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MGT101 Final

FINALTERM EXAMINATION
Spring 2010
MGT101- Financial Accounting (Session - 4)
Ref No: 1418662
Time: 90 min
Marks: 69
Student Info
StudentID: MC090402794
Center: OPKST
ExamDate: 08 Aug 2010

For Teacher's Use Only
Q No. 1 2 3 4 5 6 7 8 Total
Marks
Q No. 9 10 11 12 13 14 15 16
Marks
Q No. 17 18 19 20 21 22 23 24
Marks
Q No. 25 26 27 28 29 30 31 32
Marks
Q No. 33 34 35 36 37 38 39 40
Marks
Q No. 41 42 43 44 45 46 47 48
Marks
Q No. 49 50 51 52 53
Marks




Question No: 1 ( Marks: 1 ) - Please choose one
Liabilities of the members of the ________ is only limited to the capital introduce by member/s.

► Partnership



► Company




► Sole proprietorship

► None of the given options


Question No: 2 ( Marks: 1 ) - Please choose one
Fixed assets are also called:

► Depreciable assets
► Current assets
► Liquid assets
► Floating assets

Question No: 3 ( Marks: 1 ) - Please choose one
Stock of Trading concern consists of:

► Raw material
► Work in process
► Merchandise inventory
► All of the given options

Question No: 4 ( Marks: 1 ) - Please choose one
Which of the following would be deducted from Sundry Debtors in Balance Sheet?

► Bad debts (Trial balance item)
► Old provision for doubtful debts
► New provision for doubtful debts
► Both Bad debts (given in adjustment) and new provision for doubtful debts

Question No: 5 ( Marks: 1 ) - Please choose one
Consider the following data and identify the amount which will be deducted from Sundry Debtors in Balance Sheet.
Particulars Rs.
Bad debts (from trial balance) 1,600
Provision for doubtful debts (old) 2,000
Current year’s provision (new) 800

► Rs. 400
► Rs. 800
► Rs. 2,000
► Rs. 2,400

Question No: 6 ( Marks: 1 ) - Please choose one
Which of the following is/are the item/s of a Control Account?
► Credit sale only
► Cash sale only
► Credit purchase only
► Both Credit sales and Credit purchase

Question No: 7 ( Marks: 1 ) - Please choose one
Transaction that has been completely forgotten to enter is called:

► Error of principle
► Error of omission
► Error of commission
► Error of original entry

Question No: 8 ( Marks: 1 ) - Please choose one
A receipt of cash Rs. 10,000 from Mr. Bilal is recorded as Rs. 1,000. What amount will be adjusted in rectifying entry?

► Rs. 1,000
► Rs. 9,000
► Rs. 10,000
► Rs. 11,000

Question No: 9 ( Marks: 1 ) - Please choose one
Which of the following account will be credited when interest on capital is charged against the distribution of profit?
► Interest account
► Partner’s capital account
► Profit and Loss account
► Profit and loss appropriation account

Question No: 10 ( Marks: 1 ) - Please choose one
When the capitals are fixed, which of the following account will be debited for drawings made by a partner?


►Individual Partner’s Current Account
►Partner’s Cash Account
►Partner’s Bank Account
►Partners Capital Account

Question No: 11 ( Marks: 1 ) - Please choose one
The Joint Stock Company is formed under the Companies Ordinance:
► 1984
► I884
► 1948
► 1965

Question No: 12 ( Marks: 1 ) - Please choose one
Which of the following is NOT a cash inflow?

► Sale of fixed asset
► Issue of debentures
► Cash from business operation
► Purchase of fixed asset

Question No: 13 ( Marks: 1 ) - Please choose one
Which of the following business publishes the Financial Statements?

► Sole-Proprietorship
► Partnership
► Trust
► Public Limited Company

Question No: 14 ( Marks: 1 ) - Please choose one
When we close bad debt account, which of the following account is debited?

► Profit and loss account
► Bad debt account
► Debtor account
► Creditor account

Question No: 15 ( Marks: 1 ) - Please choose one
ABC Company received discount on its credit purchases, which of the following will be credited while entering in journal?
► Cash
► Discount received
► Creditors
► Bank

Question No: 16 ( Marks: 1 ) - Please choose one
Which of the following indicates cash discount received?
► Discount in paying debt earlier
► Discount in receiving debt earlier
► Discount in purchasing huge goods
► Discount in selling huge goods

Question No: 17 ( Marks: 1 ) - Please choose one
In the heading of financial statement, ___________ is not required?
► Title of financial statement
► Name of the person who prepares financial statement
► Period for which financial statement is prepared
► Name of business entity

Question No: 18 ( Marks: 1 ) - Please choose one
A and B entered in partnership in capital ratio of 2:3. They earned a profit of Rs.6,600 during the year. What will be the share of profit of Mr. A?
► Rs.1,320
► Rs.2,640
► Rs.3,960
► Rs.6,600

Question No: 19 ( Marks: 1 ) - Please choose one
Which of the following is the major benefit of a partnership over a sole proprietorship?
► Unlimited liability
► Single tax filing
► Difficult ownership resale
► Raising capital

Question No: 20 ( Marks: 1 ) - Please choose one
Interest expenses of Epler Corporation shows a debit balance of Rs.200 in its unadjusted trial balance and Rs.250 in adjusted trial balance. Which of the following account will be credited in adjusting entry?
► Interest expense
► Interest payable
► Prepaid interest
► Interest paid

Question No: 21 ( Marks: 1 ) - Please choose one
For which of the following share premium can be utilized?
► To write off preliminary expenses
► To meet the expenses of issue of shares
► To issue bonus shares
► All of the given options

Question No: 22 ( Marks: 1 ) - Please choose one
Which of the following statement is not true regarding the objective of statement of cash flows?
► It is helpful for decision making by management
► It is used for reporting the net profit of the period
► It can be used for estimations for cash flows in future
► It is used to determine the liquidity of the business

Question No: 23 ( Marks: 1 ) - Please choose one
Which of the following can maintain the secrecy in all business matters?
► Sole-proprietorship
► Partnership
► Public Limited Company
► Private Limited Company

Question No: 24 ( Marks: 1 ) - Please choose one
Expenditure is revenue in nature when it:
► Benefits the current period
► Benefits the future period
► Belong to the previous period
► None of the given options

Question No: 25 ( Marks: 1 ) - Please choose one
Which of the following is a process of transferring journal entry information to ledger account?
► Journalizing
► Posting
► Balancing
► Analyzing

Question No: 26 ( Marks: 1 ) - Please choose one
Which of the following account would be debited when the owner of business sold machinery of Rs. 10,000 on cash?
► Sales a/c
► Machinery a/c
► Owner a/c
► Cash a/c

Question No: 27 ( Marks: 1 ) - Please choose one
Which of the following account would be credited, when goods are sold on credit?
► Stock account
► Accounts receivable account
► Accounts payable account
► Sales account

Question No: 28 ( Marks: 1 ) - Please choose one
Which of the following account would be debited when Rs.5, 000 were paid to vendor?
► Cash
► Voucher payable-vendor payable
► Sundry debtors
► Personal account of customer

Question No: 29 ( Marks: 1 ) - Please choose one
Which of the following is TRUE during the periods of deflation?
► The use of FIFO will result in greater net income than LIFO
► The use of FIFO will result in a smaller cost of goods sold than LIFO
► The use of FIFO will result in a lower net income and higher ending inventory than LIFO
► The use of FIFO will result in a lower net income and lower ending inventory than LIFO

Question No: 30 ( Marks: 1 ) - Please choose one
Which one of the following is TRUE with respect to “LIFO” in inventory valuation?
► Last-In-First-Out
► Last-In-Freight-Out
► Last-In Frequent-Out
► Large inventory - First-Out

Question No: 31 ( Marks: 1 ) - Please choose one
Which one of the following is a fixed asset?
► Cash in hand
► Advanced payment
► Closing stock
► Leasehold vehicle

Question No: 32 ( Marks: 1 ) - Please choose one
Purpose of charging depreciation expense is the application of:
► Matching principle
► Dual aspect concept
► Separate entity concept
► Money measurement concept

Question No: 33 ( Marks: 1 ) - Please choose one
Which of the following is/are TRUE about fixed assets?
► Fixed assets have a long life
► Fixed assets are used in the business for future generation of income
► Fixed assets are not bought with the main purpose of resale
► All of the given options

Question No: 34 ( Marks: 1 ) - Please choose one
If:
Ø Cost of machine= Rs. 425,000
Ø Useful life= 5 years
Ø Residual value = Rs. 25,000
Ø Sale price= Rs. 40,000
What will be book value of machine after four years using straight line method?
► Rs. 65,000
► Rs. 400,000
► Rs. 85,000
► Rs. 105,000

Question No: 35 ( Marks: 1 ) - Please choose one
It is supposed that on 31st December, 2007, the sundry debtors are amounted to Rs. 40,000. On the basis of past experience, it is estimated that 5 % of the sundry debtors are doubtful. Actual bad debts are Rs. 1,600 appeared in trial balance. What is amount of new provision for doubtful debts?
► Rs. 3,600
► Rs. 2,000
► Rs. 1,600
► Rs. 400

Question No: 36 ( Marks: 1 ) - Please choose one
Which of the following statement is correct, if a company fails to record estimated bad debts expense?
► Net realizable value is understated
► Expenses are understated
► Revenues are understated
► Receivables are understated

Question No: 37 ( Marks: 1 ) - Please choose one
Insurance paid in advance would be treated as:
► Non current asset
► Current asset
► Intangible asset
► Deferred expense

Question No: 38 ( Marks: 1 ) - Please choose one
Which of the following is/are NOT included in the cost of goods sold?
► Distribution expenses
► Selling expenses
► Administrative expenses
► All of the given options

Question No: 39 ( Marks: 1 ) - Please choose one
Which of the following would be added in purchases in order to get the value of Net purchases?
► Purchases returns
► Carriage inwards
► Trade discount and rebates
► All of the given options

Question No: 40 ( Marks: 1 ) - Please choose one
The amount received in excess of the face value of the shares is transferred to:
► Share capital account
► Right shares
► Share premium account
► Shareholders account

Question No: 41 ( Marks: 1 ) - Please choose one
Preliminary Expenses of the company may write off against:
► Share premium account
► Shareholders account
► Debtors control account
► Creditors control account

Question No: 42 ( Marks: 1 ) - Please choose one
Which of the following can be utilized to issue bonus shares?
► Share premium
► Term finance certificates
► Bonds
► Debentures

Question No: 43 ( Marks: 1 ) - Please choose one
Which of the following is the new name of Sources and Application of Funds?
► Income Statement
► Cash Flow Statement
► Statement of Changes in Owners Equity
► Balance Sheet

Question No: 44 ( Marks: 1 ) - Please choose one
A corporation has retained earning of Rs. 100,000 and Rs. 150,000 for the year ended 2006 and 2007 respectively. The corporations had net profits after taxes of Rs. 80,000 in 2007. What will be the amount of dividend paid in the year 2007?
► Rs. 30,000
► Rs. 70,000
► Rs. 50,000
► Rs. 20,000

Question No: 45 ( Marks: 1 ) - Please choose one
Which of the following is the CORRECT statement with respect to the liquidity and profitability?
► Liquidity and Profitability is the same thing
► The importance of Liquidity > The importance of Profitability
► The importance of Liquidity < The importance of Profitability
► The liquidity and profitability is not the same thing but both have equal importance

Question No: 46 ( Marks: 1 ) - Please choose one
Which of the following is adjusted as working capital change in operating activities section of a cash flow statement?
► Decrease in trade receivable
► Repayment of dividend
► Payment of goodwill
► Investment in associated companies

Question No: 47 ( Marks: 1 ) - Please choose one
In statement of cash flows, which of the following would not be considered as an investing activity?
► Sales of fixed assets
► Purchase of long term securities
► Purchase of fixed assets
► Payments of dividends

Question No: 48 ( Marks: 1 ) - Please choose one
A company ABC purchased an asset for Rs. 40,000, paying Rs. 30,000 in cash and issuing a long term note payable for remaining balance. The amount will be recorded in statement of cash flows as:
► Rs. 40,000 cash outflow as an investing activity
► Rs. 30,000 cash outflow as an investing activity
► Rs. 10,000 cash inflow as an investing activity
► Rs. 70,000 cash inflow as an investing activity

Question No: 49 ( Marks: 3 )
What do you know about the Profit and loss appropriation account in case of partnership?

Answer:
The profit account does not included the salary of partner nor the markup on capital or interest on drawing, this all we do after calculating the net income in profit and loss appropriation account to get to the distributable income/profit among the partners as per the profit/loss sharing ratio.

Question No: 50 ( Marks: 3 )
Assume that a company repays Rs. 300,000 loan taken from its bank and then later, in the same year company borrows Rs. 500,000. How will these items be treated on the current year’s Statement of Cash Flows?

Answer : In the section of Financing Activities
300,000 will appear as (300,000) showing outflow/repayment of loan
500,000 will appear as 500,000 showing inflow of cash borrowed.

Question No: 51 ( Marks: 5 )
What types of changes are made when a new partner joins partnership? Mention those situations in which partnership comes to an end.

Answer:
In case of admission of any new partner all the assets and liabilities is revalued as well as the good will of the partnership company. The new ratio get sets for profit/loss sharing among the partner.

Usually In Case of death or retirement of partner from partnership, partnership comes to an end or in a state of dissolution.


Question No: 52 ( Marks: 5 )
Define cash flow from operating activities with some examples.

Answer:
Extract from Cash Flow Statement.

Net profit 100,000
Add Back : Non Cash Transaction
Depreciation Exp 5000
Gain on Currency Exchange 10,000
Gain on Sale of Disposal of Asset 2,000
Cash from Opening Activities before working
Capital Change 117,000
Less: Increase in Assets -10,000
Add: Decrease in Assets 5,000
Add: Increase in Liabilities 6000
Less: Decrease in Liabilities -3000
Cash Generated from Operating Activities 115,000


Question No: 53 ( Marks: 5 )
Given the following data:
Purchases Rs.26,000, Returns outwards Rs.1,470, Returns inwards Rs.2,100, Carriage outwards Rs.1,230, Carriage inwards Rs.890, Opening stock Rs.4,500, and closing stock Rs.6,130.

What would be the value of the cost of goods sold?

Solution:


Cost of Good Sold Amount
Opening Stock 4,500
Add: Purchases 26,000
Less: Return Outward -1,470
Add: Carriage Inward 890
Goods available for Sale 29,920
Less: Closing Stock -6,130
Cost of Good Sold 23,790

MGT101 Final

Spring 2010
MGT101- Financial Accounting (Session - 2)
Ref No: 1418715
Time: 90 min
Marks: 69
Student Info
StudentID:
Center:
ExamDate:

For Teacher's Use Only
Q No. 1 2 3 4 5 6 7 8 Total
Marks
Q No. 9 10 11 12 13 14 15 16
Marks
Q No. 17 18 19 20 21 22 23 24
Marks
Q No. 25 26 27 28 29 30 31 32
Marks
Q No. 33 34 35 36 37 38 39 40
Marks
Q No. 41 42 43 44 45 46 47 48
Marks
Q No. 49 50 51 52 53
Marks




Question No: 1 ( Marks: 1 ) - Please choose one
We can say that the business is in profit, when:


► Assets exceed Expenditure
► Assets exceed Liabilities
► Income exceeds Expenditure
► Income exceeds Liabilities

Question No: 2 ( Marks: 1 ) - Please choose one
Which of the following organizations prepare Income & Expenditure account?

► Public libraries
► NGOs
► Labor unions
► All of the given options

Question No: 3 ( Marks: 1 ) - Please choose one
Which of the following statement is NOT TRUE about Current liabilities?

► These are due within one year
► These are short-term loans
► These are consist of all debts, payable after 12 months
► In working capital, these are deducted from current assets

Question No: 4 ( Marks: 1 ) - Please choose one
Which of the following particular is NOT included in the specimen of a payment voucher?


► Name of organization
► Cash payment amount
► Date of transaction
► Bank receipt

Question No: 5 ( Marks: 1 ) - Please choose one
Cost of asset Rs. 1,00,000
Life of asset 5 years
Depreciation for each year Rs. 15,000
Sale price after 5 years Rs.50,000
Written down value of asset at the end of 5th year Rs.25,000
Profit or loss on disposal of fixed assets ?

► Rs.25, 000 profit
► Rs. 75,000 loss
► Rs. 15,000 profit
► Rs. 1, 00,000 profit

Question No: 6 ( Marks: 1 ) - Please choose one
Bank Reconciliation Statement is prepared by:

► Bankers
► Accountant of the business
► Statutory auditor
► Manger

Question No: 7 ( Marks: 1 ) - Please choose one
Consider the following data:

Particulars Rs.
Assets ?
Owner's equity 1,50,000
Liabilities 1,00,000


► Rs. 49,000
► Rs. 55,000
► Rs. 50,000
► Rs. 2, 50,000

Question No: 8 ( Marks: 1 ) - Please choose one
Which one of the following transactions will cause the balance in Mr. Terry's Cash Book to be greater than his Bank Statement balance?
► A cheque is drawn but not yet presented at the bank for payment
► The bank has not yet notified to Mr. Terry about a dishonoured cheque
► A credit transfer into Terry's Bank Account
► A cheque payment of Rs.101 is recorded in the Cash Book as Rs.110

Question No: 9 ( Marks: 1 ) - Please choose one
Following information are extracted from books of Mr. XYZ

Particulars Rs.
Bad Debts (Given in trial balance) 500
Old provisions (Given in trial balance) 800
Sundry Debtors (Given in trial balance) 44,500
Provision for doubtful debts @ 5%
What will be the amount of new provision ?


► Rs. 3,025
► Rs. 2,225
► Rs. 2,525
► Rs. 1,925

Question No: 10 ( Marks: 1 ) - Please choose one
Following information are extracted from books of Mr. XYZ

Particulars Rs.
Closing value of stock 40,000
Bad Debts (Given in trial balance) 500
Old provisions (Given in trial balance) 800
Sundry Debtors (Given in trial balance) 44,500
Provision for doubtful debts @ 5%
Which amount of new provision will be deducted from Sundry Debtors ?

► Rs. 2,225
► Rs. 2,525
► Rs. 1,925
► Rs. 3,025

Question No: 11 ( Marks: 1 ) - Please choose one
Amount by which the purchaser (buyer) receives a reduction in price from the seller is known as:

► Expense
► Discount Allowed
► Discount Received
► Liability

Question No: 12 ( Marks: 1 ) - Please choose one
Which of the following item will be shown on debit side of debtors account?

► Discount received
► Return inwards
► Discount allowed
► Credit sales

Question No: 13 ( Marks: 1 ) - Please choose one
Sale of goods to Mr. Amir is wrongly debited to Umair A/c(debtor) instead of Amir A/c(debtor), this is an example of:

► Error of principle
► Error of omission
► Error of commission
► Error of original entry

Question No: 14 ( Marks: 1 ) - Please choose one
Consider the following data and identify the amount which will be shown in profit & loss account.
Particulars Rs.
Bad debts 1,600
Provision for doubtful debts (old) 2,000
Current year’s provision (new) 1,000


► Rs. 600
► Rs. 1,600
► Rs. 2,000
► Rs. 2,600

Question No: 15 ( Marks: 1 ) - Please choose one
Which of the following is the first phase of the typical operating cycle?

► Sell goods and services to customers
► Purchase goods and services
► Receive cash from customers
► Pay cash to suppliers

Question No: 16 ( Marks: 1 ) - Please choose one
Which of the following are the owners of a company?
► Proprietors
► Partners
► Shareholders
► Managers

Question No: 17 ( Marks: 1 ) - Please choose one
A private limited company can commence its business:

► Immediately on receiving a certificate of incorporation
► Without receiving a certificate of incorporation
► Only when it receives certificate of commencement of business
► Only when it receives both, the certificate of incorporation as well as certificate of commencement of business

Question No: 18 ( Marks: 1 ) - Please choose one
Mr.” A” sold goods for Rs. 300,000 to Mr. “B”, Rs. 300,000 will be treated as _____________ for business of Mr. "A".
► Revenue
► Net profit
► Gross profit
► Operating profit

Question No: 19 ( Marks: 1 ) - Please choose one
Stockholder’s equity would not be affected by:
► Dividends to stockholders
► Net loss
► Purchase of land from the proceeds of bank loan
► Investments of cash by stockholders

Question No: 20 ( Marks: 1 ) - Please choose one
Accumulated depreciation is a ____________ account?
► Fixed asset
► Current asset
► Contra asset
► Liability

Question No: 21 ( Marks: 1 ) - Please choose one
Mr. A & B entered into a partnership with an equal share in profit or loss. The agreement provides that Mr. A will receive Rs.10,000 and Mr. B will receive Rs.8,000 as salary allowance. The net income for the year is Rs.85,000. What will be the total share of Mr. B?
► Rs.52,500
► Rs.42,500
► Rs.41,500
► Rs.50,500

Question No: 22 ( Marks: 1 ) - Please choose one
Which of the following can be utilized to set off any loss on revaluation?
► Capital reserve
► General reserve
► Revaluation reserve
► None of the given options

Question No: 23 ( Marks: 1 ) - Please choose one
Which of the following capital is taken up by the general public?
► Issued capital
► Subscribed capital
► Authorized capital
► Reserve capital

Question No: 24 ( Marks: 1 ) - Please choose one
Which of the following is the excess of net sales over net cost of purchases including all expenses relating to purchases?
► Gross profit
► Operating profit
► Net profit
► Revenue

Question No: 25 ( Marks: 1 ) - Please choose one
Which of the following account would be debited when Rs.5, 000 were paid to vendor?
► Cash
► Voucher payable
► Sundry debtors
► Personal account of customer

Question No: 26 ( Marks: 1 ) - Please choose one
If:
• Manufacturing Cost is Rs. 30,000
• Opening Work in Process Inventory is Rs. 5,000
• Closing Work in Process Inventory is Rs. 10,000

Then:
What is the amount of Cost of Goods Manufactured?
► Rs. 35,000
► Rs. 25,000
► Rs. 15,000
► Rs. 20,000

Question No: 27 ( Marks: 1 ) - Please choose one
Which of the following do NOT represent the Cost of goods sold?
► Sales – Gross Profit
► Opening Stock + Purchases – Return Outwards – Closing Stock
► Cost of goods Manufactured + Opening Finished Goods Inventory – Closing Finished Goods Inventory
► Opening Stock + Purchases – Return Inwards – Closing Stock

Question No: 28 ( Marks: 1 ) - Please choose one
Particulars Rs.
Opening written down value of machine ?
Cost of machine purchased during the year 50,000
Depreciation during the year 20,000
Closing written down value of the Machine 430,000

► Rs. 400,000
► Rs. 500,000
► Rs. 470,000
► Rs. 70,000

Question No: 29 ( Marks: 1 ) - Please choose one
Loss on revaluation account is charged to:
► Profit and loss account immediately
► Capital account
► Revaluation reserve account
► Liability account

Question No: 30 ( Marks: 1 ) - Please choose one
It is supposed that on 31st December, 2007, the sundry debtors are amounted to Rs. 40,000. On the basis of past experience, it is estimated that 10% of the sundry debtors are doubtful. Actual bad debts are Rs. 1,600 given in trial balance. What is the amount of new provision for doubtful debts?
► Rs. 3,600
► Rs. 4,000
► Rs. 1,600
► Rs. 2, 400

Question No: 31 ( Marks: 1 ) - Please choose one
Which of the following is NOT included in Debtors Control Account?

► Cash sale
► Credit sale
► Bills receivable
► Discount allowed

Question No: 32 ( Marks: 1 ) - Please choose one
Which of the following would NOT be the Classification of Current Assets?
► Cash Balance
► Bank Balance
► Premises
► Marketable Securities

Question No: 33 ( Marks: 1 ) - Please choose one
The amount of owner's equity in a business is NOT affected by:
► Investment made in the business by the owner
► The profitability of the business
► The amount of dividends paid to stockholders
► Taking loan from financial institutions

Question No: 34 ( Marks: 1 ) - Please choose one
Which of the following item will be credited in capital account of sole proprietor?
► Cash
► Drawings
► Debtors
► Profit

Question No: 35 ( Marks: 1 ) - Please choose one
Which of the following is/are NOT included in the cost of goods sold?
► Discount allowed
► Marketing expenses
► All of the given options
► Indirect expenses

Question No: 36 ( Marks: 1 ) - Please choose one
What maximum number of shareholders is allowed to form a Private Limited Company?
► 20
► 50
► 10
► 07

Question No: 37 ( Marks: 1 ) - Please choose one
Which of the following is shown on the liability side of Balance Sheet?
► Discount on issue of shares a/c only
► Share capital a/c only
► Premium on issue of shares a/c only
► Both share capital and share premium a/c

Question No: 38 ( Marks: 1 ) - Please choose one
Which of the following is (are) type(s) of Public Limited Companies?
► Listed company
► Non listed company
► Private limited company
► Both listed company and non listed company

Question No: 39 ( Marks: 1 ) - Please choose one
Under which of the following Act/ Ordinance, a company is allowed to issue shares at a higher price than their face value.
► Companies ordinance 1984
► Contract act 1872
► Sales of goods act 1930
► None of the given options

Question No: 40 ( Marks: 1 ) - Please choose one
The statement of changes in equity basically shows the movement of:
► Share capital during the year
► General reserves during the year
► Share premium during the year
► All of the given options

Question No: 41 ( Marks: 1 ) - Please choose one
Which of the following is TRUE?
► Sale of equipment for cash is considered as inflow of cash
► Sale of equipment on account is considered as inflow of cash
► Purchases of equipment for cash is considered as inflow of cash
► Sale of equipment for cash is considered as outflow of cash

Question No: 42 ( Marks: 1 ) - Please choose one
Which of the following is TRUE with respect to the application of Cash Flow Statement?
► Purchase of equipment for cash is considered as inflow of cash
► Purchase of equipment on account is considered as outflow of cash
► Sale of equipment on credit is considered as outflow of cash
► Purchase of equipment for cash is considered as outflow of cash

Question No: 43 ( Marks: 1 ) - Please choose one
Which of the following is considered as inflow of cash?
► Re-purchase of shares
► Redemption of debentures
► Issuance of debentures
► Payment of dividend

Question No: 44 ( Marks: 1 ) - Please choose one
Which of the following is the new name of Sources and Application of Funds?
► Income Statement
► Cash Flow Statement
► Statement of Changes in Owners Equity
► Balance Sheet

Question No: 45 ( Marks: 1 ) - Please choose one
A corporation has retained earning of Rs. 100,000 and Rs. 150,000 for the year ended 2006 and 2007 respectively. The corporations had net profits after taxes of Rs. 80,000 in 2007. What will be the amount of dividend paid in the year 2007?
► Rs. 30,000
► Rs. 70,000
► Rs. 50,000
► Rs. 20,000

Question No: 46 ( Marks: 1 ) - Please choose one
If issuance of debentures against cash is Rs. 3,000 and repurchase of shares of Rs. 4,000 then which of the following is correct?
► Inflow of cash Rs. 7,000
► Outflow of cash Rs. 7,000
► Inflow of cash Rs. 1,000
► Outflow of cash Rs. 1,000

Question No: 47 ( Marks: 1 ) - Please choose one
In calculating earning per share (EPS), the net profit is divided by which of the following?
► Number of ordinary shares
► Number of preference shares
► Paid up capital
► Authorized capital

Question No: 48 ( Marks: 1 ) - Please choose one
Which of the given Asset is Not included in the calculation acid test ratio?
► Stock
► Cash
► Debtors
► Bills Receivable

Question No: 49 ( Marks: 3 )
Mr. Ali is a partner in a partnership firm. He drew the following amounts during the financial year:

August 01 Rs. 3,000
October 01 Rs. 4,500
Required:
Calculate the markup on his drawings, if the rate of markup is 8% p.a. The period for the financial year is from 1st July to 30th June (12 months).

Draw amount in August : 3000 (11 months markup = 137)

Draw amount in October: 4500 (9 month 112.5)



Question No: 50 ( Marks: 3 )
Write down the components of Cash Flow Statement.

Following are the components of Cash flow statement:-

1. Cash Flow from Investing Activities
2. Cash Flow from Operating Activities
3. Cash Flow from Financing Activities

Question No: 51 ( Marks: 5 )
Information given in Trial balance:
Ø Plant and machinery Rs. 200,000
Ø Furniture and fixtures Rs. 100,000
Information given in adjustment:
Ø Charge 20% depreciation on Plant and machinery and 10 % on Furniture and fixture

Required:
1. Calculate the amount of depreciation expense shown in profit and loss account.
2. Calculate the amount of fixed assets shown in balance sheet.

Question No: 52 ( Marks: 5 )
Write down the common contents of Memorandum of Association.

Following are the contents of Memorandum of Association

1. Name of the company with the word Limited and last work of the name in case if public limited with parenthesis and the work Private Limited.
2. Place of Registered office
3. Objective of company
4. Amount of share capital
5. No subscriber of the company take less than one share
6. Each subscriber of the memorandum shall write opposite ot his name the number of shares held by him.



Question No: 53 ( Marks: 5 )
The following information is given about a company.

Particular Rs.
Credit purchases 100,000
Gross profit 30,000
Cost of goods sold 120,000
Opening stock 29,000
Closing stock 31,000
Average creditors 16,000
Net profit 14,000
Net fixed assets 110,000
Net sales 150,000

From the above information, calculate the following ratios:
Ø Net Profit Ratio
Ø Creditors Turnover Ratio

MGT101 Final

FINALTERM EXAMINATION
Spring 2010
MGT101- Financial Accounting (Session - 4)
Time: 90 min
Marks: 69
Student Info
StudentID:
Center: OPKST
ExamDate: 09 Aug 2010

For Teacher's Use Only
Q No. 1 2 3 4 5 6 7 8 Total
Marks
Q No. 9 10 11 12 13 14 15 16
Marks
Q No. 17 18 19 20 21 22 23 24
Marks
Q No. 25 26 27 28 29 30 31 32
Marks
Q No. 33 34 35 36 37 38 39 40
Marks
Q No. 41 42 43 44 45 46 47 48
Marks
Q No. 49 50 51 52 53
Marks




Question No: 1 ( Marks: 1 ) - Please choose one
An organization operating with the objective of making profit from the sale of goods or services is called:

► Transaction
► Business
► Society
► Trust

Question No: 2 ( Marks: 1 ) - Please choose one
We can say that the business is in profit, when:


► Assets exceed Expenditure
► Assets exceed Liabilities
► Income exceeds Expenditure
► Income exceeds Liabilities

Question No: 3 ( Marks: 1 ) - Please choose one
Which of the following account balance will be shown on debit side of Trial Balance? (It is assumed that all account balances are shown on normal balance).

► Capital account
► Sundry creditors account
► Accounts payable account
► Cash account

Question No: 4 ( Marks: 1 ) - Please choose one
If the cost of sales is Rs. 60,000, sales are Rs. 95,000 and operating expenses are Rs.20,000 during the year. What would be the Net Profit?


► Rs.15,000
► Rs. 35,000
► Rs. 55,000
► Rs. 60,000

Question No: 5 ( Marks: 1 ) - Please choose one
In cost of goods sold statement the ‘cost of goods manufactured’ is equal to:


► Total factory cost + Opening work in process + Ending work in process
► Total factory cost + Opening work in process – Ending work in process
► Total factory cost - Opening work in process + Ending work in process
► Ending work in process +Total factory cost – Opening work in process

Question No: 6 ( Marks: 1 ) - Please choose one
If, Cost of machine = Rs.400, 000
Useful life = 5 years
Residual value = Rs.25, 000
The depreciation of machine per year using straight line method is?

► Rs. 160,000
► Rs. 96,000
► Rs. 75,000
► Rs. 57,600

Question No: 7 ( Marks: 1 ) - Please choose one
Find out the missing value of an Accounting Equation with the help of given data:

Cash Rs.1, 00, 000
Debtors Rs.10, 000
Other Assets Rs. 1,000
Owner’s equity Rs. 1, 000


► Rs. 12,000 liabilities
► Rs. 11,000 liabilities
► Rs. 1, 10,000 liabilities
► Rs. 1, 11,000 liabilities

Question No: 8 ( Marks: 1 ) - Please choose one
Upon checking the Bank Statement against the Cash Book by Mr. A, It was discovered that an amount of Rs.120 for dividend from XYZ Co. had not been entered in the Cash Book. Which of the following entry should be recorded to rectify the mistake?
► Bank Account(Dr.) and Dividend Account (Cr.)
► XYZ Co. Account (Dr.) and Bank Account (Cr.)
► Dividend Account (Dr.) and Bank Account (Cr.)
► Bank Account (Dr.) and XYZ Co. Account (Cr.)

Question No: 9 ( Marks: 1 ) - Please choose one
Which one of the following transactions will cause the balance in Mr. Terry's Cash Book to be greater than his Bank Statement balance?
► A cheque is drawn but not yet presented at the bank for payment
► The bank has not yet notified to Mr. Terry about a dishonoured cheque
► A credit transfer into Terry's Bank Account
► A cheque payment of Rs.101 is recorded in the Cash Book as Rs.110

Question No: 10 ( Marks: 1 ) - Please choose one
If Bad Debts written off are given in adjustment, then which of the following entry for bad debts written off is CORRECT?


► Bad debts a/c (Dr) and Trading a/c (Cr)
► Provision for Bad and Doubtful debts a/c (Dr) and Bad debts a/c(Cr)
► Bad debts a/c (Dr) and debtors a/c (Cr)
► Trading a/c (Dr) and Bad debts a/c (Cr)

Question No: 11 ( Marks: 1 ) - Please choose one
Which of the following is (are) benefit/s of subsidiary ledger accounts to business?

► It tells about customer attitude of payments
► It can be checked against the control account to pick up recording errors
► It tells about the complete history of transactions of business client
► All of the given options

Question No: 12 ( Marks: 1 ) - Please choose one
When one or both aspects of a transaction are recorded in the wrong class or category of account, this is called:

► Error of principle
► Error of omission
► Error of commission
► Error of original entry

Question No: 13 ( Marks: 1 ) - Please choose one
Which of the following is the first phase of the typical operating cycle?

► Sell goods and services to customers
► Purchase goods and services
► Receive cash from customers
► Pay cash to suppliers

Question No: 14 ( Marks: 1 ) - Please choose one
In which type of a business, the owner and his business are considered same in the eyes of law?
► Sole proprietorship
► Public companies
► Limited companies
► Listed companies

Question No: 15 ( Marks: 1 ) - Please choose one
Which of the following clause/s are discussed in Memorandum of Association of Companies?

► Name of company
► Place of registered office of company
► Objective of the company
► All of the given options

Question No: 16 ( Marks: 1 ) - Please choose one
6% Debentures Account Rs. 3, 00,000. What amount of interest on debentures should be shown in profit and loss account?

► Rs. 6,000
► Rs. 3, 00,000
► Rs. 18,000
► Rs. 3, 18,000

Question No: 17 ( Marks: 1 ) - Please choose one
Which of the following is a type of business formed under the Companies Ordinance 1984?

► Sole-Proprietorship
► Partnership
► Joint Stock Company
► All of the given options

Question No: 18 ( Marks: 1 ) - Please choose one
If company has distributable profit is Rs. 4, 90,000. Profit sharing share ratio of Mr. A, Mr. B and Mr. C is 2:3:5 respectively what will be the Profit share for Mr. C in distributable profit.

► Rs. 98,000
► Rs. 1, 47,000
► Rs. 2, 45,000
► Rs. 3, 43,000

Question No: 19 ( Marks: 1 ) - Please choose one
When we close bad debts account, which of the following account is credited?
► Profit and loss account
► Bad debt account
► Debtor account
► Provision for bad debt account

Question No: 20 ( Marks: 1 ) - Please choose one
Stock account is credited and creditors account is debited, which of the following is reflecting the statement?
► Discount received
► Goods returned
► Purchase of goods on credit
► Payment of goods

Question No: 21 ( Marks: 1 ) - Please choose one
Which of the following justifies when profit is earned?
► Assets exceed Expenditure
► Income exceeds Expenditure
► Cash Inflow exceeds Cash Outflow
► Income exceeds Liabilities

Question No: 22 ( Marks: 1 ) - Please choose one
In a partnership of Mr. X and Mr. Y, the share of profit of Mr. X is Rs.3,840 and the share of profit of Mr. Y is Rs. 5,760. What will be the ratio of their share?
► 1:2
► 2:3
► 3:2
► 2:1

Question No: 23 ( Marks: 1 ) - Please choose one
Which of the following is the major benefit of a partnership over a sole proprietorship?
► Unlimited liability
► Single tax filing
► Difficult ownership resale
► Raising capital

Question No: 24 ( Marks: 1 ) - Please choose one
Profits earned by partnerships compensate the owners for which of the following?
► Personal services rendered to the business
► Capital invested in the business
► Assuming the risks of ownership
► All of the given options

Question No: 25 ( Marks: 1 ) - Please choose one
For which of the following share premium can not be utilized?
► To meet the expenses of issue of shares
► To issue bonus shares
► None of the given options
► To write off preliminary expenses

Question No: 26 ( Marks: 1 ) - Please choose one
According to the statement of cash flows following are the examples of investing activities except:
► Sales of machinery
► Capital invested by the owners
► Purchase of building for the business use
► Cash received from the disposal of equipment

Question No: 27 ( Marks: 1 ) - Please choose one
Which of the following is one of the major factors affecting the market value of a company’s shares?
► Current ratio
► Earning per share
► Return on investment
► Return on asset

Question No: 28 ( Marks: 1 ) - Please choose one
In statement of cash flows, a payment of cash dividends is related to:
► Investing activity
► Financing activity
► Operating activity
► Cash flows from operations

Question No: 29 ( Marks: 1 ) - Please choose one
Which of the following is the investment in business by the owners?
► Capital
► Liability
► Asset
► Profit

Question No: 30 ( Marks: 1 ) - Please choose one
Which of the following is an example of revenue in business enterprises?
► Accounts payable
► Accounts receivable
► Commission received
► Commission paid

Question No: 31 ( Marks: 1 ) - Please choose one
Which of the following system of recording transactions is based on dual aspect concept of accounting?
► Double entry system
► Cash accounting system
► Single entry system
► Management system

Question No: 32 ( Marks: 1 ) - Please choose one
Which of the following is a book of original entry in which all the vouchers are recorded at first?
► General Journal
► General Ledger
► Trial Balance
► Balance Sheet

Question No: 33 ( Marks: 1 ) - Please choose one
What is the treatment of Accumulated depreciation in Balance Sheet?
► Treated as an expense
► Treated as an asset
► Treated as a contra asset
► Treated as an income

Question No: 34 ( Marks: 1 ) - Please choose one
Which of the following is/are TRUE about fixed assets?
► Fixed assets have a long life
► Fixed assets are used in the business for future generation of income
► Fixed assets are not bought with the main purpose of resale
► All of the given options

Question No: 35 ( Marks: 1 ) - Please choose one
Which one of the following cost is NOT attributable to the fixed assets?
► Costs of site preparation
► Administration and other general overhead cost
► Initial delivery and handling charges
► Installation and assembly costs

Question No: 36 ( Marks: 1 ) - Please choose one
Mr. B’s cash book shows a credit balance of Rs.68,000. He issued a cheque of Rs.7,000 but not yet presented by the bank. What will be the balance of bank statement?
► Rs. 61,000
► Rs. 75,000
► Rs. 68,000
► Rs. 7,000

Question No: 37 ( Marks: 1 ) - Please choose one
If cash purchase is the missing figure, it can be ascertained by the construction of:
► Cash Account
► None of the given options
► Creditors Control Accounts
► Debtors Control Accounts

Question No: 38 ( Marks: 1 ) - Please choose one
Depreciation expense is charged to which of the following head?
► Administrative expenses
► Selling expenses
► Cost of sales
► It depends on the nature of expense

Question No: 39 ( Marks: 1 ) - Please choose one
Which of the following is/are included in the cost of goods sold?
► Cost of materials used
► Direct labour cost
► Factory costs
► All of the given options

Question No: 40 ( Marks: 1 ) - Please choose one
A firm had sales of Rs. 200,000, cost of goods available for sale Rs. 120,000, and an ending finished goods inventory of Rs. 20,000. Selling and Administrative expenses are Rs. 55,000. Which of the following would be TRUE?
► Net income was 22.5% of sales
► The cost of goods sold was Rs. 100,000
► The gross profit was Rs. 100,000
► All of the given options

Question No: 41 ( Marks: 1 ) - Please choose one
Which of the following is TRUE about the Companies Limited by Shares?
► Company has limited shares to offer
► Shareholders of the Company are limited
► Liability of the shareholders is limited
► Liability of the shareholders is unlimited

Question No: 42 ( Marks: 1 ) - Please choose one
Which of the following is shown on the liability side of Balance Sheet?
► Discount on issue of shares a/c only
► Share capital a/c only
► Premium on issue of shares a/c only
► Both share capital and share premium a/c

Question No: 43 ( Marks: 1 ) - Please choose one
XYZ Company has paid up capital of 20,000 shares of Rs. 100 each. The company offers to existing shareholders the right to buy 3 shares of Rs. 100 each at Rs. 125 for every 5 shares held. What would be the number of right shares?
► 120 right shares
► 12,000 right shares
► 15,000 right shares
► 25,000 right shares

Question No: 44 ( Marks: 1 ) - Please choose one
A company is said to have been registered when:

► It gets certificate of incorporation from registrar of Companies
► It gets certificate of commencement of business from registrar of Companies
► It actually starts its business
► It filed with the Registrar of Companies certain documents, like memorandum and articles of association

Question No: 45 ( Marks: 1 ) - Please choose one
Which of the following is considered as Non-cash item in cash flow statement?
► Depletion
► Accrued income
► Prepaid expenses
► Cash at bank

Question No: 46 ( Marks: 1 ) - Please choose one
Which of the following is the CORRECT statement with respect to the liquidity and profitability?
► Liquidity and Profitability is the same thing
► The importance of Liquidity > The importance of Profitability
► The importance of Liquidity < The importance of Profitability
► The liquidity and profitability is not the same thing but both have equal importance

Question No: 47 ( Marks: 1 ) - Please choose one
If issuance of shares against cash is Rs. 2,000 and payment of dividend is Rs. 9,000 then which of the following is correct?
► Inflow of cash Rs. 11,000
► Outflow of cash Rs. 11,000
► Inflow of cash Rs. 7,000
► Outflow of cash Rs. 7,000

Question No: 48 ( Marks: 1 ) - Please choose one
Which of the following is CORRECT about Gross Profit Ratio?
► (Gross profit / Net Sales) x 100
► (Gross profit / Operating Income) x 100
► (Gross profit / Sales Return) x 100
► (Gross profit / Net Income) x 100

Question No: 49 ( Marks: 3 )
ط Cash at bank Rs. 20,000
ط Closing stock Rs. 25,000
ط Sundry debtors Rs. 35,000

If provision for doubtful debts is Rs. 5,000, calculate the amount of current assets to be shown in balance sheet.

Question No: 50 ( Marks: 3 )
Particulars Rs.
Interest on loans 2,000
Interest on overdraft 4,000
Foreign exchange gain 6,000
Gain on disposal of fixed assts. 8,000
Sale of Scrap 1,000

Based on the above information, you are required to calculate the amount of following:
ط Financial charges
ط Other income

Question No: 51 ( Marks: 5 )
Briefly discuss the followings:
ط Issuance of shares at premium
ط Cash flow statement
ط Debentures
ط Notes to the accounts



Question No: 52 ( Marks: 5 )
Find the cost of goods sold by preparing a cost of goods sold statement with the help of given date for the year 2007.

Raw material Stocks on 1-1-2007 Rs. 30,000
Work in process on 1-1-2007 35,600
Finished Goods on 1-1-2007 35,400

Raw material Stocks 31-12-2007 Rs. 31,000
Work in process 31-12-2007 25,000
Finished Goods 31-12-2007 53,900
Total factory Cost 543,339


Question No: 53 ( Marks: 5 )
Classify the followings whether these Entries are Operating, Investing or Financing activity by filling the appropriate boxes given below.


S. No.
ENTRIES

CLASSIFICATION

0
Change in Accounts receivable and Inventory

Operating activity

1
Change in Property, Buildings, and Equipment

?

2
Change in Accumulated depreciation and Amortization


?

3
Change in Accounts payable, Accrued wages and Salaries payable
?

4
Change in Note payable

?

5
Net income

?

MGT101 Final

FINALTERM EXAMINATION
Spring 2010
MGT101- Financial Accounting (Session - 2)
Ref No:
Time: 90 min
Marks: 69
Student Info
StudentID:
Center: OPKST
ExamDate: 10 Aug 2010

For Teacher's Use Only
Q No. 1 2 3 4 5 6 7 8 Total
Marks
Q No. 9 10 11 12 13 14 15 16
Marks
Q No. 17 18 19 20 21 22 23 24
Marks
Q No. 25 26 27 28 29 30 31 32
Marks
Q No. 33 34 35 36 37 38 39 40
Marks
Q No. 41 42 43 44 45 46 47 48
Marks
Q No. 49 50 51 52 53
Marks




Question No: 1 ( Marks: 1 ) - Please choose one
Which of the following is correct according to the double entry system of book-keeping?

► Debit = Credit
► Debit > Credit
► Debit < Credit
► All of the given options

Question No: 2 ( Marks: 1 ) - Please choose one
An Asset that is NOT physical in nature is called _________.

► Intangible Asset
► Liquid Asset
► Current Asset
► Fixed Asset

Question No: 3 ( Marks: 1 ) - Please choose one
Which of the following account balance will be shown on debit side of Trial Balance? (It is assumed that all account balances are shown on normal balance)

► Cash account
► Furniture account
► Vehicle account
► All of the given options

Question No: 4 ( Marks: 1 ) - Please choose one
Bank Reconciliation Statement is:

► A memorandum statement
► A ledger account
► A part of cash book
► A part of journal

Question No: 5 ( Marks: 1 ) - Please choose one
Particulars Rs.
Opening written down value of machine Rs. 2,00,000
Cost of new machine purchased during the year Rs. 50,000
Depreciation during the year Rs. 25,000
Closing written down value (WDV) of machines ?

► Rs. 2, 25,000
► Rs. 2, 50,000
► Rs. 2, 75,000
► Rs. 75,000

Question No: 6 ( Marks: 1 ) - Please choose one
Following information are extracted from books of Mr. XYZ

Particulars Rs.
Closing value of stock 40,000
Bad Debts (Given in trial balance) 500
Old provisions (Given in trial balance) 700
Sundry Debtors (Given in trial balance) 44,500
Provision for doubtful debts be increases by 5%
What will be the amount of new provision ?

► Rs. 2,225
► Rs. 2,425
► Rs. 1,925
► Rs. 3,025

Question No: 7 ( Marks: 1 ) - Please choose one
Which of the following is a selling expense?

► Interest on deposits
► Any tax/freight is paid on purchases
► General salaries paid to laborers
► Tax & freight paid on sale

Question No: 8 ( Marks: 1 ) - Please choose one
Which account is increased with a debit and decreased with a credit?

► Cash
► Accounts Payable
► Contributed Capital
► Retained Earnings

Question No: 9 ( Marks: 1 ) - Please choose one
Which of the following journal entry will be recorded, if cash is drawn by a Proprietor?

► Proprietor’s drawings a/c (Dr.) and Cash a/c (Cr.)
► Cash a/c (Dr.) and Proprietor’s drawings a/c (Cr.)
► Proprietor’s Capital (Dr.) and Proprietor’s drawings a/c (Cr.)
► Proprietor’s drawings (Dr.) and Proprietor’s Capital a/c (Cr.)

Question No: 10 ( Marks: 1 ) - Please choose one
When the capitals are fixed, which of the following account will be debited for drawings made by a partner?


► Individual Partner’s Current Account
► Partner’s Cash Account
► Partner’s Bank Account
► Partners Capital Account

Question No: 11 ( Marks: 1 ) - Please choose one
Authorized share capital is also known as:
► Registered capital
► Issued capital
► Paid up capital
► Called up capital

Question No: 12 ( Marks: 1 ) - Please choose one
When goods are acquired from the supplier the gross cost of such goods is recorded in:
► Debtor Account
► Purchases Account
► Factory overhead account
► Sales Account

Question No: 13 ( Marks: 1 ) - Please choose one
Which of the following is NOT a cash inflow?

► Sale of fixed asset
► Issue of debentures
► Cash from business operation
► Purchase of fixed asset

Question No: 14 ( Marks: 1 ) - Please choose one
In cash flow statements, which of the following would appear as an inflow of cash?
► The repayments of a bank loan
► Dividend issue in the current year
► Money received as result of selling fixed assets
► The difference between the valuations of old and new fixed assets

Question No: 15 ( Marks: 1 ) - Please choose one
In cash flow statements, which of the following would appear as a cash outflow?
► The payments for purchases made during the year
► A decrease in trade debtors over the course of an accounting period
► Money received as a result of issuing new shares
► Money received as result of selling fixed assets

Question No: 16 ( Marks: 1 ) - Please choose one
When we close bad debt account, which of the following account is debited?

► Profit and loss account
► Bad debt account
► Debtor account
► Creditor account

Question No: 17 ( Marks: 1 ) - Please choose one
Subsidiary ledgers are maintained for:
► Debtors
► Creditors
► Stock
► All of the given options

Question No: 18 ( Marks: 1 ) - Please choose one
ABC Company received discount on its credit purchases, which of the following will be credited while entering in journal?
► Cash
► Discount received
► Creditors
► Bank

Question No: 19 ( Marks: 1 ) - Please choose one
Mr. Ali’s bank book shows a debit balance of Rs. 36,000. He deposited a cheque of Rs.15,000 but not yet collected by the bank. What will be the balance of bank statement?

► Rs. 21,000
► Rs. 51,000
► Rs. 36,000
► Rs. 15,000

Question No: 20 ( Marks: 1 ) - Please choose one
Which of the following indicates cash discount received?
► Discount in paying debt earlier
► Discount in receiving debt earlier
► Discount in purchasing huge goods
► Discount in selling huge goods

Question No: 21 ( Marks: 1 ) - Please choose one
Mr. A & B entered into a partnership invested Rs.50,000 and Rs.65,000 with an equal share in profit or loss. Markup on drawings of Mr. A is Rs.1,500 and of Mr. B is Rs.1,800. The net income for the year is Rs.85,000. What will be the profit share of Mr. B?
► Rs.42,350
► Rs.44,150
► Rs.41,600
► Rs.40,850

Question No: 22 ( Marks: 1 ) - Please choose one
Mr. A & B entered into a partnership invested Rs.50,000 and Rs.65,000 with an equal share in profit or loss. Markup on drawings of Mr. A is Rs.1,500 and of Mr. B is Rs.1,800. The net income for the year is Rs.85,000. What will be the amount of distributable profit?
► Rs.81,700
► Rs.88,300
► Rs.131,700
► Rs.146,700

Question No: 23 ( Marks: 1 ) - Please choose one
Which of the following value of the share is authorized by the memorandum of association?
► Par value
► Face value
► Nominal value
► All of the given options

Question No: 24 ( Marks: 1 ) - Please choose one
Which of the following statement is not true regarding the objective of statement of cash flows?
► It is helpful for decision making by management
► It is used for reporting the net profit of the period
► It can be used for estimations for cash flows in future
► It is used to determine the liquidity of the business

Question No: 25 ( Marks: 1 ) - Please choose one
Statement of cash flows helps the stakeholders to assess:
► Ability to pay cash dividends in the future
► All of the given options
► The ability to generate future cash flows
► The liquidity of the business

Question No: 26 ( Marks: 1 ) - Please choose one
According to the statement of cash flows following are the examples of investing activities except:
► Sales of machinery
► Capital invested by the owners
► Purchase of building for the business use
► Cash received from the disposal of equipment

Question No: 27 ( Marks: 1 ) - Please choose one
The cash book in book-keeping records:
► All cash and credit purchase of goods
► Only cash payments
► All receipts and payments in cash
► All cash and credit sale of goods

Question No: 28 ( Marks: 1 ) - Please choose one
What will be the effect of decrease in closing stock on gross profit?
► Gross profit increased
► Gross profit decreased
► No effect on Gross profit
► Gross profit will become positive

Question No: 29 ( Marks: 1 ) - Please choose one
If:
• Direct Material Cost is Rs. 20,000
• Direct labour cost is Rs. 10,000
• Manufacturing Cost is Rs. 45,000
Then:
What is the amount of Factory Overhead?
► Rs. 15,000
► Rs. 30,000
► Rs. 35,000
► Rs. 25,000

Question No: 30 ( Marks: 1 ) - Please choose one
Which one of the following methods for inventory valuation may overstate the income during the periods of rising prices?
► Specific Identification Method
► FIFO Method
► LIFO Method
► Weighted Average Method

Question No: 31 ( Marks: 1 ) - Please choose one
Which of the following is NOT a method of calculating depreciation?
► Straight Line Method
► Written Down Value Method
► Diminishing Balance Method
► Specific Identification Method

Question No: 32 ( Marks: 1 ) - Please choose one
What is the treatment of Depreciation in accounting?
► Written in balance sheet under the head of fixed assets
► Charged to profit and loss account
► Written in balance sheet under the head of current assets
► Written in balance sheet under the head of liabilities

Question No: 33 ( Marks: 1 ) - Please choose one
Which of the following is TRUE?
► Gain on revaluation is credited to Revaluation Reserve Account.
► Gain on revaluation is debited to Revaluation Reserve Account.
► Gain on revaluation is credited to Profit & Loss Account.
► Gain on revaluation is debited to Profit & Loss Account.

Question No: 34 ( Marks: 1 ) - Please choose one
The loss on the sale of fixed assets is a:
► Normal loss
► Ordinary loss
► Capital loss
► Revenue loss

Question No: 35 ( Marks: 1 ) - Please choose one
Which of the following is TRUE about capital receipt?
► It decreases value of property or increases value of liability
► It is shown in the income and expenditure account
► It is recurring in nature
► It is not shown in the statement of financial positions

Question No: 36 ( Marks: 1 ) - Please choose one
Which of the following is NOT included in Debtors Control Account?

► Cash sale
► Credit sale
► Bills receivable
► Discount allowed

Question No: 37 ( Marks: 1 ) - Please choose one
If cash sale is the missing figure, it can be ascertained by the construction of:
► Creditors Control Accounts
► Debtors Control Accounts
► Cash Account
► None of the given options

Question No: 38 ( Marks: 1 ) - Please choose one
Which of the following is/are the Classification of Current Assets?
► Cash Balance
► Loans and Advances
► Bank Balance
► All of the given options

Question No: 39 ( Marks: 1 ) - Please choose one
Depreciation expense is charged to which of the following head?
► Administrative expenses
► Selling expenses
► Cost of sales
► It depends on the nature of expense

Question No: 40 ( Marks: 1 ) - Please choose one
Inventory is always considered as:
► Current asset
► Current liability
► Long-term asset
► Stockholders' equity

Question No: 41 ( Marks: 1 ) - Please choose one
If:
Ø Capital at the start Rs. 100,000
Ø Profit during the year Rs. 50,000
Ø Withdrawal during the year Rs. 25,000

What would be the closing balance of capital?
► Rs. 175,000
► Rs. 150,000
► Rs. 125,000
► Rs. 75,000

Question No: 42 ( Marks: 1 ) - Please choose one
Which of the following Legal Documents of a company contain(s) the rules and regulations framed for the internal management of the company?
► Memorandum of Association
► Articles of Association
► Both Memorandum of Association and Articles of Association
► Prospectus

Question No: 43 ( Marks: 1 ) - Please choose one
Which one of the following refers to the allotment of shares to the existing shareholders by capitalizing the reserves into additional capital?
► Reserve funds
► Accumulated profit
► Right issue
► Bonus issue

Question No: 44 ( Marks: 1 ) - Please choose one
When a share having a face value of Rs.100 issued at Rs.90 then which one of the following options is correct under this situation?
► Share issued at premium
► Share issued at discount
► Share issued at nominal value
► Share issued at market value

Question No: 45 ( Marks: 1 ) - Please choose one
The amount of share premium can be utilized EXCEPT:
► To write off preliminary expenses
► To meet the expenses of issue of shares
► To distribute among the shareholders
► To issue bonus shares

Question No: 46 ( Marks: 1 ) - Please choose one
A company pays cash to purchase the stock of another company in an unrelated industry. The cash outflow can be considered as an:
► Operating activity that will appear on the statement of cash flows
► Operating activity that will not appear on the statement of cash flows due to the fact of stock from a company in an unrelated industry
► Investing activity that will appear on the statement of cash flows
► Investing activity that will not appear on the statement of cash flows due to the fact of stock from a company in an unrelated industry

Question No: 47 ( Marks: 1 ) - Please choose one
Which of the following would be a suitable head for short term advances from customers in Balance Sheet?
► Current asset
► Intangible asset
► Tangible asset
► Current liability

Question No: 48 ( Marks: 1 ) - Please choose one
If there is a portion of long term loan of Rs. 30,000 payable in the current accounting period. Where it will be shown in financial statement?
► Current liability
► Long term liability
► Current asset
► Owner’s equity

Question No: 49 ( Marks: 3 )
Ø Rent expenses Rs. 20,000
Ø Insurance expenses Rs. 30,000
Ø Bad debts Rs. 35,000

In addition rent payable is Rs. 5,000; calculate the amount of operating expenses to be shown in profit and loss account.

Question No: 50 ( Marks: 3 )
If:
Ø Retain earning at the beginning Rs. 1,000
Ø Dividend paid 500
Ø Retain earning at the end 2,500

Then:
You are required to prepare statement of Retain earnings to find the amount of Net income


Question No: 51 ( Marks: 5 )
Given the following data:
Purchases Rs. 4,500, Returns outwards Rs.300, Returns inwards Rs.150, Carriage outwards Rs.830, Carriage inwards Rs.260, Opening stock Rs.935, and closing stock Rs. 1,100.

What would be the value of the cost of goods sold?

Question No: 52 ( Marks: 5 )
Mr. Bilal is a member of partnership firm. He drew some amounts from the business on following dates.

Ø July Rs. 2,500
Ø November 1,500
Ø December 3,000
Ø March 5,000


All drawings were made on the 1st day of the month @ rate of 10 %. It is assumed that financial year starts at July 1st and ends on 30th June.

Required:
Calculate mark up on drawing.

Question No: 53 ( Marks: 5 )
Particulars Rs.
Raw Material - Opening Stock 10,000
Raw Material – Purchases 2,000
Raw Material - Closing Stock 3,000
Packing Material - Opening Stock 4,000
Packing Material – Purchases 5,000
Packing Material - Closing Stock 6,000

Based on the above information you are required to calculate the following:
Ø Cost of Raw Material Consumed
Ø Cost of Packing Material Consumed

MGT101 Final

FINALTERM EXAMINATION
Spring 2010
MGT101- Financial Accounting (Session - 2)
Ref No:
Time: 90 min
Marks: 69
Student Info
StudentID:
Center: OPKST
ExamDate: 10 Aug 2010

For Teacher's Use Only
Q No. 1 2 3 4 5 6 7 8 Total
Marks
Q No. 9 10 11 12 13 14 15 16
Marks
Q No. 17 18 19 20 21 22 23 24
Marks
Q No. 25 26 27 28 29 30 31 32
Marks
Q No. 33 34 35 36 37 38 39 40
Marks
Q No. 41 42 43 44 45 46 47 48
Marks
Q No. 49 50 51 52 53
Marks




Question No: 1 ( Marks: 1 ) - Please choose one
Which of the following is correct according to the double entry system of book-keeping?

► Debit = Credit
► Debit > Credit
► Debit < Credit
► All of the given options

Question No: 2 ( Marks: 1 ) - Please choose one
An Asset that is NOT physical in nature is called _________.

► Intangible Asset
► Liquid Asset
► Current Asset
► Fixed Asset

Question No: 3 ( Marks: 1 ) - Please choose one
Which of the following account balance will be shown on debit side of Trial Balance? (It is assumed that all account balances are shown on normal balance)

► Cash account
► Furniture account
► Vehicle account
► All of the given options

Question No: 4 ( Marks: 1 ) - Please choose one
Bank Reconciliation Statement is:

► A memorandum statement
► A ledger account
► A part of cash book
► A part of journal

Question No: 5 ( Marks: 1 ) - Please choose one
Particulars Rs.
Opening written down value of machine Rs. 2,00,000
Cost of new machine purchased during the year Rs. 50,000
Depreciation during the year Rs. 25,000
Closing written down value (WDV) of machines ?

► Rs. 2, 25,000
► Rs. 2, 50,000
► Rs. 2, 75,000
► Rs. 75,000

Question No: 6 ( Marks: 1 ) - Please choose one
Following information are extracted from books of Mr. XYZ

Particulars Rs.
Closing value of stock 40,000
Bad Debts (Given in trial balance) 500
Old provisions (Given in trial balance) 700
Sundry Debtors (Given in trial balance) 44,500
Provision for doubtful debts be increases by 5%
What will be the amount of new provision ?

► Rs. 2,225
► Rs. 2,425
► Rs. 1,925
► Rs. 3,025

Question No: 7 ( Marks: 1 ) - Please choose one
Which of the following is a selling expense?

► Interest on deposits
► Any tax/freight is paid on purchases
► General salaries paid to laborers
► Tax & freight paid on sale

Question No: 8 ( Marks: 1 ) - Please choose one
Which account is increased with a debit and decreased with a credit?

► Cash
► Accounts Payable
► Contributed Capital
► Retained Earnings

Question No: 9 ( Marks: 1 ) - Please choose one
Which of the following journal entry will be recorded, if cash is drawn by a Proprietor?

► Proprietor’s drawings a/c (Dr.) and Cash a/c (Cr.)
► Cash a/c (Dr.) and Proprietor’s drawings a/c (Cr.)
► Proprietor’s Capital (Dr.) and Proprietor’s drawings a/c (Cr.)
► Proprietor’s drawings (Dr.) and Proprietor’s Capital a/c (Cr.)

Question No: 10 ( Marks: 1 ) - Please choose one
When the capitals are fixed, which of the following account will be debited for drawings made by a partner?


► Individual Partner’s Current Account
► Partner’s Cash Account
► Partner’s Bank Account
► Partners Capital Account

Question No: 11 ( Marks: 1 ) - Please choose one
Authorized share capital is also known as:
► Registered capital
► Issued capital
► Paid up capital
► Called up capital

Question No: 12 ( Marks: 1 ) - Please choose one
When goods are acquired from the supplier the gross cost of such goods is recorded in:
► Debtor Account
► Purchases Account
► Factory overhead account
► Sales Account

Question No: 13 ( Marks: 1 ) - Please choose one
Which of the following is NOT a cash inflow?

► Sale of fixed asset
► Issue of debentures
► Cash from business operation
► Purchase of fixed asset

Question No: 14 ( Marks: 1 ) - Please choose one
In cash flow statements, which of the following would appear as an inflow of cash?
► The repayments of a bank loan
► Dividend issue in the current year
► Money received as result of selling fixed assets
► The difference between the valuations of old and new fixed assets

Question No: 15 ( Marks: 1 ) - Please choose one
In cash flow statements, which of the following would appear as a cash outflow?
► The payments for purchases made during the year
► A decrease in trade debtors over the course of an accounting period
► Money received as a result of issuing new shares
► Money received as result of selling fixed assets

Question No: 16 ( Marks: 1 ) - Please choose one
When we close bad debt account, which of the following account is debited?

► Profit and loss account
► Bad debt account
► Debtor account
► Creditor account

Question No: 17 ( Marks: 1 ) - Please choose one
Subsidiary ledgers are maintained for:
► Debtors
► Creditors
► Stock
► All of the given options

Question No: 18 ( Marks: 1 ) - Please choose one
ABC Company received discount on its credit purchases, which of the following will be credited while entering in journal?
► Cash
► Discount received
► Creditors
► Bank

Question No: 19 ( Marks: 1 ) - Please choose one
Mr. Ali’s bank book shows a debit balance of Rs. 36,000. He deposited a cheque of Rs.15,000 but not yet collected by the bank. What will be the balance of bank statement?

► Rs. 21,000
► Rs. 51,000
► Rs. 36,000
► Rs. 15,000

Question No: 20 ( Marks: 1 ) - Please choose one
Which of the following indicates cash discount received?
► Discount in paying debt earlier
► Discount in receiving debt earlier
► Discount in purchasing huge goods
► Discount in selling huge goods

Question No: 21 ( Marks: 1 ) - Please choose one
Mr. A & B entered into a partnership invested Rs.50,000 and Rs.65,000 with an equal share in profit or loss. Markup on drawings of Mr. A is Rs.1,500 and of Mr. B is Rs.1,800. The net income for the year is Rs.85,000. What will be the profit share of Mr. B?
► Rs.42,350
► Rs.44,150
► Rs.41,600
► Rs.40,850

Question No: 22 ( Marks: 1 ) - Please choose one
Mr. A & B entered into a partnership invested Rs.50,000 and Rs.65,000 with an equal share in profit or loss. Markup on drawings of Mr. A is Rs.1,500 and of Mr. B is Rs.1,800. The net income for the year is Rs.85,000. What will be the amount of distributable profit?
► Rs.81,700
► Rs.88,300
► Rs.131,700
► Rs.146,700

Question No: 23 ( Marks: 1 ) - Please choose one
Which of the following value of the share is authorized by the memorandum of association?
► Par value
► Face value
► Nominal value
► All of the given options

Question No: 24 ( Marks: 1 ) - Please choose one
Which of the following statement is not true regarding the objective of statement of cash flows?
► It is helpful for decision making by management
► It is used for reporting the net profit of the period
► It can be used for estimations for cash flows in future
► It is used to determine the liquidity of the business

Question No: 25 ( Marks: 1 ) - Please choose one
Statement of cash flows helps the stakeholders to assess:
► Ability to pay cash dividends in the future
► All of the given options
► The ability to generate future cash flows
► The liquidity of the business

Question No: 26 ( Marks: 1 ) - Please choose one
According to the statement of cash flows following are the examples of investing activities except:
► Sales of machinery
► Capital invested by the owners
► Purchase of building for the business use
► Cash received from the disposal of equipment

Question No: 27 ( Marks: 1 ) - Please choose one
The cash book in book-keeping records:
► All cash and credit purchase of goods
► Only cash payments
► All receipts and payments in cash
► All cash and credit sale of goods

Question No: 28 ( Marks: 1 ) - Please choose one
What will be the effect of decrease in closing stock on gross profit?
► Gross profit increased
► Gross profit decreased
► No effect on Gross profit
► Gross profit will become positive

Question No: 29 ( Marks: 1 ) - Please choose one
If:
• Direct Material Cost is Rs. 20,000
• Direct labour cost is Rs. 10,000
• Manufacturing Cost is Rs. 45,000
Then:
What is the amount of Factory Overhead?
► Rs. 15,000
► Rs. 30,000
► Rs. 35,000
► Rs. 25,000

Question No: 30 ( Marks: 1 ) - Please choose one
Which one of the following methods for inventory valuation may overstate the income during the periods of rising prices?
► Specific Identification Method
► FIFO Method
► LIFO Method
► Weighted Average Method

Question No: 31 ( Marks: 1 ) - Please choose one
Which of the following is NOT a method of calculating depreciation?
► Straight Line Method
► Written Down Value Method
► Diminishing Balance Method
► Specific Identification Method

Question No: 32 ( Marks: 1 ) - Please choose one
What is the treatment of Depreciation in accounting?
► Written in balance sheet under the head of fixed assets
► Charged to profit and loss account
► Written in balance sheet under the head of current assets
► Written in balance sheet under the head of liabilities

Question No: 33 ( Marks: 1 ) - Please choose one
Which of the following is TRUE?
► Gain on revaluation is credited to Revaluation Reserve Account.
► Gain on revaluation is debited to Revaluation Reserve Account.
► Gain on revaluation is credited to Profit & Loss Account.
► Gain on revaluation is debited to Profit & Loss Account.

Question No: 34 ( Marks: 1 ) - Please choose one
The loss on the sale of fixed assets is a:
► Normal loss
► Ordinary loss
► Capital loss
► Revenue loss

Question No: 35 ( Marks: 1 ) - Please choose one
Which of the following is TRUE about capital receipt?
► It decreases value of property or increases value of liability
► It is shown in the income and expenditure account
► It is recurring in nature
► It is not shown in the statement of financial positions

Question No: 36 ( Marks: 1 ) - Please choose one
Which of the following is NOT included in Debtors Control Account?

► Cash sale
► Credit sale
► Bills receivable
► Discount allowed

Question No: 37 ( Marks: 1 ) - Please choose one
If cash sale is the missing figure, it can be ascertained by the construction of:
► Creditors Control Accounts
► Debtors Control Accounts
► Cash Account
► None of the given options

Question No: 38 ( Marks: 1 ) - Please choose one
Which of the following is/are the Classification of Current Assets?
► Cash Balance
► Loans and Advances
► Bank Balance
► All of the given options

Question No: 39 ( Marks: 1 ) - Please choose one
Depreciation expense is charged to which of the following head?
► Administrative expenses
► Selling expenses
► Cost of sales
► It depends on the nature of expense

Question No: 40 ( Marks: 1 ) - Please choose one
Inventory is always considered as:
► Current asset
► Current liability
► Long-term asset
► Stockholders' equity

Question No: 41 ( Marks: 1 ) - Please choose one
If:
Ø Capital at the start Rs. 100,000
Ø Profit during the year Rs. 50,000
Ø Withdrawal during the year Rs. 25,000

What would be the closing balance of capital?
► Rs. 175,000
► Rs. 150,000
► Rs. 125,000
► Rs. 75,000

Question No: 42 ( Marks: 1 ) - Please choose one
Which of the following Legal Documents of a company contain(s) the rules and regulations framed for the internal management of the company?
► Memorandum of Association
► Articles of Association
► Both Memorandum of Association and Articles of Association
► Prospectus

Question No: 43 ( Marks: 1 ) - Please choose one
Which one of the following refers to the allotment of shares to the existing shareholders by capitalizing the reserves into additional capital?
► Reserve funds
► Accumulated profit
► Right issue
► Bonus issue

Question No: 44 ( Marks: 1 ) - Please choose one
When a share having a face value of Rs.100 issued at Rs.90 then which one of the following options is correct under this situation?
► Share issued at premium
► Share issued at discount
► Share issued at nominal value
► Share issued at market value

Question No: 45 ( Marks: 1 ) - Please choose one
The amount of share premium can be utilized EXCEPT:
► To write off preliminary expenses
► To meet the expenses of issue of shares
► To distribute among the shareholders
► To issue bonus shares

Question No: 46 ( Marks: 1 ) - Please choose one
A company pays cash to purchase the stock of another company in an unrelated industry. The cash outflow can be considered as an:
► Operating activity that will appear on the statement of cash flows
► Operating activity that will not appear on the statement of cash flows due to the fact of stock from a company in an unrelated industry
► Investing activity that will appear on the statement of cash flows
► Investing activity that will not appear on the statement of cash flows due to the fact of stock from a company in an unrelated industry

Question No: 47 ( Marks: 1 ) - Please choose one
Which of the following would be a suitable head for short term advances from customers in Balance Sheet?
► Current asset
► Intangible asset
► Tangible asset
► Current liability

Question No: 48 ( Marks: 1 ) - Please choose one
If there is a portion of long term loan of Rs. 30,000 payable in the current accounting period. Where it will be shown in financial statement?
► Current liability
► Long term liability
► Current asset
► Owner’s equity

Question No: 49 ( Marks: 3 )
Ø Rent expenses Rs. 20,000
Ø Insurance expenses Rs. 30,000
Ø Bad debts Rs. 35,000

In addition rent payable is Rs. 5,000; calculate the amount of operating expenses to be shown in profit and loss account.

Question No: 50 ( Marks: 3 )
If:
Ø Retain earning at the beginning Rs. 1,000
Ø Dividend paid 500
Ø Retain earning at the end 2,500

Then:
You are required to prepare statement of Retain earnings to find the amount of Net income


Question No: 51 ( Marks: 5 )
Given the following data:
Purchases Rs. 4,500, Returns outwards Rs.300, Returns inwards Rs.150, Carriage outwards Rs.830, Carriage inwards Rs.260, Opening stock Rs.935, and closing stock Rs. 1,100.

What would be the value of the cost of goods sold?

Question No: 52 ( Marks: 5 )
Mr. Bilal is a member of partnership firm. He drew some amounts from the business on following dates.

Ø July Rs. 2,500
Ø November 1,500
Ø December 3,000
Ø March 5,000


All drawings were made on the 1st day of the month @ rate of 10 %. It is assumed that financial year starts at July 1st and ends on 30th June.

Required:
Calculate mark up on drawing.

Question No: 53 ( Marks: 5 )
Particulars Rs.
Raw Material - Opening Stock 10,000
Raw Material – Purchases 2,000
Raw Material - Closing Stock 3,000
Packing Material - Opening Stock 4,000
Packing Material – Purchases 5,000
Packing Material - Closing Stock 6,000

Based on the above information you are required to calculate the following:
Ø Cost of Raw Material Consumed
Ø Cost of Packing Material Consumed

MGT101 Final

FINALTERM EXAMINATION
Spring 2010
MGT101- Financial Accounting (Session - 2)
Ref No:
Time: 90 min
Marks: 69
Student Info
StudentID:
Center: OPKST
ExamDate: 10 Aug 2010

For Teacher's Use Only
Q No. 1 2 3 4 5 6 7 8 Total
Marks
Q No. 9 10 11 12 13 14 15 16
Marks
Q No. 17 18 19 20 21 22 23 24
Marks
Q No. 25 26 27 28 29 30 31 32
Marks
Q No. 33 34 35 36 37 38 39 40
Marks
Q No. 41 42 43 44 45 46 47 48
Marks
Q No. 49 50 51 52 53
Marks




Question No: 1 ( Marks: 1 ) - Please choose one
Which of the following is correct according to the double entry system of book-keeping?

► Debit = Credit
► Debit > Credit
► Debit < Credit
► All of the given options

Question No: 2 ( Marks: 1 ) - Please choose one
An Asset that is NOT physical in nature is called _________.

► Intangible Asset
► Liquid Asset
► Current Asset
► Fixed Asset

Question No: 3 ( Marks: 1 ) - Please choose one
Which of the following account balance will be shown on debit side of Trial Balance? (It is assumed that all account balances are shown on normal balance)

► Cash account
► Furniture account
► Vehicle account
► All of the given options

Question No: 4 ( Marks: 1 ) - Please choose one
Bank Reconciliation Statement is:

► A memorandum statement
► A ledger account
► A part of cash book
► A part of journal

Question No: 5 ( Marks: 1 ) - Please choose one
Particulars Rs.
Opening written down value of machine Rs. 2,00,000
Cost of new machine purchased during the year Rs. 50,000
Depreciation during the year Rs. 25,000
Closing written down value (WDV) of machines ?

► Rs. 2, 25,000
► Rs. 2, 50,000
► Rs. 2, 75,000
► Rs. 75,000

Question No: 6 ( Marks: 1 ) - Please choose one
Following information are extracted from books of Mr. XYZ

Particulars Rs.
Closing value of stock 40,000
Bad Debts (Given in trial balance) 500
Old provisions (Given in trial balance) 700
Sundry Debtors (Given in trial balance) 44,500
Provision for doubtful debts be increases by 5%
What will be the amount of new provision ?

► Rs. 2,225
► Rs. 2,425
► Rs. 1,925
► Rs. 3,025

Question No: 7 ( Marks: 1 ) - Please choose one
Which of the following is a selling expense?

► Interest on deposits
► Any tax/freight is paid on purchases
► General salaries paid to laborers
► Tax & freight paid on sale

Question No: 8 ( Marks: 1 ) - Please choose one
Which account is increased with a debit and decreased with a credit?

► Cash
► Accounts Payable
► Contributed Capital
► Retained Earnings

Question No: 9 ( Marks: 1 ) - Please choose one
Which of the following journal entry will be recorded, if cash is drawn by a Proprietor?

► Proprietor’s drawings a/c (Dr.) and Cash a/c (Cr.)
► Cash a/c (Dr.) and Proprietor’s drawings a/c (Cr.)
► Proprietor’s Capital (Dr.) and Proprietor’s drawings a/c (Cr.)
► Proprietor’s drawings (Dr.) and Proprietor’s Capital a/c (Cr.)

Question No: 10 ( Marks: 1 ) - Please choose one
When the capitals are fixed, which of the following account will be debited for drawings made by a partner?


► Individual Partner’s Current Account
► Partner’s Cash Account
► Partner’s Bank Account
► Partners Capital Account

Question No: 11 ( Marks: 1 ) - Please choose one
Authorized share capital is also known as:
► Registered capital
► Issued capital
► Paid up capital
► Called up capital

Question No: 12 ( Marks: 1 ) - Please choose one
When goods are acquired from the supplier the gross cost of such goods is recorded in:
► Debtor Account
► Purchases Account
► Factory overhead account
► Sales Account

Question No: 13 ( Marks: 1 ) - Please choose one
Which of the following is NOT a cash inflow?

► Sale of fixed asset
► Issue of debentures
► Cash from business operation
► Purchase of fixed asset

Question No: 14 ( Marks: 1 ) - Please choose one
In cash flow statements, which of the following would appear as an inflow of cash?
► The repayments of a bank loan
► Dividend issue in the current year
► Money received as result of selling fixed assets
► The difference between the valuations of old and new fixed assets

Question No: 15 ( Marks: 1 ) - Please choose one
In cash flow statements, which of the following would appear as a cash outflow?
► The payments for purchases made during the year
► A decrease in trade debtors over the course of an accounting period
► Money received as a result of issuing new shares
► Money received as result of selling fixed assets

Question No: 16 ( Marks: 1 ) - Please choose one
When we close bad debt account, which of the following account is debited?

► Profit and loss account
► Bad debt account
► Debtor account
► Creditor account

Question No: 17 ( Marks: 1 ) - Please choose one
Subsidiary ledgers are maintained for:
► Debtors
► Creditors
► Stock
► All of the given options

Question No: 18 ( Marks: 1 ) - Please choose one
ABC Company received discount on its credit purchases, which of the following will be credited while entering in journal?
► Cash
► Discount received
► Creditors
► Bank

Question No: 19 ( Marks: 1 ) - Please choose one
Mr. Ali’s bank book shows a debit balance of Rs. 36,000. He deposited a cheque of Rs.15,000 but not yet collected by the bank. What will be the balance of bank statement?

► Rs. 21,000
► Rs. 51,000
► Rs. 36,000
► Rs. 15,000

Question No: 20 ( Marks: 1 ) - Please choose one
Which of the following indicates cash discount received?
► Discount in paying debt earlier
► Discount in receiving debt earlier
► Discount in purchasing huge goods
► Discount in selling huge goods

Question No: 21 ( Marks: 1 ) - Please choose one
Mr. A & B entered into a partnership invested Rs.50,000 and Rs.65,000 with an equal share in profit or loss. Markup on drawings of Mr. A is Rs.1,500 and of Mr. B is Rs.1,800. The net income for the year is Rs.85,000. What will be the profit share of Mr. B?
► Rs.42,350
► Rs.44,150
► Rs.41,600
► Rs.40,850

Question No: 22 ( Marks: 1 ) - Please choose one
Mr. A & B entered into a partnership invested Rs.50,000 and Rs.65,000 with an equal share in profit or loss. Markup on drawings of Mr. A is Rs.1,500 and of Mr. B is Rs.1,800. The net income for the year is Rs.85,000. What will be the amount of distributable profit?
► Rs.81,700
► Rs.88,300
► Rs.131,700
► Rs.146,700

Question No: 23 ( Marks: 1 ) - Please choose one
Which of the following value of the share is authorized by the memorandum of association?
► Par value
► Face value
► Nominal value
► All of the given options

Question No: 24 ( Marks: 1 ) - Please choose one
Which of the following statement is not true regarding the objective of statement of cash flows?
► It is helpful for decision making by management
► It is used for reporting the net profit of the period
► It can be used for estimations for cash flows in future
► It is used to determine the liquidity of the business

Question No: 25 ( Marks: 1 ) - Please choose one
Statement of cash flows helps the stakeholders to assess:
► Ability to pay cash dividends in the future
► All of the given options
► The ability to generate future cash flows
► The liquidity of the business

Question No: 26 ( Marks: 1 ) - Please choose one
According to the statement of cash flows following are the examples of investing activities except:
► Sales of machinery
► Capital invested by the owners
► Purchase of building for the business use
► Cash received from the disposal of equipment

Question No: 27 ( Marks: 1 ) - Please choose one
The cash book in book-keeping records:
► All cash and credit purchase of goods
► Only cash payments
► All receipts and payments in cash
► All cash and credit sale of goods

Question No: 28 ( Marks: 1 ) - Please choose one
What will be the effect of decrease in closing stock on gross profit?
► Gross profit increased
► Gross profit decreased
► No effect on Gross profit
► Gross profit will become positive

Question No: 29 ( Marks: 1 ) - Please choose one
If:
• Direct Material Cost is Rs. 20,000
• Direct labour cost is Rs. 10,000
• Manufacturing Cost is Rs. 45,000
Then:
What is the amount of Factory Overhead?
► Rs. 15,000
► Rs. 30,000
► Rs. 35,000
► Rs. 25,000

Question No: 30 ( Marks: 1 ) - Please choose one
Which one of the following methods for inventory valuation may overstate the income during the periods of rising prices?
► Specific Identification Method
► FIFO Method
► LIFO Method
► Weighted Average Method

Question No: 31 ( Marks: 1 ) - Please choose one
Which of the following is NOT a method of calculating depreciation?
► Straight Line Method
► Written Down Value Method
► Diminishing Balance Method
► Specific Identification Method

Question No: 32 ( Marks: 1 ) - Please choose one
What is the treatment of Depreciation in accounting?
► Written in balance sheet under the head of fixed assets
► Charged to profit and loss account
► Written in balance sheet under the head of current assets
► Written in balance sheet under the head of liabilities

Question No: 33 ( Marks: 1 ) - Please choose one
Which of the following is TRUE?
► Gain on revaluation is credited to Revaluation Reserve Account.
► Gain on revaluation is debited to Revaluation Reserve Account.
► Gain on revaluation is credited to Profit & Loss Account.
► Gain on revaluation is debited to Profit & Loss Account.

Question No: 34 ( Marks: 1 ) - Please choose one
The loss on the sale of fixed assets is a:
► Normal loss
► Ordinary loss
► Capital loss
► Revenue loss

Question No: 35 ( Marks: 1 ) - Please choose one
Which of the following is TRUE about capital receipt?
► It decreases value of property or increases value of liability
► It is shown in the income and expenditure account
► It is recurring in nature
► It is not shown in the statement of financial positions

Question No: 36 ( Marks: 1 ) - Please choose one
Which of the following is NOT included in Debtors Control Account?

► Cash sale
► Credit sale
► Bills receivable
► Discount allowed

Question No: 37 ( Marks: 1 ) - Please choose one
If cash sale is the missing figure, it can be ascertained by the construction of:
► Creditors Control Accounts
► Debtors Control Accounts
► Cash Account
► None of the given options

Question No: 38 ( Marks: 1 ) - Please choose one
Which of the following is/are the Classification of Current Assets?
► Cash Balance
► Loans and Advances
► Bank Balance
► All of the given options

Question No: 39 ( Marks: 1 ) - Please choose one
Depreciation expense is charged to which of the following head?
► Administrative expenses
► Selling expenses
► Cost of sales
► It depends on the nature of expense

Question No: 40 ( Marks: 1 ) - Please choose one
Inventory is always considered as:
► Current asset
► Current liability
► Long-term asset
► Stockholders' equity

Question No: 41 ( Marks: 1 ) - Please choose one
If:
Ø Capital at the start Rs. 100,000
Ø Profit during the year Rs. 50,000
Ø Withdrawal during the year Rs. 25,000

What would be the closing balance of capital?
► Rs. 175,000
► Rs. 150,000
► Rs. 125,000
► Rs. 75,000

Question No: 42 ( Marks: 1 ) - Please choose one
Which of the following Legal Documents of a company contain(s) the rules and regulations framed for the internal management of the company?
► Memorandum of Association
► Articles of Association
► Both Memorandum of Association and Articles of Association
► Prospectus

Question No: 43 ( Marks: 1 ) - Please choose one
Which one of the following refers to the allotment of shares to the existing shareholders by capitalizing the reserves into additional capital?
► Reserve funds
► Accumulated profit
► Right issue
► Bonus issue

Question No: 44 ( Marks: 1 ) - Please choose one
When a share having a face value of Rs.100 issued at Rs.90 then which one of the following options is correct under this situation?
► Share issued at premium
► Share issued at discount
► Share issued at nominal value
► Share issued at market value

Question No: 45 ( Marks: 1 ) - Please choose one
The amount of share premium can be utilized EXCEPT:
► To write off preliminary expenses
► To meet the expenses of issue of shares
► To distribute among the shareholders
► To issue bonus shares

Question No: 46 ( Marks: 1 ) - Please choose one
A company pays cash to purchase the stock of another company in an unrelated industry. The cash outflow can be considered as an:
► Operating activity that will appear on the statement of cash flows
► Operating activity that will not appear on the statement of cash flows due to the fact of stock from a company in an unrelated industry
► Investing activity that will appear on the statement of cash flows
► Investing activity that will not appear on the statement of cash flows due to the fact of stock from a company in an unrelated industry

Question No: 47 ( Marks: 1 ) - Please choose one
Which of the following would be a suitable head for short term advances from customers in Balance Sheet?
► Current asset
► Intangible asset
► Tangible asset
► Current liability

Question No: 48 ( Marks: 1 ) - Please choose one
If there is a portion of long term loan of Rs. 30,000 payable in the current accounting period. Where it will be shown in financial statement?
► Current liability
► Long term liability
► Current asset
► Owner’s equity

Question No: 49 ( Marks: 3 )
Ø Rent expenses Rs. 20,000
Ø Insurance expenses Rs. 30,000
Ø Bad debts Rs. 35,000

In addition rent payable is Rs. 5,000; calculate the amount of operating expenses to be shown in profit and loss account.

Question No: 50 ( Marks: 3 )
If:
Ø Retain earning at the beginning Rs. 1,000
Ø Dividend paid 500
Ø Retain earning at the end 2,500

Then:
You are required to prepare statement of Retain earnings to find the amount of Net income


Question No: 51 ( Marks: 5 )
Given the following data:
Purchases Rs. 4,500, Returns outwards Rs.300, Returns inwards Rs.150, Carriage outwards Rs.830, Carriage inwards Rs.260, Opening stock Rs.935, and closing stock Rs. 1,100.

What would be the value of the cost of goods sold?

Question No: 52 ( Marks: 5 )
Mr. Bilal is a member of partnership firm. He drew some amounts from the business on following dates.

Ø July Rs. 2,500
Ø November 1,500
Ø December 3,000
Ø March 5,000


All drawings were made on the 1st day of the month @ rate of 10 %. It is assumed that financial year starts at July 1st and ends on 30th June.

Required:
Calculate mark up on drawing.

Question No: 53 ( Marks: 5 )
Particulars Rs.
Raw Material - Opening Stock 10,000
Raw Material – Purchases 2,000
Raw Material - Closing Stock 3,000
Packing Material - Opening Stock 4,000
Packing Material – Purchases 5,000
Packing Material - Closing Stock 6,000

Based on the above information you are required to calculate the following:
Ø Cost of Raw Material Consumed
Ø Cost of Packing Material Consumed