Practice Test

Q1) The purpose of an accounting system includes all the following except Show Answer

Q2) Payment made to suppliers of goods may be classified as Show Answer

Q3) Principle requires that the same accounting method should be followed from one accounting period to the next . Show Answer

Q4) Guarantee give in respect of the third parties is Show Answer

Q5) A person is having inventory of cost of Rs 1,00,000.its market value as on 31st March, 2017 is Rs 80,000. He valued the inventory at Rs 1,00,000.In during so , which of the concept was voilated by him? Show Answer

Q6) Economic life of an enterprise is split into the periodic interval as per ---------- concept Show Answer

Q7) Which one of the following is not the fundamental accounting assumption? Show Answer

Q8) An accounting policy may be changed Show Answer

Q9) The aim of issuing accounting standards is Show Answer

Q10) Cash book is a type of but treated as a of accounts . Show Answer

Q11) An amount received from a customer has been debited to his account .The error may be classified as Show Answer

Q12) If sales return of Rs 2000 has been wrongly posted to the credit side of the purchase returns account , but has correctly posted in customer account , the total of the trial balance would show Show Answer

Q13) When debit balance as per cash book is the starting point,cheques deposited but not cleared are Show Answer

Q14) Calculate the cost of closing inventories using adjusted selling price method sales during the period -- Rs 4,00,000 ;
closing inventory at selling price -- Rs 1,00,000 ; Opening Inventory - NIL ; Cost of Purchase - Rs 4,00,000.
Show Answer

Q15) R sons apprehends that there has been some inventory missing . The following information for the year 2016-17 is available ;
Opening inventory Rs 2,00,000; Purchases during the year Rs 4,00,000;Sales during the year Rs 5,20,000.As per physical inventory taken o 31 st march 2017,the stock was found to be of cost of Rs 1,55,000. Gross profit o cost has been constant at 25%.
The estimated cost of missing inventory will be Show Answer

Q16) The opening inventory of a trader as on 01.04.2016 was Rs 70,000.This includes a slow moving item which was written off by Rs 2,000 having purchase price of Rs 10,000.
Such item was sold in 2016-17 for Rs 9000.Barring the transaction relating to the item, gross profit earned during the 2016-17 was 20% on sales.Total salesand purchases for the year 2016-17 was Rs 5,0900 and Rs 3,78,00 respectively .Ascertain the value of inventories as on 31.03.2017 Show Answer

Q17) While finalizing the current years profit,it has been found that there was a casting error in valuation of closing inventory of the previous year. The closing inventory was valued more by Rs 10,000. This error results Show Answer

Q18) The following information is available for the month of March, 2017:
Inventory :
As on March1,2017 Rs1,90.000
As on March 31, 2017 Rs 95,000
To0tal purchase during the month Rs 3,50,000
Payment made to creditors Rs 3,25,000. Goods are sold at 20 % gross profit on sales for the month of March were Show Answer

Q19) The book value of the asset as on 1st April, 2016 was Rs 70,000.
Depreciation is to be charged on the asset @10% under WDV method .On 1stAugust 2017, the asset was sold for Rs 60,000. Calculate profit / loss on the sale of the asset. Show Answer

Q20) A machine was purchased for Rs 3,00,000 having an estimated total working of Rs 28,000 hours .
The scrap value is estimated to be Rs 20, 000 and anticipated pattern of distribution of effective hours is as follows:
Year
1 - 3 3,000 hours per year
4- 6 2,600 hours per year
7 - 10 2,800 hours per year
In 8th year, the depreciation to be charged will be Show Answer

Q21) Depreciation on asset is provided with the objective of Show Answer

Q22) Which of the following expenses is not included in the acquisition cost of a machinery ? Show Answer

Q23) machinery costing Rs 6,00,000 was purchased on 1 st April, 2012. The installation charges amounted to Rs 20,000/ . The salvage value is estimated to be Rs 10, 000 / - The useful life of machinery is 10 years .
Deprecation on straight line method for the year ending on 31 st March, 2017 will be Show Answer

Q24) MN of Mumbai sent out goods on consignment costing Rs 4,00,000 to QR of Delhi. Commission to be paid 2 % on sales + 3 % on sales,del- credare commission. The entire goods were sold by the consignee for Rs 5,00,000. How evere, the consignee could recover only Rs 4,92,000 from the trade receivables. The amount of commission to be transferred to profit and loss A/c by QR will be Show Answer

Q25) Mehta consigns 1,000 shirts costing Rs 400 each to Khaitan.Mehta pays Rs 20,000 for packaging and freight. Khaitan sells 900 shirts at Rs 500 each and incurs Rs 15,000 as selling expenses.The value of consignment inventories will be Show Answer

Q26) Basu of Kolkata sends 600 boxes to Tewari of Delhi costing Rs 250
each.Consignors expenses were Rs 3,000.
1/6th of the boxes were goods in transit. 3/5th of the goods received by the consignee were sold by him. The cost of goods still in transit will be Show Answer

Q27) P and Q enter into joint venture sharing profits and losses equally. P purchased 5000 units @ 30 each. Q sold 4800 units @ 50 . Balance units were taken over by Q at Rs 5,000. P is entitled to get 2 % commission on purchase and Q is entitled to get 1 % commission on sales . Q' s share of profit on venture will be Show Answer

Q28) Mukesh and Vimal were partners in a joint venture sharing profit and losses in the ratio 2:1.Mukesh supplies goods worth Rs 36,000 and incurs freight for Rs 3,900. Vimal supplies goods worth Rs 17,000 and Vimal incurs expenses amounting to Rs 3,000. Vimal sells goods on behalf of joint venture and realizes Rs 65,000. Vimal settels his account by remittance of cheque of --------- to Mukesh Show Answer

Q29) P draws a bill on Q for Rs 28,000 on 15. 02. 2017 for 30 days. Mr.Q accepted the bill on 18.02.2017.What would be the maturity date of the bill ? Show Answer

Q30) The purpose of accommodation bill is Show Answer

Q31) A bill of Rs 15,000 was discounted by Shyam with the bank for Rs 14,900. At maturity, the bill returned dishonoured, noting charges Rs 50. How much amount will be debited in Shyam's bank account by the bank at the time of such dishonour ? Show Answer

Q32) Gauri draws a bill on Mita for Rs 7,500 for mutual accommodation in the ratio 2:1.Mita accepted the bill and returned to Gauri got it discounted at Rs 7,400 and remitted 1/3 rd proceeds to Mita . At the time of maturity, how much amount Gauri should remit to Mita to pay off the bill ? Show Answer

Q33) K accepted a bill for Rs 45,000 drawn by G.G endorsed the bill to become insolvent and as a consequence, the bill is dishonoured on due date.Which of the following account should be credited in the books of G to record the dishonour of the bill ? Show Answer

Q34) Under sale or return on approval basis, the ownership of goods is passed only. Show Answer

Q35) On 31.03.2017, Goods sent on sale or return basis amounting to Rs 6,500 were lying with the customer,date of return has not yet expired. Goods were sent on approval at a price of cost plus 30% .market price of such goods as on 31. 03. 2017 is 5 % less than the cost price . In the balance Sheet as on 31.03.2017, the inventories with Customer account will be shown at Show Answer

Q36) John and Deepak are partners in a firm. The firm's reported profit for the year 2016 -17 is Rs 14,200. Deepak claimed interest @12% p.a on his loan of Rs 70,000 to the firm . However, there was no written agreement. Find out the amount payable to john and Deepak . Show Answer

Q37) Ram and Karim are partners with the capital of Rs 60,000 and Rs 50,000 respectively. As per Partnership Agreement, they are entitled to interest on capital @12% per annum. Find the interest on capital for both the partners when the profits earned by the firms is Rs 9,240 Show Answer

Q38) Goodwill brought in by incoming new partner is shared by the old partners in their -------- ratio. Show Answer

Q39) Capital employed by a partnership firm is Rs 6,00,000. Its average profit is Rs 1,12,000.Normal rate of return is 14% .Find out the value of the goodwill of the firm by using capitalisation method . Show Answer

Q40) On admission of a partner,unrecorded stock of Rs 10,000and unrecorded liability of claim against the firm of Rs 5,000 will be recorded in Show Answer

Q41) At the time of retirement of a partner, firm gets _____
from his insurance company against the Joint Life Policy taken for all the partners. Show Answer

Q42) R, S and T are partners sharing profits and losses in the proportion of 3 : 2 : 1 . S retired and the new profit and loss sharing ratio of R and T would be 3:2 .The reserves of the firm Rs 15,000 will be divided amongst the partners R, S and T as ____ Show Answer

Q43) 100 shares of nominal value of Rs 10 each ( which were isued at par) have been forfeited, upon which Rs 5 per share was paid up and transferred to forfeited shares account . Afterwards, 70 shares were re-issued at at Rs 7 per share , paid up as Rs 10 per share . How much amount is to be transferred to Capital Reserve ? Show Answer

Q44) T Limited issued 15,000 equity shares of Rs 10 each . The called up value per share was Rs 8. The company forfeited 250 shares of Mr. S for non -payment of 1st call money of rs 3 per share .He Paid Rs 5 for application money and alloment money . On forfeiture.
The share capital account will be Show Answer

Q45) Small Limited issued 30,000 equity shares of Rs 100 each at par payable as Rs 50 on application . Rs 30 on allotment and balance on first call . The applications were received for 50,000 shares and 30, 000 shares were allotted. Excess money received on application was refunded after adjustment of allotment money . 500 shares were forfeited in respect of which first call money was not received .
The above is the case of ` Show Answer

Q46) A company by passing a special resolution may decide that a certain portion of its subscribed uncalled capital shall not be called up except in the event of winding up of the company .Such portion of the uncalled capital is called _____ Show Answer

Q47) Bijey Ltd . issued 5,00 equity shares of Rs 10 each at premium of 20% .Amount payable on shares was Rs 5 on application (including premium) Rs 4 on allotment and Rs 3 on final call .
The company forfeited 100 shares allotted to Mr A who failed to pay allotment money and call money .What is the amount to be credited to Forfeited shares Account / Show Answer

Q48) Preference shares amounting to Rs 3,00,000 are redeemed at a premium of 5% by issue of equity shares amounting to Rs 2,00,000 at a premium of 10 % . How much amount is to be transferred to Capital Redemption Reserve ? Show Answer

Q49) Which of the following statement is false? Show Answer

Q50) LT limited purchased land and building from AB limited for a consideration of Rs 22,00,000. The consideration was paid by issue of 12% debentures of Rs 100 each at a premium of 10% .The debenture account was credited with ___ Show Answer

Q51) Loss on issue of debentures is a ______
Show Answer

Q52) When the consent of a party to a contract in not free, the contract is _____
Show Answer

Q53) An offer is lapsed by : Show Answer

Q54) A 'lunatic person 'is a Show Answer

Q55) An offer open for acceptance over a period of time is _____ Show Answer

Q56) An Executory contract is ____ Show Answer

Q57) A specific proposal is Show Answer

Q58) Contract made on account of love and affection should be Show Answer

Q59) Threats to commit suicide amounts to _____ Show Answer

Q60) Where both the parties to an agreement are under mistake as to a matter of fact , which is essential to the agreement the agreement is Show Answer

Q61) More silence as to fact likely to affect the derive of other party amounts to Show Answer

Q62) Which of the following is false as regards to recession of contract ? Show Answer

Q63) X owes Rs 15,000 to Y, X pays Rs 12,000 in full and final settlement of the outstanding due . This is a case of ______ Show Answer

Q64) Supervening impossibility is discharge of contract by Show Answer

Q65) Discharge of contract by mutual agreement includes Show Answer

Q66) P , a property dealer, appoints Q for Rs 20,000
to find a purchases for certain property. Q found a customer R, who paid Rs 50,000 as advance to Q. Afterwards P refuse to sell the property. In this case, can R receive his money back from Q ? Show Answer

Q67) A agrees to employ B from 1 st April 2017. On 24th March, 2017 he writes a letter to b informing him that he need not join the services. This is known as Show Answer

Q68) A delivered some goods at B's warehouse by mistake and B used the goods, B is bound to pay to A the price of goods. This is on the basis of Show Answer

Q69) A Contingent Contract is always Show Answer

Q70) The word "Property" in the Sale of Goods Act , 1930 refers to : Show Answer

Q71) Where the goods are sold and deliver by the seller on sale or approval basis, the property in goods is transferred to the buyer when Show Answer

Q72) Which of there are not a form of delivery ? Show Answer

Q73) Bill of Landing is issued by Show Answer

Q74) X sold 1000 fridges to Y . The fridges were in warehouse at the time of sale, X ordered the warehouse keeper to hold them for the use of Y as X sold them to y .This is : Show Answer

Q75) The breach of warranty gives right to : Show Answer

Q76) In respect of sale of specific goods in a deliverable state, the property in goods passes to buyer when Show Answer

Q77) Risk passes from seller to buyer when Show Answer

Q78) P made the bid in an auction for a car and bid was knocked down in his favour. afterwards the auctioneer calls P to sign a document for honouring the cheque otherwise ownership of car would not pass to P . The cheque was further dishonoured. In this case ownership of the car : Show Answer

Q79) An unpaid seller is having rights against Show Answer

Q80) " Right in Rem" means:
Show Answer

Q81) Before attaining the age of majority a minor admitted to the benefits of the firm has the right to;
Show Answer

Q82) Every partner is __ liable for the acts of the partnership business Show Answer

Q83) Which of the following is false? Show Answer

Q84) A partnership firm where there is no provision for the duration of partnership is called Show Answer

Q85) In a partnership where partners agree to give share in profit but without any rights of the firms such partner is Show Answer

Q86) In the absence of an agreement profit and loss are divided by partners in the ratio of : Show Answer

Q87) Sanjay and Murli agree to work together as tailors. According to this agreement Murli will receive all profits and shall pay wages to Sanjay..Here the relationship between Sanjay and Murli of : Show Answer

Q88) Compulsory dissolution of partnership takes place on Show Answer

Q89) A partner of an unregistered firm can sue for :
Show Answer

Q90) A, B, and C are active partner in a firm. A, retire without giving public notice of his retirement, B and C carry on the business of the firm and incur liability onwards X . In this case : Show Answer

Q91) Date of compulsory dissolution for a partnership firm is Show Answer

Q92) Goods of worth Rs 4,000 was purchased from Mr. Jalan. He allowed 5% trade discount. Cash discount of Rs 100 was also allowed for quick payment . Purchases A/c will be debited by Show Answer

Q93) Pre-paid insurance Premium Account is a Show Answer

Q94) If during the year the assets are increased by Rs 1,00,000 and liabilites are decreased by Rs 50,000 . Owner's equity will be Show Answer

Q95) The best indicator of economic development of any country is Show Answer

Q96) The manager of business is entitled to 10% commission on net profit after charging such commission. If the profit before manager commission is Rs 49,500,calculate the commission payable to manager. Show Answer

Q97) Goods worth Rs. 8,000 were destroyed by fire and the insurance Company admits claim for Rs. 5,000. purchase / Trading Account will be credited by ----- Show Answer

Q98) Rent paid Rs. 1,50,000 for the year from 1st October, 2016 to 30th September, 2017 and rent paid Rs. 1,80,000 for the year from 1st October, 2017 to 30th September , 2018, Rent paid as shown in the profit and loss account for the year ended on 31st December, 2017, would be Show Answer

Q99) Opening capital was Rs. 13,000; introduction during the year by the proprietor Rs. 3,000; Drawing was Rs. 4,000 and capital at the end of the year was Rs 20,000, What was the net profit for the year? Show Answer

Q100) Some of the goods meant for the use of trading are used for construction of office of the firm. It should be credited to Show Answer