Deck 37: Accounting and Financial Management

Question 1

Closing entries are generally passed -

A)At the time of opening new books of account .
B)At the time of closing the accounts.
C)During the course of accounting period any time .
D)After certification of accounts

Answer 1

At the time of closing the accounts.

Question 2

Closing stock appearing in the Trial Balance is shown in -

A)Trading A/c and Balance Sheet .
B)Profit and Loss A/c .
C)Balance Sheet only
D)Trading A/c only

Answer 2

Balance Sheet only

Question 3

Depreciation Account appearing in the Trial Balance is shown in -

A)Profit and Loss A/c .
B)Trading A/c .
C)Deducted from the concerned assets A/c.
D)Shown on the liability side

Answer 3

Profit and Loss A/c .

Question 4

Profit on sale of old plant is shown -

A)In Trading A/c .
B)In Profit and Loss Appropriation A/c .
C)Profit and Loss A/c
D)Being a non operating item ignored

Question 5

Carriage on goods purchased is shown in -

A)Profit and Loss A/c .
B)Capitalized with work in progress .
C)Trading A/c.
D)Shown in Balance Sheet

Question 6

Which of these is not an operating income

A)Income from sale of trading goods .
B)Bad debts recovered .
C)Interest on FDs .
D)None

Question 7

ABC holds an average inventory of ` 36,000(CP) with an inventory turnover of 5 times. If the firm makes a gross profit of 25% on sales, find the total sales of the company

A)2,40,000 .
B)2,10,000 .
C)2,00,000 .
D)1,80,000

Question 8

From the following details what will be the partners' commission? Net profit before charging partners' commission `65,000. Partners' commission @ 11% after charging such commission

A)6441 .
B)5431 .
C)7654 .
D)9876

Question 9

From the following details what will be the partners' commission? Net profit before charging partners' commission `65,000. Partners' commission 11% before charging such commission

A)6441 .
B)5431 .
C)7150 .
D)5876

Question 10

Arrangement of Balance Sheet in a logical order is known as -

A)Dressing Balance Sheet .
B)Marshalling Balance Sheet.
C)Formatting Balance Sheet .
D)Make up of Balance Sheet

Question 11

Improper valuation of inventory effects-

A)Profitability .
B)Financial position .
C)Both .
D)Cash inflows

Question 12

Find the cost of goods sold if goods are sold for ` 2,000 at 25% profit on cost

A)1,600 .
B)1,500 .
C)1,000 .
D)1,800

Question 13

Find the value of opening stock from the following data. Purchases ` 1,50,000, Closing stock ` 30,000 , Sales `2,20,000, Gross profit ` 40,000.

A)50,000 .
B)55,000 .
C)60,000 .
D)65,000

Question 14

A Bill of Exchange is drawn on 1st April, 2012 payable after 3 months. The due date of the bill is

A)30th June,2012
B)1st July,2012
C)4th July,2012
D)4th August,2012

Question 15

Which of the following statements is/are true?

A)Noting charges are paid by the holder of the bill on the date of default
B)A bill can be endorsed only thrice
C)On renewal of bill the old bill is canceled
D)Both (a) and (c) above

Question 16

When bill discounted with the bank is dishonoured?

A)Acceptor's Account is debited in the books of drawer
B)Bills Receivable Account is credited in the books of drawer
C)Bank Account is debited in the books of drawer
D)Bills Payable Account is debited in the books of drawer

Question 17

Which of the following statements is/are false?

A)Accommodation bills are drawn for the benefit of drawer only
B)Bills sent for collection is an asset
C)Bills of exchange cannot be drawn on a banker
D)Both (a) and (c) above

Question 18

In the books of the drawer, the accounting treatment involved on receipt of a bill of exchange duly accepted by the drawee is
i. Debit Bills Receivable Account
ii. Debit Drawee's Account
Iii. Credit Drawee's Account
iv. Credit Sales Account

A)Only (i) above
B)Both (ii) and (iv) above
C)Both (i) and (iii) above
D)Both (i) and (iv) above

Question 19

The noting charges levied on dishonour of an endorsed bill by the Notary Public are to be borne by

A)The drawer of the bill
B)The person responsible for dishonour
C)The holder of the bill
D)The endorser of the bill

Question 20

The drawer of a trade bill passes relevant entries with regard to the transaction involved in it. But, in case of an accommodation bill, he passes an entry in addition to the usual entries. The additional entry so passed is with respect to

A)Discounting of the bill with the bank
B)Payment of the bill on due date
C)Remitting or receiving the amount
D)Sending the bill to bank for collection

Question 21

Under which of the following situations, is journal entry not passed in the books of the drawer?

A)When a discounted bill is honoured by the drawee on the due date
B)When a bill is sent to the bank for collection
C)When a bill is renewed at the request of the drawee
D)When a debtor accepts a bill drawn by the drawer

Question 22

Which of the following is not a feature of a promissory note?

A)It must be in writing
B)It contains an unconditional promise to pay
C)It is payable to the bearer
D)It must be signed by the maker

Question 23

How many parties are generally found in a Bill of Exchange

A)4 .
B)2 .
C)3 .
D)5

Question 24

X draws a Bill of Exchange on Y for ` 10,000 on 1-1-2013 for 3 months. The due date of the bill will be -

A)4-4-2013 .
B)3-4-2013 .
C)1-4-2013 .
D)31-3-2013

Question 25

When a B/R is endorsed by the Drawer what entry is passed by the Drawee-

A)B/R A/c Dr. to Drawer A/c Cr. .
B)B/P A/c Dr. to Drawer A/c Cr.
C)3rd Party's A/c Dr. to B/P A/c Cr. .
D)No entry at all