GROUP TEST FOR CPT TEST

1. All of the followings are functions of accounting except –
(a) Decision making (b) Measurement

(c) Forecasting (d) Ledger posting

2. Two primary qualitative characteristics of financial statements are –
(a) Understandability and materiality (b) Relevance and reliability

(c) Relevance and understandability (d) Materiality and reliability

3. Selection of an inappropriate accounting policy decision may
(a) Overstate the performance and financial position a business entity

(b) Understate / overstate the performance and financial position a business entity

(c) Overstate the performance a business entity

(d) Understate the financial position a business entity

4. Creating reserve for discount on creditor is an example of –
(a) Increase in asset & owner’s liability (b) Decrease in asset & owner’s liability

(c) Increase in liability & owner’s liability (d) Decrease in liability & Increase owner’s liability

5. Which is entered on the debit side of Cash Book?
(a) Trade discount allowed (b) Trade discount received

(c) Cash discount allowed (d) Cash discount received

6. A cheque is payable across the bank counter is:
(a) Crossed cheque (b) Bearer cheque

(c) none

7. General subsidy received from Govt. is:
(a) Capital receipts (b) Revenue receipts

(c) Advance receipts (d) None

8. Sale of office furniture has been credited to Sales a/c. It is :
(a) A Clerical error (b) An error of principle

(c) An error of omission (d) Compensating error

9. Sale of office furniture has been credited to Sales a/c:
(a) Is an error of omission (b) Will affect the T/B

(c) Will not affect the profit (d) None

10. X ltd. Purchased 100 units @ Rs.10 for cash, 200 units @ Rs.20 subject to 10% trade discount and 5% cash discount against current dated cheque. The total amount of purchases is :
(a) Rs. 3,600 (b) Rs. 4,600

(c) Rs. 3,420 (d) Rs. 4,420

11. In case of a company manufacturing chemicals, Land is:

(a) A current asset (b) A fixe intangible asset

(c) A fixed tangible depreciable asset (d) A fixed tangible non-depreciable asset

12. Which method is followed to have a uniform charge for depreciation and repairs and maintenance together?
(a) WDV (b) SLM

(c) Double Declining Method (d) Sum of years digits method.

13. For depreciating Goodwill, the suitable method is:
(a) SLM (b) WDV

(c) Depletion (d) Annuity Method.

14. For depreciating Leases, the suitable method is:
(a) SLM (b) WDV

(c) Depletion (d) Annuity Method.

15. If the amount of any known liability cannot be determined with substantial accuracy:
(a) A definite liability should be created (b) A provision should be created

(c) A reserve should be created

16. Provision is :
(a) An appropriation of profit (b) A charge against the profit

(c) A reserve (d) None

17. If consignee is not authorized to get del-credere commission, then:
(a) He is liable for all the losses on account of non-recovery of debts due to insolvency of customers.

(b) He is not liable for all the losses on account of non-recovery of debts due to dispute.

(c) He is not liable for all the losses on account of non-recovery of debts due to insolvency of customers.

(d)None

18. A firm is the name of:
(a) The partners

(b) The minors in the firm

(c) The business under which the firm carries on business

(d) The collective name under which it carries on business.

19. The portion of acquisition cost of the asset, yet to be allocated to P&L a/c is known as :
(a) Book value (b) Accumulated value

(c) Realizable value (d) Salvage value

20. As per sec. 12 of Negotiable Instrument Act, which of the following is not a foreign bill?
(a) A bill drawn outside India and made payable outside India.

(b) A bill drawn outside India and made payable in India.

(c) A bill drawn outside India on a person resident in India

(d) A bill drawn in India on a person resident outside India and made payable outside India.

21. A suspense a/c facilitates the preparation of …. even when the ……. has not tallied.
(a) Ledger; T/B (b) Financial statements; T/B

(c) T/B; Financial statements (d) Journal; T/B

22. A company cannot issue redeemable preference shares for a period exceeding:
(a) 6 yrs. (b) 10 yrs.

(c) 20 yrs. (d) 24 yrs.

23. Rs. 5000 incurred for up gradation of computer by installing of 128 MB RAM is:
(a) C.E (b) D.R.E

(c) R.E (d) None.

24. In case of debit balance, the words …… written on debit side:
(a) To bal. b/d (b) To bal. c/d

(c) By bal. b/d (d) By bal. c/d.

25. Accrual basis is recognized under:
(a) Indian Partnership Act, 1932 (b)Indian Companies Act, 1956

(c) Concept of Accrual Act, 1946 (d) None.

26. Fundamental accounting assumptions are:
(a) 2 (b) 3

(c) 4 (d) None.

27. Accounting estimates are required in case of:
(a) Determining Gross Profit (b) Making prov. on Doubtful Debts

(c) Calculating int. on capital (d) All.

28. In case of Cash Book with discount column, Discount a/c is …………. in the ledger.
(a) opened (b) not opened.

29. Trial Balance is:
(a) a statement (b) an account

(c) both (d) None.

30. A transaction which is journalized but not posted to the ledger is an error of:
(a) complete omission (b) partial omission

(c) commission (d) None.

31. Depreciation is the process of:
(a) Allocation of profit (b) valuation of expenses

(c) segregation of profit (d) appropriation of profit.

32. Goods distributed as free sample should be credited to:
(a) Advertisements’ a/c (b) Charity a/c

(c) Purchase a/c (d) Goods a/c.

33. Which are the advantage of imprest system of Petty Cash Book:
(a) Control over mistake (b) Control over fraud

(c) Control over petty expensed (d) Benefits of specialization.

34. ……………….. normally doesn’t yield benefits beyond current accounting period.
(a) Capital Expenditure (b) Revenue Expense

(c) Def. Rev. Expenditure (d) Contingent Liability.

35. If the change in accounting policy has no material effect in current period but which is reasonably expected to have a material effect in later periods:
(a)The amount of change should be disclosed.

(b) The fact of change should be disclosed.

(c) The fact of change should not be disclosed.

(d) None

.
36. Bad debts recovered a/c is:
(a) An asset a/c (b) A liability a/c

(c) A revenue a/c (d) An expense a/c.

37. When a cheque received is endorsed, it must be entered on:
(a) Cr. Side of C.B only (b) Dr. side of C.B only

(c) Both side of C.B (d) Nowhere.

38. Rectifying entry for the error of the credit purchase of goods worth Rs. 1000 recorded as credit sale to Mr. X discovered two months later is two be passed in:
(a) Journal Proper (b) Sales Book

(c) Cash Book (d) Purchase Book.

39. A purchase of Rs. 10000 has been wrongly posted to the dr. of Supplier’s a/c but had been correctly entered in Purchase a/c. This error:
(a) is an error of principle (b) will not affect the T/B

(c) will affect the gross profit (d) None.

40. Which of the following statements is true:
(a) A bill cannot be endorsed more than two times.

(b) A bill is drawn by the purchaser.

(c) A bill contains an unconditional promise to pay.

(d) Noting charges are borne by the drawee in the event of dishonour of the bill.

41. ‘A provision is a liability which can be measured by using a substantial degree of estimation.’ -according to
(a) AS 10 (b) AS 4

(c) AS 6 (d) AS 29

42. Which is odd one out:
(a) Error of complete omission (b) Error of commission

(c) Error of partial omission (d) Compensating error.

43. Inventory is ascertained on the basis of ‘records’ in:
(a) Periodic Inventory System (b) Perpetual Inventory System

(c) None.

44. Over-riding commission is given :
(a) When agent is required to put in hand work in introducing a new product in the market

(b) For bearing the loss on a/c of bad debts

(c) Both (d) None.

GROUP TEST FOR CPT TEST

Consignment and its features

Consignment is the act of consigning, which is placing a person or thing in the hand of another, but retaining ownership until the goods are sold or person is transferred. This may be done for shipping, transfer of prisoners, or for sale in a store (i.e. a consignment shop).

Features of consignment are:

1. The relation between the two parties is that of consignor and consignee and not that of buyer and seller
2. The consignor is entitled to receive all the expenses in connection with consignment
3. The consignee is not responsible for damage of goods during transport or any other procedure.
4. Goods are sold at the risk of consignor. The profit or loss belongs to consignor only. Procedure A consignor will bring their second-hand clothes in to be reviewed. After being looked at, a "yes" pile will be made. These are the clothes that will be acceptable for selling in the store. These items are generally in perfect condition and lightly used without any stains/damages/defects. The clothes will be priced at a fraction of their retail price (usually 1/3 to 1/4 of what they originally sold for). When a consignor's item(s) sell, they will make a percentage of the sold price so that the store and the consignor make a profit. Once their clothes sell the consignor is able to receive their profit. Policies differ amongst stores but the concept remains the same. There are also laws against consigning fake designer pieces.Consignment differs from "selling-outright" where a seller brings their items in and receives immediate payment on review.

COORDINATION IS THE ESSENCE OF MANAGEMENT. DISCUSS.

I WANT TO DEFINE FIRST WHAT IS MANAGEMENT - IT IS AN ART OF GETTING THINGS DONE THROUGH A MANAGER. MANAGEMENT IS ONE WHO ACHIEVES THE OBJECTIVES BY THE DIRECTING EFFORTS OF OTHERS.

THEN I M TRYING TO DEFINE WHAT IS COORDINATION-IT IS THE SYSTEMATICAL ARRANGEMENT OF PLANNING , ORGANIZING, STAFFING, DIRECTING AND CONTROLLING.

COORDINATION IS THE ARRANGEMENT OF MANAGEMENT FUNCTION. COORDINATION IS THE LIFE LINE OF MANAGEMENT. MANAGEMENT IS THE COORDINATION BETWEEN PLANNING, ORGANIZING, STAFFING, DIRECTING AND CONTROLLING. It is a hidden force which binds all the other functions of management.

Co-ordination is an integral element or ingredient of all the managerial functions as discussed below: -

1. Co-ordination through Planning - Planning facilitates co-ordination by integrating the various plans through mutual discussion, exchange of ideas. e.g. - co-ordination between finance budget and purchases budget.
2. Co-ordination through Organizing - Mooney considers co-ordination as the very essence of organizing. In fact when a manager groups and assigns various activities to subordinates, and when he creates department's co-ordination uppermost in his mind.
3. Co-ordination through Staffing - A manager should bear in mind that the right no. of personnel in various positions with right type of education and skills are taken which will ensure right men on the right job.
4. Co-ordination through Directing - The purpose of giving orders, instructions & guidance to the subordinates is served only when there is a harmony between superiors & subordinates.
5. Co-ordination through Controlling - Manager ensures that there should be co-ordination between actual performance & standard performance to achieve organizational goals.

DIFFERENVE BETWEEN SHARE AND DIBENTURE

SHARES- 1.share holder is the real owner of the company.share holder have not fixed dividend rate.share holder have not maturity period.share are not redeemed.shares are more volatile.share holder have high risk.share holder have high return.share holder have right on residial income.share face value is Rs 10/each.
DEBENTURE-1.debenture holder is the creditor of a company.they have fixed rate of interest.they have a maturity period.they dont have right to vote.debentures are redeemed.they are not volatile.they have no risk.they have low return.debenture face value is Rs-100/each

EXPLAIN BREIFLY THE VARIOUS METHODS OF REDEMPTION OF DIBENTURE?

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