St.

Marys Boys Higher Secondary School

12th Standard

ACCOUNTANCY
Time : 01:00:00 Hrs Total Marks : 120
CHOOSE THE BEST ANSWER: 119 x 1 = 119
1) Financial performance of a business can be ascertained by preparing .............
(a) Final Accounts (b) Trial Balance (c) Capital Accounts
2) Final accounts is prepared on the basis of ..............
(a) Capital Accounts (b) Assets (c) trial Balance
3) Outstanding expenses will be shown on the debit side of ................... by way of additions to
the particular expense.
(a) Trading Account (b) Trial Balance (c) Profit and Loss Account
4) Prepaid expenses will be shown on the ........... side of the Balance Sheet.
(a) Assets (b) Debit (c) Liabilities
5) Accured income will be shown on the ............... side of Profit and Loss account by way of
addition to particular income.
(a) Assets (b) Credit (c) Liabilities
6) Income received during a particular accounting period for the work to be done in future
period is called as .................
(a) Accrued Income (b) Outstanding Income (c) Income received in advance
7) Amount withdrawn by the owner for his personal use is called as ................
(a) Capital (b) Drawings (c) Profit
8) Borrowings from banks, financial institutions and outsiders for business are called
(a) Capital (b) Loans (c) Drawings
9) Accured interest on investments will be shown on the assets side of the ............ by way of
addition to the investment account.
(a) Trial Balance (b) Balance Sheet (c) Profit and Loss Account
10) Bad debts will be shown on the assets side of the ............... by way of deduction from
sundry debtors.
(a) Balance Sheet (b) Trial Balance (c) Profit and Loss Account
11) Final accounts refer the preparation of
(a) trading, profit, and loss account only (b) balance sheet only
(c) trading, profit and loss account and balance sheet
12) If provision for bad and doubtful debts is maintained, the loss on account of bad debts is
taken to profit and loss account not directly but via
(a) provision for discount on debtors account
(b) provision for bad and doubtful debts account
(c) provision for discount on creditors account
13) The object of preparing trading , profit and loss account is to know the of the
business.
(a) financial position of the concern (b) net profit or net loss (c) gross profit or gross loss
14) All the items given in adjustment will appear at in the final accounts
(a) three places (b) two places (c) one place
15) Depreciation @ 10% p.a. on furniture Rs. 25,000 as on 31.3.2000 for one year is

(a) Rs.2,500 (b) Rs.2,800 (c) Rs.250

16) Provision for discount on creditors is calculated at a certain percentage on
(a) bills payable (b) cash purchases (c) sundry creditors
17) To motivate the debtors to make prompt payments are given.
(a) free samples (b) incentives (c) cash discounts
18) Income received in advance is shown in the side of the balance sheet
(a) debit (b) assets (c) liabilities
19) As per trial balance debtors is Rs.10,500. In the adjustment, bad debts written off Rs.500 is
given. The amount to be shown in the assets side is
(a) Rs.11,000 (b) Rs.10,000 (c) Rs.500
20) Prepaid expenses will be shown on the
(a) debit side of the profit and loss account by deducting from the particular expenses.
(b) credit side of the profit and loss account by adding with the particular item.
(c) liability side of the balance sheet
21) An amount received in respect of which full service has not been rendered is
called
(a) prepaid expenses (b) income received in advance (c) accured income
22) Income for which services are rendered but remuneration not received are called

(a) income received in advance (b) prepaid expenses (c) accured income
23) Single entry system maintains ...........
(a) All kinds of accounts (b) Only cash acounts (c) Only personal and cash accounts
24) Single entry system actually refers to ..............
(a) Incomplete double entry system (b) both a & c (c) The defective double entry system
25) Statement of affairs is prepared to find out...........
(a) capital (b) profit (c) drawings
26) Incomplete double entry is..............
(a) a scientific method (b) an unscientific method (c) a systematic method.
27) Total creditors account is prepared to find out..............
(a) cash and credit purchases (b) cash purchases (c) credit purchases
28) If cash sales and credit sales are added we get...............
(a) total sales (b) total purchases (c) total debtors
29) A trader's closing capital is Rs.20,000, his drawings Rs.3,000 his opening capital
Rs.14,000.His profit for the year is ..................
(a) Rs.8,000 (b) Rs.9,000 (c) Rs.10,000
30) Total sales of a concern is RS 60,000. Of this credit, sales is Rs.38,000.Cash sales is.............
(a) Rs.33,000 (b) Rs.22,000 (c) Rs.11,000
31) Debtors on 1st April 2004, Rs.20,000 and 31st March 2005 Rs.30,000.Cash received from
debtors during the year Rs.60,000.Credit sales made during the year is.............
(a) Rs.70,000 (b) Rs.90,000 (c) Rs.50,000
32) The reduction in the production capacity or earning capacity of a fixed asset is termed as
--------------
(a) Depreciation (b) Appriciation (c) an improvement
33) The cause of depreciation due to use of tangible asset is --------------
(a) Maintenance (b) Depletion (c) Wear and tear
34) When assets are exposed to forces of nature, it is -------------.
(a) Obsolescence (b) Effluxion of time (c) Time factor
35) The same amount of depreciation is charged every year throughout the life of the asset,
under -----------.
(a) Fixed Instalment method (b) Annuity method (c) Insurance Policy method
36) This method is recognised by the Income Tax authorities.
(a) Annuity method (b) Revaluation method (c) Written down value method
37) Under this method, funds are made available for the replacement of asset at the end of its
useful life
(a) Fixed Instalment Method (b) Annuity Method (c) Sinking fund method
38) Depreciation account is closed by transferring to ----------- at the end of the year.
(a) Profit and loss A/c (b) Trading A/c (c) Fixed Asset A/c
39) Internal cause of depreciation is
(a) time factor (b) deplection (c) effluxion of time
40) The amount of depreciation provided on the straight-line method @ 10% p.a. on
Rs.1,00,000 will be
(a) Rs.100 (b) Rs.1,000 (c) Rs.10,000
41) The value of machinery purchased is Rs.2,00,000. Installation charges are Rs. 10,000.
Depreciation amount on straight line method @ 10% per annum is
(a) Rs.20,000 (b) Rs.21,000 (c) Rs.19,000
42) The cost of an asset is Rs.1,00,000. Depreciation is calculated @ 10% p.a. under straight
line method. Book value of asset at the end of the second year is
(a) Rs.90,000 (b) Rs.80,000 (c) Rs.70,000
43) Depreciation is provided to ascertain the
(a) the real cost of production (b) market value (c) residual value
44) Cost of an asset is Rs.45,000. It's estimated life is 10 years. Amount of depreciation is

(a) Rs.45 (b) Rs.450 (c) Rs.4,500

45) Cost of an asset is Rs.5,00,000. It's estimated life is 10 years. Amount of depreciation is

(a) 50% (b) 10% (c) 5%

46) Installation cost of a machinery is included in for determining
depreciation.
(a) original cost (b) written down value (c) scrap value
47) Residual value is otherwise known as .
(a) scrap value (b) cost value (c) selling price
48) Cost price of an asset is Rs.10,000. Selling price of the asset is Rs.9,000.Book value of asset on
the date of sale is Rs.8,500. It denotes
(a) profit Rs.500 (b) loss Rs.500 (c) profit Rs.1,000
49) .................. is an expression of one number in relation to another.
(a) Profit (b) Loss (c) Ratio
50) Ratios are expressed in .............
(a) Times and Percentage (b) Time and Pure (c) Times, Percentage and Pure
51) The objectives of using ratios are to test.................
(a) the profitability, financial position (liquidity and solvency) and the operating efficiency of a
concern
(b) the operating efficiency of a concren (c) the profitability of a concern
52) Liquidity ratios are otherwise called as....................
(a) Short Term Solvency Ratios (b) Profitability Ratios (c) Turnover Ratios
53) The relationship of current assets to current liabilities is known as...................
(a) Net Profit Ratio (b) Current Ratio (c) Proprietory Ratio
54) The relationship of liquid assets to current liabilities is known as..................
(a) Current Ratio (b) Operating Ratio (c) Liquid ratio
55) All liquidity ratios are expressed as a........................
(a) Proportion (b) Time (c) Percentage
56) ..................ratio studies the firm's ability to meet its long term obligations.
(a) Solvency (b) Liquidity (c) Turnover
57) Dept Equity Ratio indicates the proportion between total long term debts
and.........................
(a) Loans (b) Shareholders funds (c) Bank overdraft
58) Total long term debt includes......................
(a) Debentures, long term loans from banks and financial institutions
(b) Shareholders funds (c) Fixed Assets
59) ................... measures the profit earning capacity of the business concern.
(a) Solvency Ratio (b) Liquidity Ratio (c) Profitability Ratio
60) The relationship of Gross profit to sales is known as.......................
(a) Gross Profit Ratio (b) Net Profit Ratio (c) Operating Ratio
61) The relationship of Net profit to ........................ is known as Net profit ratio.
(a) Stock (b) Sales (c) Purchases
62) Operating expenses include.................
(a) Administration and selling expenses (b) Selling and distribution expenses
(c) administration, selling and distribution expenses
63) All profitability ratios will be expressed in term of .....................
(a) Proportion (b) Times (c) percentage
64) ................... indicate the performance of the business.
(a) Activity Ratios (b) Solvency Ratios (c) Liquidity Ratios
65) The relationship ..................... and capital employed is known as capital Turnover Ratio.
(a) Purchases (b) Sales (c) Drawings
66) The relationship between ........................... and Fixed Assets is known as Fixed Assets
Turnover ratio.
(a) Purchases (b) Sales (c) Total sales
67) Debtors Turnover Ratio establishes the relationship between .................and average
accounts receivable.
(a) Credit Sales (b) Cash Sales (c) Total Sales
68) Accounts Receivable includes...................... and bills receivable.
(a) Sundry Debtors (b) Sundry Creditors (c) Bills Payable
69) .................. Ratio establishes the relationship between credit purchases and average
accounts payable.
(a) Net Profit Ratio (b) Operating Ratio (c) Creditors Turnover Ratio
70) Cost of gold is Rs.4,00,000 and average stock is Rs.80,000. Stock turnover ratio will
be...........
(a) 5 times (b) 4 times (c) 7 times
71) Net profit ratio establish the relationhip between..........
(a) net profit and net sales (b) gross profit and credit sales (c) gross profit and cash sales
72) Debtors turnover ratio is the relationship between.............., .............
(a) Credit sales and average accounts payable
(b) Credit sales and average accounts receivable. (c) credit sales and cash sales.
73) Liquidity ratio measures the firms ability to pay off..........
(a) Current liabilities (b) Long term liablilities (c) Fixed liabilities
74) Solvency ratio measures the firms ability to meet its.............
(a) current liabilities (b) long term liabilities (c) fixed liabilities
75) Current assets are those assets which are convertible into cash within......
(a) two years (b) one year (c) three years
76) A firm has cash at bank Rs.1,10,000, stock Rs.36,500, Sudry debtors Rs.63,500 and
prepaid expenses Rs.1,000. Value of current assets is.............
(a) 1,01,000 (b) 1,10,000 (c) 1,11,000
77) Liquid assets means...........
(a) current assets less stock and prepaid expenses
(b) current assets plus stock and prepaid expenses (c) current assets minus bank overdraft
78) Balance sheet shows equity share capital Rs.2,00,000. Reserves and surplus Rs. 50,000.
Preference share capital Rs. 1,00,000. Long term loans Rs.75,000 and Debentures
Rs.50,000. Shareholders funds will be.............
(a) Rs.4,25,000 (b) Rs.4,75,000 (c) Rs.3,50,000
79) Gross profit is the difference between net sales and...........
(a) cost of goods sold (b) credit sales (c) total sales
80) A firm has current assets Rs.60,000 and current liabilities Rs.30,000 then current ratio
will be...............
(a) 1 : 2 (b) 1 : 1 (c) 2 : 1
81) Cash Budget is a component of two words
(a) cash and Budget (b) Cash and Bank (c) Cash and Credit
82) ............... is an account of probable future income and expenditure.
(a) Balance sheet (b) Budget (c) Income and Expenditure A/c
83) The two basic components of Receipts and payments method are
(a) Cash and credit purchases (b) Debtors & Creditors
(c) estimate of cash receipts and payments
84) Sale of asset is an example for....................
(a) cash payment (b) cash receipt (c) revenue receipt
85) Closing balance of cash for the month of March, April and May are Rs.38,000, Rs.60,000
and Rs.93,000 respectively. Opening Cash Balance of April is..............
(a) Rs.99,000 (b) Rs.38,000 (c) Rs.69,500
86) Purchase of computer is an example for..............
(a) cash payment (b) cash receipt (c) income
87) The opening balance of cash in March is Rs.18,000. The estimated receipts are Rs.28,000
and the estimated payments are Rs.20,000.The opening balance of cash in April will
be.........................
(a) Rs.42,000 (b) Rs.22,000 (c) Rs.26,000
88) ..................shows the estimate of cash receipts and cash payments from sources over a
specific period.
(a) Cash sales (b) Cash receipt (c) Cash received from customers
89) Cash budget is otherwise known as...............
(a) Finance budget (b) Sales budget (c) Purchase budget
90) The closing cash balance in July is Rs.16,000 the estimated receipts is Rs.18,000 and
estimated payments is Rs.12,000. The opening balance of cash in July will be.................
(a) Rs.10,000 (b) Rs.30,000 (c) Rs.17,000
91) The opening balance of cash in April is Rs.18,000, the estimated receipts is Rs.25,000,
estimated payments is Rs.28,000. Then the opening balance of cash in May will be.............
(a) Rs.15,000 (b) Rs.42,000 (c) Rs.12,000
92) The maximum number of partners in banking business is ............
(a) 20 (b) 10 (c) 5
93) Amount drawn regularly at the end of every month during the year, interest is
calculated for ............
(a) 13/24 months (b) 11/24 months (c) 12/24 months
94) Goodwill is ..............

(a) a Tangible Asset (b) an intangible Asset (c) a Fictitious Asset

95) The excess of average profit over normal profit is .............

(a) Goodwill (b) Average Profit (c) Super Profit
96) The liability of a shareholder in a company is ...............
(b) Unlimited (b) limited (c) Joint and several
97) The difference between the authorised capital and the issued capital represents ............
(c) Nominal capital (b) Subscribed capital (c) Unissued capital
98) That part of the called - up capital, which has been actually paid up by the shareholders is
............
(d) Authorised capital (b) Subscribed capital (c) Paid up capital
99) The capital of the company divided into units of small denomination is called ..............
(e) Shares (b) Dividend (c) Debentures
100) If the issue price of share is equal to the face value, it is said to be issued ...........
(f) at par (b) at premium (c) at discount
101) When a company issues its shares at a price more than the face value, it is said to be
issued ...........
(g) par (b) premium (c) discount
102) When a company issues its shares at a price less than the face value, it is said to be
issued ............
(h) at par (b) at premium (c) at discount
103) Forfeiture of shares will........the share capital.
(i) remain same (b) reduce (c) increase
104) The application money should be......of the face value
(j) more than 5% (b) less than 5% (c) atleast 5%
105) The company has no powers to forfeit the shares unless it is provided by the.........
(k) Memorandum of association (b) Articles of association (c) Certificate of incorporation
106) The company should send a notice to the share holder before forfeiture,not less
than.......days.
(a) 20 (b) 15 (c) 14
107) The profit on forfeited shares is transferred to........account.
(l) General reserve (b) Capital reserve (c) Sundry reserve
108) JK Ltd, issued 75,000 shares of Rs.10 each fully subscribed by public Rs.7 per share has
been called up.Then.......will present uncalled capital.
(a) 2,25,000 (b) 5,25,000 (c) 7,50,000
109) Discount on issues of shares should not be more than.......of the face value of shares.
(a) 5% (b) 10% (c) 15%
110) ..........interest is allowed on calls in advance from the date of receipt till due date.
(a) 6% (b) 9% (c) 10.5%
111) .........can be issued only at the time of winding up.
(m) Authorised capital (b) Issued capital (c) Reserve capital
112) A call money can't exceed.......% of the nominal value of share.
(a) 6% (b) 25% (c) 10%
113) .........is the maximum amount of share capital which a company is authorised to raise.
(n) authorised capital (b) subscribed capital (c) issued capital
114) The amount of calls in arrears is deduced from.......
(o) called up capital (b) paid up capital (c) subscribed capital
115) Shares which cannot be converted into equity shares are called.........
(p) non convertible preference shares (b) non participating shares
(c) participating preference shares
116) The part of authorised capital which is issued to the public for subscription is
called.........capital.
(q) issued (b) subscribed (c) called up
117) A company is a voluntary association of.........
(r) workers (b) merchants (c) persons
118) If a share of Rs.10 is issued for Rs.11, then.........is the premium on share.
(a) Re.1 (b) Rs.2 (c) Rs.10
119) If 50,000 shares of Rs.10 each subscribed by public of which Rs.6 per share has been
called up, then total amount of uncalled capital is..........
(a) 3,00,000 (b) 2,00,000 (c) 5,00,000