A-PDF Page Cut DEMO: Purchase from www.A-PDF.com to remove the watermark
I. Audit working papers are the property of

Company


Auditor


Registrar of companies


Government of India


2. Internal Auditor is appointed by the:

Shareholders of the company


Statutory auditor


Institute of internal auditors of India


Board of directors of the company


3. Management Audit is

an independent appraisal of the total management process


a statutory requirement


an investigation into the conduct of director


an independent appraisal of competitiveness of business


4. Period costs are

affected by changes in the level of activity


directly proportionate to the level of activity


unaffected by changes in the level of activity


associated with a unit of product


5. Marginal cost is

variable cost of one unit of product


fixed cost of one unit of product


total cost of one unit of product


opportunity cost ofone unit ofproduct


6. Cost of policy formulation is the example of:

Production cost


Administrative cost


Selling and Distribution cost


None of these


BAC-32 2B
7. Prime product cost is equal to

Direct Material Direct Labour
Direct Expenses



Direct Material Direct Labour
Indirect Expenses



Direct Material Direct Labour
Direct Expenses -Indirect Expenses



Direct Material Indirect Labour
Direct Expenses



8. If volume of production is increased, then:

Fixed cost per unit will remain unchanged.


Fixed cost per unit will decrease


Fixed cost per unit will increase


Variable cost per unit will increase


9. Amount of underwriting commission payable on issue of debentures is limited to
2%

5%
10%
10. Which of the following sections of the Companies Act, 1956 requires the maintenance of proper books of account?

Section 205


Section 209


Section 211


Section 217


II. The minimum share application money is

Rs. 5 per share


Rs. 10 per share


of the face value of shares


10% of the face value of shares


(Contd.)
12. The remuneration payable to a managing whole time director ofthe company should not exceed

of the net profit


of the net profit


10% of the net profit


II of the net profit


13. A company auditor can be removed by
Board of Directors
• Managing Director

Any Director


General Meeting


14. The most significant test of a business solvency is indicated with the help of the following ratio
Net profit after taxes

Total assets
Total fixed assets(b)
Capital employed
Total assets

Total outside liabilities
Current assets Current liabilities
IS. The return on equity capital ratio is obtained by dividing net profit (after tax) less preference dividend by

Total capital


Current assets


Equity capital


Fixed assets


16. The higher the ratio, the lower the profitability would be relevant in the case of:

Gross Profit Ratio


Operating Ratio


Net Profit Ratio.


Interest Coverage Ratio


BAC-32 3B
17. Which one ofthe following is least suited for measuring return on investmt:nt
Income
Invested Capital
Net operating income before interest and taxes



Average total assets

Operating income ratio x Total assets turnover

Net income after interest but before taxes


Average total share­holder equity
18. Return on investment is meaningful to
J. Shareholders
2.
Creditors

3.
Management Of the statements given below



I alone is true


I and 3 are true


2 and 3 are true


2 and 3 are true


19. Payment of interim dividend is a

Source of fund


Application of fund


No flow of fund


All the above


20. Flow of funds takes place when

Creditors are issued bills payable


There is loss on sale of machinery


Building is sold on payment vide Banker Demand Draft


Transfer is made to general reserve


(Contd.)
21. A plant standing in the books at Rs. 44,000 was sold for Rs. 62,000. The profit on its sale raised the net profit to Rs. 1,84,000. Find out the fund from operation

1,84,000


2,02,000


1,66,000


1,22,000


22. Which one ofthe foUowing is an example of sources of funds?

Decrease in share capital


Decrease in long term liabilities


Increase in long term liabilities


Increase in fixed assets


23. Which of the following items are applications of fund
I. Loss from operations
2.
Loans from financial institutions

3.
Redemption of debentures

4.
l'ayment of dividend

5.
Sale of fixed assets



2,3,4and5


I,2and5


I,3and4


and5


24. A banking company in India can issue:

Only equity capital and debentures


Only equity capital and preference capital


Only equity capital


Any type of security


25. Naked debentures are those:

Which are not secured


Which are transferrable by mere delivery


Which cannot be exchanged for shares


In respect of which no time is fixed for redemption


BAC-32
26. The Public Company is defined under
which Section of The Companies
Act 1956?
3
3
3
3
27. If a company adopts Table the
maximum rate of interest payable per •
annum by a person to the company on
calls in arrear is




28. The Provision for doubtful debts is made
by crediting
Profit and Loss Account
Provision for Doubtful Debts ACcount
Debtors Account
Bad Debts Account
29. Reserve is charged to
Profit and Loss Account
Profit and Loss Appropriation
Account
Balance Sheet
General Reserve Account
30. Which of the following is not a Capital
Reserve:
Premium on the issue of shares
Profits prior to incorporation
Profit on the sale on fixed assets
Dividend Equalization reserve
IB (CoDtd.)

31. A Provision isa

General Reserve


Capital Reserve


Specific Reserve


Both and


32. In which method, the assets account appears at its original cost throughout its life?

Sum of digits method


Sinking Fund method


Annuity method


Revaluation method


33. Any profit arising by sale of furniture by a cricket club will be shown

As expenses in the income and expenditure account


As liability in Balance Sheet


As income in the income and expenditure account


As an asset in Balance Sheet


34. Legacies debited in receipts and payments account are

Shown as income in the income and expenditure account


Shown as expenditure in the income and expenditure


Shown on the asset side of Balance Sheet


Shown on the liabilities side of Balance Sheet


35. The Income and Expenditure account begins with

Debit Balance


Credit Balance


No Balance


Both and


BAC-32 5B
36. Admission fee income should be

Capitalized


Treated as revenue


Treated as revenue unless the amount is pretty large


Treated as a liability


37. The receipts and payments account shows the Subscriptions received as Current year Rs. 5000/, Previous year Rs. 5001­and next year Rs. 700/-. The amount to be taken to Income and Expenditure account should be

Rs. 6200/­


Rs. 5000/­


Rs. 5700/­


Rs. 5200/­


38. X and Y shared profits in the ratio of
7 5. They admit a new partner Z whom they give 1/6th share in profits. He acquires this share as 1/24th from X and 1/8th from

Y.
The new profit sharing ratio of Y andZ willbe



35:25: 12





4





39. A and B are equal partners in a firm the new partner brought Rs. 15,000 cash and a plant of Rs. 30,000. Firm gave him 1/4th share in profits. Firm also agreed to pay his creditors of Rs. 5,000. Capital of C will be

Rs. 10,000


Rs. 12,500


Rs. 40,000


Rs. 50,000


(Contd.)
40. X, Y and Z are partners sharing profits and losses in the ratio of I 2 I. Y retires. Now, X and Z share the profits and losses in the ratio of 5 3. gain will be

1/8


3/8


1/4


1/2


41. A and B are partners sharing profits and losses in the ratio of 3 2. They admit C as partner who is unable to bring goodwill in case but pays Rs. 8,000 as his capital. The Goodwill of the firm is to be valued at two years' purchase of three years' average profits. The profits for the three years were Rs. 5,000, Rs. 4,000 and Rs. 4,500. The new ratio will be 5 2
2. The value of goodwill credited to A will be

Rs. 3,600


Rs. 4,800


Rs. 5,000


Rs. 5,400


42. Upon dissolution of a firm, all assets are transferred to the Realization at

Market Value


Book Value


Cost or market value, whichever is less


Cost or market value, whichever is more


43. Interest paid on debentures is shown in

the profit and loss account


the profit and loss appropriation account


the Balance Sheet Liabilities side under the heading current liabilities


the Balance sheet by adding to the Debentures account


BAC-32
44. AB Co. Ltd. forfeited 30 shares ofRs. 10 each fully called up for non-payment of allotment money of Rs. 3 per share and call money ofRs. 4 per share. These shares are reissued for Rs. 8 per share fully paid. The amount to be transferred to Capital reserve alc will be

Rs. 30


Rs. 60


Rs. 90


Rs. 300


45. Balance of share premium alc cannot be used for:

issuing of fully paid bonus shares


writing off prejiminary expenses


writing offdiscount on issue ofshares


writing off goodwill


46. X Co. Ltd. forfeited 1,000 shares of Rs. 10 each fully called up for non-payment of final call of Re. 1 per share. 400 of forfeited shares were reissued as fully paid up at Rs. 8 per share. The amount to be shown in the Balance Sheet as Shares Forfeited Alc will be

Rs. 800


Rs. 3,600


Rs. 5,400


Rs. 9,000


47. When debentures are redeemed by sinking fund method, after redemption of debentures, the balance of Debenture Redemption Fund Alc should be transferred to

Debenture Redemption Fund Investment Ale


General Reserve Ale


Debentures Alc


None of these


B (CoDtd.)
48. The primary objective of audit is

detection of errors and frauds


detection and prevention of errors . detection and prevention of frauds


to ensure that final accounts and statements exhibit true and fair position of business


49. The auditor is generally expected to carry out the following in a particular sequence:
I. Verification of assets and liabilities
II. Vouching of transactions
III. Checking of valuation of assets and
liabilities
Codes


II and III


II, I and III


II, III and I


III, II and I


50. Bonus shares may be issued out of
I. Profit
2.
Share premium

3.
Capital Reserve

4.
General Reserve



I,3and4


3and4


I,2,3and4


2,3and4


5I. For debentures issued at a discount, it is prudent to write off the discount

In the year of issue


Within two or three years of issue


During the life of the debentures


In the year of redemption


BAC-32
52. Rights shares are the shares

Issued to the directors ofthe company


First offered to the debentureholders


First offered to the existing share­holders


Issued by a newly formed company


53. Which of the following are the methods of marketing new issue of securities?
I. Listing of securities
2.
Jobbers and brokers

3.
Private placement of securities

4.
Privileged Subscriptions


Select the correct answer

Iand2


2and 3


3and4


I,2,3and4


54. Purchase and sale of shares before or after official trading hours of stock exchange is known:

Hammering


Kerb trading


Short selling or short buying


Margin trading


55. It is compulsory for a share broker to register with the

Concerned stock exchange


SEBI


Department of Company affairs


Concerned stock exchange in concurrence with SEBI


(Conld.)
56. Which one of the following does not constitute the purpose of setting up of SEBI?

To protect the interests of the investors in securities


To promote the development of the securities markets


To regulate the global securities markets


To deal with matters connected with


fraudulent and unfair trade practices relating to securities markets
57. Mutual funds are to be operated by

Asset Management Companies


Public Sector Banks


Private Sector Banks


Financial InstitUtions


58. Which of the following statement is not an objective of accounting?

To provide information about the enterprise assets, liabilities and capital


To provide information on the personal assets and liabilities of the owner of an enterprise


To maintain records of business


To provide information on the performance of an enterprise


59. The accounting equation is satisfied by

Capital assets liabilities


Liabilities capital -assets


Assets capital liabilities


Assets liabilities -capital


BAC-32 SE
60. Top level management require accounting information for

Controlling


Decision making


Planning


Co-ordination


61. The assumption that a business enterprise will not be sold or liquidated in the near future is known as the

Economic Entity


Monitory unit


Conservation


Going concern


62. Which of the following is not input oriented accounting principle

Coservativeness


Comparability


Disclosure


Objectivity


63. Any expenditure incurred in order to reduce the operating expenses is

Revenue expenditure


Capital Expenditure


Deferred revenue expenditure


Promotional Expenditure


64. An amount obtained on sale offixed asset is

Capital receipt


Revenue receipt


Deferred revenue receipt


Both and



(Contd.)
65; Receipts and Payments account is a
summary of;


Income and Expenses


Cash receipts and Payments


Debit and Credit balances of ledger accounts


Both and


66. Which of the following is not an example
of Deferred revenue expenditure?


Research and Development expenses


Discount on issue of debentures


Preliminary expenses


Machine establishment expenses


67. Freight paid on the new machine will be debited to

Machinery account


Freight account


Neither of the above two


Profit and Loss account


68. When Accounting Standard Board of India was established

21 April, 1977


30 May, 1980


16 August, 1977


15 June, 1982


69. Historical cost of inventories as per AS-2 should normally be determined by using:

Fifo or Weighted average cost formula


Fifo, Base stock or adjusted selling price formula


Fifo, Lifo or Latest purchase price formula


Lifo, Base stock or Adjusted selling price formula


BAC-32 9B
70. When asset is revalued at higher than original cost, the accumulated depreciation is credited to revaluation reserve as per

AS-6


AS-9


AS-IO


AS-2


7I. AS-6 is applicable to which one of the following assets

Goodwill


Livestock


Plantation


Plant and Machinery


72. Which of the following items is not dealt with by AS-9

Revenue recognition on sale of goods


Revenue recognition on rendering of services


Revenue recognition on the use of resources of the enterprise


Unrealized gains on the holding of current assets


73. Section 37 of the Partnership Act provides interest on the amount left by the retiring or deceased partner at







Bank rate


Prime lending rate


74. C is admitted in a firm at 14 share in the profits for which he brings Rs. 3000 for Goodwill. It will be taken by the old partners in

New profit sharing ratio


Old profit sharing ratio


Sacrificing ratio


Gaining ratio


(Contd.)
75. Proposed dividend is shown in Balance Sheet on Liabilities side under the heading of:
Reserves and Surplus

Share Capital


Secured Loans


Current Liabilities and Provisions


76. A Sugar Industrial Unit acquires a chocolate manufacturing unit. This is termed as:

Horizontal Combination


Vertical Combination


Lateral Combination


Backward Linkage


77. One of the statements below is untrue. Pickitup

Combinations may lead to Dominance in the market


Combinations may take place in one Nation to face a dominant foreign firm


Combinations increase the competition among the combining firms and increase efficiency


Combinations help consolidation and lead to market efficiency.


78. One of the following is not a function of Trade Association. Pick it up

Representing Trade Problem to the government


Conducting Meetings of members of the Trade Association


Resorting to collective bargaining activities with the government on behalf of Association


Deciding prices of products on behalf of members


BAc-n 101
79. "Profit is the result but not objective. Businessman is .like a captain running a ship; ships are allowed to sail by the sea; sea not only permits the ships to sail but also threatens to wreck through cyclones." This is said by

Peter Drucker


Raymond Peter


Elton Mayo


Herzberg


80. Modernization of Industrial Enterprises is opposed by Trade Unions mainly due to

Fear of Retrenchment of staff


Harassment of staff


Dominance of Trade Unions will corne down


Politics


81. An evidence that the Shipping Company has accepted the goods for carrying to the designated destination is known as

Letter of Credit


Bill of Lading


Mates Receipt


Certificate of Origin


82. "A guarantee issued by the importer's bank that will honour up to a certain amount the payment of export bills to the bank of the exporter" is known as

Letter of Credit


Mate's Receipt


Bill of Lading


Certificate of Origin


(Contd.)
83. Export Inspection Council of India is one agency which carries out inspections and issues the certificate. Such certificate is known:

Letter of Credit


Certificate of Origin


Certificate of Inspection


Invoice


84. Entry into Foreign Trade can be made through different modes. One of the following is not one among them. Pick it
. up:

Contract Manufacturing


Licensing


Franchising


Consignment


85. TRIPS is one of the WTO agreements that deal with

Agriculture


Investment measures


Intellectual Property Rights


Trade in Services


86. General insurance agreements are made generally for a maximum period of

Six months


Five years


One year


Ten years


87. Reinsurance means transfer of the part of the risk by the insurer to
Another insurer
the Commercial.bank
The Reserve Bank
the Government

BAC-32 111
88. Actuarial science is related to

Aquaculture


Sericulture


Natural sciences


Insurance


89. The Insurance Regulatory Development Authority (IRDA) Bill was passed during the year:
1947
•

1952


1999


2005


90. The "Doctrine of Subrogate" indicates:

Insurance policy


Insurance premium


Insurance claim


Substitution of one person in place of another


91. "Grapevine" indicates

A technique of planning


A technique of decision making


Informal organization


Informal channel of communication


92. Which one of the following is out of "Maslow's" list of motivational needs

Physiological needs


Belongingness needs


Esteem needs


Special needs


B (Contd.)
93. People working any time, anywhere and with anyone is known as

Virtual office


Parallel office


Branch office


Central office


94. A graphic depiction of a two-dimensional view ofleadership style (managerial grid) has been developed by

Likert


Blake and Mouton


Douglas McGregor


Elton Mayo


95. Who has introduced the concept of Management By Objectives

Mary Parker Follet


Keith Davis


P.F. Drucker


Henry Fayol


96. "Espirit De Corps" means

Individual work


Team work


Formal office work


Informal office work


97. The Father of the Scientific Management:

Henry Fayol


F.W. Taylor


Elton Mayo


Mahatma Gandhi


98. Franking Machines are utilized to send

E-mails


Goods and articles


Affixing postal stamps


Telegrams


BAC-32 12B
99. Punched Card Machines are meant for:

Invoicing


Sales and purchase accounting


Calculation of wages


All of these


100. Office routines means

Day to day office matters


A series of steps to be taken for doing a particular work in the office


Long term plans of the organization


Recruitment of people


10I. The company is called an artificial person because:

It does not have the shape of a natural person


It can not be sued in the Court of Law


It is invisible and intangible


It exists only in the contemplation of Law


102. The Doctrine of Ultra Vires indicates

Registration of a company


Commencement of business of a company


Incorporation of a company


That a company can not go beyond its objectives mentioned in its Memorandum


103. The minimum number of Directors of a Public Company

Two


Five


Three


Twelve


(Contd.)
104. The powers of the Board of Directors are
spelled out in section of the
Companies Act of 1956.


21


310


291


110


105. A government company means:

a company run by Central government


a company run by State government


other than a private company


a company in which more than 50% of the equity share capital is held by the government


106. The Institute of Company Secretaries of India was constituted during the year

1947


1952


1962


1969


107. The Company Secretary is appointed by:

President of India


Prime Minister of India


Registrar of Joint Stock Companies


Board of Directors of the Company


108. The role of a Company Secretary is

as a statutory officer


as a coordinator


as an administrative officer


All of these


BAC-32 I3B
109. Section 383 A of the Companies Act 1956 provides that every company having paid up share capital of Rs. or more must have a whole time Secretary.

Rs. 10 lakhs


Rs. 50 lakhs


Rs. 10 crore


Rs. I crore


110. The person to be appointed as a Secretary must be a member of

Government Employees Association


Audit and Accounts Department


Institute of Company Secretaries


Institute of Certified Accountants


111. Distinctive feature of a sole proprietorship is as follows

Agency Principle


One for all and all for one


Corporate veil


Responsibility and Autonomy with owner


I 12. In case partner's Agreement is silent, profits and losses are shared by partners in

Capitals' Ratio


Equally


Sacrificing Ratio


Gaining Ratio


(Coold.)
113. Sleeping partner in Partnership is one

Who participates actively but does not bring capital


Who contributes capital but does not participate actively in running the firm


Who neither brings capital nor participates in running the firm but only lends name


Who is ill but takes profit share


114. Unlimited liability is not a characteristic of one of the forms of organization given below; Pick it up

Sole proprietorship


Partnership


Hindu undivided Family


Joint Stock Company


115. One of the forms of organizations is intended to eliminate middleman and thereby consumer gets good products at affordable price

Sole proprietorship


Joint Stock Company


Partnership


Cooperative Sector


116. Which of the following has government ownership, control and participation in business decisions as an essential feature?

Monopoly Firm


Public Sector Organizations


Joint Stock Company


Cooperative Society


14B
BAC-32
117. Hindustan Machine Tools Ltd. is an example of:

Private Sector


Joint Sector


Public Sector


Cooperative Sectors


118. According to Gamer Vs. Murray Case, in case one of the partners become insolvent,

the loss arising out of insolvency of that
partner is borne by other solvent partners
in the ratio of

Profit Sharing Ratio


Capital Accounts Ratio standing just
before insolvency of the Partner



Capitals Standing at the beginning
the year



Equally


119. The Indian Railways is an example for

Departmental Undertaking


Statutory Corporation


Government owned Joint Stock
Company



Joint Sector Company


120. A Joint Stock Company is created by

Agreement


Hindu undivided family


Registration under the Companies
Act 1956



A Statute of Parliament


SPACE FOR ROUGH WORK

BAC-32 ISB