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BSNL JAO Exam 2017 : Papers with Answer Keys (Batch 2) (05 NOV 2017)

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201.

151. When the total of Trial Balance does not tally the difference is taken as:
(A) Suspense Account
(B) Profit and Loss Account
(C) Error Account
(D) Difference Account 

ANS (A)

152. Current Liabilities are obligations to be settled in _______.

(A) Short period
(B) Long period
(C) Immediately
(D) None of these

ANS (A)

 153. XY Ltd. sells its products on credit basis and its customers are associated with 2% credit risk. Its annual turnover is expected at Rs.10,00,000 if credit is extended. If no credit is allowed the sales would be 70% thereon. Compute net profit on credit sales assuming cost of capital is 15% p.a. and variable cost 75% of sales, credit period is 30 days. Cost of administration is 2% of credit sales.

(A) Rs.2,47,500
(B) Rs.2,75,000
(C) Rs.2,52,500
(D) Rs.2,50,000

ANS (A)

154.  Greenways Ltd. issued 10,000 shares @ Rs.100 to the public under the terms: Rs. 20 on application; Rs.30 on allotment; Rs.25 on First Call; Rs.25 On Final Call. All moneys upto Allotment were duly received. But a shareholder holding 500 shares did not pay the first call amount due. Another shareholder who was allotted 250 shares paid them up in full. Show how ‘calls-in-advance’ will be shown in the Balance-Sheet.
(A)

Liabilities                                          (in Rs.)	Assets                                                     (in Rs.)
	Call in Advance  (250 *50)=12,500

(B)

Liabilities                                           (in Rs.)	Assets
current Liblities calls in Advance 12,500/-

(C)

Liabilities                                              (in Rs.)	Assets                                            (in Rs.)
Issued and Subscribed  capital less : Call in Advance 12,500/-

(D) None of these

ANS (B)
 

155.  On 30th, june, 2017, the balance sheet of good Luck Ltd stood as follows:

Liabilities           (in Rs.)		Assets                  (in Rs.)
EQUITY SHARE CAPITAL :	20,00,000	Sundry   Assets	28,00,000
Redeemable   Preference Share capital	8,00,000	Bank balance	10,00,000
P&L  Account	6,00,000
sundry creditor	4,00,000
	38,00,000		38,00,000

On the above data, the preference shared had to be redeemed. for this purpose, 4,00,000  equity  shares of Rs 100 each were issued  at Rs 110. The company also issued 8% debentures  totalling  Rs 2,60,000 The shares and debentures were immediately  subscribed and paid for. The preferences shares were duly redeemed. you are required to calculate the amount  to be shown in the balance sheet after redemption under '' bank balance''

(A) Rs.10,20,000
(B) Rs.12,40,000
(C) Rs.10,40,000
(D) Rs.14,20,000

ANS (B)

156.EF Ltd. issued 1,000, 10% Debentures of Rs.100 each at a discount of 6%. The Debentures are repayable by annual drawings at the end of each year from the first year onwards at the rate of Rs.20,000 per year. Ascertain the discount amount to be written off at the end of Fourth Year under Fluctuating Instalment Method.

(A) Rs.400
(B) Rs.800
(C) Rs.6,000
(D) Rs.1,200

ANS (B)

157 Mr. X, an industrialist (SME Category) decided to convert his firm into a limited company from 1 June 2016. He obtained the Certificate of Incorporation on 1 October 2016 and the Certificate of Commencement of Business on 1 December 2016. His accounts were to be closed on 31 March 2017. There were 30 employees in the firm on 1 June 2016 and 20 more employees were appointed on 1 October 2016. Ascertain the weighted time ratio.

(A) 1 : 3
(B) 1 : 4
(C) 1 : 5
(D) 2 : 5

ANS (C)

158 " Fictitious Assets" are to be shown on the assets side of the Balance Sheet under the Heading:

(A) Miscellaneous Expenditure
(B) Current Assets
(C) Investments
(D) Fixed Assets

ANS (A)

159. Shree Ltd has a credit balance  on  P&l Account of rs 6,00,000 on 1.4.2016 and net profit for the year is Rs 60,00,000 The following decision were taken regarding provision, reserves and dividend :

1) General reserve Rs 7,00,000  2) Investment Allowance  Rs. 7,00,000  3) provision for taxation @ 50 %  4) Dividend  Equalization fund A/C Rs. 4,00,000  5) Dividend  on 10% preference shares of Rs, 40,00,000  6) dividend  on 15% on 6,00,000 Equity shares of Rs. 10 each fully paid tax.

(A) Rs.3,30,000
(B) Rs.5,30,000
(C) Rs.5,00,000
(D) Rs.3,70,000

ANS (D)

 160 The Directors of a public limited company have decided to write off Goodwill appearing Rs.50,000 at the beginning of the year 2016-17. How will you treat this?

(A) Rs.50,000 should be shown separately in P&L Account.
(B) Credit P & L Account by Rs. 50,000
(C) Debit P & L Appropriation Account by Rs. 50,000
(D) Show in Balance Sheet under Assets Rs.50,000

 161. Profit on sale of machinery comes under:
(A) Investing activity
(B) Financing activity
(C) Operating activity
(D) None of these

ANS (B)

162.
Which of the following is NOT a characteristic of cash-equivalents?
(A) Highly liquid
(B) Long-term
(C) Readily convertible into cash
(D) None of these

ANS (B)

163. you are required to calculate cash inflow from debtors from the following  data

	in Rs
Total assets Cash sales Opening Debtors Closing Debtors Sales Returns	10,00,000 4,00,000 1,00,000 1,60,000 40,000

(A) Rs.5,00,000
(B) Rs.4,00,000
(C) Rs.4,40,000
(D) Rs.4,60,000

ANS (A)

164. Compute net profit before tax :

Particulars	Balance
	Opening	Closing
P&L Accounts General Reserve Provision for Depreciation : plant Outstanding Expenses Goodwill Sundry Debtors	90,000 50,000 80,000 10,000 50,000 1,20,000	1,00,000 60,000 90,000 4,000 30,000 1,00,000

 An item of plant Costing Rs. 1,00,000 having book value of Rs 80,000 was sold for Rs. 90,000

(A) Rs.25,000
(B) Rs.30,000
(C) Rs.20,000
(D) Rs.22,000

ANS (B)

165.  Anil sells an article to Prakash at 10% profit. Prakash sells it back to Anil at a loss of 10%. The transaction gives
(A) Loss to Anil
(B) Profit to Anil
(C) There is no loss or gain
(D) Prakash makes profit

ANS (B)

166. In relation to a company, investors are least concerned with
(A) Profitability
(B) Short term liquidity
(C) Solvency
(D) Future share price

ANS (B)

167.  Which one of the following can be treated as capital expenditure?
(A) Acquisition of land, building, machinery etc.
(B) Amount spent on modification of asset
(C) Expenses incurred for right to carry on a business
(D) All of these

ANS (D)

168. As per accrual concept which one is NOT true
(A) Revenue – expenditure = profit
(B) Revenue – profit = expenditure
(C) Sales + gross profit = revenue
(D) Revenue = profit + expenditure

ANS (C)

169. Which of the following provide frame work and accounting policies so that the financial statements of different periods are comparable
(A) Business standards
(B) Accounting standards
(C) Market standards
(D) None of these

ANS (B)

170. What is the journal entry for goods purchased on credit?

(A)  Purchase     DR
                 To creditors A/C

(B)   Creditor's    Dr
                  To Purchase A/C

(C)   Purchase   Dr
                To Debtors  A/C

(D)   Debtor's A/C 
                To Purchase A/C

ANS (A)

171.  Which one of the following is NOT correct about Fund Flow Statement?
 (A) Records inflows and outflows of cash only
 (B) It is based on Cash Accounting System
 (C) It measures changes in working capital.
 (D) It is based on Accrual accounting system
ANS (A)

173 .  XY Ltd. has a policy of maintaining a minimum cash balance of Rs.45,000. The Standard Deviation of company’s daily net cash Rs.1,000. The transaction cost is Rs.90 per transaction. The interest rate is 0.2% daily. Compute the upper limit as per Miler Orr Model:
(A) Rs.41,500
(B) Rs.49,500
(C) Rs.43,500
(D) Rs.47,500

ANS (B)

174.  Which of the following statement is correct?
 (A) Default costs are caused due to failure of customers to pay on time.
 (B) Financial costs to support credit sales are referred to as collection costs
 (C) Business firms should not opt for relaxation of credit standards as they cause increase in collection costs,amount of bad debts and financial costs.
 (D) Receivables management involves a trade-off between costs and benefits or receivable.
 
ANS (D)

175.  Which of the following statement is NOT TRUE?
(A) Cash discount increases the average collection period.
(B) The increase in credit period increases average investment in receivables.
(C) The credit term “3/10 net 30” implies that the customer is entitled to 3% cash discount only when he pays within 10 days after the beginning of credit period, though the credit period is 30 days.
(D) Financial costs of investment in debtors are determined with reference to Cash Cost of Sales.

ANS (A)

176.  AB Ltd. purchased assets for Rs.4,80,000 from X & Co. payable in fully paid shares of Rs.100 each at a premium  of 20%. Which of the following is the correct Journal Entry in the Books of AB Ltd.
(A) X & Co. A/c : Dr. 4,80,000
To Share Capital A/c : 4,80,000

(B) X & Co. A/c : Dr. 4,80,000
To Share Capital A/c : 4,00,000
To Share Premium A/c :80,000

(C) Share Capital A/c : Dr. 4,00,000
Share Premium A/c : 80,000
To X & Co. A/c : 4,80,000

(D) X & Co. A/c : Dr. 5,60,000
To Share Capital A/c : 4,80,000
To Share Premium A/c : 80,000

ANS (B)

177.  The articles of association of Good Luck Ltd. provide for the following:
i) That 10% of profit of each year shall be transferred to Reserve Fund;
ii) That an amount equal to 10% of equity dividend shall be set aside for bonus to staff;
iii) That the balance available for distribution shall be applied:
a) In paying 7% on Cumulative Preference Shares,
b) In paying 7% on Equity shares
c) One third of the balance available as additional dividend on preference shares and two-thirds as additional
equity dividend.
A further condition was also imposed by the Articles, namely, the balance carried forward shall not be reduced by the provisions under (ii), (iii) (b) or (iii) (c) below a sum equal to 6% of the preference capital.
The company has issued 52,000 7% cumulative particularly preference shares of Rs.100 each fully paid. The profit for the year 2016-17 was Rs.28, 85,978 and the balance brought forward from the previous year was Rs.3, 14,349. Provide Rs.12, 54,600 for taxation before making other appropriations. Ignore corporate dividend tax. Balance c/fd to Balance Sheet will be:

(A) Rs.3,28,680
(B) Rs.3,60,580
(C) Rs.3,18,580
(D) Rs.3,65,680

ANS (C)

178. From the  following particulars, calculate the cash flows from investing activities:

Particulars	purchases (in Rs.)	Sales (in Rs)
Investments Goodwill Machinery Patents	6,00,000 3,00,000 13,00,000 -	4,00,000 - 4,20,000 2,00,000

Dividends received on shares held on investment Rs. 60,000 Interest received on debentures held as investment Rs. 80,000 a building purchased for investment purpose (out of surplus fund) was let out and rent proceeds received there by  Rs, 2,40,000

(A) Rs.8,00,000
(B) Rs.80,000
(C) Rs.6,00,000
(D) Rs.12,00,000
ANS (A)

179. Trading Account does not –
(A) Compare the sales with the cost of those sales
(B) Calculate gross profit
(C) Show the effect of return on capital पूंजी पर वापसी का भाव
(D) Include the cost of goods sold बेची गई वुओंकी
ANS (C)

180.  Net current asset is equivalent to – शु
(A) Fixed asset + current assets – current liabilities
(B) Current liabilities – current assets
(C) Stock + debtors + cash
(D) Working capital
ANS (D)

181. In net profit ratio the denominator is – शु
(A) Net purchase शु
(B) Credit sales
(C) Net sales शु
(D) Cost of goods sold
ANS (C)

182.  Unpaid calls are shown in the balance sheet of a company –
(A) By adding it to share capital
(B) By deducting it from called up share capital
(C) Under current liabilities
(D) Under current assets
ANS (B)

183. Interest cost incurred during construction phase or before the asset is put to use is accounted under –
(A) Repair
(B) Maintenance
(C) Capital asset
(D) Cost of acquisition
ANS (D)

184. Which concept satisfy valuation criteria –
(A) Going concern, Realisation, Cost
(B) Going concern, Cost, Dual aspect
(C) Cost, Dual aspect, Conservatism
(D) Realisation, Conservatism, Going concern
ANS (A)

185.  An asset was purchased for Rs. 5,00,000 with down payment of Rs. 2,00,000 and bills accepted for Rs. 3,00,000. The effect on total asset of the company will be –
   
(A) Assets increased by 3,00,000 and liabilities decreased by 3,00,000
(B) Assets decreased by 3,00,000 and liabilities increased by 3,00,000
(C) Assets increased by 5,00,000 and liabilities decreased by 3,00,000
(D) Assets increased by 3,00,000 and liabilities increased by 3,00,000
ANS (D)

186.  Historical cost concept requires the valuation of an asset at –
(A) Original cost
(B) Replacement value
(C) Net realizable value
(D) Market value

ANS(A)

187.

Particulars	As on Dec. 31, 2011 (in Rs)	As on Dec.31.2012(in Rs)
Pre paid salary Unpaid salary	20,000 50,000	35,000 20,000

Salary paid during 2012 amounted to Rs 2,40,000.
Amount to be shown under ''salaries'' in I&E A/C for the year ending Dec 31,2012

(A) Rs.3,10,000
(B) Rs.2,55,000
(C) Rs.1,95,000
(D) Rs.1,70,000
ANS(C)

188.  C was admitted into a Partnership firm for 5 years where A & B were already partners. C paid a premium of Rs.2,40,000. After 36 months, the partnership firm was dissolved due to misconduct of B. The amount of refund to Mr. C is:

(A) Rs.96,000
(B) Rs.1,44,000
(C) Rs.2,40,000
(D) None of these
ANS(A)
 

189.  A Building was purchased for Rs.48,00,000/- on 14/5/2012. Down payment of Rs.30,00,000/- was made and the balance was to be paid on 14/4/2013. What is the amount on which depreciation on the building was to be charged as at 31/3/2013?

(A) Rs.48,00,000
(B) Rs.30,00,000
(C) Rs.18,00,000
(D) Rs.24,00,000

ANS(A)

190. Net Working Capital is equal to:

(A) Excess of current assets over current liabilities
(B) Excess of current liabilities over current assets
(C) Total current assets
(D) None of these
ANS(A)

 191.
Arithmetical accuracy of basic entries, ledger posting & balancing is ensured by

(A) Trial Balance
(B) Profit & Loss Account
(C) Cash Flow Statement
(D) Balance Sheet
ANS(A)

192. Great Pvt. Ltd. bought machinery for Rs.1,00,000 on 01.01.2013 and spent Rs.10,000 on its installation. The life of the machinery is estimated to be 5 years & estimated scrap value at the end of period will be Rs. 5,000. The amount of annual depreciation as per straight line method will be

(A) Rs. 21,000
(B) Rs. 20,000
(C) Rs. 19,000
(D) Rs. 22,000
ANS(A)

 193. A sells goods to B for Rs. 20,000. A draws a bill on B who accepts the same to pay the amount after 2 months. Here, B is A 20,000 पए
(A) Drawee
(B) Drawer
(C) Payee
(D) Endorsee
ANS(A)

194 The payment side of Cash Book is overcast by Rs.7000. If the starting point of the BRS is the Overdraft Balance (A) as per pass Book, then what is to be done to reach to Overdraft Balance of Cash Book?

(A) Add Rs.7,000
(B) Less Rs.7,000
(C) Add Rs.13,000
(D) Less Rs.3500

ANS(A)

195. If a bill of exchange dated 8th January is issued for 2 months after date, the date of maturity will be
(A) 11th March
(B) 8th March
(C) 15th March
(D) 11th April
ANS(A)

196. ______ method of depreciation takes into account the element of interest on capital outlay and sees to write off the asset and the interest cost over the life of asset
 (A) Sinking fund
 (B) Annuity
 (C) Straight line
 (D) Written down value
ANS(A)

197. A Machine was purchased on 1st July 2010 for Rs. 14,000 and an amount of Rs.1000 was spent on its installation. . The rate of depreciation is 10% p.a. every year. The books are closed on 31st December. Find the value of Machinery as on 31st Dec 2011 after following Diminishing Balance method of depreciation.

(A) Rs. 12,825
(B) Rs.12,150
(C) Rs. 13,575
(D) Rs.13,500
ANS(A)

198 Which of the following is TRUE?
(B)
(A) Two mutually exclusive projects (L & M) have been evaluated. Project L has an NPV of Rs.2 lakh and anIRR of 15 percent; Project M has NPV of and has an IRR of 17 percent. Since Project M has higher IRR, itshould be selected.

(B) Two competing projects have the following NPVs: Project A + Rs. 10 lakhs (with an initial outlay of Rs.30lakhs and Project B + Rs. 9 lakhs (with an initial outlay of Rs.27.5 lakhs).The company should opt for Project Aas it has higher

(C) The cost of capital for new projects is 16%. Two competing projects (P&Q) have IRR 15% and 13% respectively. Since IRR of project P is higher, it should be selected.

(D) A project requires an initial investment of Rs.50 lakhs. The estimated profit after tax for years 1- 5 are: Rs.6 lakhs, Rs.7 lakhs, Rs.7 lakhs, Rs.14 lakhs and Rs.18 lakhs, the accounting rate of return is 18%.

199.  Z Ltd. has Rs 30,00,000 lakhs available for investment in capital projects. it has the option of making investment in projects A,B,C and D. Each project is entirely independent and has a useful life of 5 years. The expected present value of cash flows from the project are as follows:

Projects	Initial Outlay (in Rs)	Present value of cash flows (in Rs)
A	8,00,000	10,00,000
B	15,00,000	19,00,000
C	7,00,000	14,00,000
D	13,00,000	20,00,000

(A) Combination of A + B + C
(B) Combination of A + D
(C) Combination of A + C + D
(D) Combination of B + D
ANS(C)

200.  Calculate NPV of Certainty Equivalent of cash flows for the following information :

year	proposal X		Proposal Y
	CFAT	CE	CFAT	CE
0	(35,000)	1	(25,000)	1
1	18,000	0.8	10,000	0.9
2	20,000	0.7	16,000	0.8
3	15,000	0.6	18,000	0.7
4	15,000	0.5	20,000	0.4

(A) X = Rs.6,372; Y = Rs.10,657
(B) X = Rs.4,652; Y = Rs.9,997
(C) X = Rs.5,722; Y = Rs.10,957
(D) X = Rs.3,752; Y = Rs.10,975
 ANS(D)

201. Z Ltd. requires 5,000 units of a certain item per year. The Purchase Price per unit is Rs.20. The Carrying Cost of inventory is 20% of the unit cost and the cost per order is Rs.400. Compute the total cost of ordering and cost of carrying inventory when 5 orders of equal size are placed.

(A) Rs.3,500
(B) Rs.2,500
(C) Rs.3,000
(D) Rs.4,000
ANS(D)

202. Which of the following statement is NOT correct?
(A) The primary function of financial intermediaries is to convert direct securities into indirect securities.
(B) The two key financial markets are money market and capital market.
(C) Money market is a market for long term funds having maturity of more than one year.
(D) Organisation, underwriting and distribution are three services provided by the New issue market.
ANS(C)

203.  PQ Ltd. has been issued equity share which, are priced currently at Rs.108. The investor’s required rate of return is 12% and the dividend grows at 8% per year. Compute the current dividend declared by the company:
(A) Rs.5
(B) Rs.4
(C) Rs.4.50
(B)
ANS(D) Rs.5.50

 204.  The cash outgoings of XY Ltd. are estimated to be Rs.4,00,000 p.a. spread evenly throughout the year. The money on deposit earns 10% p.a. The switching cost per transaction is Rs.120. Calculate the optimum amount to be transferred. Use Bau Mol Model:
(A) Rs.30,000
(B) Rs.32,000
(C) Rs.33,333
(D) Rs.31,000
ANS(D)

205. Equity Share Capital:Rs.1,50,000; 10% Pref. Share Capital:Rs.1,00,000; Reserve and Surplus :Rs.5,00,000; Net Profit after Tax: Rs.2,10,000. Return on Equity will be:
(A) 28%
(B) 20%
(C) 25%
(D) 30%
ANS(A)

 206. Margin of safety is calculated as
(A) Actual sales + Break even point sales
(B) Actual production - Break even point sales
(C) Actual sales / Break even point sales
(D) Actual sales - Break even point sales
ANS(D

 207. Angle of incidence is the angle where
 (A) The total cost intersects the total sales
(B) Variable cost intersects fixed cost
(C) Fixed cost intersects total cost
(D) Variable cost intersects total Cost
ANS(A)

208.  If selling price per unit increases and other variables remain constant, the operating break-even point in units will
(A) increase
(B) decrease
(C) constant
(D) None of these

ANS (B)

209. Limitations of Break-even analysis
(A) non-linear cost behaviour
(B) presence of competition
(C) static concept
(D) capital not considered
ANS(C)

210. Determine contribution if Fixed cost is Rs. 75000 and loss is Rs. 30000

(A) Rs. 45000
(B) Rs. 105000
(C) Rs. 75000
(D) Rs. 30000
ANS(A)

211.  Determine P/V Ratio when Sales Rs. 80,000/- and variable cost Rs. 60,000/-:

(A) 0.25
(B) 0.4
(C) 0.3
(D) 0.1
ANS(A)

212.  What is margin of safety if sales is Rs. 50,000 and BEP is Rs. 30,000

(A) Rs. 20,000
(B) Rs. 30,000
(C) Rs. 80,000
(D) Rs. 50,000
ANS(A)

 213.  Material cost Rs. 10, sales price Rs. 30, labour Rs. 5, Electricity Rs. 5, fixed cost Rs. 3000. The BEP will be

(A) 300
(B) 3000
(C) 30
(D) 1000
ANS(A)

214.  Other valuable remain constant, if selling price decreases, the BEP will
(A) Constant
 (B) Increase
(C) Decrease
(D) None of these
ANS(B)

215. Fixed assets in the business is for
(A) Converting to cash
(B) Generating revenue
(C) Resale
(D) None of these
ANS(B)

 216. According to which concept the closing stock is credited to trading account?
(A) Cost
(B) Realisation
(C) Going concern
(D) Matching
ANS(D)

217.  Any change in the capital account of the proprietor may occur due to
(A) Profit earned
(B) Loss incurred
(C) Capital introduced
(D) All of these
ANS(D)

218. For computing the value of equity shares by yield method, it is essential to know:

(A) Normal Rate of Return
(B) Net Assets
(C) Expected Rate of Return
(D) Capital employed
ANS(C)

219.  Calculate the value of goodwill of a company on the basis of 2years' purchased of  weighted of average profits for the last 3 years purchased of weighted average profite for the last 3 years

2014   :     Rs,50,000
2015   :     Rs,35,000
2016   :     Rs,25,000

The weights assigned to each years are :

2014   :     1
2015   :     2
2016   :     3

1) On 1.10.2015, a repair in respect of machinery was Rs, 2,500 which was charged to revenue . this is to be capitalised for Goodwill calculation subject to the depreciation of 10% p.a on reducing balance method.

2) The closing stock for the year 2014 was overvalued by Rs. 1,500

3) To cover the management cost, Rs 2,000 should be made for Goodwill valuation

(A) Rs.62,881
(B) Rs.52,188
(C) Rs.61,818
(D) Rs.63,881
ANS(A)

220. Variable cost Rs. 10, sale price Rs. 20. Total fixed cost Rs. 10,000. BEP will be

(A) 1000 units
(B) 10000 units
(C) 100 units
(D) 2000 units
ANS(A)

 221 Which one is a used to test long term liquidity

(A) Interest coverage ratio
(B) Stock turnover ratio
(C) Operating ratio
(D) Current ratio
ANS(A)

 222. Which of the following is a budget according to function:

(A) Fixed budget
(B) Operating budget
(C) Flexible budget
(D) Long term budget
ANS(B)

 223. A bond has 3 years remaining until maturity. It has a par value of Rs.1000. The coupon interest rate on bond is 10%. Compute the yield to Maturity (YTM) at current market price of Rs.900.
(A) 14.63%
(B) 12.03%
(C) 13.63%
(D) 14.03%
ANS(D)

224. Green ways LTd. issue 10,000 shares @ Rs. 100 to the public under the terms :

Rs.20     on application
Rs.30     on allotments
Rs.25     on first call
Rs.25      on final call

All money upto Allotment were duly received, but a shareholder holding 500 shares did not pay the first call amount due.  another shareholder who was allotted 250 shares paid them up in full.
How calls - in - arrears '' will be shown in the balance sheets ?

(A) (Rs.500 Rs.25): Rs.12,500 will be shown on the Assets side of the Balance-sheet.
(B) Rs.12,500 is to be shown as deducted from the issued and subscribed capital on the Liabilities side of the Balance-sheet.
(C) Rs.12,500 is not to be shown in the Balance-sheet.
(D) None of these
 ANS(B)

 225. From  the following data, ascertain the amount of fresh issue of shares :

Redeemable Preference shares :        Rs. 1,60,000
Premium on redemption          :          5%
Divisible  profit available         :       Rs. 30,000
General Reserves Balance      :       Rs. 13,000
Securities Premium                 :       Rs 8,000

Fresh issue is to be made at a discount of 10 %

(A) Rs.65,000
(B) Rs.2,11,000
(C) Rs.1,47,000
(D) Rs.1,30,000
ANS(D)

 226. The term “acquisition of business” refers to:
(A) purchase of business of sole trading concern or partnership firm by an existing company
(B) conversion of sole trading concern or partnership firm into a limited company
(C) Both purchase of business of sole trading concern or partnership firm by an existing company and conversion of sole trading concern or partnership firm into a limited company
(D) The purchase of business of one limited company by another limited company.
ANSC)

227. Mr. X, an industrialist (SME Category) decided to convert his firm into a limited company from 1 June 2016. He obtained the Certificate of Incorporation on 1 October 2016 and the Certificate of Commencement of Business on 1 December 2016. His accounts were to be closed on 31 March 2017. Time Ratio is :
(A) 1 : 3
(B) 2 : 3
(C) 1 : 1
(D) 1 : 2
ANS(A)

 228 . Mr. VR and Mr. ST, partners of a firm agreed to sell their firm to a limited company on 1 April 2016. It was incorporated on 1 July 2016. It got Certificate of Commencement of Business on 1 August 2016. Final Accounts were prepared on 31 March 2017. It was found that the sales were uniform upto the date of incorporation but went up by 100% on an average thereafter. Compute the weighted sales ratio.

(A) 2 : 3
(B) 1 : 2
(C) 1 : 5
(D) 1 : 6
ANS(D)

 229. Which of the following statement is NOT TRUE?

(A) In other than Joint Stock Company forms of business concerns, the Final Accounts of such entities are split into two sections: Trading A/c and Profit and Loss A/c.
(B) In Company Accounts, a BOLD Line is drawn between P&L A/c and P&L Appropriation A/c.
(C) Items that are to be shown in Trading and P & L A/c are called “above line” items.
(D) Items that are to be shown in and P&L Appropriation A/c are called “below line” items.
ANS(B)

 230. Balance of profit in P&L Appropriation A/c has to be carried to the Balance Sheet and shown under the heading:

(A) Share capital
(B) Reserves and surplus
(C) Provisions
(D) Miscellaneous Expenditure
ANS(B)

 231. A product is sold at Rs. 100/- the variable cost is Rs. 80/- and Fixed cost is Rs. 5000/-. What will be the break even point in units –
(A) 250
(B) 500
(C) 600
(D) 225
ANS(A)

 232.  Degree of solvency of two firms are compared by –

(A) Net worth
(B) Tangible net worth
(C) Asset ratio
(D) Solvency ratio
ANS(D)

 233. 1Financial leverage means-
(A) High degree of solvency
(B) Low bank finance
(C) Use of more debt capital
(D) None of these
ANS(C)

 234. Which of the following accounts is a non-current liability?

(A) Share capital
(B) Bank loan
(C) Retained earnings
(D) Trade payables
ANS(B)

 235.  ABC company has current liabilities Rs. 30,000 and total liability Rs. 80,000 and current asset Rs. 50,000 and total asset Rs. 1,50,000/-. Equity of ABC company is –

(A) Rs. 70,000
(B) Rs. 90,000
(C) Rs. 1,10,000
(D) Rs. 95,000
ANS(A)

 236. Which of the following accounts in a current liability?

(A) Tax payable
(B) Inventories
(C) Bank deposits
(D) Fixed assets
ANS(A)

237.  Price per share is Rs. 60 and earning per share is Rs. 7. The P/E Ratio will be –

(A) 8.57 times
(B) 7.85 times
(C) 8.75 times
(D) 8.00 times
ANS(A)

 238. Net income available to stock holder is Rs. 1.25 lacs and total assets are Rs. 10.96 lacs. The return on common equity will be –
(A) 11.04%
(B) 11.4%
(C) 111.4%
(D) 111.04%
ANS(B)

239. The market value of a listed company is not shown on its balance sheets because –

(A) Market value is not known till balance sheet date
(B) Market value changes over time
(C) Shares are generally a small portion of the company
(D) None of these
ANS(D)

240. Which of the following is s short term liquidity ratio –

(A) Cash ratio
(B) Quick ratio
(C) Inventory ratio
(D) All of these
ANS(D)

241 The gross profit is unchanged but net profit margin declined over the same period. This could happen if –

(A) Cost of goods sold increased relative to sale
(B) Sales increased relative to expense
(C) Increase in tax rate
(D) Dividends were decreased.
ANS(C)

 242. Net profit signifies-

(A) Operational profitability
(B) Liquidity position
(C) Solvency
(D) Profit for lenders
ANS(A)

 243. Working capital turnover measures the relationship of working capital with ______.

(A) Fixed assets
(B) Sales
(C) Purchases
(D) Stock
ANS(A)

244. Return on shareholders investments calculates __________.

(A) All reserves
(B) Preference of equity capitals
(C) All appropriations
(D) All of these
ANS(D)

245. If total cost of 100 units are Rs. 4000 and cost of 105 units are Rs. 4100, then the variable cost per unit is –

(A) Rs. 20
(B) Rs. 200
(C) Rs. 60
(D) Rs. 65
ANS(A)

 246 Fixed assets Rs.6,00,000/- , current assets Rs. 4,00,000/- , capital Rs. 5,00,000/-, fixed liabilities Rs. 2,50,000/- , current liabilities RS. 2,50,000/-. The solvency ratio will be –

(A) 20%
(B) 30%
(C) 40%
(D) 50%

ANS(A)

 247. P/E ratio is calculated by dividing market price per equity by ________.

(A) Earning per share
(B) Current assets
(C) Current liabilities
(D) Liquid assets
ANS(A)

 248. Acid test ratio is quick current assets divided by _______.

(A) Current liabilities
(B) Current assets
(C) Total liabilities
(D) Total assets
ANS(A)

 249. Average stock level = ?

(A) 1/2 (Maximum stock level + Minimum stock level)
(B) (Maximum stock level + Minimum stock level)
(C) 1/2 (Maximum stock level - Minimum stock level)
(D) 1/4 (Minimum stock level + Maximum stock level)
ANS(A)

 250.  Which of the following is not a reason(s) of depreciation of a fixed asset?
(A) Proper maintenance
(B) Passage of time
(C) Obsolescence
(D) Usage
ANS(A)

251. When the prices of raw material constantly decreasing, LIFO method of raw materials issue
(A) Results in lower cost of production
(B) Results in higher cost of production
(C) Does not affect the cost of production
(D) All the statements are incorrect
ANS(A)

 252. Which of the following items is not an item of direct expense?

(A) General travelling expense
(B) Architect's fees
(C) Payment of royalty for using technology
(D) Hire charges for special machines that is used in relation to a specific job
ANS(A)

 253. re intended to be used over the prolonged period before becoming unusable or obsolete and the store having a significant disposal value. This type of stores falls under which category?

(A) NCS
(B) LTAS
(C) CS
(D) None of these
ANS(A)

 254. Mr. A wants to know the present value of Rs.5,000 to be received 5 years from now, assuming 10% rate of interest. Compute the present value.
(A) Rs.3,105
(B) Rs.5,500
(C) Rs.4,500
(D) Rs.4,000
ANS(A)

 255 If the frequency of compounding is more than 1, relationship between annual effective rate of interest and annual nominal rate of interest will be:

(A) Effective Rate = Nominal Rate
(B) Effective Rate < Nominal Rate
(C) Effective Rate > Nominal Rate
(D) None of these

ANS(C)

256. Compute the present value of a perpetuity of Rs.1,000 year if the discount rate is 10%.

(A) Rs.10,000
(B) Rs.100
(C) Rs.1,00,000
(D) None of these

ANS(A)

257. Which of the following terms of issue of debentures (including terms of redemption) is not possible.

(A) Issue of debentures at Par, redeemable at Discount
(B) Issue of debentures at Par, redeemable at Premium
(C) Issue of debentures at Discount, redeemable at Premium
(D) Issue of debentures at Premium, redeemable at Premium
ANS(A)

 258. Own debentures mean:

(A) Debentures purchased for investment
(B) Debentures purchased for immediate consideration
(C) Debentures owned by the directors exclusively
(D) None of these
ANS(A)

 259 . XY Ltd. took over the assets and liabilities of Rs.25,00,000 and Rs.2,50,000 of PQ Ltd. XY Ltd. paid the purchase consideration of Rs.24,00,000 by issuing debentures of Rs.100 each at a premium of 20%. Determine which of the following option is correct:

(A) Goodwill : Rs.1,50,000
(B) Capital Reserve: Rs.1,50,000
(C) Goodwill : Rs. 8,00,000
(D) Capital Reserve: Rs.8,00,000
ANS(A)

260. LM Ltd. issued Rs. 5,00,000, 12% debentures of Rs.100 each at a premium of 20%. The Net effective rate of interest on debentures will be:

(A) 15%
(B) 13%
(C) 10%
(D) 12%
(ANSC)

261. RS Ltd. redeemed 4,800 15% debentures of Rs.100 each which were issued at Rs.110 by converting them into equity shares of Rs.10 each issued at a discount of 4%. Compute the number of equity shares to be issued:
(A) 1,10,000 equity shares
(B) 52,800 equity shares
(C) 55,000 equity shares
(D) 48,000 equity shares
ANS(C)
 

262. GH Ltd. purchased its own 500 debentures of the face value of Rs.50,000 from the open market for immediate cancellation at Rs.85 which of the following is the effect of cancellation of Debentures?
(A) Loss : Rs.5,000
(B) Profit : Rs.5,000
(C) Loss : Rs.7,500
(D) Profit : Rs.7,500
ANS(D)

263.  XY Ltd. issued 10,000 shares of Rs.10 each at Rs. 12 (at a premium of Rs. 2 per share) payable as follows: Rs. 2 on application; Rs.3 on allotment; Rs.7 on First Call and the Final Call (including Premium). Correct Journal Entry for Receipt of Call Money will be: Journal Entry for Discount will be:

(A) Bank  A/c                                Dr.      70,000
      To share allotment  A/c                        50,000
       To securities Premium A/c                   20,000

(B) Bank A/c                                  Dr       70,000
      To first Call and final call A/c                 70,000

(C)  Bank A/c                                  Dr       70,000
       To first call and final call A/c                 50,000
        To  Securities Premium  A/c                 20,000

(D) None of these

ANS(C)

 264. Which of the following is a non-cash operating activities?
(A) Issue of Bonus Share
(B) Depreciation on fixed assets
(C) Issuance of Equity Shares on cash
(D) Increase in inventories
ANS(B)

265. Which of the following is true?
(A) Value of a bond is dependent solely on the interest payment it provides.
(B) Bond value will differ from its poor value, even though yield to maturity – coupon rate.
(C) For a bond, yield to maturity is always equal to coupon rate.
(D) If coupon rate = Required rate, the value of bond is equal to its par value.
ANS(D)

266. SR Ltd. currently pays Rs.3 per share as annual dividend Assuming 10% required rate of return on shares Ke, compute the value of shares: Annual rate of growth, 5% to infinity:

(A) Rs.53
(B) Rs.70
(C) Rs.63
(D) Rs.66
ANS(C)

267. Best Ltd. purchased a amchine for Rs.2,50,000  which is likely to give the following cash flow. Cash flow after  Taxes (CFAT)

year	CFAT
1 2 3 4 5 6	50,000 60,000 70,000 75,000 65,000 1,00,000

Compute pay-Back Period

(A) 4.13 years
(B) 3 years
(C) 4 years
(D) 3.93 years
ANS(D)

268.  X Ltd. plans to purchase a machine for  Rs 4,00,000  Which is likely to yield the following returns in the next three years.

Years	CFAT
1 2 3	1,50,000 1,80,000 1,60,000

Compute the NPv of the proposal at required rate of interest 10% and 12%

(A) 11.78%
(B) 10.96%
(C) 10.78%
(D) 11.04%
ANS(D)

 269. A firm is considering to buy one of the following two mutually exclusive investment projects:
Project S: Buy a machine that requires an initial investment outlay of Rs.2,00,000 and with generate CFAT of Rs.60,000 per year for 5 years.
Project W: Buy a machine that requires an initial investment outlay of Rs.2,50,000 and with generate CFAT of Rs.54,000 per year for 8 years.
Assume 10% as cost of capital. Determine the Equivalent Annual Net Present Value (EANPV) of both the Projects.

(A) S: Rs.7,140: W: Rs.7,514
(B) S: Rs.7,243: W: Rs.7,440
(C) S: Rs.7,243: W: Rs.7,140
(D) S: Rs.7,140: W: Rs.7,243
ANS(C)

 270. A company Requires an initial investment of Rs. 2,00,000 The /estimated net cash flow after tax but before depreciation is as follows :

Years	1	2	3	4	5	6	7	8	9	10
Net cash inflow (in Rs)	35,000	35,000	35,000	35,000	35,000	40,000	50,000	75,000	50,000	20,000

Calculate NPv ( Net present value ) of cash inflows ( using 10% as discount factor )

(A) Rs.45,805
(B) Rs.44,508
(C) Rs.44,805
(D) Rs.46,508
ANS(C)

 271. From the  following information, compute the p.I ( profitability Index) of the two projects.
 

	Project  A	Project A
Total present value	Rs 54,238	Rs 84,940
Cost of investment	Rs 60,000	Rs 82,000

(A) Project A: 0.9039; Project B: 1.0358
(B) Project A: 1.0358; Project B: 0.9039
(C) Project A: 0.9039; Project B: 1.358
(D) Project A: 0.9039; Project B: 1.538
ANS(A)

272. AB Ltd provides the following information :]

Sales	Rs. 37,50,000
Variable cost	Rs. 21,00,000
Fixed cost	Rs  3,00,000
Debt	Rs.  22,50,000
Rate of debt	9%
Equity capital	Rs.  27,50,000

ROI ( Return of Investment) will be :

(A) 27%
(B) 25%
(C) 28%
(D) 25.5%
ANS(A)

 273.  Compute EPS (Earnings per share) from the following data:
Total Funds to be raised = Rs.5,00,000; 50% to be raised through shares and 50% by Debt cost of Debt 10%; Tax rate 50%; Equity shares of Rs.10 each to be issued at 10% premium; Expected EBIT Rs.2,00,000.

(A) 3.5
(B) 5
(C) 6.5
(D) 4.5
ANS(A)

274. From the following data, computer the decrease / increase in duration of Operating Cycle :

Particulars	Years 2015	Years 2016
Raw Materials	20	27
W.I.P	14	20
finished goods	21	25
Purchase	96	135
Cost of goods sold	180	200
Sales	140	180
Debtors	32	40
Creditors	16	21

Given one year : 36 Days

(A) Decrease 21 days
(B) Increase 20 days
(C) Decrease 20 days
(D) Increase 21 days
ANS(B)

275. XYZ Ltd. issued 2,50,000 shares of Rs.100 each at a premium of 20%. The whole issue was underwritten by Mr. A. In addition, there is a firm underwriting of 30,000 shares by Mr. A. Applications for 2,00,000 shares were received by the company in all. Calculate the liability of Mr. A. (in number of shares).

(A) 170000
(B) 80000
(C) 220000
(D) 20000
ANS(B)

 276. Excelent Ltd made an issue of 60,000 shares which were underwriting as under

A           30,000 shares           B        18,000 shares            C         12,000 shares

In addition there was '' Firm '' underwriting  as under

A            3,000 shares            B         1,500 shares                        C             4,500 shares

The total subscription  including firm under writing were for 45,600 shares the following marked forms were included in the subscription

A          9,000 shares             B         13,500 shares                   C                 5,100  shares

Compute the total liablity of each under writing if the benefit of firms underwriting application are not given to individual underwriters by treating them as unmarked forms

(A) A. 21000. B. 4500 C 6900
(B) A-12000, B-900, C- 3300
(C) A-14357, B 1500, C-7543
(D) A- 11357, B-900, C-3043
 ANS(D)

277 . of the company to appropriate the profits: i) To transfer Rs.3,15,000 to General Reserve ii) To pay Rs.42,500 as ex-gratia bonus to the employees of the company iii) To declare dividend at 5% on equity shares iv) To transfer Rs.22,500 to staff gratuity reserve v) To transfer Rs.25,000 to Development Rebate Reserve vi) To transfer Rs.45,000 to Deferred Taxation Reserve The company’s capital consisted of 50,000 equity shares of Rs.10 each fully paid for the year ending 31.3.2017, the directors transferred Rs.20,000 to Debenture Redemption Fund A/c. Compute the Balance to be carried forward to the Balance Sheet.

(A) Rs.6,07,700
(B) Rs.6,02,700
(C) Rs.6,07,200
(D) Rs.6,02,200
ANS (B)

 278.  Shree Ltd. has a credit balance on P & L A/c of Rs.6,00,000 on 1.4.2016 and net profit for the year is Rs.60,00,000. The following decisions were taken regarding provisions, reserves and dividends: i) General Reserve Rs.7,00,000 ii) Investment Allowance Rs.7,00,000 iii) Provision for Taxation @ 50% iv) Dividend Equalisation Fund A/c Rs.4,00,000 v) Dividend on 10% Preference Shares of Rs.40,00,000 vi) Dividend on 15% on 6,00,000 equity shares of Rs.10 each fully paid. Compute Net profit after tax (to be carried forward to P&L Appropriation A/c)

(A) Rs.6,00,000
(B) Rs.23,00,000
(C) Rs.30,00,000
(D) Rs.20,00,000

ANS(C)

279.  Which of the following is an example of sources of funds
(A) Decrease in share capital
(B) Decrease in long term liabilities
(C) Increase in fixed assets
(D) Increase in long-term liabilities
ANS(B)

 280.  X Ltd. has part of its Share Capital in 5,000 12% Redeemable Preference Shares of Rs.100 each. The General Reserve of the Company shows a credit balance of Rs.6,00,000. The directors decided to utilize 70% of theReserve in redeeming pref. Shares and the balance is to be met from the proceeds of the fresh issue of sufficient  number of equity shares of Rs.10 each. No. of fresh issue of shares will be:
 (A) 14000
(B) 6000
(C) 3000
(D) 8000
ANS(D)

281.  Under income Tax Act, who is empowered to issue Zero Coupon Bonds?

(A) All Scheduled Banks
(B) All NBFCs
(C) All Trusts
(D) All State Governments
ANS(A)

 282.  ERM under internal Audit is

(A) Enterprise Risk Management
(B) Enterprise Resource Management
(C) Enterprise Resource Manual
(D) Enterprise Risk Manual
ANS(A)

 283 . Surcharge in case of a domestic company if the income exceeds Rs 10 crore.
(A) 12%
(B) 10%
(C) 5%
(D) 7%

ANS(A)

 284. GST Council has been created
 

(A) As per Article 279A of the amended Constitution
(B) As per Article 280A of the amended Constitution
(C) As per Article 281A of the amended Constitution
(D) As per Article 282A of the amended Constitution
ANS(A)

 285.  The amount of deduction in respect of salary paid to its own members in case of PFAOP is:
(A) Without any limit
(B) 1,50,000
(C) Nil
(D) None of these
ANS(A)

 286. As per the Companies Act, 2013, which one of the following is not allowed for the companies to buy-back its shares:

(A) Its free reserves
(B) The securities premium account
(C) The proceeds of specified securities like employees’ stock option
(D) The proceeds of an earlier issue of the same kind of shares
ANS(D)

287 Form for Cancellation of Registration under GST is

(A) GST REG -16
(B) GST REG -17
(C) GST REG -18
(D) GST REG -19
ANS(A)

288. Under GST CIN stands for

(A) Challan Identification Number
(B) Computer Identification Number
(C) Cost Identification Number
(D) None of these
ANS(A)

289. What is E-FPB under GST?

(A) Electronic Focal Point Branch
(B) Electronic Fund Payment Bank
(C) Electronic Focal Point Bank
(D) Electronic Focus Point Bank
ANS(A) 290. In terms of GST what is RNR?

(A) Revenue Neutral Rate
(B) Revenue Natural Rate
(C) Rate of Non-Revenue
(D) Rate Neutral Revenue
ANS(A

 291.   As per the Payment of Wages Act 1936, when the wages of terminated employee is to be paid?
(A) Before the expiry of the 2nd day from the date of termination of employment
(B) Before 7th of subsequent month of termination of employment
(C) Before the expiry of the 7th day from the date of termination of employment
(D) None of these
ANS(A

292 Which one of the following is TRUE about GST?
(A) The final consumer will bear only the GST charged by the last dealer in the supply chain with set-off benefitsat all the previous stages
(B) GST applies to importsGST आयात पर लागूहोता है
(C) It covers petrol
(D) It covers entertainment taxes earlier levied by local bodies
ANS(A)

 293. Section ----- of the Companies Act which deals with Corporate Social Responsibility.

(A) 135
(B) 136
(C) 137
(D) 138
ANS(A)

 294. Which one of the following is True in respect of issue of Shares at discount as per Companies Act 2013
(A) Shares other than sweat shares cannot be issued at discount
(B) As per Sec 79, shares can be issued at discount with some conditions.
(C) Shares can be issued at discount not exceeding 25%
(D) None of these
ANS(A

 295. SPICe =

(A) Simplified Pro-forma for Incorporating Company Electronically
(B) Simple Protocol for Incorporating Company Electronically
(C) Simplified Protocol for Indian Company Electronically
(D) Simplified Proforma for Indian Company Electronically
ANS(A)

 296. Form used for obtaining DIN is

(A) DIR 3
(B) DIR 2
(C) DIR 4
(D) DIR 5
ANS(A)

 297 le to:

(A) Top 100 companies by market capitalisation
(B) Top 200 companies by market capitalisation
(C) Top 300 companies by market capitalisation
(D) Top 400 companies by market capitalisation
ANS(A

 298. The following loss is not allowed to carry forward:

(A) House property loss
(B) loss from running and maintaining of race camels कैमल रेस चलानेऔर बनाए रखनेसेनुकसान
(C) Loss under the head ―Income from other source
(D) None of these
ANS(A)

 299. Income on which equalization levy is charged is:

(A) Chargeable under income tax
(B) Not chargeable under income tax
(C) Not an income under IT Act, 1961
(D) None of these
ANS(A

300. The due date for remittance of Provident Fund is :

(A) 21st of the subsequent month
(B) 7th nof the subsequent month
(C) 15th of the subsequent month
(D) 24th of the subsequent month
ANS(A)

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