227148135-financial-ing-assignment.pdf 331b2m
This document was ed by and they confirmed that they have the permission to share it. If you are author or own the copyright of this book, please report to us by using this report form. Report r6l17
Overview 4q3b3c
& View 227148135-financial-ing-assignment.pdf as PDF for free.
More details 26j3b
- Words: 2,841
- Pages: 11
Financial ing
Amity Center for e-Learning
Assignments Program: Semester 1 Subject Name : Financial ing Permanent Enrollment Number (PEN) : Roll Number (SEN) : Student Name : INSTRUCTIONS a) Students are required to submit all three assignment sets. ASSIGNMENT Assignment A Assignment B Assignment C
DETAILS Five Subjective Questions Three Subjective Questions + Case Study 40 Objective Questions
MARKS 10 10 10
b) Total weightage given to these assignments is 30%. OR 30 Marks c) All assignments are to be completed as typed in word/pdf. d) All questions are required to be attempted. e) All the three assignments are to be completed by due dates (specified from time to time) and need to be submitted for evaluation by Amity University. ( √ ) Tick mark in front of the assignments submitted Assignment ‘A’ Assignment ‘B’ Assignment ‘C’
Copyright@Amity University
Financial ing ASSIGNMENT ‘A’ Q 1. Define ing. How does it differ from book-keeping? Q 2 What is basic ing equation? Q 3 What is Journalizing? Give a format of Journal & briefly explain its content. Q 4 what are the advantages of special Journal & list them. Q 5 State the reasons for the difference between the cash book balance & book balance. ASSIGNMENT ‘B’ Q1 Define depreciation. Differentiate, with suitable example, between Diminishing Balance Method & Straight Line Method of charging depreciation. Q2 Define Bills of Exchange and explain the parties involved in it. Q3 Distinguish between capital expenditure & revenue expenditure. Q 4 Case Study: The following is the Trial Balance of Gupta as on 30th June, 2001 Trial Balance of Gupta for the year ending 30th June, 2001 Dr. Cr. Particulars Rs. Particulars Rs. Cash Cash at Bank Purchases Return inwards
540 2,630 40,675 680
Wages
8,480
Fuel and power
4,730
Carriage on sales
3,200
Carriage on Purchases
2,040
Inventory (1st July, 2000)
5,760
Buildings
32,000
Freehold land
10,000
Machinery
20,000
Patents
7,500
Salaries
15,000
General expenses
Returns outwards Capital
98,780 500 62,000
s payable
6,300
Rent
9,000
3,000
Insurance
600
Drawings
5,245
Copyright@Amity University
Sales
Page 2
Financial ing s receivable
14,500
1,76,580
1,76,580
Taking into the following adjustments prepare the Trading, Profit and Loss as on 30th June, 2001. 1. Inventory on hand on 30th June, 2001 is Rs.6,800. 2. Machinery is to be depreciated at the rate of 10% and Patents at the rate of 20%. 3. Salaries for the month of June 2001amounting to Rs.1,500 were unpaid. 4. Insurance includes an annual of Rs.170 on a policy expiring on 31st December, 2001. 5. Bad debts to be written off are Rs.725. 6. Rent receivable Rs.1,000.
Copyright@Amity University
Page 3
Financial ing ASSIGNMENT ‘C’ OBJECTIVE QUESTIONS In each of the following cases indicate the alternative which you consider to be correct: Q1. Which of the following financial statements is prepared as of a particular date? (a) Profit and loss (b) Balance sheet (c) Cash flow statement (d) Income and expenditure statement (e) Profit and loss appropriation . Q2. Based on which of the following concepts, share capital is shown on the liability side of balance sheet? (a) Business entity concept (b) Money measurement concept (c) Cost concept (d) Going concern concept (e) Conservatism concept. Q3. Which of the following is not an ing transaction? (a) Sale of goods for cash (b) Payment of salary of office staff (c) Agreement to sell (d) Purchase of office furniture (e) Repayment of bank loan. Q 4. Which of the following is false? (a) Taking the favourable balance as per book as the starting point, the amount in respect of charges made by the bank will be added to the book balance (b) Taking the favourable balance as per book as the starting point, the amount in respect of dividends received directly will be deducted from the book balance (c) Bank charges recorded twice in cash book will be added to the overdraft as per cash book in the preparation of reconciliation statement (d) Cheque issued but not presented for payment will be added when favourable balance as per cash book is the starting point (e) The amount of the undercasting of the credit side of the bank column of the cash book will be deducted from the overdraft as per book. Q5. From the books of Mr.Neelam, it was observed that cheques amounting to Rs.2,40,000 were deposited in the bank, out of which cheques worth Rs.20,000 were dishonored and cheques worth Rs.40,000 are still in the process of collection. The treatment of this while preparing Bank Reconciliation Statement is (a) Deduct Rs.60,000 from bank balance as per book (b) Add Rs.20,000 and deduct Rs.40,000 from overdraft balance as per cash book (c) Deduct Rs.60,000 from overdraft balance as per book (d) Add Rs.60,000 to overdraft balance as per book Copyright@Amity University
Page 4
Financial ing (e) Deduct Rs.40,000 and add Rs.20,000 from overdraft balance as per book. Q6 . Which of the following is true? (a) Bank is a personal (b) Stock of stationery is a nominal (c) Returns inward is a personal (d) Outstanding rent is a nominal (e) Capital is a real . Q7 . A sales day book is to record (a) all credit sales only (b) All cash sales only (c) all credit and cash sales (d) credit sales of goods and trade discount (e) all cash and credit sales and trade discount. Q8. Which of the following is a liability of a firm? (a) Debit balance of discount column of cash book (b) Credit balance of bank book (c) Debit balance of bank column of cash book (d) Debit balance of cash column of cash book (e) Credit balance of bank column of cash book. Q9. Which of the following s will invariably have a debit balance? I. s receivable. II. s payable. III. Purchases . IV. Bank . V. Prepaid expenditure. (a) Only (III) above (b) Both (II) and (III) above (c) Both (I) and (III) above (d) (I), (III) and (V) above (e) (I), (III), (IV) and (V) above. Q10. The following is not a book of original entry (a) Purchase book (b) Journal proper (c) Cash book (d) General ledger (e) sales book Q11. The ant of a company is recording the transactions of the day in various Books of Original Entry. Which of the following transactions is recorded in the wrong book? (a) Goods purchased on credit - Purchase Book Copyright@Amity University
Page 5
Financial ing (b) Goods sold on credit - Sales Book (c) Wages paid in cash - Cash Book (d) General Stationery purchased on credit - Purchase Book (e) Office Equipment purchased on credit - Journal Proper Q12. The impact on assets, profit and liabilities of a firm, on of salary paid will be Assets Profit Total Liabilities (a) No effect Decreases Decreases (b) Decreases No effect Decreases (c) Decreases Decreases Decreases (d) Increases No effect Increases (e) Decreases Increases Decreases. Q13. Which of the following is true? (a) Discount columns in cash book are totaled and not balanced (b) A petty cash book in which a separate column is provided to record payment under each head is called imprest system (c) The total of purchases book is posted periodically on the credit side of sundry creditors (d) The total of sales book is posted periodically on the debit side of sundry debtors (e) Petty cash book is used to record all cash transactions. Q14. Total of sales day book at the end of the month indicates (a) The total sales for the month (b) The total credit sales for the month (c) Total cash sales of the month (d) Total amount due to suppliers (e) Total amount receivable from credit sales. Q15. Which of the following is true? (a) Cash book may be defined as the record of transactions concerning cash receipts and payments (b) Discount should be balanced in the cash book (c) The ledger is the book of original entry (d) Sales journal is used for recording cash sales (e) Purchase return book is used for recording the return of goods purchased from suppliers against cash. Q16. Journal entry for receiving interest in cash from Mr. Prashant against the loan given to him (a) Interest on loan Dr. To Prashant (b) Prashant Dr. To Interest (c) Cash Dr. Copyright@Amity University
Page 6
Financial ing To Prashant (d) Cash Dr. To Interest on loan (e) Cash Dr. To Loan . Q 17. Which of the following entries recorded in the books of the drawee of a bill is false? (a) When a bill is accepted, the to be debited is drawer’s a/c (b) When a bill is discharged, the to be debited is bills payable a/c (c) When a bill presented for payment by a bank is dishonored, the to be debited is bills payable a/c (d) When noting charges of a dishonored bill is paid by the endorsee ,the to be debited is noting charges a/c (e) At the time of retirement of a bill the to be debited is the drawer’s a/c. Q 18. Which of the following is true? (a) A bill sent for collection by bank when dishonored, the drawer will credit bank a/c (b) At the time of renewal of bill interest a/c is credited in the books of the drawee (c) Accommodation bills are drawn, accepted and endorsed for some consideration (d) Refusal by the acceptor to make payment of the bill on due date is called dishonor (e) When a bill is endorsed, the drawer credits the drawee’s a/c. Q19. Bills receivable is a (a) Nominal (b) Personal (c) Intangible asset (d) Real (e) Representative Personal . Q20 . Closing stock is generally valued at (a) Cost price (b) Replacement cost (c) Market price (d) Realisable value (e) Cost price or market price whichever is lower. Q21. The provision for discount on debtors is calculated on the amount of debtors (a) Before deducting the provision for doubtful debts (b) Left after deducting the provision for doubtful debts (c) Before deducting the actual bad debts (d) After deducting the actual bad debts (e) After deducting the actual bad debts and the provision for doubtful debts. Q22. Consider the following information of Thumbs-up Company for the year 2006-2007: Copyright@Amity University
Page 7
Financial ing Opening balance of provision for debtors Rs. 20,000 Bad debts during the year Rs. 18,000 Closing balance of Sundry debtors Rs.2,65,000 Estimated provision for doubtful debts 4% The amount to be debited to profit and loss to make the estimated provision is (a) Rs. 8,600 (b) Rs.10,400 (c) Rs.10,520 (d) Rs.10,600 (e) Rs.10,680. Q23. At the time of preparation of final s, bad debts recovered will be transferred to (a) Debtor’s (b) Profit & loss (c) Profit & loss adjustment (d) Profit & loss appropriation (e) Provision for discount on debtors . Q24. Which of the following is false about diminishing balance method of depreciation? (a) Higher amount of depreciation is charged when the machine is more efficient (b) It recognizes the risk of obsolescence by higher amount of depreciation in the early years (c) The total amount of depreciation and repairs is almost uniformally distributed over the useful life (d) It results in better cash flow through tax deferral as taxable income is lower in the initial years (e) Depreciation amount throughout the useful life will be uniform. Q25. The following is not an example of fixed asset (a) Plant and machinery (b) Land and building (c) Royalty (d) Patent (e) Office furniture. Q26. Under depletion method, depletion per unit is calculated as (a) Acquisition cost divided by average production units per annum (b) Acquisition cost divided by actual production units in the year (c) Acquisition cost minus residual value divided by average production units per annum (d) Acquisition cost minus residual value divided by the actual production units in the year (e) Acquisition cost minus residual value divided by the total production units over the useful life. Q 27. Which one of the following is a capital expenditure? Copyright@Amity University
Page 8
Financial ing (a) Compensation paid to Directors on termination of their services (b) Expenditure for renewal of trade mark (c) Gratuity paid to employees (d) Installments paid for the purchase of patent for manufacture and sale of medicine (e) Compensation paid to workers on retirement. Q28. Entries ed for outstanding expenses, depreciation, interest on capital etc. are (a) Opening entries (b) Journal entries (c) Adjustment entries (d) Rectification entries (e) Closing entries. Q29. Which of following transactions does not change the total amount of liabilities in the balance sheet? (a) Purchase of office furniture on credit (b) Payment of bank loan (c) Issue of debentures (d) Acceptance of bills from creditors (e) Redemption of preference shares. Q30. Which of the following is false? (a) Capital plus liabilities will be equal to assets (b) The difference between assets and liabilities is bank borrowing (c) Capital is a personal (d) Investment is a real (e) Outstanding rent is a representative personal . Q31. The expenses and incomes pertaining to full trading period are taken to the Profit and Loss of a business, irrespective of their actual payment or receipt. This is in recognition of (a) Time period concept (b) Business entity concept (c) Going concern concept (d) Accrual concept (e) Duality concept. Q32. Which of the following statements can be used to assess the liquidity of a company? (a) Balance sheet (b) Profit and loss (c) Profit and loss appropriation (d) Bank reconciliation statement (e) Manufacturing . Q33 . Which of the following state that “Anticipate no profit and provide for all possible losses”? Copyright@Amity University
Page 9
Financial ing (a) Convention of materiality (b) Convention of consistency (c) Convention of disclosure (d) Convention of conservatism (e) Convention of matching. Q34. Which of the following statements is/are true? I. Drawings is a nominal . II. Capital is a real . III. Sales is a nominal . IV. Outstanding salaries is a nominal . V. Patents is a personal . (a) Only (I) above (b) Only (III) above (c) Both (II) and (IV) above (d) (II), (IV) and (V) above (e) (I), (II), (III) and (IV) above. Q35. RS Ltd., makes purchases on credit. If the purchases are not as per the specifications, the company returns them to the suppliers. The book, that is used to record such returns is (a) Returns inward book (b) Returns outward book (c) Cash book (d) Journal proper (e) Purchases day book. Q36 . Which one of the following is not a reason for discrepancy in the balance as per cash book and bank book of a company? (a) Cheque issued to suppliers may not have been presented (b) Cheque deposited in the may not have been realized (c) Bill discounted with bank is not due for payment (d) Customers may have directly deposited money in the company’s (e) Bank charges not ed. Q37. The bank balance in the cash book of Mr.Avinash, a proprietor showed a credit balance of Rs.10,500 on March 31, 2008. On comparing it with his book he discovered the following discrepancies. i. Cheque No. 51 for Rs.540 in favour of Mr.Raman has not yet been presented. ii. A bill of Rs.1,000 was retired by the bank under a rebate for Rs.15, but the full amount of the bill was credited to bank in cash book. The balance as per book is (a) Rs.11,025 (Dr.) (b) Rs. 9,945 (Dr.) (c) Rs. 9,945 (Cr.) (d) Rs. 9,975 (Dr.) (e) Rs. 9,975 (Cr.). Copyright@Amity University
Page 10
Financial ing Q38. The total cost of goods available for sale with a company during the current year is Rs.12,00,000 and the total sales during the period are Rs.13,00,000. If the gross profit margin of the company is 25% on sales, the closing inventory during the current year is (a) Rs.4,00,000 (b) Rs.3,40,000 (c) Rs.2,25,000 (d) Rs.1,60,000 (e) Rs.1,00,000 Q39. Unearned income is (a) A current asset (b) A current liability (c) An expense (d) An income (e) Deferred expense. Q40. The essentials of double entry book-keeping in sequential order are (a) ing journal entries, posting in ledger, appropriate adjusting entries, trial balance, Profit & Loss a/c and Balance-sheet (b) ing journal entries, posting ledger, trial balance, Profit & Loss a/c and Balance-sheet, ing adjusting entries. (c) ing journal entries, posting ledger, ing adjusting entries, Profit & Loss a/c and Balance sheet, trial balance (d) ing adjusting entries, ing journal entries, trial balance, posting in ledger, Profit & Loss a/c and Balance-sheet (e) ing journal entries, posting in ledger, trial balance, ing adjusting entries, Profit & Loss a/c and Balance-sheet.
Copyright@Amity University
Page 11
Amity Center for e-Learning
Assignments Program: Semester 1 Subject Name : Financial ing Permanent Enrollment Number (PEN) : Roll Number (SEN) : Student Name : INSTRUCTIONS a) Students are required to submit all three assignment sets. ASSIGNMENT Assignment A Assignment B Assignment C
DETAILS Five Subjective Questions Three Subjective Questions + Case Study 40 Objective Questions
MARKS 10 10 10
b) Total weightage given to these assignments is 30%. OR 30 Marks c) All assignments are to be completed as typed in word/pdf. d) All questions are required to be attempted. e) All the three assignments are to be completed by due dates (specified from time to time) and need to be submitted for evaluation by Amity University. ( √ ) Tick mark in front of the assignments submitted Assignment ‘A’ Assignment ‘B’ Assignment ‘C’
Copyright@Amity University
Financial ing ASSIGNMENT ‘A’ Q 1. Define ing. How does it differ from book-keeping? Q 2 What is basic ing equation? Q 3 What is Journalizing? Give a format of Journal & briefly explain its content. Q 4 what are the advantages of special Journal & list them. Q 5 State the reasons for the difference between the cash book balance & book balance. ASSIGNMENT ‘B’ Q1 Define depreciation. Differentiate, with suitable example, between Diminishing Balance Method & Straight Line Method of charging depreciation. Q2 Define Bills of Exchange and explain the parties involved in it. Q3 Distinguish between capital expenditure & revenue expenditure. Q 4 Case Study: The following is the Trial Balance of Gupta as on 30th June, 2001 Trial Balance of Gupta for the year ending 30th June, 2001 Dr. Cr. Particulars Rs. Particulars Rs. Cash Cash at Bank Purchases Return inwards
540 2,630 40,675 680
Wages
8,480
Fuel and power
4,730
Carriage on sales
3,200
Carriage on Purchases
2,040
Inventory (1st July, 2000)
5,760
Buildings
32,000
Freehold land
10,000
Machinery
20,000
Patents
7,500
Salaries
15,000
General expenses
Returns outwards Capital
98,780 500 62,000
s payable
6,300
Rent
9,000
3,000
Insurance
600
Drawings
5,245
Copyright@Amity University
Sales
Page 2
Financial ing s receivable
14,500
1,76,580
1,76,580
Taking into the following adjustments prepare the Trading, Profit and Loss as on 30th June, 2001. 1. Inventory on hand on 30th June, 2001 is Rs.6,800. 2. Machinery is to be depreciated at the rate of 10% and Patents at the rate of 20%. 3. Salaries for the month of June 2001amounting to Rs.1,500 were unpaid. 4. Insurance includes an annual of Rs.170 on a policy expiring on 31st December, 2001. 5. Bad debts to be written off are Rs.725. 6. Rent receivable Rs.1,000.
Copyright@Amity University
Page 3
Financial ing ASSIGNMENT ‘C’ OBJECTIVE QUESTIONS In each of the following cases indicate the alternative which you consider to be correct: Q1. Which of the following financial statements is prepared as of a particular date? (a) Profit and loss (b) Balance sheet (c) Cash flow statement (d) Income and expenditure statement (e) Profit and loss appropriation . Q2. Based on which of the following concepts, share capital is shown on the liability side of balance sheet? (a) Business entity concept (b) Money measurement concept (c) Cost concept (d) Going concern concept (e) Conservatism concept. Q3. Which of the following is not an ing transaction? (a) Sale of goods for cash (b) Payment of salary of office staff (c) Agreement to sell (d) Purchase of office furniture (e) Repayment of bank loan. Q 4. Which of the following is false? (a) Taking the favourable balance as per book as the starting point, the amount in respect of charges made by the bank will be added to the book balance (b) Taking the favourable balance as per book as the starting point, the amount in respect of dividends received directly will be deducted from the book balance (c) Bank charges recorded twice in cash book will be added to the overdraft as per cash book in the preparation of reconciliation statement (d) Cheque issued but not presented for payment will be added when favourable balance as per cash book is the starting point (e) The amount of the undercasting of the credit side of the bank column of the cash book will be deducted from the overdraft as per book. Q5. From the books of Mr.Neelam, it was observed that cheques amounting to Rs.2,40,000 were deposited in the bank, out of which cheques worth Rs.20,000 were dishonored and cheques worth Rs.40,000 are still in the process of collection. The treatment of this while preparing Bank Reconciliation Statement is (a) Deduct Rs.60,000 from bank balance as per book (b) Add Rs.20,000 and deduct Rs.40,000 from overdraft balance as per cash book (c) Deduct Rs.60,000 from overdraft balance as per book (d) Add Rs.60,000 to overdraft balance as per book Copyright@Amity University
Page 4
Financial ing (e) Deduct Rs.40,000 and add Rs.20,000 from overdraft balance as per book. Q6 . Which of the following is true? (a) Bank is a personal (b) Stock of stationery is a nominal (c) Returns inward is a personal (d) Outstanding rent is a nominal (e) Capital is a real . Q7 . A sales day book is to record (a) all credit sales only (b) All cash sales only (c) all credit and cash sales (d) credit sales of goods and trade discount (e) all cash and credit sales and trade discount. Q8. Which of the following is a liability of a firm? (a) Debit balance of discount column of cash book (b) Credit balance of bank book (c) Debit balance of bank column of cash book (d) Debit balance of cash column of cash book (e) Credit balance of bank column of cash book. Q9. Which of the following s will invariably have a debit balance? I. s receivable. II. s payable. III. Purchases . IV. Bank . V. Prepaid expenditure. (a) Only (III) above (b) Both (II) and (III) above (c) Both (I) and (III) above (d) (I), (III) and (V) above (e) (I), (III), (IV) and (V) above. Q10. The following is not a book of original entry (a) Purchase book (b) Journal proper (c) Cash book (d) General ledger (e) sales book Q11. The ant of a company is recording the transactions of the day in various Books of Original Entry. Which of the following transactions is recorded in the wrong book? (a) Goods purchased on credit - Purchase Book Copyright@Amity University
Page 5
Financial ing (b) Goods sold on credit - Sales Book (c) Wages paid in cash - Cash Book (d) General Stationery purchased on credit - Purchase Book (e) Office Equipment purchased on credit - Journal Proper Q12. The impact on assets, profit and liabilities of a firm, on of salary paid will be Assets Profit Total Liabilities (a) No effect Decreases Decreases (b) Decreases No effect Decreases (c) Decreases Decreases Decreases (d) Increases No effect Increases (e) Decreases Increases Decreases. Q13. Which of the following is true? (a) Discount columns in cash book are totaled and not balanced (b) A petty cash book in which a separate column is provided to record payment under each head is called imprest system (c) The total of purchases book is posted periodically on the credit side of sundry creditors (d) The total of sales book is posted periodically on the debit side of sundry debtors (e) Petty cash book is used to record all cash transactions. Q14. Total of sales day book at the end of the month indicates (a) The total sales for the month (b) The total credit sales for the month (c) Total cash sales of the month (d) Total amount due to suppliers (e) Total amount receivable from credit sales. Q15. Which of the following is true? (a) Cash book may be defined as the record of transactions concerning cash receipts and payments (b) Discount should be balanced in the cash book (c) The ledger is the book of original entry (d) Sales journal is used for recording cash sales (e) Purchase return book is used for recording the return of goods purchased from suppliers against cash. Q16. Journal entry for receiving interest in cash from Mr. Prashant against the loan given to him (a) Interest on loan Dr. To Prashant (b) Prashant Dr. To Interest (c) Cash Dr. Copyright@Amity University
Page 6
Financial ing To Prashant (d) Cash Dr. To Interest on loan (e) Cash Dr. To Loan . Q 17. Which of the following entries recorded in the books of the drawee of a bill is false? (a) When a bill is accepted, the to be debited is drawer’s a/c (b) When a bill is discharged, the to be debited is bills payable a/c (c) When a bill presented for payment by a bank is dishonored, the to be debited is bills payable a/c (d) When noting charges of a dishonored bill is paid by the endorsee ,the to be debited is noting charges a/c (e) At the time of retirement of a bill the to be debited is the drawer’s a/c. Q 18. Which of the following is true? (a) A bill sent for collection by bank when dishonored, the drawer will credit bank a/c (b) At the time of renewal of bill interest a/c is credited in the books of the drawee (c) Accommodation bills are drawn, accepted and endorsed for some consideration (d) Refusal by the acceptor to make payment of the bill on due date is called dishonor (e) When a bill is endorsed, the drawer credits the drawee’s a/c. Q19. Bills receivable is a (a) Nominal (b) Personal (c) Intangible asset (d) Real (e) Representative Personal . Q20 . Closing stock is generally valued at (a) Cost price (b) Replacement cost (c) Market price (d) Realisable value (e) Cost price or market price whichever is lower. Q21. The provision for discount on debtors is calculated on the amount of debtors (a) Before deducting the provision for doubtful debts (b) Left after deducting the provision for doubtful debts (c) Before deducting the actual bad debts (d) After deducting the actual bad debts (e) After deducting the actual bad debts and the provision for doubtful debts. Q22. Consider the following information of Thumbs-up Company for the year 2006-2007: Copyright@Amity University
Page 7
Financial ing Opening balance of provision for debtors Rs. 20,000 Bad debts during the year Rs. 18,000 Closing balance of Sundry debtors Rs.2,65,000 Estimated provision for doubtful debts 4% The amount to be debited to profit and loss to make the estimated provision is (a) Rs. 8,600 (b) Rs.10,400 (c) Rs.10,520 (d) Rs.10,600 (e) Rs.10,680. Q23. At the time of preparation of final s, bad debts recovered will be transferred to (a) Debtor’s (b) Profit & loss (c) Profit & loss adjustment (d) Profit & loss appropriation (e) Provision for discount on debtors . Q24. Which of the following is false about diminishing balance method of depreciation? (a) Higher amount of depreciation is charged when the machine is more efficient (b) It recognizes the risk of obsolescence by higher amount of depreciation in the early years (c) The total amount of depreciation and repairs is almost uniformally distributed over the useful life (d) It results in better cash flow through tax deferral as taxable income is lower in the initial years (e) Depreciation amount throughout the useful life will be uniform. Q25. The following is not an example of fixed asset (a) Plant and machinery (b) Land and building (c) Royalty (d) Patent (e) Office furniture. Q26. Under depletion method, depletion per unit is calculated as (a) Acquisition cost divided by average production units per annum (b) Acquisition cost divided by actual production units in the year (c) Acquisition cost minus residual value divided by average production units per annum (d) Acquisition cost minus residual value divided by the actual production units in the year (e) Acquisition cost minus residual value divided by the total production units over the useful life. Q 27. Which one of the following is a capital expenditure? Copyright@Amity University
Page 8
Financial ing (a) Compensation paid to Directors on termination of their services (b) Expenditure for renewal of trade mark (c) Gratuity paid to employees (d) Installments paid for the purchase of patent for manufacture and sale of medicine (e) Compensation paid to workers on retirement. Q28. Entries ed for outstanding expenses, depreciation, interest on capital etc. are (a) Opening entries (b) Journal entries (c) Adjustment entries (d) Rectification entries (e) Closing entries. Q29. Which of following transactions does not change the total amount of liabilities in the balance sheet? (a) Purchase of office furniture on credit (b) Payment of bank loan (c) Issue of debentures (d) Acceptance of bills from creditors (e) Redemption of preference shares. Q30. Which of the following is false? (a) Capital plus liabilities will be equal to assets (b) The difference between assets and liabilities is bank borrowing (c) Capital is a personal (d) Investment is a real (e) Outstanding rent is a representative personal . Q31. The expenses and incomes pertaining to full trading period are taken to the Profit and Loss of a business, irrespective of their actual payment or receipt. This is in recognition of (a) Time period concept (b) Business entity concept (c) Going concern concept (d) Accrual concept (e) Duality concept. Q32. Which of the following statements can be used to assess the liquidity of a company? (a) Balance sheet (b) Profit and loss (c) Profit and loss appropriation (d) Bank reconciliation statement (e) Manufacturing . Q33 . Which of the following state that “Anticipate no profit and provide for all possible losses”? Copyright@Amity University
Page 9
Financial ing (a) Convention of materiality (b) Convention of consistency (c) Convention of disclosure (d) Convention of conservatism (e) Convention of matching. Q34. Which of the following statements is/are true? I. Drawings is a nominal . II. Capital is a real . III. Sales is a nominal . IV. Outstanding salaries is a nominal . V. Patents is a personal . (a) Only (I) above (b) Only (III) above (c) Both (II) and (IV) above (d) (II), (IV) and (V) above (e) (I), (II), (III) and (IV) above. Q35. RS Ltd., makes purchases on credit. If the purchases are not as per the specifications, the company returns them to the suppliers. The book, that is used to record such returns is (a) Returns inward book (b) Returns outward book (c) Cash book (d) Journal proper (e) Purchases day book. Q36 . Which one of the following is not a reason for discrepancy in the balance as per cash book and bank book of a company? (a) Cheque issued to suppliers may not have been presented (b) Cheque deposited in the may not have been realized (c) Bill discounted with bank is not due for payment (d) Customers may have directly deposited money in the company’s (e) Bank charges not ed. Q37. The bank balance in the cash book of Mr.Avinash, a proprietor showed a credit balance of Rs.10,500 on March 31, 2008. On comparing it with his book he discovered the following discrepancies. i. Cheque No. 51 for Rs.540 in favour of Mr.Raman has not yet been presented. ii. A bill of Rs.1,000 was retired by the bank under a rebate for Rs.15, but the full amount of the bill was credited to bank in cash book. The balance as per book is (a) Rs.11,025 (Dr.) (b) Rs. 9,945 (Dr.) (c) Rs. 9,945 (Cr.) (d) Rs. 9,975 (Dr.) (e) Rs. 9,975 (Cr.). Copyright@Amity University
Page 10
Financial ing Q38. The total cost of goods available for sale with a company during the current year is Rs.12,00,000 and the total sales during the period are Rs.13,00,000. If the gross profit margin of the company is 25% on sales, the closing inventory during the current year is (a) Rs.4,00,000 (b) Rs.3,40,000 (c) Rs.2,25,000 (d) Rs.1,60,000 (e) Rs.1,00,000 Q39. Unearned income is (a) A current asset (b) A current liability (c) An expense (d) An income (e) Deferred expense. Q40. The essentials of double entry book-keeping in sequential order are (a) ing journal entries, posting in ledger, appropriate adjusting entries, trial balance, Profit & Loss a/c and Balance-sheet (b) ing journal entries, posting ledger, trial balance, Profit & Loss a/c and Balance-sheet, ing adjusting entries. (c) ing journal entries, posting ledger, ing adjusting entries, Profit & Loss a/c and Balance sheet, trial balance (d) ing adjusting entries, ing journal entries, trial balance, posting in ledger, Profit & Loss a/c and Balance-sheet (e) ing journal entries, posting in ledger, trial balance, ing adjusting entries, Profit & Loss a/c and Balance-sheet.
Copyright@Amity University
Page 11
More Documents from "Riz Fahan" 3r3t6u
227148135-financial-ing-assignment.pdf 331b2m
October 2021 0
Studyandexam Com 5e2a3g
December 2019 50
2c82t
November 2021 0
Lp Ikterik 502t3g
September 2020 0
Arthakranti Proposal Synopsis 5x174v
August 2021 0