Practice Test

Q1) A purchased a car for Rs.5,00,000, making a down payment of Rs.1,00,000 and signing a Rs.4,00,000 bill payment due in 60 days. As a results of this transaction Show Answer

Q2) All the following items are classified as fundamental accounting assumptions except Show Answer

Q3) Two primary qualitative characteristics of financial statements are Show Answer

Q4) Kanika Enterprises follows the written down value method of depreciating machinery year after year due to Show Answer

Q5) Mohan purchased goods for Rs.15,00,000 and sold 4/5th of the goods amounting Rs.18,00,000 and met expenses amounting Rs.2,50,000 during the year , 2005. He counted net profit as Rs.3,50,000. Which of the amounting concept was followed by him ? Show Answer

Q6) A businessman purchased goods for Rs.25,00,000 and sold 80% of such goods during the accounting year ended 31st March, 2005. The market value of remaining goods was Rs.4,00,000, He valued the closing stock at cost . He violated the concept of Show Answer

Q7) Capital brought in by the proprietor is an example of Show Answer

Q8) Fixed Assets are held in the business for the purpose of Show Answer

Q9) Revenue from Sale of products, is generally , realized in the period in which Show Answer

Q10) The concept of conservatism when applied to the balance sheet results in Show Answer

Q11) Decrease in the amount of creditors results in Show Answer

Q12) The 'going concern concept' is the underlying basis for Show Answer

Q13) Economic life of an enterprise is split into the periodic interval as per Show Answer

Q14) If an individual asset is increased , there will be a corresponding Show Answer

Q15) Purchase of machinery for cash Show Answer

Q16) MATCH THE PAIRS :- Entity concept assumptions Show Answer

Q17) Accrual concept Show Answer

Q18) Going concern , consistency and accrual Show Answer

Q19) Going concern , cost and realization concept Show Answer

Q20) Consistency Show Answer

Q21) Money measurement Show Answer

Q22) Entity Show Answer

Q23) Conservatism Show Answer

Q24) Accrual Show Answer

Q25) Going concern Show Answer

Q26) Cost Show Answer

Q27) fundamental accounting assumptions as per AS-1 are Show Answer

Q28) Economic life of an enterprise is artificially split into the periodic interval in accordance Show Answer

Q29) the assets are classified as current assets & fixed assets in accordance with Show Answer

Q30) the accounting data should be defined ,verifiable & free from the personal bass in accordance with Show Answer

Q31) materiality principle is an exception to the Show Answer

Q32) when stock is valued at a cost in one accounting period & at a lower of cost & net realizable value in another accounting period Show Answer

Q33) accrual means Show Answer

Q34) prudence principle is as exception to the Show Answer

Q35) the assets & incomes are not overstated & the liabilities & losses are not understated in accordance with Show Answer

Q36) prudence is a concept to recognize Show Answer

Q37) accounting of a small calculator as an expenses & not as an asset is in accordance with Show Answer

Q38) appending notes to the financial statements is in accordance with Show Answer

Q39) valuation of the crops at the market value is in accordance with Show Answer

Q40) X ltd . Purchased a machine for Rs.1,00,000 on 1st Jan .The market price of there machine was Rs.1,20,000 on 31st dec. The accountant of X ltd .values machine for Rs.1,20,000 while finalizing the accounts .He has violated the Show Answer

Q41) X purchased merchandise worth Rs.1,00,000 & sold 60% for Rs.90,000 & 40% of the remaining sold for Rs.60,000. The market value of the remaining merchandise was Rs.20,000 .He valued the closing stock at Rs.24,000.He has violated the Show Answer

Q42) X purchased merchandise worth Rs.1,00,000 & sold 60% for Rs.90,000 & 40% of the remaining sold for Rs.60,000. and met operating expenses Rs.10,000 .He counted operating profit as Rs.40,000.He has violated the Show Answer

Q43) personal transaction are distinguished from business transaction of an accounting period in accordance with Show Answer

Q44) x purchased a motorcycle for his son on credit & recorded as purchase of asset in business books.He has violated Show Answer

Q45) x started a business on 1st April 2001 & reported about the financial performance & financial position of the business on 31st march 2007 being the date of liquidation of enterprise. He has violated Show Answer

Q46) the principle which treats all rupees alike whether it is a rupee of 1957 or 2007 Show Answer

Q47) As per AS-I , the fact need not be disclosed in the financial statements if the following concept is followed Show Answer

Q48) As per AS-I , the fact need not be disclosed in the financial statements if the following concept is followed Show Answer

Q49) As per AS-I , the fact must be disclosed with reason in the financial statements if the following concept is not followed Show Answer

Q50) X value the inventory on FIFO basis & LIFO basis during 2006 & 2007 respectively .He has violated Show Answer

Q51) Y followed WDV method & SLM method of depreciation during 2006 & 2007 respectively .He has violated Show Answer

Q52) X has a closing stock costing Rs.10,000 but its market value is Rs.9,000.He shows this stock at Rs.10,000 in the financial statements .He has violated Show Answer

Q53) X has a closing stock costing Rs.10,000 but its market value is Rs.12,000.He shows this stock at Rs.12,000 in the financial statements .He has violated Show Answer

Q54) X has a sundry debtors of Rs.1,00,000 .creating a provision for doubtful debts @ 5% on sundry debtor is in accordance with Show Answer

Q55) X has a sundry debtors of Rs.1,00,000 .creating a provision for discount @ 2% on sundry debtor is in accordance with Show Answer

Q56) X has a sundry creditor of Rs.1,00,000 .creating a reserve for discount @ 2% on sundry creditor is in accordance with Show Answer

Q57) The production manager reports to the top management that the production for the year 2007 is 200 tons but actual production is 1,99,000.90 kg.He has followed Show Answer

Q58) X purchased a building for Rs.1,00,000 but at the end of the accounting period ,the market value of building is Rs.1,50,000.& he disclosed the building at Rs.1,50,000 in the financial statement.He has violated the Show Answer

Q59) X purchased goods for Rs.40,000 of which 25% for cash ,incurred expenses Rs.10,000 of which Rs.2,000 still outstanding & sold all goods for Rs.80,000 of which 75% on credit. he calculated his profit at Rs.2,000.He has violated Show Answer

Q60) X purchased goods for Rs.40,000 of which 25% for cash ,incurred expenses Rs.10,000 of which Rs.2,000 still outstanding & sold 80% of the goods for Rs.80,000 of which 75% on credit. he calculated his profit at Rs.30,000.He has violated Show Answer

Q61) X purchased goods for Rs.40,000 of which 25% for cash ,incurred expenses Rs.10,000 of which Rs.2,000 still outstanding & sold 80% of the goods for Rs.80,000 of which 75% on credit. he calculated his profit for the period Show Answer

Q62) The concept which calls for adjustment to be made in respect of prepaid & outstanding expenses & accrued & unaccrued revenues Show Answer

Q63) subjectivity is involved in Show Answer

Q64) objectivity is involved in Show Answer

Q65) X purchased a car for Rs.4,00,000 making a down payment of Rs.50,000 & signing a Rs.3,50,000 bill payable due in 60 days. As a result of this transaction Show Answer

Q66) during the year ,2006 X purchased goods for Rs.5,00,000 & sold 3/5th of the goods for Rs.5,00,000 & met expenses amounting Rs.1,50,000 . He counted net profit as Rs.50,000 .which of the accounting concept was followed by him ? Show Answer

Q67) a businessman purchased goods for Rs.15,00,000 and sold 80% of such goods during the accounting year ended 31st March, 2007. The market value of remaining goods was Rs.2,50,000, He valued the closing stock at Rs.3,00,000 . He violated the concept of Show Answer

Q68) consider the following data pertaining to X ltd . Particulars :- cost of machinery purchased on 1st April 2006 Rs.1,00,000 ; Installation charges Rs.10,000 ; market value as on 31st March 2006 1,20,000. while finalizing the final accounts, if the company values the machinery at Rs.1,20,000 Which of the following concept is violated by the X ltd Show Answer

Q69) A proprietor X has a reported a profit of Rs.1,00,000 at the end of the financial year after taking into consideration the following amount (I) the cost of an asset of Rs.10,000 has been taken as an expenses (ii) X is anticipating a profit of Rs.5,000 on the future sale of a car shown as an asset in his books (iii) salary of Rs.200 payable in the financial year has not been taken into account (iv) X purchased an asset for Rs.50,000 but its fair value on the date of purchase was Rs.60,000.X recorded the value of asset in his book at Rs.60,000.On the basis of the above facts answers the following question from the given choice ? 1. what is the correct amount of profit to be reported in the books Show Answer

Q70) A proprietor X has a reported a profit of Rs.1,00,000 at the end of the financial year after taking into consideration the following amount (I) the cost of an asset of Rs.10,000 has been taken as an expenses (ii) X is anticipating a profit of Rs.5,000 on the future sale of a car shown as an asset in his books (iii) salary of Rs.200 payable in the financial year has not been taken into account (iv) X purchased an asset for Rs.50,000 but its fair value on the date of purchase was Rs.60,000.X recorded the value of asset in his book at Rs.60,000.On the basis of the above facts answers the following question from the given choice ? 1. which measurement base should be followed in the statement Show Answer

Q71) A proprietor X has a reported a profit of Rs.1,00,000 at the end of the financial year after taking into consideration the following amount (I) the cost of an asset of Rs.10,000 has been taken as an expenses (ii) X is anticipating a profit of Rs.5,000 on the future sale of a car shown as an asset in his books (iii) salary of Rs.200 payable in the financial year has not been taken into account (iv) X purchased an asset for Rs.50,000 but its fair value on the date of purchase was Rs.60,000.X recorded the value of asset in his book at Rs.60,000.On the basis of the above facts answers the following question from the given choice ? 1. which concept should be followed in the statement Show Answer

Q72) A proprietor X has a reported a profit of Rs.1,00,000 at the end of the financial year after taking into consideration the following amount (I) the cost of an asset of Rs.10,000 has been taken as an expenses (ii) X is anticipating a profit of Rs.5,000 on the future sale of a car shown as an asset in his books (iii) salary of Rs.200 payable in the financial year has not been taken into account (iv) X purchased an asset for Rs.50,000 but its fair value on the date of purchase was Rs.60,000.X recorded the value of asset in his book at Rs.60,000.On the basis of the above facts answers the following question from the given choice ? 1. which concept should be followed in the statement Show Answer

Q73) x ltd .follows the WDV method of depreciating machinery year after due to Show Answer

Q74) The determination of expenses for an accounting period is based on the principle of Show Answer

Q75) Economic life of an enterprise is split into the periodic interval as per Show Answer

Q76) The value of human resources is generally not shown in the balance sheet as per Show Answer