: c) Closing rate method
176. Objects of branch accounts
a) To ascertain profit and loss of each branch b) To control the branches
c) To estimate all branch requirements d) All the above
Answer: d) All the above
177. The goods supplied to the branch by the head office under dependent branch
method
a) Cost price b) Invoice price
c) Cost price or invoice price d) None of the above
Answer: c) Cost price or invoice price
178. Debtor system suitable for branches which in --------------- size.
a) small b) big
c) larger d) None of the above
Answer: a) small
179. Under Debtor system , which of the following will be brought into credit side of the
branch account at the end of the year
a) Unsold stock b) Petty cash
c) Outstanding customer’s balances d) All the above
Answer: d) All the above
180. Under debtor system expenses met by head office debited to
a) Branch account b) Head office account
c) Bank account d) Expenses account
Answer: a) Branch account

181. Under hire purchase system, each installment is treated as

a) interest b) cash price
c) hire charges d) advance
Answer: c )hire charges
182. If the hire purchaser fails to make payment of any installment, it is called
a) default b) repossession
c) sale d) purchase
Answer: a) default
183. The advance amount under hire purchase system is called
a) cash price b) retail price
c) interest d) down payment
Answer: d) down payment
184. Cash price plus interest is
a) installment price b) hire purchase price
c) maximum retail price d) retail price
Answer: b) hire purchase price
185. Hire purchase system is governed by
a) Hire Purchase Act 1972 b) Hire Purchase Act 1973
c) Hire Purchase Act 1974 d) Hire Purchase Act 1975
Answer: a) Hire Purchase Act 1972
186. Nature of hire purchase agreement is
a) agreement of sale b) option to transfer
c) option to buy d) option to sell
Answer: c) option to buy
187. The hire vendor take away only a portion of the goods on which there is default of
installments it is called
a) repossession b) partial repossession
c) complete repossession d) purchase
Answer: b) partial repossession
188. If the hire vendor may take away all the goods on which there is default of
installment it is called
a) repossession b) partial repossession
c) complete repossession d) purchase
Answer: c) complete repossession
189. In case of Hire-Purchase the total sum payable by the hire-purchaser as per terms in
order to complete the transactions is
a) Hire-Purchase Price b) Net Cash Price
c) Cash Price Installment. d) Net Hire-Purchase Charges
Answer: a) Hire-Purchase Price
190. In the books of hirer, when the asset is repossessed, asset account will be
a) debited b) credited
c) rectified d) reversed
Answer: b) credited

191. Stock as on the date of fire is found out by preparing-------------------.

a) Trading a/c b) Memorandum Trading a/c
c) Purchase a/c d) Sales account
Answer: b) Memorandum Trading a/c
192. Average clause is applied when ---------------------------.
a) Policy amount is less than stock as on the date of fire b) Policy amount is
more than stock as on the date of fire
c) Policy amount is equal to stock as on the date of fire d) When the entire
stock is lost
Answer: a) Policy amount is less than stock as on the date of fire
193. Average clause discourages -----------------.
a) Over insurance b) Under insurance
c) Over valuation of stock d) Under valuation of stock
Answer: b) Under insurance
194. Fire Insurance provides cover for ---------------.
a) Tangible assets b) Intangible assets
c) Fictitious assets d) both tangible and Intangible
195. Answer: a) Tangible assets
The average clause in a loss of profits policy protects the
a) Insured b) Insurer
c) Workers d) Tax authorities
Answer: b) Insurer
196. A fire insurance policy is taken up to indemnify -------------------------.

a) Capital and revenue losses to tangible property b) Revenue losses to intangible

property.
c) Revenue losses to tangible property d) Capital losses to intangible property
 Answer: a) Capital and revenue losses to tangible property
197. Trading accounts for the previous years are prepared when fire accidents takes place
in any year is to know
a) To determine the rate of Gross profit for calculating gross profit on sales upto the
date of fire b) To determine the rate of net profit for calculating net profit on sales
upto the date of fire
c) To determine sales d) To determine purchase
Answer: a) To determine the rate of Gross profit for calculating gross profit on sales upto
the date of fire
198. Claim for loss of stock =
a) Stock as on the date of fire – stock lost in fire b) Stock on the date of fire -
stock salvaged from fire
c) Opening stock – salvaged stock d) Opening stock – closing stock
Answer: a) Stock on the date of fire – stock salvaged from fire
199. Actual loss of stock= ---------- - Salvage value
a) stock on the date of fire b) damaged value
c) undamaged value d) None of the above
Answer: a) stock on the date fire
200. The sales during the same months as the affected period in the previous year is
known as --------------------------
a) Standard turnover b) Accounting year turnover
c) Saved turnover d) Annual turnover
Answer: a) Standard turnover
Modern and Rural banking
201. Which is bankers’ bank and lender of last resort?
a) Central Bank b) Cooperative Bank
c) Commercial Bank d) Industrial Bank
Answer: C
202. The Banking Regulation Act was enacted in the year ------------.
a) 1947 b) 1948
c) 1949 d) 1950
Answer: c
203. The Bank of England was established in ------------.
a) 1693 b) 1694
c) 1695 d) 1696
Answer: B
204. A financial institution which accepts deposits from the public repayable on demand
and lends them for short periods is called --------.
a) Commercial Bank b) Industrial Bank
c) Savings Bank d) Exchange Bank
Answer: a
205. The process of conversion of foreign currencies into Indian currency and vice versa
involves many problems and these problems are tackled by --------------.
a) Commercial Banks b) Exchange Banks
c) Industrial Banks d) Agricultural Banks
Answer: b
206. ------------------ is a system of banking in which one bank carries on its business
through a network of branches spread all over the country.
a) Chain Banking b) Unit Banking
c) Branch Banking d) Group Banking
Answer: c
207. Imperial Bank was renamed as ----------------.
a) Reserve bank of India b) State bank of India
c) Canara Bank d) Central Bank of India
Answer: A
208. ---------------- is a form of banking when a small group of individuals control three or
more banks which are independently chartered.
a) Branch banking b) Unit Banking
c) Group Banking d) Chain banking
Answer: d
209. A plan offered by banks designed to be used by groups rather than individuals is
known as ---------------------.
a) Unit Banking b) Branch Banking
c) Group Banking d) Chain banking
Answer: C
210. ------------- is considered to be the home of deposit banking.
a) USA b) England
c) Germany d) France
Answer: B
211. The fixed deposits are withdrawn by the customers from the banks by___________.
a) Using cheques. b) Usingwithdrawal slips.
c) using ATM. d) Surrendering fixed deposit receipts.
Answer: D
212. Recurring deposit account is an innovation over______________.
a) Current account. b) savings account
c) recurring deposit account d) fixed deposit account
Answer: d
213. Current Account is otherwise called as_______________.
a) Demand deposit or liability. b) Time deposit.
c) Accrued deposit. d) recurring deposit
Answer: A
214. Fixed deposits and recurring deposits are_____________.
a) Repayable after an agreed period b) Repayable on demand
c) Not repayable d) Repayable on demand or after an agreed period as per
bank's choice
Answer: A
215. Interest payable on savings bank accounts is____________.
a) Regulated by State Governments b) Fixed by respective banks
c) Regulated by RBI d) Regulated by Finance Minister
Answer: B
216. According to the ___________, a person is regarded as a minor until he completes
his 18th year of age.
a) Banking Regulation Act b) Indian Majority Act, 1875
c) Indian Contract Act, 1872 d) None of these
Answer: B
217. According to Section 12 of the _________,lunatics cannot enter into any contract,
except during their lucid intervals.
a) Indian Contract Act, 1872 b) Indian Majority Act, 1875
c) Banking Regulation Act d) None of these
Answer: A
218. Accounts are allowed to be operated by cheques in respect of ----------.
 a) Both savings bank accounts and fixed deposit accounts b) Both Savings bank
accounts and current accounts
c) Both savings bank accounts and loan accounts d) Both savings bank accounts
and cash accounts only
Answer: B
219. A____________isrepayable even without an express demand by the creditor.
a) Special Commercial debt b) debt by a bank:
c) ordinary commercial debt d) None of these
Answer: C
220. The banker acts as the _____ of thecustomer when a cheque is deposited by him to
the banker for collection.
a) Trustee b) Beneficiary
c) Debtor d) Creditor
Answer: A
221. Indian Negotiable Instrument Act enacted in the year ____
a) 1871 b) 1881
c) 1891 d) 1901
Answer: B
222. According to section 6 of the Negotiable Instrument Act, a cheque is a ______
a) Letter of credit b) Bill of Exchange
c) Memorandum of Association d) Memorandumof Understanding
Answer: B
223. There are _____ parties involved in cheque.
a) One b) Two
c) Three d) Four
Answer: C
224. A person who draws the cheque on a bank is called the ---------.
a) Drawer b) Drawee
c) Payee d) Payer
Answer: A
225. The bank on which the cheque is drawn is called the -------------.
a) Drawer b) Drawee
c) Payee d) Payer
Answer: B
226. The practice of crossing cheque was originated in -------------
a) United states of America b) France
c) United Kingdom d) Germany
Answer: C
227. There are ________ types of crossing the cheque.
a) One b) Two
c) Three d) Four
Answer: B
228. When a cheque is crossed ______, the banker on whom it is drawn is directed not to
make payment to any person other than a banker.
a) Specially b) Generally
c) Particularly d) None of these
Answer: B
229. Who defines acheque as “an unconditional order”?
a) Lean C. Megginson b) Herbert L. Hart,
c) Michael J. Jucius d) None of these
Answer: B
230. One of the requisites of a valid chequeis ------------------.
a) It must be an unconditional order b) It may be a oral or written order:
c) It must be drawn on a person. d) It may be a blank one
Answer: a
231. A debit card is
a) Buy now & pay now b) Buy now & pay later
c) Buy later & pay now d) Buy later & pay later
Answer: A
232. A Credit card is
a) buy now & pay now b) Buy now & pay later
c) Buy later & pay now d) Buy later & pay later
Answer: B
233. Which is the first bank to establish an ATM and where was the first ATM
established?
a) Citi Bank in 1965 in New York
b) HongkongShanghai Banking Corporation in 1963 in Shanghai
c) Barclay's Bank in 1967 in London
d) Di-I chi-Kangyo-Bank in 1961 in Tokyo
Answer: C
234. Why Credit cards are useful?
a) Risk of carrying cash is very low b) It is helpful in case of contingent purchasing
c) There is an increase in sales directly d) All of the above
Answer: D
235. Which committee has recommended introduction of Smart card?
a) Rangarajan Committee b) Saraf Committee
c) Nayak Committee d) Pannirselvam Committee
Answer: B
236. Which is the first bank to launch Debit card in India?
a) Standard Chartered Bank b) Citi Bank
c) ABN Amro Bank d) American Express Bank
Answer: B
237. Which is the first bank to introduce Credit card in India?
a) Bank of India b) Global Trust Bank
c) IndusInd Bank d) Central Bank of India
Answer: D
238. ---------- are popularly known as Plastic cards or Plastic money.
a) Smart cards b) Electronic cards
c) Credit cards d) Debit cards
Answer: C
239. Credit-card sized card with an embedded processor and memory designed to serve
as a mobile electronic purse used for on-line shopping is called _____________.
a) Smart card b) Cash card
c) Lobby card d) Electronic card
Answer: A
240. The apex institution for agricultural finance is___________.
a) NABARD. b) EXIM Bank.
c) Reserve Bank of India. d) IDBI.
Answer: A
241. NABARD (National Bank of Agriculture and Rural Development) was established in
the year ------------.
a) 1956 b) 1976
 c) 1987 d) 1982
Answer: D
242. NABARD is having its Head Quarters in ----------
a) Kolkata b) Mumbai
c) Delhi d) Hyderabad
Answer: B
243. After the recommendations of which of the following committee the NABARD was
setup?
a) Shivaraman committee b) Kapoor Committee
c) Rangarajan Committee d) None of these
Answer: A
244. __________ refines the financial institutions which finance the rural sector.
a) RBI b) NABARD
c) IDBI d) SBI
Answer: B
245. The present chairman of NABARD is -------------------.
a) Prakash Baksh b) Rangarajan
c) Harsh Kumar Bhanwala d) None of these
Answer: C
246. The initial corpus of NABARD was
a) Rs.50 Crores b) Rs.100 Crores
c) Rs.150 Crores d) Rs.200 Crores
Answer: B
247. The Chairman of RRB is appointed by ---------------------.
a) State government b) Central government
c) Finance commission d) Planning commission
Answer: B
248. RRBs can borrow from sponsor banks and-----------------.
a) NABARD b) IDBI
c) SIDBI d) RBI
Answer: a
249. Regional Rural Banks were set up inaccordance with the recommendations of the
BankingCommission in -------
a) 1971 b) 1972
c) 1973 d) 1974
Answer: B
250. Which is the first bank to introduce ATM in India?
a) HSBC,1987 b) HDFC Bank 1992
c) SBI, 2000 d) ICICI Bank 1992
Answer: A
Marketing

251. Fixing and maintaining the standards for quality, quantity, size and other features of
the product refer to ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Standardization (b) Grading (c) Packaging (d) Labeling.
Answer: A
252. The task of any business is to deliver ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ at a profit.
a)Customer needs (b) Products (c) customer value (d) Quality.
Answer:C
253. The traditional view of marketing is that the firm makes something and then ‐‐‐‐‐‐‐‐‐‐
‐‐‐‐‐ it.
 a)Markets (b) Sells (c) Prices (d) Services.
Answer:B
254. A market where goods are sold in bulk quantities to the customers is known as ‐‐‐‐‐‐‐
‐‐‐‐‐‐‐‐‐‐‐‐.
a)Retail market (b) Wholesale market (c) Product market (d) Service market.
Answer:B
255. ‐‐‐‐‐‐‐‐‐‐‐‐‐‐ is a process of identifying the areas of market that are different from one
another.
a)Marketing (b) Segmentation (c) Promotion (d) Targeting.
Answer:B
256. ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ segmentation classifies consumers on the basis of age, sex, income,
and occupation.
a)Psychological (b) Geographic (c) Demographic (d) Behavioral.
Answer:C
257. ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ is the process of identifying specific market segments.
a)Market targeting (b) Target marketing (c) Positioning (d) Marketing.
Answer:A
258. ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ referred to as zero segmentation.
a)Mass marketing (b) Niche marketing (c) Differentiated marketing (Market targeting.
Answer:A
259. ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ is a process of transforming information and experience into
knowledge.
a)Marketing (b) Positioning (c) Perception (d) Learning.
Answer:D
260. ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ is the next stage of market segmentation.
(a)Market targeting (b) positioning (c) MIS (d) Marketing.
Answer:A

261. Testing before launching a product is known as ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.

a)Test marketing (b) Concept testing (c) Acid test (d) Market test.
Answer:A
262. The marketing outcomes of a product is known as ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Profit (b) Brand loyalty (c) Branding (d) Brand equity.
Answer:D
263. The emotional attachment of a customer towards a brand is known as ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Brand association (b) Perceived quality (c) Brand loyalty (d) Brand awareness.
Answer:C
264. The literary meaning of the term product is ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Lead forward (b) Good (c) Features (d) Goods and services.
Answer:A
265. The process of adding a higher priced prestigious product to the existing line of
lower priced products is known as ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Trading down (b) Product differentiation (c) Trading up (d) Product simplification.
Answer:C
266. The emotional attachment of a customer towards a brand is known as ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Brand loyalty (b) Brand awareness (c) Brand equity (d) Brand association.
Answer:A
267. The legalized version of a brand is known as ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Standardization (b) Quality(c) Trademark (d) Production.
Answer:C
268. Logistics means ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
 (a)Production (b) Flow of goods (c) Consumption (d) Marketing channel.
Answer:B
269. The process of moving the raw materials from the place of the suppliers to the place
of the producers is known as ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Inbound logistics (b) Outbound logistics (c) Inventor management (d) Acquisition of raw
materials.
Answer:A
270. The concept which deals with the entire processes from production to delivery of
goods is known as ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)SCM (b) VMS(c) Logistics (d) Distribution
Answer:A
271. ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ is the strong feeling, desire or emotion that makes the buyer buy a
product.
a)Buying motive (b) Demand (c) Price (d) Quality.
Answer:A
272. ‐‐‐‐‐‐‐‐‐‐‐‐‐‐ motives are those which determine where or from whom products are
purchased.
a)Product (b) Patronage (c) Emotional (d) Rational.
Answer:B
273. The four Cs are ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Customer focus, cost, convenience and communication.
b)Convenience, control, competition and cost.
c)Customer solution, cost, convenience and communication.
d)Competition, cost, convenience and communication.
Answer:C
274. A marketing information system (MIS) caters to the needs of ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Marketing decision (b) Databases (c) Safeguard (d) customized.
Answer:A
275. Today, companies have to manage relation with their ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ in order to
ensure timely supplies and meet customer’s requirements.
a)Customers (b) Government (c) Suppliers (d) International market.
Answer:C
276. Banks are a part of ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Macro environment (b) Micro environment (c) Ecological (d) Technological environment.
Answer:B
277. In ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ segmentation, buyers are awarded into different groups on the
basis of life‐style or personality and values.
(a)Geographic (b)Demographic (c)Psychographic (d)Behavioral.
Answer:C
278. Brand loyalty indicates customers ‐‐‐‐‐‐‐‐‐‐‐‐‐‐ towards the brand.
a)Commitment (b) Belief (c) Attributes (d) Quality.
Answer:A
279. The practice of using the established brand names of two different companies on
the same product is termed as ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Manufacturer brand (b) Private brand (c) Brand licensing (d) C0‐branding.
Answer:D
280. The number of customers exposed to the brand is called ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Brand licensing (b) Brand awareness (c) Brand equity (d) Positioning.
Answer:B
281. ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ simply refers to product planning
a)Merchandising (b) Selling (c) Operating.
 Answer:B
282. Which of the following is not included in the function of physical supply?
a)Standardization (b) Storage (c) Packaging (d) Transportation.
Answer:C
283. The factors that affect marketing policies, decisions and operations of a business
constitute.
a)Marketing control (b) Marketing mixes (c) Marketing environment (d) none of these.
Answer:B
284. Marketing is a ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ process.
a)Goal oriented (b)Social (c) Exchange (d) All of these.
Answer:A
285. The process of finding or creating new uses or users or satisfaction for an existing
product is known as ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Niche‐ marketing (b) Re‐marketing (c) Social marketing (d) none of these.
Answer:A
286. Who has introduced the concept of market segmentation?
a)N.H. Borden (b) Rosser (c) Wendell .R. Smith (d) none of these.
Answer:C
287. Which of the following is not part of demographic segmentation?
a)Age (b) Income(c) Education (d) Interest.
Answer:D
288. When a buyer decides to buy after careful consideration or logical thinking, his
decision is said to be ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Rational (b) Emotional (c) Product (d) none of these.
Answer:A
289. ‐‐‐‐‐‐‐‐‐‐‐‐‐ is the process where individuals decide what, when, where, how and from
whom to purchase goods and services.
a)Packaging (b) Consumer behavior (c) Segmentation.
Answer:B
290. ‐‐‐‐‐‐‐‐‐‐‐‐ is the process of creating an image for a product in the minds of targeted
customers.
a)Segmentation (b) Target marketing (c) Positioning (d) none of these.
Answer:C
291. The process of direct communication between the sales person and a prospect is
called
a)Direct marketing (b) Personal selling (c) Advertising (d)none of these.
Answer:B
292. MPR stands for
a)Managing public relations (b) Measuring public relations (c) Marketing public relations (d)
Monitories’ public relations.
Answer:C
293. Which of the following is not a characteristic of service marketing.
a)Intangibility (b) Separability (c) Heterogeneity (d) Perish ability.
Answer:B
294. Medical treatment with ayurvedic massage is an example of
a)Pure tangible (b) Hybrid (c) Pure service (d) none of these.
Answer:C
295. Which of the following is not a service?
a)Hospital (b) Banking (c) Insurance (d)none of these.
Answer:D
296. Which of the following is not an element of service marketing mix?
 a)People (b) Packaging (c) Process (d) Physical evidence.
Answer:B
297. Being ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ one cannot taste, touch, see, hear, smell or use services like
physical products.
a)Intangible (b) Tangible (c) none of these.
Answer:A
298. Which of the following is against marketing concepts.
a)Social marketing (b) De‐marketing (c) Niche marketing (d) none of these.
Answer:B
299. Which of the following involves targeting bulk purchasers and offering them special
benefits and privileges.
a)Frequency marketing (b)Event marketing (c) Viral marketing (d) none of these.
Answer:A
300. Green marketing is a part of ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a)Re‐marketing (b) Event marketing (c) Social marketing (d) Mega marketing.
Answer:C
Business Law
301. A Contract creates
a) Rights in personam b) rights in rem
c) only rights and no obligation d) only obligations and no rights
Answer: a
302. An agreement not enforceable by law is said to be
a) Void b) voidable
c) valid d) unenforceable
Answer: a
303. A contract is
a) a legal obligation b) an agreement plus a legal obligation
c) consensus ad idem d) an agreement plus a legal object.
Answer: b
304. Capacity to contract may arise from
a) Lack of free consent b) lack of consideration
c) minority d) absence of legal formalities.
Answer: c
305. There is a counter-offer when
a) the offeree gives conditions for acceptance b) the offerer makes a fresh
offer
c) the offeree makes some query d) the offeree accepts it
Answer: a
306. An advertisement to sell a thing by auction is
a) An offer b) an invitation to offer
c) no offer at all d) a contract
Answer: b
307. A specific offer can be accepted by
a) Any person b) any friend of offerer
c) the person to whom it is made d) any friend of offeree
Answer: c
308. Consideration must move at the desire of
a) The promisor b) the promisee
c) promisor or any third party d) both
Answer: a
309. Consideration means
 a) Must be adequate to the promise b) need not be adequate to the
promise
c) must be of reasonable value d) must be more value than value of promise
made
Answer: b
310. Consideration in a contract
a) May be past, present or future b) need not be adequate to the promise
c) must be of reasonable value d) must be more value than value of promise
made.
Answer: a
311. ___________ creates only a legal obligation
a) Contingent contract b) quasi contract
c) wagering agreement d) contract of indemnity
Answer: b
312. A person who finds good belonging to another and takes them into his custody, is
subject to the same responsibility as a
a) bailee b) true owner
c) bailor d) pledgee
Answer: a
313. A finder of lost goods is a
a) bailor b) bailee
c) true owner d) thief
Answer: b
314. Quantum merit means
a) a non-gratuitous promise b) an implied promise
c) as much as earned d) as much as is paid
Answer: c
315. A contract of indemnity is a
a) contingent contract b) wagering agreement
c) quasi contract d) void agreement
Answer: a
316. A guarantee obtained by a creditor by keeping silence as to material circumstances
is
a) valid b) voidable
c) unenforceable d) invalid
Answer: d
317. The right of subrogation in a contract of guarantee is available to the
a) creditorb) principal debtor
c) surety d) indemnified
Answer: c
318. __________ is a contract to perform the promise of a third person in case of the
fault.
a) contract of Indemnity b) contract of guarantee
c) contingent contract d) quasi contract
Answer: b
319. Law of quasi contract is also known as
a) law of contingent contract b) law of indemnity
c) law of guarantee d) law of restitution
Answer: d
320. __________ is not a contract at all
a) contract of indemnity b) contract of guarantee
 c) quasi contract d) contingent contract
Answer: a
321. A bailment that arises because of the actions of the parties, without any oral or
written agreement, is
a) illegal b) implied by law
c) an express bailment d) implied in fact
Answer: c
322. Bailments implied by law often are created
a) Through express agreements b) through implied agreement
c) through mutual agreement d) when people find and take possession of
lost or stolen property
Answer: a
323. If bailed property is lost or damaged as a result of the bailee’s negligence
a) the bailee has no liability b) through implied agreements
c) through mutual agreement d) when people find and take possession of
lost or stolen property
Answer: b
324. All of the following can be the subject of a bailment except
a) stock certificate. b) automobile
c) garage d) motorcycle
Answer: a
325. A bailment is a special kind of contract that is widely used in business and in
a) personal affairs b) cultural activities
c) academic research d) charitable institutions
Answer: a
326. A bailment allows an owner of a personal property to transfer possession of it to
another individual for any one of the following purposes , except
a) sale b) transportation
c) storage d) lease
Answer: d
327. A bailment for the sole benefit of a bailee usually results in
a) borrowing /lending transaction b) spring transaction
c) declarative transaction d) autonomous transaction
Answer: a
328. A bailment in which only the person who borrows an article(bailee) gets the benefit
is known as
a) bailment for the sole benefit of the bailee b) bailment for the sole
benefit of the bailor
c) mutual-benefit bailment d) constructive bailment
Answer: a
329. A who purchases certain goods from B by a misrepresentation pledges them with C.
the pledge is
a) Valid b) void
c) voidable d) invalid
Answer: b
330. The right of lien excised by an unpaid seller is to
a) retain possession b) regain possession
c) recover price and other charges d) Damages
Answer: a
331. In a sale, the property in goods
a) Is transferred to the buyer b) is yet to be transferred to be buyer
 c) may be transferred at a future time d) is transferred when goods are
delivered to the buyer.
Answer: a
332. In a sale, if the goods are destroyed, the loss falls on
a) The buyer b) the seller
c) partly on the buyer and partly on the seller d) the seller if price has not
been paid
Answer: a
333. The doctrine of caveat emptor applies
a) In case of implied conditions and warranties b) when the buyer does not
intimate the purpose to the seller and depends upon his own skill and judgment
c) when goods are sold by sample d) when goods are sold by description.
Answer: a
334. If a sale is by sample as well as by description, the implied condition is that the
goods shall correspond with
a) Sample b) description
c) both sample and description d) either sample or description
Answer: c
335. In a sale, there is an implied condition on the part of the seller that he
a) Has a right to sell the goods b) is in possession of the goods
c) will have the right to sell d) will acquire the goods
Answer: a
336. A condition is a stipulation which is
a) Essential to the main purpose of contract of saleb) not essential to the main
purpose of contract of sale
c) collateral to the main purpose of contract of sale d) (a)
none of the above
Answer: a
337. In case of breach of a warranty, the buyer can
a) Repudiate the contract b) claim damage only
c) return the goods d) refuse to pay the price
Answer: b
338. In case of breach of a warranty, the buyer can
a) Claim damages only b) repudiate the contract
c) cannot return the goods d) refuse to take delivery of
the goods
Answer:b
339. The main object of a contract of sale is
a) Transfer of possession of goods b) transfer of property in goods
c) delivery of goods d) payment of price
Answer: b
340. Risk follows ownership
a) Only when goods have been delivered b) only when price has been paid
c) whether delivery has been made or not d) even when price has not
been paid
Answer: c
341. A person may act on behalf of another without his knowledge (or) consent, is called
a) Agency by necessity b) Agency by Estoppel
c) Agency by Ratification d) Agency by operation of law
Answer: c
342. ___________ that is when a person acts in some emergency as agent for another
without requiring the consent of that other person.
a) Agency by necessity b) Agency by Estoppel
c) Agency by Ratification d) Agency by operation of law.
Answer: a
343. Who is appointed to perform a particular act?
a) General Agent b) Special Agent
c) Universal Agent d) Mercantile Agent
Answer: b
344. ____________ is one who has authority to do all acts connected with a particular
trade.
a) General Agent b) Special Agent
c) Universal Agent d) Mercantile Agent
Answer: a
345. A universal Agent is one whose authority to act for the principal is
a) Limited b) Unlimited
c) Gradual d) None of these
Answer: b
346. ‘A Mercantile Agent’ is also called known as
a) General Agent b) Special Agent
c) Universal Agent d) Commercial Agent
Answer: d
347. A factor is a __________ entrusted with the possession of goods for the purpose of
selling them.
a) Special Agent b) General Agent
c) Mercantile Agent d) Universal Agent
Answer: c
348. _________ is the authority conferred on an agent by the principal.
a) Ostensible Authority b) Express Authority
c) Implied Authority d) Actual Authority
Answer: d
349. An authority is said to be express when it is given by words spoken or written is
called
a) Ostensible Authority b) Express Authority
c) Implied Authority d) Actual Authority
Answer: b
350. The scope of an agent’s authority is determined by his
a) Ostensible Authority b) Express Authority
c) Implied Authority d) Actual Authority
Answer: a
Accounting Package:
351. To get into company info, press---------------.
a) Alt+F1 b) Alt+F2
c) Alt+F3 d) Alt+F4
Answer: c) Alt+F3
352. To select a company, press --------------.
a) F1 b) F2
c) F3 d) F4
Answer: a) F1
353. To alter the date, Press -------------.
 a) F1 b) F2
c) F3 d) F4
Answer: b) F2
354. To alter the accounting period, Press ---------------.
a) Alt+F1 b) Alt+F2
c) Alt+F3 d) Alt+F4
Answer: b) Alt+F2
355. ------------------- consists of subgroups and ledgers which are similar in nature in one
way or the other.
a) Accounting groups b) Ledgers
c) Features d) Configurations
Answer: a) Accounting groups
356. To alter features, Press ----------.
a) F9 b) F10
c) F11 d) F12
Answer: c) F11
357. Which one of the following is not a menu of company info?
a) Create company b) Alter
c) Display d) Backup
Answer: c) Display
358. Ledgers are created under --------------.
a) Accounting groups b) Accounting Features
c) Statement of accounts d) Accounting Books
Answer: a) Accounting groups
359. To use calculator in Tally, Press ------------.
a) Ctrl+M b) Ctrl +N
c) Ctrl+O d) Ctrl+P
Answer: b) Ctrl +N
360. To get back to Gateway of Tally from Calculator, Press
a) Ctrl+P b) Ctrl+O
c) Ctrl +N d) Ctrl+M
Answer: d) Ctrl+M
361. Cash or credit sale of goods is recorded in the ----------------- voucher.
a) Payment b) Receipt
c) Purchase d) Sales
Answer: d) Sales
362. Purchase return of goods can be entered through ---------------- voucher.
a) Debit note b) Sales
c) Purchase d) Credit note
Answer: a) Debit note
363. Sales return of goods is recorded in -------------- voucher.
a) Debit note b) Credit note
c) Purchase d) Sales
Answer: b) Credit note
364. Adjustment entries and credit purchase or sale of assets are recorded in
a) Contra b) Credit note
c) Journal d) Debit note
Answer: c) Journal
365. The keys used to create credit note voucher are ------------------.
a) Alt+ F8 b) Alt+F9
c) Ctrl+ F8 d) Ctrl+ F9
 Answer: c) Ctrl+ F8
366. The keys used to create debit note voucher are ------------------.
a) Alt+ F8 b) Alt+F9
c) Ctrl+ F8 d) Ctrl+ F9
Answer: d) Ctrl+ F9
367. By default transactions involving cash or/and bank cannot be recorded in --------------
- Voucher
a) Journal b) Receipt
c) Payment d) Contra
Answer: a) journal
368. The voucher which allows only double entry is -----------------.
a) Journal b) Receipt
c) Payment d) Contra
Answer: a) Journal
369. The method of adjustment of Bill wise details for Purchase and sale of goods is -------
-----.
a) New Ref b) Agst Ref
c) Advance d) On Account
Answer: a) New Ref
370. The method of adjustment of Bill wise details for payment or receipt/ purchase
return or sales return is ------------.
a) New Ref b) Agst Ref
c) Advance d) On Account
Answer: b) Agst Ref
371. --------------- dealers who operate at small scale are allowed to pay a lump sum on the
turnover they have for a particular period.
a) Unregistered b) Regular and Registered
c) Unauthorised d) Composite
Answer: d) Composite
372. ---------- is the tax collected from the buyer or lessee at the time of buying or leasing
goods which fall under section 206C of the Income Tax Act, 1961 by the seller or lesser.
a) TDS b) TCS
c) VAT d) Service Tax
Answer: b) TCS
373. Which one of the following pairs comes under Income Tax?
a) TDS & TCS b) VAT& Service Tax
c) TDS&VAT d) TCS & Service Tax
Answer: a) TDS & TCS
374. Which one of the following is not found in payroll info?
a) Employee groups b) Employees
c) Payroll d) Salary details
Answer: c) Payroll
375. Maintenance of payroll is enabled through ------------------------.
a) Inventory features b) Accounting features
c) Configurations d) Add on features
Answer: b) Accounting features
376. Which one of the following is not found statutory reports?
a) VAT Computation b) TDS reports
c) TCS reports d) VAT classifications
Answer: d) VAT classifications
377. Payroll reports do not contain --------------------- menu.
 a) Salary details b) Statements of Payroll
c) Attendance register d) Attendance sheet
Answer: a) Salary details
378. Which one of the following does not affect the accounting records?
a) Budget b) payroll
c) VAT d) TDS
Answer: a) Budget
379. To fill up the payroll details automatically (Payroll auto fill) while creating payroll or
payment voucher, press ---------------.
a) Alt + C b) Alt + A
c) Alt + D d) Alt + B
Answer: b) Alt + A
380. Which is one of the following created for showing variance between actual and
estimated for a given period?
a) Accounting groups b) Budgets
c) Cost centres d) Payroll
Answer: b) Budgets
381. Which is a primary inventory element in Tally?
a) Stock category b) Stock item
c) Stock group d) Unit
Answer: b) Stock item
382. Which is used to quantify stock items?
a) Stock category b) Stock item
c) Stock group d) Unit
Answer: d) Unit
383. ------------- is a group of stock items or sub stock groups which are similar in nature in
one way or the other.
a) Stock group b) Stock category
c) Cost category d) Stock item
Answer: a) Stock group
384. ------------------- is the parallel classification of stock items to stock groups.
a) Cost category b) Stock item
c) Stock category d) Stock journal
Answer: c) Stock category
385. Which is the inventory voucher used to record internal movement of stock items?
a) Physical stock b) Stock Journal
c) Reverse journal d) Delivery note
Answer: b) Stock Journal
386. ---------------- are the short cut keys for creating stock journal.
a) Alt+F7 b) Alt+F8
c) Alt+F9 d) Alt+F10
Answer: a) Alt+F7
387. What are the two types of units of measure created in Tally?
a) Single and Multiple b) Simple and compound
c) Primary and secondary d) Value and volume
Answer: b) Simple and compound
388. --------------- are created and applied in Tally when stock items are stored in two or
more locations.
a) Warehouses b) Backyards
c) Godowns d) Stock Categories
Answer: c) Godowns
389. Stock as per physical verification is recorded through
a) Receipt note b) Stock journal
c) Delivery note d) Physical stock
Answer: d) Physical stock
390. --------------- are the short cut keys used to create physical stock voucher.
a) Alt +F7 b) Alt+F8
c) Alt+F9 d) Alt+F10
Answer: d) Alt+F10
391. Purchase orders which are executed or not can be found in -------.
a) Purchase order book b) Purchase register
c) Purchase bill bending d) Purchase order outstandings/Summary
Answer: a) Purchase order book
392. Sales orders which are not executed so far are viewed through -----
a) Sales bill bending b) Sales order outstandings/Summary
c) Sales order book d) Sales register
Answer: b) Sales order outstandings/ Summary
393. Sales orders which are executed or not can be found in -------.
a) Sales bill bending b) Sales order outstandings/Summary
c) Sales order book d) Sales register
Answer: c) Sales order book
394. Purchase bill bending shows ----------------------------------
a) Goods received but not bill received b) Goods delivered but not bill issued
c) Purchase orders outstanding d) Sales orders outstanding
Answer: a) Goods received but not bill received
395. Sales bill bending shows ---------------------.
a) Goods received but not bill received b) Goods delivered but not bill issued
c) Purchase orders outstanding d) Sales orders outstanding
Answer: b) Goods delivered but not bill issued
396. Cash/fund flow statement can be extracted from -------------.
a) Gateway of Tally Display b) Gateway of Tally
c) Gateway of Tally Accounts info d) Gateway of Tally Accounting Vouchers
Answer: a) Gateway of Tally Display
397. Ratio analysis can be extracted from ----------------.
a) Gateway of Tally Display b) Gateway of Tally
c) Gateway of Tally Accounts info d) Gateway of Tally Accounting Vouchers
Answer: b) Gateway of Tally
398. Which one of the following does not appear in the exception reports?
a) Negative stocks b) Negative ledgers
c) Stock summary d) Overdue receivables
Answer: c) Stock summary
399. Tally audit can be enabled when a ------------- is created or altered.
a) company b) group
c) ledger d) voucher
Answer: a) company
400. -------- is the short cut key used to reconcile when you view vouchers in the ledger
created under bank accounts.
a) F4 b) F5
c) F6 d) F7
Answer: b) F5
Corporate Accounting
401. When shares are forfeited, the share capital A/C is debited by
 a) Paid-up-capital b) Called-up-capital
c) Calls-in-arrear d) Nominal value of such share
Answer: Called-up-capital
402. Discount on reissue of forfeited shares should not exceed
a) 5% subscribed capital b) 10% reissued capital
c) The amount received so far on forfeited shares d) Neither of the above
Answer: The amount received so far on forfeited shares
403. The profit on reissue of forfeited shares is transferred to
a) General reserve b) Capital redemption reserve
c) Capital reserve d) Profit & Loss A/C
Answer: Capital reserve
404. If share of Rs. 10, on which Rs. 8 has been called and Rs. 5 has been received is
forfeited share capital A/C in case will be debited with
a) Rs.2 b) Rs. 5
c) Rs. 8 d) Rs. 10
Answer: Rs. 8
405. Right shares are those share which are
a) Issued by a newly formed company b) First offered to the existing
shareholders
c) Issued to the directors of the company d) Issued to holders of convertible
debentures
Answer: First offered to the existing shareholders
406. The difference between subscribed capital and called-up-capital is called
a) Uncalled capital b) Calls-in-arrear
c) Paid-up capital d) Calls-in-advance
Answer: Uncalled capital
407. Capital redemption reserve is created
a) Out of share forfeiture A/C b) To meet legal requirement
c) Out of securities premium A/C d) Voluntarily
Answer: b) To meet legal requirement
408. Transfer to capital redemption reserve can be made from:
a) Capital reserve b) Forfeited shares A/C
c) General reserve d) Securities premium A/C
Answer: c) General reserve
409. Transfer to capital redemption reserve A/C is not allowed from:
a) P& L A/ C b) Debenture redemption fund
c) Workmen’s accident fund d) Profit prior to incorporation
Answer: d) Profit prior to incorporation
410. Capital redemption reserve A/C can be used for:
a) Writing off past losses b) Issuing fully paid bonus shares
c) Declaring dividends d) Declaring bonus to employee
Answer: b) Issuing fully paid bonus shares
411. Debentures are shown in the balance sheet under the head ………..
a) Secured loans b) Unsecured loans
c) Provisions d) Current liabilities
Answer: a) Secured loans
412. NPA stands for………….
a) Non‐ Performing Assets b) Normal Performing Assets
c) National Performing Asset d) None of these
Answer: a) Non‐ Performing Assets
413. Which of the following is not a statutory reserve?
 a) General reserve b) Development rebate reserve
c) Investment allowance reserve d) Workmen compensation fund
Answer: a) General reserve
414. A characteristic of a fixed asset is that it is_____________.
a) intangible b) used in the operations of a business
c) held for sale in the ordinary course of the business d) not currently used
in the business but held for future use
Answer: c) held for sale in the ordinary course of the business
415. If rate of proposed dividend is less than 10% of paid up capital, the rate of profit
transferred to Reserve shall be………..
a) 10% b) 2.5%
c) 5% d) Nil
Answer: d)Nil
416. Expenses of management is shown in
a) Revenue a/c b) Profit or loss a/c.
c) Profit or loss a/c appropriate a/c d) Nominal a/c.
Answer: a)Revenue a/c
417. The Profit and Loss Account of companies is prepared in the form ………….
a) Part I of Schedule V b) Part I of Schedule VI
c) Part II of Schedule V d) Part II of Schedule VI
Answer: d) Part II of Schedule VI
418. Legal fee shown on_________
a) Revenue a/c. b) Profit or loss a/c.
c) Profit or loss a/c appropriate a/c. d) Nominal a/c
Answer: b) Profit or loss a/c.
419. Public limited companies cannot issue_____________.
a) Equity shares b) Deferred shares
c) Preference shares d) Debentures
Answer: b) Deferred shares
420. Preference dividend is to be paid before__________________.
a) Payment of debenture interest b) Payment of Income tax
c) Distribution of equity dividend d) All the above
Answer: a) Payment of debenture interest
421. Accounting standard for Amalgamation is
a) AS-8 b) AS-20
c) AS-14 d) AS-3
Answer: c) AS-14
422. Pooling of interest methods is used to account for Amalgamation in the nature of :
a) Purchase b) Sales
c) Merger d) None of the above
Answer: c) Merger
423. Purchase consideration, as per AS-14, should include cash and securities agreed to
be given by the transferee company to transferor companies.
a) Shareholders b) Shareholders & Debenture holders
c) Creditors. Debenture holders and Shareholders d) None of the above
Answer: a) Shareholders
424. Expenses of liquidation of transferor company may be shown as ‘Reimbursement’ in
Transferor company’s book, if the expenses are agreed to be paid by :
a) Transferor company b) Transferee Company
c) Both the companies d) Neither company
Answer: b) Transferee Company
425. Excess purchase consideration paid to the transferor company and debited to
goodwill account under purchase method of accounting for Amalgamation should be written
off within a period of:
a) 2years b) 8years
c) 20years d) 5years
Answer:d) 5years
426. The company which is amalgamated into another company is called ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a) Transferor company b) Transferee company
c) Holding company d) Subsidiary co.
Answer: a) Transferor company
427. When 2 or more companies carrying on similar business go into liquidation and form
a new company is called;
a) Amalgamation b) Absorption
c) External reconstruction d) Internal reconstruction.
Answer: a)Amalgamation
428. The company which takes over another company is called ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐.
a) Transferor company b) Transferee company
c) Statutory Company d) chartered company
Answer: b) Transferee company
429. No liquidation and no new formations identify the situation.
a) Absorption b) Amalgamation
c) Internal reconstruction d) Consolidation
Answer: c) Internal reconstruction
430. When an existing company takes over the business of one or more existing
companies is called
a) Amalgamation b) Absorption
c) Holding d) Internal reconstruction.
Answer: b) Absorption
431. Excess of paid up value of the shares over cost of investment is considered as:
a) Goodwill b) Capital Reserve
c) Minority Interest d) Non of above
Answer: b) Capital Reserve
432. Profit earned before acquisition of share is treated as
a) Capital profit b) Revenue profit
c) General Reserve d) Revaluation Loss
Answer: a) Capital profit
433. Profit earned after acquisition of share is treated as
a) Capital profit b) Revenue profit
c) General Reserve d) Revaluation Loss
Answer: b) Revenue profit
434. Preparation of consolidated statement as per AS 21 is
a) Optional b) Mandatory for listed Companies
c) Mandatory for Pvt. Ltd. d) Companies Ltd. partnership firm
Answer: b) Mandatory for listed Companies
435. Holding Co. share in capital profits of subsidiary company is adjusted in :
a) Cost of control b) Shown on Assets side of Balance sheet
c) Revenue profit d) None of above
Answer: a) Cost of control
436. Holding Co. share in revenue profits of subsidiary company is adjusted in :
a) Cost of control b) Shown on Assets side of Balance sheet
c) Profit and loss account d) None of above
 Answer: c) Profit and loss account
437. Unrealised profit on goods sold and included in stock is deducted from :
a) Capital Profit b) Revenue Profit
c) Fixed Assets d) Minority interest
Answer: b) Revenue Profit
438. Face value debentures of subsidiary co. held by Holding Company is deducted from :
a) Debentures b) Cost of control
c) Minority interest d) Debentures in consolidated balance sheet
Answer: b) Cost of control
439. Minority Interest includes :
a) Share in share capital b) Share in Capital profit
c) Share in Revenue profit d) All of the above
Answer: d) All of the above
440. The Time interval between the date of acquisition of shares in subsidiary company
and date of Balance Sheet of Holding Company is known as :
a) Pre acquisition period b) Post acquisition period
c) Pre commencement period d) Pre incorporation period.
Answer: b) Post acquisition period
441. The company has to submit the statement of affairs to the official liquidator within
a) 14days b) 21 days
c) 30 days d) 45 days
Answer: a) 14days
442. A company can be liquidated by _____.
a) Compulsory winding up by the court. b) Voluntary winding up by the
members or creditors
c) Winding up under the supervision of the court d) All of the above
Answer: a) Compulsory winding up by the court.
443. Equity shareholders are -----------.
a) Creditors of the company b) Owners of the company
c) Customers of the company d) None of the above
Answer: b)Owners of the company
444. Preference shareholders are---------.
a) Creditors of the company b) Owners of the company
c) Customers of the company d) None of the above
Answer: d) None of the above
445. Maximum ___________ can be treated as preferential salary and wages.
a) 20000 b) 25000
c) 30000 d) 40000
Answer: a) 20000
446. Preference dividend is to be paid before-----------.
a) Payment of debenture interest b) Payment of Income tax
c) Distribution of equity dividend d) All the above
Answer: b) Payment of Income tax
447. List H shows ______ account
a) Secured loan b) Preferred.
c) Debentures. d) Creditors.
Answer: a) Secured loan
448. Any sum due to an employee out of provident fund is exempt of:
a) Unsecured creditor b) Preferential creditors
c) Secured creditors d) Partially secured creditors
Answer: b) Preferential creditors
449. List ‘E’ statement of affairs gives the list of :
a) Preferential creditor b) debenture holder
c) Unsecured creditors d) Secured creditors
Answer: c) Unsecured creditors
450. Secured creditors are shown in the statement of affairs under:
a) List A b) List B
c) List C d) List D
Answer: b) List B
Security Analysis
451. Gambling is
a) An intelligent speculation b) Based on rumours
c) Successful speculation d) None of these
Answer: b) Based on rumours
452. If the investment is properly undertaken, then
a) The return will commensurate with the risk b) The return will be certain
c) It will be liquid d) All of these
Answer: a) The return will commensurate with the risk
453. Investors buy
a) High grade securities b) Low grade securities
c) Securities for short-term purposes d) None of these
Answer: a) High grade securities
454. The negotiable financial investment differs from non-negotiable financial investment
in terms of
a) Face value b) Transferability
c) Maturity period d) Interest rate
Answer: b) Transferability
455. Investment made in real estate is a
a) Real investment b) Financial investment
c) Non-financial investment d) Intangible investment
Answer: a) Real investment
456. Which one of the following is not a fixed income bearing security?
a) Debentures b) Bonds
c) Fixed Deposits d) Equity shares
Answer: d) Equity shares
457. Which one of the following schemes helps in reducing tax liability?
a) Investment in real estate b) National saving certificate
c) Equity shares d) Savings bank account
Answer: b) National saving certificate
458. The open-ended scheme of Mutual fund is
a) Open on a continuous basis b) Open for a particular period
c) Having a fixed period of maturity d) Interest earning scheme
Answer: a) Open on a continuous basis
459. Which one of the following is a contingent investment?
a) Recurring deposit b) Bonds
c) Equity shares d) Life Insurance policy
Answer: d) Life Insurance policy
460. Speculator is a person
a) Who evaluates the performance of the company b) Who uses his own
funds only
c) Who is willing to take high risk for higher return d) Who considers heresays
and market behaviours
 Answer: d) Who considers heresays and market behaviours
461. Primary market is
a) An issue marketability outstanding securities b) A new issue market
c) Both d) None of these
Answer: b) A new issue market
462. State which one of the following is the method of floating new issue
a) Origination b) Underwriting
c) Placement d) None of these
Answer: c) Placement
463. At par means
a) Shares issued at premium b) Shares issued at discount
c) Shares issued at face value d) All of these
Answer: c) Shares issued at face value
464. Right issue are offered to
a) The existing shareholders b) The promoters of the company
c) The public at face value d) Employees of the company
Answer: a) The existing shareholders
465. Stock exchange
a) Helps in the fixation stock prices b) Ensures safe and fair dealing
c) Induces good performance by the company d) All the above
Answer: d) All the above
466. In the governing body of the stock exchange, certain percentage of the elected
members retires at annual general meeting. That is
a) 33% b) 40%
c) 50% d) 25%
Answer: a) 33%
467. The president and Vice president of the stock exchanges can offer themselves for re-
election after a gap of
a) One year b) Two years
c) Three years d) Six months
Answer: a) One year
468. “Sell Reliance Petro shares at ` 60. This order is a
a) Best rate order b) Limit order
c) Discretionary order d) Stop loss order
Answer: b) Limit order
469. In BSE shares are divided into
a) Two categories b) Three categories
c) Four categories d) Five categoreis
Answer: b) Three categories parties
470. The settlement cycle in BSE and NSE are
a) 10 days b) 8 days
c) 7 days d) 15 days
Answer: c) 7 days
471. The growth in book value per share shows the
a) Rise in the share price b) Increase in the physical assets of the firm
c) Increase in the net worth d) Growth in reserves
Answer: d) Growth in reserves
472. A common stock pay-out ratio:
a) Is directly related to the company’s growth rate
b) Can be zero for a growth firm
c) Measures the earnings of share as a percentage of its market price
 d) Indicates the future cash dividends to be expected
Answer: b) Can be zero for a growth firm
473. The price earnings ratio of a stock reflects
a) The growth of the company b) The market mood for the company’s stock
c) The earnings retained and invested in the company
d) The dividend paid out for the company’s stock
Answer: b) The market mood for the company’s stock
474. Which of the following is used in economic analysis?
a) Gross Domestic Product b) Surveys
c) Labour cost d) Diffusion indexes
Answer: a) Gross Domestic Product
475. The investor wants to study those fundamental factors
a) That affect profit and dividend of a company
b) That influence the interest and dividend characteristics of a company
c) That affect the risk and return characteristics of a security
d) None of these
Answer: c) That affect the risk and return characteristics of a security
476. Default risk is lower in
a) Treasury bills b) Government bonds
c) ICICI Bonds d) IDBI bonds
Answer: a) Treasury bills
477. The value of the bond depends on
a) The coupon rate b) Years to maturity
c) Expected yield to maturity d) All the above
Answer: d) All the above
478. The term structure of the bonds is the relationship between the
a) Interest rate and bond’s maturity period
b) Interest rate of the bond and market rate of interest
c) Interest rate and the price of bond d) Yield and time taken to mature
Answer: d) Yield and time taken to mature
479. The bond portfolio manager has to watch carefully
a) The shape of the yield curve b) The market interest rate
c) The shape of the yield curve and shifts that occur in the market interest rate
d) The repaying capacity of the issuers
Answer: c) The shape of the yield curve and shifts that occur in the market interest rate
480. Duration is the measure of
a) Time structure of the bond b) Interest rate risk
c) Time structure and market risk d) Time structure and the interest rate risk
Answer: d) Time structure and the interest rate risk
481. The market value of the scrip is determined by
a) The dividend declared by the company
b) The present status of the stock market
c) The number of floating shares
d) The interaction of demand and supply
Answer: d) The interaction of demand and supply
482. In the stock market psychology
a) Investors forget the past b) History repeats itself
c) More faith in future prediction d) a) and b)
Answer: b) History repeats itself
483. Dow theory was developed to explain
a) New York stock market movement b) The Dow Jones Industrial averages
 c) Security market price movement
d) The buy and sell strategy
Answer: b) The Dow Jones Industrial averages
484. The share prices
a) Move either in declining or increasing trend
b) May remain flat for a period of time
c) The movements of the share prices form a straight line
d) The increasing or decreasing move maybe Zigzag
Answer: d) The increasing or decreasing move maybe Zigzag
485. Violation of a trend line means
a) Moving away from the trend line
b) Changing the direction
c) Penetration of the trend line
d) Cutting the rising trend line form above
Answer: c) Penetration of the trend line
486. In the bull market
a) The stock prices are increasing
b) Each peak is higher than the previous peak
c) Each bottom is higher them the previous bottom
d) b) and c)
Answer: d) b) and c)
487. The declaring market is called ‘bear market’ because of
a) The hibernation period is long for bears b) The traditional usage
c) The fur coat of the bears d) The attacking manner of the bears
Answer: d) The attacking manner of the bears
488. The secondary corrections of the previous trend is in certain percentage of the
previous fall or rise in price
a) 33% to 43% b) 43% to 53%
c) 33% to 66% d) 53% to 66%
Answer: c) 33% to 66%
489. A support level exists
a) At a price fixed by the stock exchange brokers
b) At a price fixed by the regulatory authority of the stock exchanges
c) At a price where considerable demand is created
d) At a low price where stock would be available
Answer: c) At a price where considerable demand is created
490. The stock price in the stock market
a) Hovers around the support level or resistance level
b) Moves between the same support and resistance level
c) Move between the changing support and resistance level
d) a) and b)
Answer: c) Move between the changing support and resistance level
491. Using futures contracts to transfer price risk is called
a) Speculating b) Hedging
c) Diversifying d) Arbitrage
Answer: b) Hedging
492. Which of the following investment strategies has unlimited profit potential?
a) Protective put b) Writing a call
c) Bull spread d) Covered call
Answer: a) Protective put
493. When someone "writes" a call option, he/she has_____
 a) "Marked to Market" a futures contract b) Sold a call option
c) Bought a call option d) Exercised a call option
Answer: b) Sold a call option
494. ________is the primary government regulator of futures markets in the U.S.
a) Federal Reserve b) SEC
c) CBOE d) CFTC
Answer: d) CFTC
495. With futures market contracts, ________ guarantee(s) all trades, so that default risk
is minimized.
a) Position traders b) An organized exchange
c) Day traders d) The CFTC
Answer: b) An organized exchange
496. Forward contracts, futures contracts, and option contracts are all known as
a) Spot contracts b) Preferred contracts
c) Derivative securities d) Credit securities
Answer: c) Derivative securities
497. The basis is defined as
a) Spot price minus futures price b) Futures price minus spot price
c) Futures price minus forward price d) Forward price minus spot price
Answer: a) Spot price minus futures price
498. The basis must equal ________ at the delivery date for the futures contract.
a) A negative value b) A positive value
c) Zero d) The fixed futures price
Answer: c) Zero
499. The financial institution that guarantees both sides of a future trade is called the
a) Futures exchange b) Clearinghouse
c) SEC d) Local
Answer: b) Clearinghouse
500. If an investor anticipates a significant rally in the stock market, the investor should
a) Sell a put option on the S&P 500 b) Sell the S&P 500 futures contract
c) Buy the S&P 500 futures contract d) buy a put option on the S&P 500
Answer: c) Buy the S&P 500 futures contract