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Q - 1 .One of the statements in respect of Profit & Loss Adjustment account is incorrect, rest are correct. Mark the incorrect sentence.

The account is credited with closing balance of profit and loss account of last year
The account is credited with current year s net profit
The account is debited with provision for taxes
The account is debited with provision for dividend

Q - 2 .Which of the following will not affect Trial Balance

Goods sold on credit not recorded in books.
Overstating of sales register.
Rent account credited instead of debit.
Salary debited to the extent 1/2 the amount.

Q - 3 .. In TOM, the exchange of currencies take place on

Same Day
Next Day
Second Working Day
Third Working Day

Q - 4 .Machinery worth (WDV) 1000/- sold for 1200/- is entered in sales register. The rectification is

Credit sales 1200/-, debit machinery 1000/- and debit P&L a/c 200/-.
Debit sales 1200/- , credit machinery 1000/- and credit P&L a/c 200/-.
Credit machinery 1200/-, debit sales 1000/- and debit P&L a/c 200/-.
Debit machinery 1200/-, credit sales 1000/- and credit P&L a/c 200/-.

Q - 5 .Due to heavy flooding a truck carrying consignment goods sinks. This loss is called

contingent loss
Nominal loss
Abnormal loss
Casual loss

Q - 6 .Which of the following is true

Trial balance ensures arithmetical accuracy.
Trial balance errors are not located then the difference is sent to suspense a/c.
Trial balance is base for final accounts.
All of the above.

Q - 7 .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 - 8 .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 - 9 .Income for the year = I, Outstanding Income for previous year = Id, Outstanding Income of current year = Idi, then Receipts for the year is

I - Idi + Id
I + Idi - Id
I + Idi + Id
None of the above.

Q - 10 .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 - 11 .Advances given to a staff by a bank as a employer should be included in-----

other assets
advances
investments
none of the above

Q - 12 .Below are some statements about partnership. One of them is correct, identify that statement.

Partnership arises from reputation
A partnership is formed only for a legal business
The liability of partners is limited
The business of the firm is conducted by two partners

Q - 13 .A firm earns Rs.10,000 as its normal profits. The rate of normal return being 10%. The assets of the firm amount to Rs.72,000 and liabilities to Rs.24,000. Find out the value of goodwill.

Rs.52,000
Rs.1,00,000
Rs.28,000
Nil

Q - 14 .If the goodwill account is raised for Rs.50,000, the amount is debited to____

The capital accounts of partners
Goodwill account
Cash account
None of the above

Q - 15 .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

Q - 16 .In banking company, matured term deposit to be shown under-----

demand deposits
saving bank deposits
term deposits
other liabilities and provisions

Q - 17 .The investment under held to maturity should not exceed _____ of banks total investment

0.25
0.75
0.05
None of the above

Q - 18 .In sum of digits method for 5 years which of the following is the 1st year s allocation ratio

42005
42036
42095
42125

Q - 19 .Select the incorrect sentence

Whenever, there is no profit or inadequate profit, dividend cannot be declared
The right to claim dividend lapses when there is no profit in case of cumulative preference shares
When the company makes profit , arrears of preference dividend are cleared first
The Act prohibits the issue of any preference shares which are irredeemable

Q - 20 .Any facts, observations, occurrences are called -----

data
record
file
system

Q - 21 .If Rs.10 share has been issued at a premium of Rs.5, on which entire amount has been called up, has been forfeited for non payme

Rs.15
Rs.10
Rs.4
Rs.6

Q - 22 .Depreciation on banks property is part of Operating Expenses. Some of the items included under this category are listed below. One of the expenses is wrongly included. Identify that item of expense.

depreciation on motor cars
depreciation on stationary and stamps
depreciation on furniture
depreciation on non-banking assets

Q - 23 .Identify a pair which is mismatch from the following pairs in respect of Company Accounts

Discount on issue of shares Profit and Loss Account
Bill discounted contingent liabilities
Interest accrued and due on debentures Secured Loans
Mortgage Loan Secured Loans

Q - 24 .According to NPV, undertake those investments for which the NPV is

Positive
Negative
Either positive or Negative
None of these

Q - 25 .Which of the following is not true

Depreciation is an expense charged to the P & L a/c
Depreciation is not a part of the operating costs.
Assets that are depreciated are tangible assets.
Depreciation is like an insurance expense.

Q - 26 .A capital equipment costing Rs. 200,000 today has Rs. 50,000 salvage value at the end of 5 years. If the straight line depreciation method is used, what is the book value of the equipment at the end of 2 years?

Rs. 200,000
Rs. 170,000
Rs. 140,000
Rs. 50,000

Q - 27 .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 - 28 .Due to a fall in the rate of interest from 11% to 10.5%, a money-lender's yearly income from interest falls by Rs. 240. What is his principal amount?

Rs. 42,800
Rs. 41,600
Rs. 44,600
Rs. 48,000

Q - 29 .The average net profits expected are Rs.108000 per annum before charging remuneration of Rs. 18000 to partner . The capital employed in the business is Rs.6,00,000. The rate of return expected on capital employed of a firm is 10%. What is the value of goodwill on the basis of two years purchase of super profits.

Rs.108,000
Rs.60,000
Rs.78,000
None of the above

Q - 30 .L,K and P are partners. The following differences as listed at (i) to (iv) have arisen due to misunderstanding. The answer to each point is given at (a) to (d). One of the solutions is incorrect. Identify the wrong solution. (i) L used Rs.25,000 belonging to the firm and made a profit of Rs.4,000. K wants the amount to be given to the firm (ii) P used Rs.10,000 belonging to the firm and suffered a loss of Rs. 3000. He wants the firm to bear the loss (iii) L & K wishes to appoint S as new partner. P does not agree (iv) L has given loan of Rs. 50,000 to the firm, he wants interest at 6% ( there is no partnership deed)

K is right .L must pay Rs.29,000 to the firm
P is right . Firm should bear profit as well as losses.
P is right. No new partner can be admitted without the consent of all.
L is right. He is entitled for interest at 6% in the absence of partnership agreement.

Q - 31 .Sales return of amount Rs.1000 from Vijay was wrongly entered in purchase book. The rectification is

Debit sales to the extent of Rs.2000.
Credit purchases to the extent of Rs.2000
Credit Vijay Rs.2000, debit sales and purchases to the extent Rs.1000, each.
Debit sales return by Rs.1000 and credit purchases by Rs.1000

Q - 32 .If a share of Rs.10 issued at a premium of Rs.1 on which Rs.9 ( including premium) have been called and Rs.7( including premium) paid is forfeited, the capital account should be debited by_________

Rs.8
Rs.10
Rs.9
Rs.7

Q - 33 .In case any sum has been written off on a reduction of capital or revaluation of assets, each balance sheet subsequent to such reduction or revaluation must show the reduced figures and date of reduction for a period of _________

1 year thereafter
2 years thereafter
3 years thereafter
5 year thereafter

Q - 34 .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 - 35 .A, B and C share profits as 3:2:1. C retires. Calculate the gain ratio of A and B

0.12638888888889
0.041666666666667
0.083333333333333
None of the above

Q - 36 .Mr.Ghatge commenced his business on 1st April, 2006 with Capital of Rs.1,00,000. He did good business during the year and earned handsome profit. At the end of 31st March, 2007, his financial position was: Fixed Assets Rs.1, 20,000 and bank balance of Rs.

Rs. 36000
Rs.70000
Rs.53000
None of the above

Q - 37 .Goods lost in transit is

Nominal loss
Abnormal loss
Casual loss
Conditional loss

Q - 38 .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 - 39 .Which of the following is not a deferred revenue expenditure

Preliminary expenses for setting up a company.
Amount raised through Rights issue.
Huge sales promotion expenditure in launch of new product
Cost of preparing project report

Q - 40 .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 - 41 .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 - 42 .A company wishes to pay dividend on shares. State which of the following may be used for the purpose.

Premium of shares
Profit on re-issue of forfeited shares
General Reserve
None of the above

Q - 43 .Which is not Tax deductible?

Interest Payments on Debts
Dividend Payments
Both
None of these

Q - 44 .Which one is not among the three pillars of BASEL II ?

Minimum Capital Requirement
Supervisory Review Process
Risk Based Supervision
Market Discipline

Q - 45 .A sum of money at simple interest amounts to Rs. 2,800 in 2 years and to Rs. 3,250 in 5 years. Find the sum and the rate of interest.

Rs. 2,500; 5%
Rs. 2,500; 6%
Rs. 3,000; 5%
Rs. 3,000; 6%

Q - 46 .One of the pairs given below is wrong. Select the wrong pair.

Outstanding expenses - Nominal account
Profit and Loss Account (Dr. balance) Application of funds
Net worth less reserves & surplus - Capital
Balance sheet - Financial position

Q - 47 .The financial statement of bank consists of ________ schedules

18 Schedules
16 Schedules
17 Schedules
Schedules

Q - 48 .The method in which depreciation rate is constant is

straight line method
Declining Balance Method
Double Declining Balance Method
Accelerated Depriciation

Q - 49 .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 - 50 .Opening balance of asset = Oi, Closing balance of asset = Oc, Depn. = D, Then addition to the asset during the year is

Oc D Oi
Oi + D Oc
Oc + D Oi
Oi D Oc

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