Sample Questions of Commerce Olympiad

Accountancy

1. Various steps of accounting process are

(i) Recording,

(ii) Summarizing,

(iii) Identifying the financial transaction

(iv) Classifying

(v) Communicating

Identify from the following, which is the correct order of above steps

(a) (i), (ii), (iii), (iv), (v)

 (b) (i), (iii), (iv), (ii), (v)

(c) (iii), (i), (iv), (ii), (v)

(d) (iii), (i), (iv), (v), (ii)

2. Which of the following qualitative features of accounting is reflected, when accounting policies and

conventions are followed consistently ?

(a) Reliability

(b) Understandability

(c) Relevance

(d) Comparability

3. Window dressing in accounting refers to-

(a) Showing more or less profit than true and fair profit

(b) Showing more profit than true profit

(c) Showing less profit than true profit

(d) Disclosure of information about accounting policies

4. Capital is the –

(a) Excess of external liabilities over the assets

(b) Excess of assets over the external liabilities

(c) Excess of external liabilities over fixed assets

(d) Excess of assets over internal liabilities

5. The term “purchase” is used only for purchase of _______________and is never used for the purchase of

______________

(a) Assets, Investment

(b) Assets, Goods

(c) Intangible assets, Goods

(d) Goods, Non current assets

6. Cash discount is allowed at the time of ________

(a) Receiving early payment of due amount

(b) Sale of goods in bulk quantity

(c) Both at the time of sale of goods and receiving the payment

(d) Making payment for purchase of goods

7. Which accounting principle is followed when a firm makes provision for doubtful debts on debtors ?

(a) Consistency

(b) Materiality

(c) Going concern

(d) Prudence

8. All the following items are classified as fundamental accounting assumptions EXCEPT –

(a) Consistency

(b) Business entity

(c) Going concern

 (d) Accrual

9. Mr. Harish purchased a motorcycle for his son on credit and recorded it as purchase of asset in the business books. He has violated –

(a) Money measurement principle

(b) Periodicity

(c) Consistency

 (d) Accounting entity principle

10. Name the principle which treats all rupees alike whether it is rupee of year 1972 or 2012 –

(a) Money measurement principle

 (b) Periodicity principle

(c) Consistency principle

 (d) Accounting Entity

11. The adjustments for outstanding expenses, prepaid expenses, accrued income and unearned income are

made as per which of the following accounting principle ?

(a) Entity

(b) Periodicity

(c) Matching

(d) Conservatism

12. “IFRS” stands for

(a) Indian Financial Reporting System

(b) International Financial Reporting Standards

(c) Internal Financial Recording System

(d) International Financial Reporting System

13. Which of the following is the source voucher/document ?

(a) Debit voucher

(b) Credit voucher

(c) Transfer voucher

 (d) Invoice

14. In Accounting equation outstanding rent is an example of –

(a) Increase in Assets and decrease in Capital

(b) Increase in Liability and decrease in Capital

(c) Decrease in Liability and Capital

(d) Increase in Assets and Capital

15. Credit means-

(a) Increase in Assets

(b) Increase in Liability

(c) Decrease in Liability

(d) Decrease in Capital

16. Which of the following is the odd one out with reference to the nature of accounts ?

(a) Interest A/c

 (b) Outstanding Interest A/c

(c) Advance Interest A/c

(d) Accrued Interest A/c

17. While passing an entry for purchase of goods of the list price of ` 10,000 from Mr. Vikas who allowed 10%

trade discount and 5% cash discount. ___________A/c will be debited with ______________

(a) Purchases, ` 10,000

 (b) Purchases, ` 8,500

(c) Vikas, ` 8,550

(d) Purchases, ` 8,550

18. The debit balance of a personal account is __

(a) Cash in hand

(b) Amount receivable

(c) Income earned

(d) Amount payable

19. Which of the following accounts are normally balanced __

(a) Personal and Nominal accounts

 (b) Real and Nominal accounts

(c) Personal and Real accounts

(d) Personal, Real and Nominal accounts

20. Which document is sent to a customer when he returns the goods, which were sold to him on credit ?

(a) Credit Note

 (b) Cheque

(c) Debit Note

 (d) Return Invoice

21. Furniture used by a Furniture dealer for furnishing his office will be credited to___

(a) Furniture A/c

(b) Cash A/c

(c) Sales A/c

(d) Purchases A/c

22. Which of the following transactions will result in lower balance in the bank column of Cash Book in

comparison to Pass Book ?

(a) Interest credited by Bank, not recorded in Cash Book

(b) Bank charges not recorded in Cash Book

(c) Cheques sent to bank, but not yet credited

(d) Cheques paid into bank, and duly collected

23. Overdraft as per Pass Book is ` 10,000, Cheques deposited but not credited ` 2,500. What will be the balance as per Cash Book ?

(a) Overdraft ` 7,500

 (b) Favourable Balance ` 7,500

(c) Favourable Balance `12,500

(d) Overdraft ` 2,500

24. A cheque issued for ` 108 was recorded twice in the Cash Book. When the balance as per Cash Book is

taken as base, while preparing the Bank Reconciliation Statement __

(a) ` 108 will be substracted

 (b) ` 216 will be added

(c) ` 216 will be substracted

 (d) ` 108 will be added

25. The Trial Balance checks

(a) Honesty of Book keeper

 (b) Systematic recording of transactions

(c) Arithmetical accuracy of books

(d) Frauds of Accountant

26. Purchase of computer for office worth ` 24,000 has been debited to office expenses A/c. Which type of

error is this ?

(a) Clerical error

(b) Error of Principle

(c) Error of Omission

(d) Error of Commission

27. Which of the following errors will not affect the Trial Balance ?

(a) Wrong carry forward balance of an account

(b) Wrong totalling of an account

(c) Omission of an account from the Trial Balance

(d) Posting in wrong account on correct side

28. Purchased goods from Kavish for ` 4,800 but was recorded to the debit of Kavish as ` 8,400. In the rectifying entry, Kavish's A/c will be ________

(a) Credited with ` 13,200

 (b) Debited with ` 3,600

(c) Credited with ` 4,800

(d) Debited with ` 13,200

29. In which of the following errors, Suspense account will be opened in rectifying entry ?

(a) Goods worth ` 4,800 withdrawn by proprietor omitted to be recorded

(b) Goods returned by Naresh` 480 was recorded in sales book

(c) Ramesh who owed us ` 400 has been credited with ` 4,000

(d) Sales of ` 1,296 to Rohitwas entered in the sales book as ` 1,269

30. Which of the following is NOT an error of commission ?

(a) A sale of ` 1,080 not recorded in books at all

(b) Instead of crediting Nidhi, Vidhi is credited

(c) Rent paid to landlord was posted to Landlord's A/c

(d) A purchase of ` 480 was wrongly posted to sales A/c

Attempt ANY ONE Section out of Section A and Section B

Section - A

(From Q. No. 31 to 40)

31. Depreciation is provided on___

(a) Current Assets

(b) Intangible Assets

(c) Tangible Fixed Assets

(d) Fictitious Assets

32. Which of the following is not the cause of depreciation ?

(a) Physical wear and tear

(b) Expiry of period

(c) Expiry of legal rights

 (d) Theft of an asset

33. A machine was purchased on 1 April, 2011 for ` 5,00,000 and on 1 October, 2011 a new machine is added for ` 2,00,000. Calculate the balance of machine account, on March 31, 2012 if depreciation is charged @ 20% p.a on Written Down Value.

(a) ` 6,00,000

 (b) ` 5,60,000

(c) ` 6,60,000

(d) ` 5,80,000

34. X Ltd. Purchased a machine on 1.1.2012 for ` 2,40,000. Installation expenses were ` 20,000. Residual value of machinery after 5 years ` 10,000. On 1.7.2012, repair expense was incurred to the extent of ` 4,000. Depreciation is provided @20% by Straight Line Method. Find out the amount of depreciation for

the fourth year.

(a) ` 50,000

(b) ` 34,000

(c) ` 42 ,000

 (d) ` 50,800

35. Which of the following statements are correct about “Provisions’

i. Provision is a charge against profit of an enterprise

ii. Provision is created out of profit

iii. Creation of provision is necessary for a business

iv. Provision is created to meet a known liability

(a) i,ii and iii

(b) ii and iv only

(c) i,iii and iv

 (d) i and iv only

36. Who pays the noting charges initially, when an endorsed bill is dishonoured ?

(a) Drawer

(b) Drawee

(c) Endorser

(d) Endorsee

37. What will be the due date, If a bill is drawn on 13 July, 2012 for 30 days ?

(a) 15 August, 2012

 (b) 14 August, 2012

(c) 17 August, 2012

 (d) 16 August, 2012

38. On 1.1.2012 X draws a bill on Y for ` 1,50,000 for 3 months. X got the bill discounted on 4.2.2012 @ 12%

p.a. What will be the amount of discount ?

(a) ` 3,000

(b) ` 6,000

(c) ` 18,000

(d) ` 4,500

39. On 1.6. 2007 X draws a bill on Y for ` 25,000. At maturity Y requests X to accept ` 5,100 in cash (including

noting charges ` 100). For the balance X draws a bill on Y for two months at 12% p.a. What will be the

amount of interest.

(a) ` 410

 (b) ` 420

(c) ` 440

(d) ` 400

40. A bill of ` 1,50,000 was discounted by A with his banker of ` 1,45,500. At maturity the bill returned

dishonored, the noting charges being ` 200. How much amount will the banker deduct from A's bank

balance at the time of such dishonor ?

(a) ` 1,45,500

(b) ` 1,45,700

(c) ` 1,50,200

(d) ` 1,50,000

Section-B

(From Q. No. 41 to 50)

41. Huge expenses incurred on advertising campaign for a soft drink is which type of expenditure ?

(a) Revenue Expenditure

 (b) Capital Expenditure

(c) Deferred Revenue Expenditure

 (d) Prepaid Expenditure

42.. Life Insurance premium paid by a proprietor ` 3,000 appearing in the Trial Balance will be-

(a) Debited to Profit and Loss A/c

(b) Credited to Profit and Loss A/c

(c) To be shown in Dr. of P&L A/c and deducted from capital

(d) Deducted from capital

43. Profit and Loss A/c of a business shows its.

(a) Financial performance at a particular date

(b) Financial performance for an accounting period

(c) Financial position at a particular date

(d) Financial position for an accounting period

44. Kriti's Trial balance as at 31 December 2012 contains the following information : 12% Bank loan ` 40,000,

Interest paid ` 3,800. How much amount of interest will be debited to Profit and Loss A/c

(a) ` 4,800

(b) ` 5,000

(c) ` 1,000

(d) ` 3,800

45. Closing stock appearing in Trial Balance is shown_

(a) Only on the debit side of Trading A/c

(b) Only on the credit side of Trading A/c

(c) Only on the Asset side of Balance Sheet

(d) On Credit side of Trading A/c and Asset side in Balance Sheet

46. Trial balance as on 31 December, 2012 shows Debtors ` 5,00,000, Bad Debts ` 15,000 and Provision for

Doubtful Debts ` 1,00,000

Additional Information:

(i)                  Further Bad Debts are ` 25,000

(ii)                (ii) Maintain provision@ 10% on debtors

By what amount will the P&L A/c be debited ?

(a) ` 87,500

(b) ` 1,00,000

(c) ` 47,500

(d) None of the above

47. From the following calculate total sales of XYZ Ltd.

Opening Stock :` 50,000, Purchases : ` 1,00,000, Manufacturing Expenses : ` 30,000., Net Profit is `

25,000, Gross Profit on sales is 20%

(a) ` 45,000

(b) ` 2,25,000

(c) ` 2,40,000

(d) ` 2,00,000

48. Under the liquidity approach of marshalling of Assets and Liabilities

(a) The most liquid assets are presented at the bottom of Balance Sheet

(b) The least urgent payment are presented at the top of the Balance Sheet

(c) The least urgent payment are presented at the bottom of the Balance Sheet

(d) The least liquid assets are presented at the bottom of the Balance Sheet

49. Select the odd one:

(a) Goodwill

(b) Trade Debtors

(c) Outstanding Telephone Bills

 (d) Rent Receivable

50. Which of the following would not be transferred to Profit and Loss A/c, while preparing Final Accounts ?

(a) Accumulated Depreciation

 (b) Bad Debts

(c) Discount Allowed

 (d) Bad Debts recovered