ACCOUNTS TEST(CA-CPT) BY CA PANKAJGOEL,

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1 AKN KAILASH THAKUR INSTITUTE, New Office:1/10,Ground Floor, Surana Bhawan, Main Red Light, Laxmi Nagar,Delhi-92, Branch Office- S-547,G.F,Main Mother Dairy Road, School Block, Shakarpur,DELHI-92 Office:1/7; I Floor, Lalita Park,Main Vikas Marg, Main Red Light,Laxmi Nagar,Delhi-92 Mob: , , KAUN BANEGA CHARTERED ACCOUNTANT TEST SERIES ACCOUNTS TEST(CA-CPT) BY CA PANKAJGOEL, NOTE: Each Qts Carry 1 marks each. For every incorrect answer, there is deduction of 0.25 mark from the score. 1. Subscribed Capital refers to (a) Paid up value of all shares allotted (b) Called up value of all shares allotted (c) Nominal value of all shares allotted (d) Paid up value of all shares offered to public 2. Hardcore Computers Ltd. issued to public 15,000 shares of 10 each at premium of Rs. 2. Applications were received for 10,000 shares. The amount payable was as follows: On application 3 per share On allotment 4 per share (including premium) On first and final call 5 per share All sums were duly received by the company except the following: Mr. Perfect holder of 100 shares did not pay allotment and cell money. Mr. Right holder of 200 shares did not pay call money. The company forfeited all the shares of Mr. Perfect. Share Capital a/c will be debited by (a) Rs. 1,000 (b) Rs. 900 (c) Rs. 800 (d) None of the three 3. Which type of the following shares has the right to received dividends unpaid in prior years, whenever earning becomes adequate? (a) Cumulative preference shares (b) Participating preference shares (c) Convertible preference shares (d) Callable preference shares 4. Preference shares can be redeemed only if these are: (a) Partly paid (c) Cumulative (b) Fully paid (d) Participating 5. Mr. Rajiv was the holder of 200 shares of Rs. 10 each in RPG Ltd. upon which Rs. 5 per share had been called up but he had paid only Rs. 2.5 per share thereon. The company forfeited his shares and afterwards sold them to Satbir, credited as Rs. 5 per share paid for Rs The amount to be transferred to capital reserve is : (a) Rs. 300 (b) Rs. 500 (c) Rs. 400 (d) None of the above 6. Pankaj Ltd. issued 300 equity shares of Rs. 10 each fully paid up in consideration of purchases of plant and machinery of Rs. 40,000. What will be the amount of discount on issue of shares? (a) Rs. 15,000 (b) Rs. 10,000 (c) Rs. 5,000 (d) Rs. 1, Bank reconciliation is prepared by: (a) Sole Proprietor concern (b) Partnership firm

2 (c) Corporate bodies 8. Entry in credit side of bank pass book implies: (a) Cash withdrawn (c) Business expenses (d) All the three (b) Cash/cheque deposited in Bank (d) Personal expenses 9. Consider the following statements and analyze their correctness: (1) Overdraft facility is permitted to the customer by the bank, only when he fulfils certain conditions. (2) The bank charges interest on overdrawn balances. (a) Both are true (b) Both are false (c) A is true and B is false 10. Depreciation is charged on: (a) Patents (b) Software (c) Computer (d) B is true and A is false (d) Land 11. An asset is purchased for Rs. 25,000. Depreciation is to be provided annually according to WDV. Useful life of the asset is 10 years and the residual value is Rs. 5,000. Rate of WDV depreciation will be (a) 10% (b) 8% (c) 12% (d) 15% 12. A machine purchases on for Rs. 10,00,000 was depreciated on straight line basis over its useful life of 10 years. On 1,4,2010, it was found that machine is in a good condition and will be used in the production for another 10 years. The amount at depreciation for the year ending will be (a) Rs. 1,00,000 (b) Rs. 80,000 (c) Rs. 83,333 (d) Rs. 66, Purchase of a car by maruti dealers shall be debited to (a) Purchases Account, (b) Goods Account, (c) Personal Computer Account, (d) Drawings Account 14. Goods costing Rs.1,20,000 were sent on consignment basis. These goods are invoiced to give a gross margin of 20% on cost. The amount of loading is: A Rs.24,000. B Rs.30,000.c Rs.20,000 d None of the above 15. During falling Prices, FIFO method not report (a) lower profit (b) higher profit (c) zero profit (d) none 16. Which of the following is not a difference between LIFO & FIFO? a. Recommendation by AS-2 b. Valuation of Closing Stock c. Effect on the quantity of stock left d. Difference in Profit 17. As per AS-1,an accounting policy can be changed provided: (a) (b) (c) (d) it is required by statute it is required for compliance within accounting standards the change would result in more appropriate presentation of financial statements in all the above situations 18. If nothing is written about the accounting assumption to be followed it is presumed that a) They have been followed b) They have not been followed c) They are followed to some extentd) none of these 19. Which of the following is False? (a) Total Assets = Total Equities (b) Assets = Internal Equity + External Equity (c) Assets = Capital + Liabilities (d) Fixed Assets + Current Assets = External Liabilities

3 20. Economic life of an enterprise is artificially split into periodic intervals in accordance with (a) Periodicity Principle (c) Revenue Recognition Principle (b) Going Concern Principle (d) Matching Principle 21. The periodic total of sales book is posted to- (a) Trading a/c (b) Profit and loss a/c (c ) Sales a/c (d) Manufacturing a/c 22. A Sale of Rs. 20,000 was wrongly entered in the Purchase Book. This will (A) Decrease the Gross Profits by Rs. 20,000. (B) Increase the Gross Profits by Rs. 20,000. (C) Increase the Gross Profits by Rs. 40,000. (D) Decrease the Gross Profits by Rs. 40, Days of grace are added in (a) Bill at Sight (b) DEMAND BILL (c) Bill after date (d) none A sent some goods SP Rs. 3,000 at a profit of 25% on cost to B on sale or return basis.b returned goods costing Rs At the end of the accounting period i.e. on 31st December,2005, the remaining goods were neither returned nor were approved by him. ANSWER THE FOLLOWING QUESTIONS based on above question: 24. The stock on approval will be shown in the balance sheet at Rs. a)2,000. (b) 2,700. (c) 2,700 less 25% of 2,700. (d) none 25. Rate of profit on SPat Rs. a)30%. (b) 40%. (c) 20%. (d) none 26. When Fixed assets are sold on CASH (a) Total assets will increase (c) Total assets will decrease 27. DEBIT signifies: (a) Increase in Assets account (c) Decrease in Capital account 28. Which account is the odd one out? (b) Total liabilities will increase (d) There is no change in total assets (b) Decrease in Liability account (d) All of the above (a) Office furniture & Equipment. (b) Freehold land and Buildings.(c) Stock of materials. (d) Plant and Machinery 29. The basic book-keeping rule : Debit : What comes in; Credit : What goes out, is applicable to : (a) real accounts, (b) nominal accounts, (c) personal accounts, (d) contra accounts 30. Which of these are not required in a promissory note: (a) Acceptance (b)unconditional promise to pay(c)properly stamped(d)payment to be made in legal currency 31. In the case of downward revaluation of an asset, which is for the first time revalued, account is debited. a) Fixed Asset B) Revaluation Reserve C) Profit & Loss account DGeneral Reserve 32. When stock reserve is created: a) When reserve is created for abnormal loss b) When some stock is kept reserved with the consignor c) When gods are invoiced above cost (d) None

4 33. Goods sent out on consignment `2,00,000. Consignor s expenses `5,000. Consignee s expenses `2,000. Cash sales `1,00,000, credit sales `1,50,000.. The amount irrecoverable from customer `3,000. What will be the profit on consignment? (a) 38,000(b)40,000(c)36,000(d) 43, Which of the following is False? a. Contingent Liability should be disclosed by way of note to the Balance Sheet. b. The classification of expenditures and receipts each into Capital and Revenue is as per Going Concern Principle. c. Sale of land & buildings by a real estate dealer is a capital receipt and not a revenue receipt. d. Provision should be recognized in Financial Statements. 35. X Ltd. was formed with a capital of Rs 1,00,000 divided into shares of Rs. 10 each. Out of these 2,000 shares were issued to the vendors as fully paid as purchase consideration.6,500 shares was offered to the public and of these 6,000 shares were applied for andallotted. The directors called Rs 6 per share and received the entire amount except a call of Rs 2 per share on 500 shares. The amount of Issued Capital is (a) Rs 48,000 (b) Rs 65,000 (c) Rs. 85,000 (d) Rs. 80, Received Rs. 975 on account from Ram to whom goods were sold for Rs. 1,000 (a) Ram's A/c is to be credited with Rs. 975 (b) Ram's A/c is to be credited with Rs. 1,000 (c) Discount A/c is to be debited with Rs.25 (d) Bad debts A/c is to be debited with Rs Received Rs. 975 from Ram to whom goods were sold for Rs. 1,000 and whose A/c was previously written off as bad debts (a) Ram's A/c is to be credited with Rs. 975 (b) Ram's A/c is to be credited with Rs. 1,000 (c) Discount A/c is to be debited with Rs.25 (d) Bad debt recovered A/c is to be credited with Rs Goods used by proprietor for personal use (cost Rs. 1,000, selling price Rs. 1,500) (a) Sales A/c is to be credited with Rs. 1,500 (b) Purchases A/c is to be credited with Rs. 1,000 (c) Sales A/c is to be credited with Rs. 1,000 (d) Drawings A/c is to be credited with Rs. 1, Which of the following is a Capital Receipt? (a) Sale of land and building by DLF (b) Raising of loan by a person engaged in business of finance. (c) Sale of shares and debentures by a dealer in securities. (d) Subsidy received from government for Purchase of Machinery 40. If'Trial Balance contains the following information: Rs. Bad debts 3,000 Discount allowed 3,000 Provision for discount on debtors 3,200

5 Provision for Doubtful debts 3,500 Sundry Debtors 50,000 At the end of the year, it is desired to maintain a provision for Doubtful debts at Rs 4,000 and provision for discount on debtors at Rs 2,000. Sundry Debtors will appear in the Balance Sheet at a figure of: (a) Rs 44,000 (b) Rs 38,000 (c) Rs 44,700 (d) Rs 32, The profits for are Rs. 4,000; for is Rs. 52,200 and for is Rs. 62,400. Closing stock for and includes the defective items ofrs. 4,400 and Rs. 12,400 respectively which were considered as having market value NIL.The value of goodwill on average profit method is (a) Rs. 47,400. (b) Rs. 35,400 (c) Rs. 27,400 (d) Rs. 34, A and B are partners sharing profits and losses in the ratio of 3:2 (A's Capital is Rs. 60,000and B's Capital is Rs. 30,000). They admitted C agreed to give l/5th share of profits to him.how much Cshould bring in towards his capital? (a) Rs. 18,000 (b) Rs. 24,000 (c) Rs. 29,000 (d) Rs. 22, In the financial statement, contingent liability is (a) Recognised(b) Not recognised.(c) Adjusted.(d) None of the above 44. On death of a partner, his executor is paid the share of profits of the dying partner for the relevant period. This payment is recorded in Profit & Loss Account. a. Adjustment. b. Appropriation. c. Suspense. d. Reserve 45. A, B and C are partners with profits sharing ratio 4:3:2. B retires and Goodwill Rs. 10,800shown in books of account. If A & C shares profits of B in 5:3, then find the new profit sharing ratio. a. 13:11. b. 17:11. c. 31:11. d. 14: Balance sheet prepared after the new partnership agreement, assets and liabilities are recorded at: a. Original Value. b. Revalued Figure. c. At realisable value. d. At current cost 47. What time would be taken into consideration if equal monthly amount is drawn as drawings at the beginning of each month? a. 7 months. b. 6 months. c. 5 months. d. 6.5 months. 48. Memorandum Joint venture account is a a. Personal account. b.real account.c.nominal account. D.None of the above 49. If Average Stock = Rs 12,000. Closing stock is Rs 3,000 more than opening stock then the value of opening stock will be a. Rs 12,000 b. Rs 24,000 c. Rs 10,500 d. Rs 13,500.

6 50. Provision for doubtful debts is Rs.1000 & debtors are Rs.90,000 at end of year, provision for doubtful debt 1% required, then the entry a) P & L A/c Dr 900 To provision for doubtful debts 900 b) Provision for doubtful debts 900 To P & C A/c 900 c) P & L A/c Dr 100 To RDD A/c 100 d) none of these 51. A draws a bill on B on 12th May 2008 for Rs.20,000 for 3 months, accepted on 15 may. What will be the maturity date? a) 13th Aug 2008 b) 14th Aug 2008 c) 15th Aug 2008 d) 18th Aug In the absence of Agreement, interest on Capitals of partners to be allowed is a) 6% b) 8% c) 9% d) None 53. According to Companies Act 1956 Balance Sheet is prepared as per a) Part II schedule VI b) Part I schedule VI c.part II schedule VII d) Part I schedule VII 54. The cost of physical inventory on April 20th was computed as Rs.5,25,000. The purchase of goods from April 1st to 20th were 3,25,000 which include cash purchase of Rs.75,000 and goods costing Rs.75,000 not yet received.the value of closing stock as per books for year ending 31st March would be a) 2,00,000 b) 2,75,000 c) 3,25,000 d) 5,00, If the opening stock is overstated by Rs.10,000 and closing stock is understated by Rs.15,000, the effect on profit will be a) Understated by Rs.5,000 b) Understated by Rs.25,000 c) Overstated by Rs.25,000 d) Overstated by Rs.5, If the closing inventory represents the latest purchases, the method of valuation followed is a) LIFO b) FIFO c) Straight line d) None of these 57. The success of perpetual inventory system depends upon a) Placing order for materials an regular intervals b) Exercising control over the issue of materials c) Recording the receipts and issue of materials immediately after transaction d) Recording the receipt of material at fixed interval 58. Liability arises because of a. only cash transactions b. only credit transactions c. cash as well as credit transactions d. none of the above 59. Accounting has been referred to as the of business.

7 a. book keeping b. language c. record d. blood 60. Bearer debentures are transferable a. to a registered debentureholder b. by delivery c. only to equity shareholders d. none of the above

8 1. C 2. A 3. A 4. B 5. B 6. B 7. D 8. B 9. A 10. C 11. D 12. B 13. A 14. C 15. B 16. C 17. D 18. A 19. D 20. A 21. C 22. D 23. C 24. D 25. C 26. D 27. D 28. C 29. A 30. A 31. C 32. C 33. B 34. C 35. D 36. A 37. D 38. B 39. D 40. A 41. B 42. D 43. B

9 44. C 45. B 46. B 47. D 48. C 49. C 50. D 51. B 52. D 53. B 54. B 55. B 56. B 57. C 58. B 59. B 60. B