Accounting & Finance for Bankers Online Test, Accounting & Finance for Bankers Online exam, Accounting & Finance for Bankers Free Exam, Accounting & Finance for Bankers Exam, Accounting & Finance for Bankers Questions and answer, Accounting & Finance for Bankers Study Guide, Accounting & Finance for Bankers Material

Q - 1 .Companies are required to transfer certain percentage of their profit after tax to reserves, to declare dividend. The various rates of transfer based on the rates of dividend are given below in pair. Select the wrong pair.

Rate of dividend exceeds 10% but not 12.50- Transfer to reserve @ Nil%
Rate of dividend exceeds 12.50% but not 15%- Transfer to reserve @ 5%
Rate of dividend exceeds 15% but not 20%- Transfer to reserve @ 7.50%
Rate of dividend exceeds 20% - Transfer to reserve @ 10%

Q - 2 .Liability for partially paid investments in respect of banking companies is grouped under the head________

Investments
Other assets
Other liabilities and provisions
Contingent liabilities

Q - 3 .Select the True statement from the following

Interest on drawing is an income to the partnership firm
Joint Venture is a permanent partnership firm
Goodwill is a tangible asset of the firm
In the absence of partnership agreement , partners share profit and loss in proportion to the capital contributed by the partners.

Q - 4 .Select the incorrect statement in respect of calls in advance

The company may accept from shareholders , the uncalled amount on shares even before it is fallen due
The article of association must permit such acceptance of advance call money
Interest on calls in advance can be paid but the maximum is upto 6%
The amount of calls in advance is part of the paid up share capital

Q - 5 .If the net worth of the business is Rs.500, fixed assets are Rs. 500, current assets Rs.300, investments Rs.300, current liabilities Rs. Nil, what is the amount of claim to outsiders?

Rs. Nil
Rs. 1100
Rs.500
Rs.600

Q - 6 .Freight expenses for moving new machinery to factory is

Revenue expenses
Deferred revenue expenditure
Capital expenditure
None of the above

Q - 7 .Identify a pair which is mismatch from the following pairs in respect of Company Accounts

Miscellaneous Expenditure Preliminary Expenses
Contingent Liabilities footnote to balance sheet
Debentures Unsecured Loans
Outstanding Expenses Current Liabilities

Q - 8 .Choose the correct treatment for premium paid on Joint Life Policy when premium paid is treated as an expense.

Premium amount is debited to P & L account every year and when claim becomes due then to be shared by all partners
Every year amount debited to Joint Life Policy Account and balance is shown on asset side at surrender value . The difference between surrender value and premium paid is written off to Profit and Loss account
Joint Life Policy and Joint Life reserve Account are adjusted to bring them down to surrender value of policy.
None of the above.

Q - 9 .Due to heavy flooding a truck carrying consignment goods sinks. This loss is called

contingent loss
Nominal loss
Abnormal loss
Casual loss

Q - 10 .For an expense to be classified as revenue or capital depends on

Kind of expense
Duration of the benefit of the expenditure
Effect on revenue earning capacity
All of the above

Q - 11 .From the following ,find a sentence which is false in respect of partnership

If the partnership is following the Fixed Capital Account Method salary payable to a partner is credited to the partner s curr
Drawings made by partners are never entered in the Profit and Loss Appropriation Account.
In the Fluctuating Capital Account Method the balance in the capital account always remains the same
The capital account of a partner is required to be opened in both the Fixed Capital Account Method and Fluctuating Capital Account Method

Q - 12 .Investments, Advances, Fixed Assets and other Assets are part of Schedule Nos.--respectively

6,7,8,9
7,8,9,10
8,9,10,11
9,10,11,12

Q - 13 .While preparing the final accounts of the company, the adjustments [(i) to (iv)] are to be made by passing necessary entries. One of the entries passed is wrong entry. Select the wrong entry.(i) Depreciate plant ,WDV of which is Rs.3,30,000 at 15% (ii) Write off Rs.5,000 from Preliminary Expenses (iii) Half years debenture interest due (12% debentures of Rs. 3,00,000) (iv) a claim of Rs. 25,000 for workmens compensation is disputed by the company.

Debit Depreciation on plant by Rs.49,500 credit plant by 49,500 AND Debit Profit & Loss Account by 49,500 and Credit Depreciation on plant by 49,500
Debit Profit and Loss Account by Rs.5,000 and Credit Preliminary Expenses
Debit Debenture Interest by Rs.18,000 & Outstanding Liability for Deb. Interest by 18,000 AND Debit Profit and Loss Account by Rs.18,000 and Credit Debenture Interest by Rs.18000
Debit Wages by Rs.25,000 & Credit Outstanding Liability for Workers compensation AND Debit Profit and Loss Account by Rs.25,000 and Credit Wages by Rs.25,000

Q - 14 .Read the following four journal entries which are passed to consider revaluation of assets and liabilities at the time of admission of a partner. One of the journal entries is wrong, choose the entry which is wrong.

For increase in the value of assets-Debit Asset Account and Credit Revaluation Account.
For decrease in the value of liabilities- Debit Liabilities Account and Credit Revaluation Account.
For Profit on revaluation of assets and liabilities Debit Old Partners Capital Account in old profit sharing ratio and Credit
For decrease in the value of assets -Debit Revaluation Account and Credit Asset Account

Q - 15 .Choose the wrong pair from the following. The information given in the pair is pertaining to banking companies

The company is an artificial person
A member of a company may bind the company by its actions.
The shareholders are not liable for the acts of the company
The premium received on shares may be distributed among shareholders.

Q - 16 .The scheduled banks are required by RBI to transfer at least ______ of their disclosed profit after adjustment/provision towards bonus to staff

20%
15%
10%
None of the above

Q - 17 .Mr. X was issued 100 shares of Rs.10 each. He failed to pay call money of Rs. 5 per share. The shares were forfeited and re-issued to Mr. Y at Rs.9. When the entry recording the re-issue of shares was passed in all, four accounts were affected. The debit and credit effect of these four accounts is given below. One of the accounts is given wrong effect. Select that account from the following.

Debit bank account by Rs.900
Debit forfeited shares by Rs.500
Credit share capital by Rs.1000
Credit forfeited shares by Rs.400

Q - 18 .A, B and C share profits as 3:2:1. C retires. Calculate the gain ratio of A and B

03:02
01:00
02:00
None of the above

Q - 19 .On the retirement of the partner, the profits on revaluation of assets should be credited to the accounts of-----

All the partners in their profit sharing ratio
The remaining partners in their new profit sharing ratio
The remaining partners in their old profit sharing ratio
None of the above

Q - 20 .Preliminary Expenses is-----

Fictitious Asset
Current liability
Current asset
None of the above

Q - 21 .Which of the following is most desirable 1000/- sold for 1200/- is entered in sales register. The rectification is

Pricing issue of goods to match current material costs
Overstating profits
Understating profits
none of the above

Q - 22 .Goods worth Rs.2000 sold to Vijay was entered in purchase account; The rectification is

Credit purchases and credit sales to the extent of Rs.2000 each & debit Vijay by Rs.2000
Debit purchases and debit sales to the extent of Rs.2000 each & credit Vijay.
Debit sales to the extent of Rs.4000.
Credit purchases to the extent of Rs.4000.

Q - 23 .When a new partner gives cash for goodwill, the amount is credited to____

Goodwill account
Capital account of new partner
Cash account
None of the above

Q - 24 .Select the incorrect statement in respect of financial Statements of Banks

a banking company is not required to prepare financial statements in accordance with Schedule VI of the Companies Act , 1956.
The Act prescribes special forms of balance sheet and profit and loss account for the preparation of its final accounts
These are set out in form A and form B of the first schedule to the Banking regulation Act, 1949
Form A gives format of a balance sheet and form B gives the format of a profit and loss account

Q - 25 .Suspense a/c is not used in which of the following cases.

before trial balance.
after trial balance.
before final accounts.
none of the above.

Q - 26 .The list given below provides the close relationship between the items of each pair. One of the pairs has no such close relationship. Identify this pair.

Banking company trustees and executors
Form B - Profit and Loss Account
Ledger book - Letter of credit register
Other liabilities and provisions - Schedule 5

Q - 27 .Cost of goods sold is

Opening stock + purchases + closing stock
Opening stock + purchases closing stock
Opening stock purchases + closing stock
None of above

Q - 28 .In the books of ABC Enterprises, a partnership firm, when Mr. C, a partner decided to resign from the firm, a revaluation of assets and liabilities was done and Revaluation account was prepared which showed the following position: At the credit side of Revaluation Account, Stock A/c Rs.25000, Premises A/c Rs.52000 and Creditors A/c Rs. 8000 were shown while at debit side of Revaluation Account Reserve for Doubtful Debts A/c. Rs.15000, As Capital A/c.Rs.20000, Bs Capital A/c. Rs.20,000 and Cs Capital A/c. Rs.20000 were shown. Accountant has interpreted the Revaluation Account as follows. One of the interpretations by him is incorrect. Select the incorrect sentence.

Stock is revalued upwardly by Rs. 25000
Creditors are revised upwardly by Rs.8000
Premises are revised upwardly by Rs.52000
A provision on debtors of Rs. 15,000 is made for doubtful debts

Q - 29 .Which of the following is true

Bank Reconciliation Statement(BRS) is an account.
BRS is prepared by the bank.
BRS shows causes of disagreement between cash book & passbook.
BRS shows only excess of cash book over passbook.

Q - 30 .Goods lost in transit is

Nominal loss
Abnormal loss
Casual loss
Conditional loss

Q - 31 .Select from the following a sentence which is wrong

If assets increase and liabilities do not , the capital will increase
If assets increase and liabilities also increase by same sum , the capital will remain same
A reduction in the amount of assets will amount to equivalent reduction in the net worth
An increase in the amount of liabilities with no corresponding increase in liabilities will increase the amount of capital

Q - 32 .In comparing lease & hire purchase (H P) Of the following which one is not true?

In lease the user of the asset does not retain it, while in H P he does.
In lease the user does not claim depreciation while he does in H P.
Payment of rentals is on instalment basis in both.
The users of assets in both lease & H P run the risk of obsolescence.

Q - 33 .O and P are two partners sharing profits in the ratio of 7:3. They admit Q into partnership as a partner from 1st April 2006 on 3/7th share in the profit. What is the new profit sharing ratio

14:06:14
07:03:03
02:02:03
None of the above

Q - 34 .Choose the wrong pair from the following. The information given in the pair is pertaining to banking companies

Reserves & surplus - Share premium
Time deposits - Matured time deposits
Borrowings in India - Refinance from NABARD
Other Liabilities & Provisions - Inter office/branch adjustments(net

Q - 35 .The list given below consists of various securities. Identify the security which is SLR security

Securities issued by local authorities
Shares
Bonds
subsidiaries

Q - 36 .In banking company, matured term deposit to be shown under-----

demand deposits
saving bank deposits
term deposits
other liabilities and provisions

Q - 37 .Choose the incorrect statement in case of dissolution of partnership from the following statements

On the dissolution of the firm , first creditors like wages outstanding etc. will have to be paid
Goodwill will be raised in the books when a firm is dissolved
The loan from the spouse of a partner is treated just like a loan from outside parties
After the books are closed, no account will show any balance.

Q - 38 .The liability side of the balance sheet of ABC International Ltd. is showing following position: Paid up share capital Rs.25 Lakh ( 25,000 shares of Rs.100 each fully paid up)Share premium Rs.5 Lakh, Capital Reserve Rs. 3 Lakh, General Reserve Rs. 15 Lakh and Profit & Loss account Rs. 15 Lakh .It was decided to use minimum free reserve for issue of 1:1 bonus shares.. The accounts and the amount with which the account is debited are given below in sets. One of the set is correct. Select the same.

Share Premium Account (Rs.5 Lakh), Capital Reserve Account ( Rs. 1 Lakh), General Reserve Account (15 Lakh) & Profit & Loss Account by Rs. 4 Lakh
Share Premium Account (Rs. Nil Lakh), Capital Reserve Account ( Rs. Nil Lakh), General Reserve Account (10 Lakh) & Profit & Loss Account by Rs. 15 Lakh
Share Premium Account (Rs.5 Lakh), Capital Reserve Account ( Rs. 3 Lakh), General Reserve Account (15 Lakh) & Profit & Loss Account by Rs. 2 Lakh
Share Premium Account (Rs.5 Lakh), Capital Reserve Account ( Rs. 1 Lakh), General Reserve Account (4 Lakh) & Profit & Loss Account by Rs. 15 Lakh

Q - 39 .Select the incorrect statement in case of Share Capital and Reserves and Surplus as shown in the balance sheet.

Under share capital, the following order is maintained: Authorised capital, issued capital, subscribed capital
The called up amount per share is indicated and in the amount column total amount i.e. number of shares multiplied by amount called up per share is shown
The amount of unpaid calls is deducted from (b) above
The amount of forfeited shares account is shown under Reserves & surplus

Q - 40 .One of the accounts is wrongly debited to Profit and Loss Appropriation A/c of a company. Name the wrong account debited

Interim dividend
Proposed dividend
Provision for tax
Capital redemption reserve

Q - 41 .Select the incorrect statement in respect of companies.

A member of a company can enter into contract with a company
It is compulsory to register a joint stock company
If all but one member of a private company becomes insolvent ,it affects the existence of the organisation
Shareholders are not liable for the acts of the company

Q - 42 .The firm sells goods on credit for Rs.50000, the cost of the goods sold is Rs.30000.The effect of the transaction is that, the capital of the firm-----

increases by Rs.50000
reduces by Rs.40000
increases by Rs. 20000
reduces by Rs. 20000

Q - 43 .Money received in advance from shareholder before it is actually called up by the company is -----

Debited to Calls in arrears Account
Debited to Calls in Advance Account
Credited to Calls in Advance Account
Credited to Share Capital Account

Q - 44 .In operating lease the period is

Less than the useful life of the asset.
Greater than the useful life of the asset.
Equal to the useful life of the asset.
None of above

Q - 45 .Select the incorrect statement in respect of form of balance sheet of companies ( Asset side).

Live Stock is grouped under the head current Asset
Balance of unutilized monies raised by issue is grouped under the head Investments
Interest paid out of capital during construction is grouped under the head Miscellaneous Expenditure
Vehicles are grouped under the head Fixed Asset

Q - 46 .Receipts and payments statement shows

Only revenue receipts and payments during a year.
Only capital receipts & payments during a year.
Both capital and revenue receipts during a year.
Cash Only transactions.

Q - 47 .Select the incorrect statement

Authorized capital is the capital with which the company is registered
Issued capital is equal to its authorized capital
Authorized capital, issued capital, subscribed capital, called up capital and paid up capital cannot be same
The amount which the company has asked its shareholders to pay is called up capital of the company.

Q - 48 .Noting charges are

Paid to bank for dishonour
Paid to drawer for dishonour
Paid to notary public for recording dishonour
None of the above.

Q - 49 .Direct deposit by a customer in the bank

Shows a higher passbook balance than cash book.
Shows a lesser passbook balance than cash book.
Shows no difference.
None of the above.

Q - 50 .If the adjustment in the values of assets at the time of the admission of a partner shows a profit, it should be credited to the capital accounts of-----

The old partners in their new profit-sharing ratio
All partners in their new profit sharing ratio
The old partners in their old profit sharing ratio
None of the above

Online Tests for Accounting & Finance for Bankers

countDown(3600,"status");