(1) Which of the following is not a business transaction?
a. Bought furniture of ₹10,000 for business
B. Paid for salaries of employees 5.000
C. Paid sons fees from her personal bank account 20.000
D. Paid sons fees from the business ₹2,000
(2) . Use of common unit of measurement and common format of reporting promotes.
a. Comparability
b. Understandability
c. Relevance
d. Reliability
(3) The primary qualities that make accounting information useful for decision making are
a. Relevance and freedom from bias
b. reliability and comparability
C. Comparability and consistency
d. None of the above
(4) Concept that a business enterprise will not be sold or liqudated in the near future is known as
a. Going concern
b. Economic entity
c. Monetary unit
d. None of the above
(5) When an entry is made in journal
a. Assets are listed first
b. Accounts to be debited listed first
c. Account to be credited listed first
d. Accounts maybe listed in any order
(6) Journal entry to record salaries will include
a. Debit salaries credit cash
b. Debit capital credit cash
c. Debit cash credit salary
d. Debit salary credit creditors
(7) Double column cash book records
a. All transactions
b. Cash and bank transactions
c. Only cash transactions
d. Only credit transactions
(8) Good purchase on cash are recorded in the
a. Purchases( journal )book
b. Sales ( journal ) book
c. Cash book
d. Purchases return( journal ) book
(9) Yah bank reconciliation statement is prepared by
a. Creditors
b. Bank
c. Accounts holder in a bank
d. Debtors
(10) A bank reconciliation statement is prepared with the balance
a. Passbook
b. Cash book
c. Both passbook and cash book
d. None of these
(11) Depreciation is provided on
a. Current assets
b. Fixed assets
c. Investment
d. Fictitious assets
(12) Depreciation is charged on the
a. Market value
b. Depreciable value
c. Purchase value
d. Sale value
(13) Passbook is a copy of
a. Copy of customer account
b. Bank column of cash book
c. Cash column of cash book
d. Copy of receipts and payment
(14) Balancing of accounting means
a. Total of debit side
b. Total of credit side
c. Difference in total of debit & credit
d. None of these
(15) Financial statements consist of
a. Trial balance
b. Profit and loss account
c. Balance sheet
d.(i)&(iii)
e. (ii)&(iii)
(16) Choose the correct chronological order of ascertainment of the following profit from the profit and
loss account
a. Operating profit, net profit, cross profit
b. Operating profit, gross profit, net profit
c. Gross profit, operating profit, net profit
d. Gross profit, net profit, operating profit
(17) If the insurance premium paid 1000 and prepaid insurance 300 the amount of insurance premium
shown in profit and loss account will be:
a. 1300
b. 1000
c. 300
d. 700
A. Define accounting.
B. Explain the meaning of gain and profit distinguish between these two terms.
C. What is the money measurement Concept and going concern concept.
D. What is the accounting concept.
E. What is petty cash book ?how its prepared ?
F. What is cash book ? explain the types of cash book.
G. State the need for the preparation of bank reconciliation statemen.
H. What is bank reconciliation statement. why is it prepared?
I. What is abnormal factor
J. What is depreciation
K. Distinguish between provision and reserve
L. State briefly the need for providing depreciation
M. Explain the double entry mechanism with an illustrative example
N. Give any three example of revenues.
O. Describe the role of accounting in the modern world
P. Define voucher, stock and goods.
(Simple cash book.)
Record the following transaction in simple cash book for November 2016:
01 Cash in hand. 12,500
04 Cash paid to Hari. 600
07 Purchased goods. 800
12 Cash received from Amit. 1,960
16 Sold goods for cash. 800
20 Paid to Manish. 590
25 Paid cartage. 100
Prepare a double column cash book with the help of following information for December 2016:
01 Started business with cash. 1,20,000
03 Cash paid into bank. 50,000.
05 Purchased goods from Sushmita. 20,000
06 Sold goods to Dinker and received a cheque. 20,000
10 Paid to Sushmita cash. 20,000
14 Cheque received on December 06, 2016 deposited Into bank
18 Sold goods to Rani. 12,000
20 Cartage paid in cash. 500
22 Received cash from Ranib. 12,000
27 Commission received. 5,000
30 Drew cash for personal use. 2,000
( Petty cash book )
Record the following transactions during the week ending December, 30 , 2014 with a weekly imprest
500
2017 January
24 stationery. 100
25 bus fare. 12
25 cartage 40
26 taxi fare 80
27 wages to casual labour 90
29 posted. 80
Enter the following transaction in sales (journal) book of MS Bansal electronics:
2014 September
01. sold to Amit trader as per bill number. 4321
20 pocket radio @70 per radio
2, T.V set, B&W.(6") @ 800 per T.V
10. sold to Arun electronics as per bill number 4351.
5 T.V, sets (20") B&W @ 3000 fer T.V
2 T.V, sets (21") colour @ 4800 per T.V
22. Sold 200 electronics as per bil number 4399
10 tape recorder @ 600 each
5 walkman @300 each
28. Told to Harish trader as per bill number 4430
10 mixture juicer grinder @800 each.
. The cash book shows a bank balance of ₹7,800. On comparing the cash book with passbook the
following discrepancies were noted:
(a)Cheque deposited in bank but not credited₹3,000-
(b) Cheque issued but not yet present for payment 1,500
(c) Insurance premium paid by the bank 2,000
(d) Bank interest credit by the bank 400
(e) Bank charges 100
(F) Directly deposited by a customer₹4,000
Vakarubie balance of cash book and passbook
1. From the following particulars, prepare a bank reconciliation statement as at March 32.2017.
(i) Balance as per cash book₹3,200
(ii) Cheque issued but not presented for payment ₹1,800
(iii) Cheque deposited but not collected upto March 31, 2014 ₹2,000
(iv) Do Eque charges debited by bank₹150
1. On April 01. 2010. Bajrang Marbles purchased a Machine for₹ 1,80,000 and spent ₹10,000 os
carriage and 10.000 on its installation. It is estimated that its working life is 10 years and after 10 years
its scrap value will be ₹20,000.
(a) Prepare Machine account and Depreciation account for the first four years by providing depreciation
on straight line method. Accounts are closed on March 31st every year.
(b) Prepare Machine account. Depreciation account and Provision for depreciation account (or
accumulated depreciation account) for the first four years by providing depreciation using straight line
method accounts are closed on March 31 every year
2 . Berlia Ltd. Purchased a second hand machine for₹56,000 on July 01, 2015 and spent 24,000 on its
repair and installation and₹ 5,000 for its carriage. On September 01, 2016, it purchased another
machine for 2,50.000 and spent ₹ 10,000 on its installation.
(a) Depreciation is provided on machinery @10% p.a on original cost method annually on December 31.
Prepare machinery account and depreciation account from the year 2015 to 2018.
(b). Prepare machinery account and depreciation account from the year 2011 to 2018, if depreciation is
provided on machinery @10% p.a. on written down value method annually on December 31
(3). Saraswati Ltd, purchased a machinery costing₹10,00,000 on January 01,2011. A new machinery was
purchased on 01 May, 2012 for₹15,00,000 and another on July 01, 2014 for₹ 12,00,000. A part of the
machinery which originally cost ₹2.00,000 in 2011 was sold for ₹75,000
on April 30, 2014. Show the machinery account, provision for depreciation account and machinery
disposal account from 2011 to 2015 if depreciation is provided at 10% p.a. on original cost and accurat
are closed on December 31, every year
(4). Azad Ltd. purchased furniture on October 01, 2014 for 4,50,000. On March 01, 2015 it purchased
another furniture for ₹ 3,00,000. On July 01, 2016 it sold off the first furniture purchased in 2014 for
2,25,000. Depreciation is provided at 15% p.a. on written down value method each year. Accounts are
closed each year on March 31. Prepare furniture account, and accumulated depreciation account for the
years ended on March 31, 2015, March 31, 2016 and March 31, 2017. Also give the above two accounts
if furniture disposal account is opened.
(1). Calculate the amount of gross profit and operating profit on the basis of the following balances
extracted from the books of M/s Rajiv & Sons for the year ended March 31, 2017.
Opening stock. 50,000
Net sales. 11,00,000
Net purchases. 6,00,000
Direct expenses. 60,000
Administration expenses. 45,000
Selling and distribution expenses. 65,000
Loss due to fire. 20,000
Closing stock. 70,000
(2). Prepare trading and profit and loss account and balance sheet as on March 31, 2017:
Machinery 27,000 Capital 60,000
Sundry debtor 21,600 Bills payable 2,800
Drawings 2,700 Sundry creditors 1,400
Purchases 58,500 Sales 73,500
Wages 15,000
Sundry expenses 600
Rent & taxes 1,350
Carriage inwards 450
Bank 4500
Opening stock 6,000
