MGT101 Final

FINALTERM EXAMINATION
Spring 2010
MGT101- Financial Accounting (Session - 4)
Ref No:
Time: 90 min
Marks: 69
Student Info
StudentID:
Center: OPKST
ExamDate: 15 Aug 2010

Question No: 1 ( Marks: 1 ) - Please choose one
While making Income & Expenditure account, Excess of income over expenses in a specified accounting period is called:

► Profit
► Loss
► Surplus
► Deficit

Question No: 2 ( Marks: 1 ) - Please choose one
Which of the following organizations do NOT prepare Income & Expenditure account?

► Public limited companies
► Private limited companies
► Partnership firms
► All of the given options

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 best describes unpresented cheques?

► Cheques received on behalf of the business by the bank
► Cheques drawn but yet to be recorded in the bank records
► Cheques issued by the bank not recorded in business records
► Cheques received but yet to be recorded in the bank records

Question No: 5 ( Marks: 1 ) - Please choose one
If provision is created for doubtful debts, which of the following entry will be passed to record bad debts in control account?

► Bade debts (Dr) and Debtors Control A/c (Cr)
► Provision for doubtful debts (Dr) and Debtors Control A/c (Cr)
► Provision for doubtful debts (Dr) and Debtors A/c (Cr)
► Debtors Control A/c (Dr) and Provision for doubtful debts (Cr)

Question No: 6 ( Marks: 1 ) - Please choose one
Which of the following entry will be passed to record discount received in control account?

► Discount Received (Dr) and Creditors Control A/c (Cr)
► Discount Received (Dr) and Creditors A/c (Cr)
► Creditors Control A/c (Dr) and Discount Received (Cr)
► Creditors A/c (Dr) and Discount Received (Cr)

Question No: 7 ( Marks: 1 ) - Please choose one
Goods purchased from “Mr. A” for Rs. 2,000 passed through the sales book. The rectification of error will result in:

► Increase of gross profit
► Decrease of gross profit
► Remains constant and no effect on net profit
► There is no relation between goods purchased and gross profit

Question No: 8 ( Marks: 1 ) - Please choose one
Which of the following entry will be recorded, if a cheque deposited is dishonored by bank?


► Bank Account (Dr.) and Debtor's Account (Cr.)
► Debtor's Account (Dr.) and Bank Account (Cr.)
► Dishonored Cheque Account (Dr.) and Bank Account (Cr.)
► Creditor's Account (Dr.) and Bank Account (Cr.)

Question No: 9 ( Marks: 1 ) - Please choose one
Which financial statement show what a business owes at a particular point in time?

► A cash flow statement
► The bank statement for the business
► A balance sheet
► A statement of retained earnings

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
A _______________ business is one in which income is generated by the resale of bought Products.
► Manufacturing
► Merchandising
► Sole Proprietorship
► Partnership

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 is a type of business formed under the Companies Ordinance 1984?

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

Question No: 14 ( Marks: 1 ) - Please choose one
If company has distributable profit of Rs. 490,000, Profit sharing share ratio of Mr. A, Mr. B and Mr. C is 2:3:5 respectively. What will be the share of profit for Mr. A in distributable profit?

► Rs. 98,000
► Rs. 147,000
► Rs. 245,000
► Rs. 343,000

Question No: 15 ( Marks: 1 ) - Please choose one
Wages outstanding given in the trial balance will be treated as a (an):

► Asset
► Liability
► Revenue
► Deferred expense

Question No: 16 ( Marks: 1 ) - Please choose one
An overdraft will appear as:

► A debit balance in both the bank statement and the cash book
► A credit balance in the bank statement but as a debit balance in the cash book
► A credit balance in the cash book but as a debit balance in the bank statement
► A credit balance in both the bank statement and the cash book

Question No: 17 ( Marks: 1 ) - Please choose one
In which of the following case the bank cannot refuse the payment?
► Stale cheque
► Bearer cheque
► Insolvency of the customer
► Post dated cheque

Question No: 18 ( Marks: 1 ) - Please choose one
Which of the following is NOT a financial statement?
► Balance sheet
► Audit report
► Income statement
► Cash flow statement

Question No: 19 ( Marks: 1 ) - Please choose one
In a partnership of Mr. A and Mr. B, the share of profit of Mr. A is Rs.75,375 and the share of profit of Mr. B is Rs. 25,125. What will be the ratio of their share?
► 1:2
► 2:3
► 3:2
► 3:1

Question No: 20 ( Marks: 1 ) - Please choose one
Failure to record ___________ will result in understates net income.
► Accrued expenses
► Expenses incurred
► Accrued revenues
► Accounts payable

Question No: 21 ( Marks: 1 ) - Please choose one
The value of a share as quoted on the stock exchange is known as:
► Book value
► Par value
► Market value
► Face value

Question No: 22 ( 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: 23 ( Marks: 1 ) - Please choose one
The financial statement that captures both the current operating result and the associated changes in the balance sheet is:
► Statement of retained earnings
► Statement of financial position
► Statement of cash flows
► Statement of changes in equity

Question No: 24 ( Marks: 1 ) - Please choose one
Which of the following ratio cannot be computed for a period in which the company incurs a net loss?
► Acid-test ratio
► Return on investment
► Price-earning ratio
► None of the given options

Question No: 25 ( Marks: 1 ) - Please choose one
In statement of cash flows, interest payment made on loan from bank is related to:
► Investing activity
► Financing activity
► Operating activity
► Net changes in working capital

Question No: 26 ( Marks: 1 ) - Please choose one
Which of the following is the type of business owned by one person?
► Sole-Proprietorship
► Partnership
► Public Limited Company
► Unlimited Company

Question No: 27 ( Marks: 1 ) - Please choose one
Which of the following shows a debit balance under normal circumstances?
► Asset
► Capital
► Liability
► Profit

Question No: 28 ( Marks: 1 ) - Please choose one
Which of the following account would be credited when goods are given as charity?
► Charity a/c
► Free sample a/c
► Purchases a/c
► Sales a/c

Question No: 29 ( Marks: 1 ) - Please choose one
Which of the following account would be credited when the owner of business sold machinery of Rs. 10,000 for cash?
► Sales a/c
► Machinery a/c
► Owner a/c
► Cash a/c

Question No: 30 ( Marks: 1 ) - Please choose one
What is the best condition to finance a business?
► Fully financed from your own resource
► Fully relied on financial institutions
► Investment through own resources as well as rely on financial instructions
► None of the given options

Question No: 31 ( Marks: 1 ) - Please choose one
Which of the following particulars are included in the specimen of a bank receipt voucher?
1) Name of the organization
2) Bank code
3) Date of transaction
► (1) & (2) only
► (1) & (3) only
► (2) & (3) only
► (1), (2) & (3)

Question No: 32 ( Marks: 1 ) - Please choose one
Which of the following account would be debited, when goods are sold on credit?
► Stock account
► Accounts receivable account
► Accounts payable account
► Sales account

Question No: 33 ( 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: 34 ( Marks: 1 ) - Please choose one
Under which of the following methods for inventory valuation, cost of goods sold is based on older costs?
► FIFO Method
► LIFO Method
► Weighted Average Method
► Specific Identification Method

Question No: 35 ( Marks: 1 ) - Please choose one
Bank reconciliation is NOT a:
► Ledger account
► Reconcile records
► Memorandum statement
► Procedure to prove cash book balance

Question No: 36 ( Marks: 1 ) - Please choose one
When Pass Book shoes a debit balance it means:
► Favourable balance as per cash book
► Unfavorable balance as per bank statement
► Debit balance as per cash book
► Favourable balance as per bank statement

Question No: 37 ( Marks: 1 ) - Please choose one
Which of the following is NOT a cause of disagreement between the balance of cash book and bank statement?
► Cheques issued to creditors but not paid by bank
► Cheques deposited for collection but not yet collected and credited by the bank
► Amount deposited directly into the bank by the debtors but not recorded in the cash book
► Amount deposited directly into the bank by the debtors and the same has also been recorded in the cash book

Question No: 38 ( Marks: 1 ) - Please choose one
Which of the following is INCORRECT about subsidiary account?
► It is not a summary account
► It reduces the burden of control account
► It provides detailed information about individual accounts
► It summarizes the total of related items from other accounts

Question No: 39 ( Marks: 1 ) - Please choose one
Prepaid insurance will become an expense when the balance of prepaid amount is _________.
► Expired
► Collected
► Paid
► Earned

Question No: 40 ( Marks: 1 ) - Please choose one
Which of the following Legal Documents of a company contain(s) the information about the capital and liability clause of a company?
► Memorandum of Association
► Articles of Association
► Both Memorandum of Association and Articles of Association
► Both Memorandum of Association and Articles of Association
Prospectus

Question No: 41 ( Marks: 1 ) - Please choose one
Which of the following types of Companies is (are) registered in Securities and Exchange Commission of Pakistan?
► Public Limited Companies
► Private Limited Companies
► Both Public Limited Companies & Private Limited Companies
► Neither Public Limited Companies nor Private Limited Companies

Question No: 42 ( 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: 43 ( 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: 44 ( 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: 45 ( 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: 46 ( Marks: 1 ) - Please choose one
Which of the following would be considered as non cash item in cash flow statement?
► Depreciation
► Accounts receivable
► Accounts payable
► Inventory

Question No: 47 ( 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: 48 ( Marks: 1 ) - Please choose one
Current ratio may be increased by:
► Overstating current Assets
► Overstating current Liabilities
► Understating current Assets
► Understating current assets and overstating current liabilities

Question No: 49 ( Marks: 3 )
Mr. A, B & C entered into a partnership. At the beginning of the year their capital balances were Rs. 180,000, Rs. 140,000 and Rs. 80,000 respectively. Profit or loss is to be divided as:
• Mr. A: one-half
• Mr. B: one-third
• Mr. C: one-sixth
Required:
If profit is Rs. 390,000, calculate the share of profit for all the partners.

Question No: 50 ( Marks: 3 )
Particulars Rs.
Markup on Loans 1,000
Finance Lease Charges 2,000
Profit on Bank Deposits 3,000
Dividend Income 4,000

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

Question No: 51 ( Marks: 5 )
Umer and Usman, both of whom are CPAs, form a partnership, with Umer investing Rs.100,000 and Usman, Rs.80,000. They agree to share net income as follows:
• Salary allowances of Rs.80,000 to Umer and Rs.50,000 to Usman.
• Interest allowances at 15 percent of beginning capital account balances.
• Any partnership earnings in excess of the amount required to cover the interest and salary allowances to be divided 60 percent to Umer and 40 percent to Usman.
The partnership net income for the first year of operations amounted to Rs.247,000 before interest and salary allowances. Show how this amount should be divided between the two partners.

Question No: 52 ( Marks: 5 )
• In trial balance at June 30, 2007 10% debentures are shown at Rs.75,000 and mark up on debentures are shown at Rs.3,750. Six months debenture mark up is to be accrued. What will be the amount of total mark up on debentures show in profit and loss account?

• From the following information calculate cost of goods sold.
Stock opening balance Rs.56,950
Purchases 175,750
Stock closing balance 65,020
Carriage inward 5,200
Sales 245,500


Question No: 53 ( Marks: 5 )
Information given in Trial balance:
• Plant and machinery FINALTERM EXAMINATION
Spring 2010
MGT101- Financial Accounting (Session - 4)
Ref No:
Time: 90 min
Marks: 69
Student Info
StudentID:
Center: OPKST
ExamDate: 15 Aug 2010

For Teacher's Use Only
Q No. 1 2 3 4 5 6 7 8 Total
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Q No. 9 10 11 12 13 14 15 16
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Q No. 17 18 19 20 21 22 23 24
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Q No. 25 26 27 28 29 30 31 32
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Q No. 33 34 35 36 37 38 39 40
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Q No. 41 42 43 44 45 46 47 48
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Q No. 49 50 51 52 53
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Question No: 1 ( Marks: 1 ) - Please choose one
While making Income & Expenditure account, Excess of income over expenses in a specified accounting period is called:

► Profit
► Loss
► Surplus
► Deficit

Question No: 2 ( Marks: 1 ) - Please choose one
Which of the following organizations do NOT prepare Income & Expenditure account?

► Public limited companies
► Private limited companies
► Partnership firms
► All of the given options

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 best describes unpresented cheques?

► Cheques received on behalf of the business by the bank
► Cheques drawn but yet to be recorded in the bank records
► Cheques issued by the bank not recorded in business records
► Cheques received but yet to be recorded in the bank records

Question No: 5 ( Marks: 1 ) - Please choose one
If provision is created for doubtful debts, which of the following entry will be passed to record bad debts in control account?

► Bade debts (Dr) and Debtors Control A/c (Cr)
► Provision for doubtful debts (Dr) and Debtors Control A/c (Cr)
► Provision for doubtful debts (Dr) and Debtors A/c (Cr)
► Debtors Control A/c (Dr) and Provision for doubtful debts (Cr)

Question No: 6 ( Marks: 1 ) - Please choose one
Which of the following entry will be passed to record discount received in control account?

► Discount Received (Dr) and Creditors Control A/c (Cr)
► Discount Received (Dr) and Creditors A/c (Cr)
► Creditors Control A/c (Dr) and Discount Received (Cr)
► Creditors A/c (Dr) and Discount Received (Cr)

Question No: 7 ( Marks: 1 ) - Please choose one
Goods purchased from “Mr. A” for Rs. 2,000 passed through the sales book. The rectification of error will result in:

► Increase of gross profit
► Decrease of gross profit
► Remains constant and no effect on net profit
► There is no relation between goods purchased and gross profit

Question No: 8 ( Marks: 1 ) - Please choose one
Which of the following entry will be recorded, if a cheque deposited is dishonored by bank?


► Bank Account (Dr.) and Debtor's Account (Cr.)
► Debtor's Account (Dr.) and Bank Account (Cr.)
► Dishonored Cheque Account (Dr.) and Bank Account (Cr.)
► Creditor's Account (Dr.) and Bank Account (Cr.)

Question No: 9 ( Marks: 1 ) - Please choose one
Which financial statement show what a business owes at a particular point in time?

► A cash flow statement
► The bank statement for the business
► A balance sheet
► A statement of retained earnings

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
A _______________ business is one in which income is generated by the resale of bought Products.
► Manufacturing
► Merchandising
► Sole Proprietorship
► Partnership

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 is a type of business formed under the Companies Ordinance 1984?

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

Question No: 14 ( Marks: 1 ) - Please choose one
If company has distributable profit of Rs. 490,000, Profit sharing share ratio of Mr. A, Mr. B and Mr. C is 2:3:5 respectively. What will be the share of profit for Mr. A in distributable profit?

► Rs. 98,000
► Rs. 147,000
► Rs. 245,000
► Rs. 343,000

Question No: 15 ( Marks: 1 ) - Please choose one
Wages outstanding given in the trial balance will be treated as a (an):

► Asset
► Liability
► Revenue
► Deferred expense

Question No: 16 ( Marks: 1 ) - Please choose one
An overdraft will appear as:

► A debit balance in both the bank statement and the cash book
► A credit balance in the bank statement but as a debit balance in the cash book
► A credit balance in the cash book but as a debit balance in the bank statement
► A credit balance in both the bank statement and the cash book

Question No: 17 ( Marks: 1 ) - Please choose one
In which of the following case the bank cannot refuse the payment?
► Stale cheque
► Bearer cheque
► Insolvency of the customer
► Post dated cheque

Question No: 18 ( Marks: 1 ) - Please choose one
Which of the following is NOT a financial statement?
► Balance sheet
► Audit report
► Income statement
► Cash flow statement

Question No: 19 ( Marks: 1 ) - Please choose one
In a partnership of Mr. A and Mr. B, the share of profit of Mr. A is Rs.75,375 and the share of profit of Mr. B is Rs. 25,125. What will be the ratio of their share?
► 1:2
► 2:3
► 3:2
► 3:1

Question No: 20 ( Marks: 1 ) - Please choose one
Failure to record ___________ will result in understates net income.
► Accrued expenses
► Expenses incurred
► Accrued revenues
► Accounts payable

Question No: 21 ( Marks: 1 ) - Please choose one
The value of a share as quoted on the stock exchange is known as:
► Book value
► Par value
► Market value
► Face value

Question No: 22 ( 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: 23 ( Marks: 1 ) - Please choose one
The financial statement that captures both the current operating result and the associated changes in the balance sheet is:
► Statement of retained earnings
► Statement of financial position
► Statement of cash flows
► Statement of changes in equity

Question No: 24 ( Marks: 1 ) - Please choose one
Which of the following ratio cannot be computed for a period in which the company incurs a net loss?
► Acid-test ratio
► Return on investment
► Price-earning ratio
► None of the given options

Question No: 25 ( Marks: 1 ) - Please choose one
In statement of cash flows, interest payment made on loan from bank is related to:
► Investing activity
► Financing activity
► Operating activity
► Net changes in working capital

Question No: 26 ( Marks: 1 ) - Please choose one
Which of the following is the type of business owned by one person?
► Sole-Proprietorship
► Partnership
► Public Limited Company
► Unlimited Company

Question No: 27 ( Marks: 1 ) - Please choose one
Which of the following shows a debit balance under normal circumstances?
► Asset
► Capital
► Liability
► Profit

Question No: 28 ( Marks: 1 ) - Please choose one
Which of the following account would be credited when goods are given as charity?
► Charity a/c
► Free sample a/c
► Purchases a/c
► Sales a/c

Question No: 29 ( Marks: 1 ) - Please choose one
Which of the following account would be credited when the owner of business sold machinery of Rs. 10,000 for cash?
► Sales a/c
► Machinery a/c
► Owner a/c
► Cash a/c

Question No: 30 ( Marks: 1 ) - Please choose one
What is the best condition to finance a business?
► Fully financed from your own resource
► Fully relied on financial institutions
► Investment through own resources as well as rely on financial instructions
► None of the given options

Question No: 31 ( Marks: 1 ) - Please choose one
Which of the following particulars are included in the specimen of a bank receipt voucher?
1) Name of the organization
2) Bank code
3) Date of transaction
► (1) & (2) only
► (1) & (3) only
► (2) & (3) only
► (1), (2) & (3)

Question No: 32 ( Marks: 1 ) - Please choose one
Which of the following account would be debited, when goods are sold on credit?
► Stock account
► Accounts receivable account
► Accounts payable account
► Sales account

Question No: 33 ( 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: 34 ( Marks: 1 ) - Please choose one
Under which of the following methods for inventory valuation, cost of goods sold is based on older costs?
► FIFO Method
► LIFO Method
► Weighted Average Method
► Specific Identification Method

Question No: 35 ( Marks: 1 ) - Please choose one
Bank reconciliation is NOT a:
► Ledger account
► Reconcile records
► Memorandum statement
► Procedure to prove cash book balance

Question No: 36 ( Marks: 1 ) - Please choose one
When Pass Book shoes a debit balance it means:
► Favourable balance as per cash book
► Unfavorable balance as per bank statement
► Debit balance as per cash book
► Favourable balance as per bank statement

Question No: 37 ( Marks: 1 ) - Please choose one
Which of the following is NOT a cause of disagreement between the balance of cash book and bank statement?
► Cheques issued to creditors but not paid by bank
► Cheques deposited for collection but not yet collected and credited by the bank
► Amount deposited directly into the bank by the debtors but not recorded in the cash book
► Amount deposited directly into the bank by the debtors and the same has also been recorded in the cash book

Question No: 38 ( Marks: 1 ) - Please choose one
Which of the following is INCORRECT about subsidiary account?
► It is not a summary account
► It reduces the burden of control account
► It provides detailed information about individual accounts
► It summarizes the total of related items from other accounts

Question No: 39 ( Marks: 1 ) - Please choose one
Prepaid insurance will become an expense when the balance of prepaid amount is _________.
► Expired
► Collected
► Paid
► Earned

Question No: 40 ( Marks: 1 ) - Please choose one
Which of the following Legal Documents of a company contain(s) the information about the capital and liability clause of a company?
► Memorandum of Association
► Articles of Association
► Both Memorandum of Association and Articles of Association
► Both Memorandum of Association and Articles of Association
Prospectus

Question No: 41 ( Marks: 1 ) - Please choose one
Which of the following types of Companies is (are) registered in Securities and Exchange Commission of Pakistan?
► Public Limited Companies
► Private Limited Companies
► Both Public Limited Companies & Private Limited Companies
► Neither Public Limited Companies nor Private Limited Companies

Question No: 42 ( 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: 43 ( 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: 44 ( 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: 45 ( 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: 46 ( Marks: 1 ) - Please choose one
Which of the following would be considered as non cash item in cash flow statement?
► Depreciation
► Accounts receivable
► Accounts payable
► Inventory

Question No: 47 ( 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: 48 ( Marks: 1 ) - Please choose one
Current ratio may be increased by:
► Overstating current Assets
► Overstating current Liabilities
► Understating current Assets
► Understating current assets and overstating current liabilities

Question No: 49 ( Marks: 3 )
Mr. A, B & C entered into a partnership. At the beginning of the year their capital balances were Rs. 180,000, Rs. 140,000 and Rs. 80,000 respectively. Profit or loss is to be divided as:
• Mr. A: one-half
• Mr. B: one-third
• Mr. C: one-sixth
Required:
If profit is Rs. 390,000, calculate the share of profit for all the partners.

Question No: 50 ( Marks: 3 )
Particulars Rs.
Markup on Loans 1,000
Finance Lease Charges 2,000
Profit on Bank Deposits 3,000
Dividend Income 4,000

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

Question No: 51 ( Marks: 5 )
Umer and Usman, both of whom are CPAs, form a partnership, with Umer investing Rs.100,000 and Usman, Rs.80,000. They agree to share net income as follows:
• Salary allowances of Rs.80,000 to Umer and Rs.50,000 to Usman.
• Interest allowances at 15 percent of beginning capital account balances.
• Any partnership earnings in excess of the amount required to cover the interest and salary allowances to be divided 60 percent to Umer and 40 percent to Usman.
The partnership net income for the first year of operations amounted to Rs.247,000 before interest and salary allowances. Show how this amount should be divided between the two partners.

Question No: 52 ( Marks: 5 )
• In trial balance at June 30, 2007 10% debentures are shown at Rs.75,000 and mark up on debentures are shown at Rs.3,750. Six months debenture mark up is to be accrued. What will be the amount of total mark up on debentures show in profit and loss account?

• From the following information calculate cost of goods sold.
Stock opening balance Rs.56,950
Purchases 175,750
Stock closing balance 65,020
Carriage inward 5,200
Sales 245,500


Question No: 53 ( Marks: 5 )
Information given in Trial balance:
• Plant and machinery Rs. 200,000
• Furniture and fixtures Rs. 100,000
Information given in adjustment:
ط 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 s
Rs. 200,000
• Furniture and fixtures Rs. 100,000
Information given in adjustment:
ط 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 s