Commerce Objective type Question Paper

I want to get the B.Com IGNOU question paper, will you please provide me that ?

[Quick Sam]

As you want to get the B.Com IGNOU question paper, so here I am giving you some question of that paper:

1. According to Balance Sheet equation concept, the capital will be–
(A) Capital = Liabilities – Assets
(B) Capital = Fixed Assets –
Current Assests
(C) Capital = Assets – Liabilities
(D) Capital = Assets + Liabilities


2. In common size Balance Sheet analysis we evaluate–
(A) Increase or decrease over two years is analysed
(B) Only increase over two years is analysed
(C) Only decrease over two years is analysed
(D) All assets and liabilities are expressed in terms of percentage of total


3. Increase in fixed asset due to purchase is–
(A) Source of fund (B) Fund from operation
(C) Use of fund (D) None of the above


4. For the purpose of preparation of fund flow statement, fund means–
(A) Total resources (B) Cash/bank balances
(C) Current Assets (D) Working capital


5. The following data, relates to manufacturing company for the year 2006-07–
Net Profit as per P & L A/c–Rs. 2,40,000; Depreciation–Rs. 80,000; Goodwill written-off–Rs. 40,000, Profit on Sale of Fixed Assets–Rs. 16,000, Proposed Dividend–Rs. 96,000. The fund from operation would be–
(A) Rs. 4,40,000 (B) Rs. 4,00,000
(C) Rs. 6,40,000 (D) None of the above


6. A vacancy caused by the resignation of the auditor is filled only by the–
(A) Board of Directors of the Company
(B) Central Government
(C) General Meeting of the shareholders
(D) Managing Director of the company


7. The first auditor of a company appointed, holds office–
(A) For a period of one year
(B) For that period till new auditor is appointed
(C) Till the conclusion of first Annual General Meeting
(D) Till the holding of statutory meeting of the company


8. Internal Auditor is appointed by the–
(A) Management (B) Shareholders
(C) Government (D) Statutory Auditor


9. “Auditor is a watchdog and not a blood hound” was a remark made in the case of–
(A) The London Oil Storage Co. Ltd. 1904
(B) Kingston Cotton Mills Ltd. 1896
(C) London and General Bank 1895
(D) Delightful Cigarette Co. Ltd. 1943


10. The auditor is generally expected to carryout the following in a particular sequence–
1. Verification of Assets and Liabilities.
2. Vouching of transactions.
3. Checking of valuation of Assets and Liabilities.
Select the correct sequence of the above from the following–
(A) 1, 3 and 2 (B) 3, 2 and 1
(C) 2, 1 and 3 (D) 3, 1 and 2


11. What is the quorum of General Meetings in the case of a Private Company ?
(A) 2 members (B) 3 members
(C) 4 members (D) 5 members


12. Which of these must hold a Statutory Meeting ?
(A) Public Limited Company (B) Private Company
(C) Unlimited Company (D) All of these


13. When three sugar mills combine, it is an example of–
(A) Vertical combination (B) Horizontal combination
(C) Diagonal combination (D) None of the above


14. The first electronic computer system was developed in–
(A) 1920 (B) 1940
(C) 1930 (D) 1950


15. An Index is–
(A) A filing system (B) A photostat procedure
(C) The procedure to collect data (D) An important help in filing


16. Consider the following statements in respect of PERT–
1. PERT is a variation of milestone budgeting.
2. PERT employs probabilistic estimate of time required for completion of an activity.
3. PERT also includes the transfer of resources for reduction of duration of completion of a project.
Which of the statements given above are correct ?
(A) 1, 2 and 3 (B) 1 and 2 only
(C) 2 and 3 only (D) 1 and 3 only


17. Some organizations have escalator clause in their labour agreements.
What does this clause provide for ?
(A) Automatic increase in wage/salary depending on seniority
(B) Wage increase depending on output per day by the worker
(C) Automatic increase in wage/salary depending upon increase in price index
(D) Automatic increase in wage/salary depending on increase in profits of the firm


18. What is an organization structure in which each employee reports to both a functional (or division) manager and to a project (or group) manager, known as ?
(A) Strategic business unit (B) Departmentation by customer
(C) Matrix structure (D) Departmentation by territory


19. According to force-field theory, every behaviour is the result of equilibrium between which of the following ?
(A) Push and pull effect (B) Strong and weak forces
(C) Positive and negative forces (D) Driving and restraining forces


20. Life insurance is a contract of which one of the following ?
(A) Indemnity (B) Guarantee
(C) Contribution (D) Subrogation

Hi I want the Objective type Question Paper of Commerce so can you please provide me?

[Quick Sam]

Hi, as you want the Objective type Question Paper of Commerce so here I am providing you.

Commerce Question Paper

1. On January 1, 1992 there was a balance of Rs. 4,000 in the plant and machinery account. An addition of Rs. 2,000 was made on July 1, 1992. Accounts were closed for the year on December, 31, 1992. If depreciation was charged 10% per annum, the balance in the plant and machinery account on the closing date would be:

(a) Rs. 5,300

(b) Rs. 5,400

(c) Rs. 5,500

(d) Rs. 5,600

Ans. (c)

2. A machinery having a residual value of Rs. 5,000 was purchased on 1-1-1988 for Rs. 1, 00,000 and was depreciated @ 9.5% on a straight line method. On 1-1-91, it was estimated that its useful life has been reduced to eight years. Under the changed circumstances, the annual depreciation charges for the year 1991 and onwards will be:

(a) Rs. 11,875

(b) Rs. 13,300

(c) Rs. 9,500

(d) Rs. 12,500

Ans. (b)

3. In which one of the following methods of charging depreciation shall the balance never be reduced to zero?

(a) Fixed installment method

(b) Depreciation fund method

(c) Diminishing balance method

(d) Depletion unit method

Ans. (c)

4. Match List-I with List-II and select the correct answer using the following codes given below the lists:

List-I List-II

(Types of accounts) (Principles)

A. Real Accounts 1. Debit the receiver, credit the give.

B. Nominal Accounts 2. Debit what comes in credit what goes out.

C. Personal Accounts 3. Debit all expenses, credit all gains.

Codes:

A B C

(a) 3 2 1

(b) 1 3 2

(c) 2 3 1

(d) 1 2 3

Ans. (c)

5. Which one of the following branches of accounting primarily deals with processing and Goodwill presenting of accounting data for internal one?

(a) Financial Accounting

(b) Tax Accounting

(c) Management Accounting

(d) Inflation Accounting

Ans. (c)

6. “Holding gains in relation to stocks should not be used for payment of Dividend.” Which one of the following accounting principles is involved in this?

(a) Consistency

(b) Cost

(c) Materiality

(d) Realization

Ans. (d)

7. X started business with a capital of Rs. 20,000 and purchased goods worth Rs. 2,000 on credit. These transactions may be expressed in the form of ‘Accounting Equation’ such as:

(a) Rs. 22,000 = Rs. 20,000 – Rs. 2,000

(b) Rs. 20,000 = Rs. 22,000 – Rs. 2,000

(c) Rs. 22,000 = Rs. 22,000 + 0

(d) Rs. 22,000 = 0 + Rs. 22,000

Ans. (b)

8. Accounting records transaction in terms of:

(a) commodity units

(b) monetary units

(c) production units

(d) none of the above

Ans. (b)

9. Market price or actual cost, whichever is less, is the generally accepted accounting principle for valuation of:

(a) Stock in trade

(b) Fixed assets

(c) Current assets

(d) All assets

Ans. (a)

10. Capital employed in a business is Rs.1, 50,000. Profits are Rs. 50,000 and the normal rate of profits is 20%. The amount of goodwill as per capitalization method would be:

(a) Rs. 1, 00,000

(b) Rs. 1, 50,000

(c) Rs. 2, 00,000

(d) Rs. 3, 00,000

Ans. (a)

11. Consider the following data:

Jan. 1, 1989 Opening Stock 500 units Rs. 5 per unit

Jan. 15, 1989 Purchases 400 units @ Rs. 6 per unit

Jan. 30, 1989 issued 300 units

Feb. 15, 1989 Purchases 200 units Rs. 7 per unit

Feb. 28, 1989 Issued 300 units

March 25, 1989 Purchases 200 units @ Rs. 8 per unit

Based on the above data, the value of inventory in hand on 31st March, 1989 as per ‘First in First out’ (FIFO) method will be:

(a) Rs. 3,700

(b) Rs. 3,600

(c) Rs. 4,800

(d) None of the above

Ans. (c)

12. Renewal fee for Patents is a:

(a) capital expenditure

(b) revenue expenditure

(c) deferred revenue expenditure

(d) development expenditure

Ans. (a)

13. A manufacturing company spent the following amounts on the import and installation of a machine:

Rs. 50,000 Price of the machine

Rs. 5,000 Freight

Rs, 1,050 Insurance premium

Rs. 6,000 Replacement of a part damaged in transit, not covered under the insurance policy.

Based on the above data, Capital expenditure would be:

(a) Rs. 50, 000

(b) Rs. 56, 050

(c) Rs. 62, 050

(d) Rs.57, 050

Ans. (b)

14. Given, subscription received in 1990:

For the year 1989 Rs. 500

For the year 1990 Rs. 7,000

For the year 1991 Rs 400

1990-Subscription outstanding Rs. 250.

The amount of subscription to be posted to Income on 31st December 1990 and Expenditure account of 1990 is:

(a) Rs. 7,000

(b) Rs. 7,250

(c) Rs. 7,900

(d) Rs. 8,150

Ans. (b)

15. What is the correct sequence of the preparation of the following accounts and statements of a non-profit organization?

1. Income and Expenditure account

2. Receipts and Payment account

3. Balance Sheet

Select the correct answer from the codes given below:

(a) 1, 2, 3

(b) 1, 3, 2

(c) 2, 1, 3

(d) 2, 3, 1

Ans. (c)

16. Profit as per accounts from incomplete records may be construed as equivalent of:

(a) excess of assets over liabilities at the close of the period.

(b) excess of capital at the end over the capital at the beginning

(c) excess of assets over liabilities at the commencement of the period

(d) excess of capital at the beginning over the capital at the beginning

Ans. (b)

17. If the rate of gross profit is 20% on cost of goods sold and the sales are Rs. 1, 50,000 then the total gross profit would be:

(a) Rs. 25,000

(b) Rs. 30,000

(c) Rs. 37,500

(d) None of the above

Ans. (a)

18. According to records of a firm which does not keep its accounts on double entry system, all sales were made on credit so as to realize a profit of 33 % sale proceeds. The

3

stock of unsold goods at the beginning and at the end of the trading period were valued at Rs. 21,000 and Rs. 18,000 respectively. Goods worth Rs.1, 39,500 were purchased for resale during the period. The proprietor withdrew goods worth Rs. 1, 500 during the accounting period for personal use. What were the total sales during the period?

(a) Rs. 1, 80,000

(b) Rs. 2, 11,500

(c) Rs. 2, 25,000

(d) Rs. 2, 31,500

Ans. (b)

19. In the absence of partnership deed provision of Partnership Act, 1932 became applicable under which a partner is entitled to interest on money advances to the firm at:

(a) 4% p.a.

(b) 5% p.a.

(c) 6% p.a.

(d) 10% pa.

Ans. (c)

20. Which one of the following as not applicable to a co-operative form of business organization?

(a) Membership is open to all having a common interest

(b) Transferability of shares is permitted among general public

(c) Policy decisions are taken by the members in a general meeting

(d) Major portion of profit is distributed to members by way of dividend

Ans. (d)

21. Which one of the following statements is correct?

(a) A company consists of heterogeneous members

(b) A body corporate includes a co-operative society

(c) The expression ‘corporation’ or ‘Body corporate’ are the same

(d) A partner cannot contract with his firm, whereas a member of a company can

Ans. (d)

22. Dividend declared and paid by a company is:

(a) an expense of the company

(b) an income of the company

(c)the distribution of profit earned by the company

(d) the source of fund for the company

Ans. (c)

23. Long term liabilities are:

(a) fixed assets minus current assets

(b) fixed assets minus current liabilities

(c) current Assets plus current liabilities

(d) total liabilities minus current liabilities

Ans. (d)

24. A business entity has assets of Rs. 26,000 and liabilities of Rs. 6,000. Owner’s equity in this case is:

(a) Rs. 32,000

(b) Rs. 26,000

(c) Rs. 20,000

(d) Rs. 6,000

Ans. (c)

25. While preparing ‘Annual Financial Statements’, credit balance shown by the Bank pass book should be treated as:

(a) a liability

(b) an income

(c) an excess of payments over receipts

(d) an asset

Ans. (d)

26. If the trial balance does not tally in spite of through scruting and the difference is substantial, then which one of the following courses should an accountant adopt?

(a) Defer preparation of financial statements

(b) Open suspense account.

(c) Write off the difference to profit and losses A/c

(d) Ignore the difference and prepare financial statements

Ans. (b)

27. ‘A’ and ‘B’ are sharing profit and losses in the ratio of 4 I. ‘C’ is admitted as a new partner for 1/3rd share of profits for which he pays Rs. 30,000 as goodwill. Lf ’A’ and ‘B’ agree to share future profits equally, then the amount of goodwill to be credited to ‘A’ would be:

(a) Rs. 30.000

(b) Rs. 90,000

(c) Rs. 48,000

(d) Rs. 42,000

Ans. (d)

28. The joint life policy account received on the death of a partner is credited to the:

(a) Joint life policy reserve account

(b) Capital accounts of all the partners in their profit sharing ratio

(c) General Reserve account

(d) Profit and Loss Account

Ans. (b)

29. In setting the accounts of a firm after its dissolution, the assets of the firm shall be applied first in paying:

(a) each partner proportionately what is due to him on account of loans advanced by him

(b) each partner proportionately what is due to him account of capital

(c) each partner proportionately what is due to him on account of past profits

(d) the debts of the firm to the third parties

Ans. (d)

30. A limited company issued equity shares of Rs. 100 each. It has called up Rs. 75 on each share but received only Rs. 60 per share. The share capital account will be credited with:

(a) Rs. 60 per share

(b) Rs. 75 per share

(c) Rs. 100 per share

(d) None of the above

Ans. (b)

31. Redeemable preference shares can be redeemed:

(a) only if they are fully paid

(b) even if they are partly paid

(c) if they are paid not less than 50% of the nominal value of shares

(d) only if they are issued at a premium

Ans. (a)

32. Where all the debentures are redeemed, the balance left in the Debenture Sinking Fund Account is transferable to:

(a) Debentures Account

(b) Sinking Fund Investment Account

(c) Capital Redemption Reserve

(d) General Reserve

Ans. (d)

33. The balance in share forfeiture account, after the reissue of all forfeited shares, should be:

(a) added to paid up capital

(b) transferred to goodwill account

(c) transferred to capital reserve account

(d) shown as share forfeiture account

Ans. (c)

34. A company issued Rs. 20,000, 4% bonds repayable on equal installments over 10 years. What is the amount required in the initial year, to pay interest and to redeem the bonds (ignore tax and DCF)?

(a) Rs. 56,000

(b) Rs. 28,000

(c) Rs. 20,000

(d) Rs. 8,000

Ans. (b)

35. Match List-I with List-II and select the correct answer using the codes given below the lists:

List-I List-II

A. Deferred shares 1. Repayment obligation

B. Preference shares 2. Resembles Stock dividend

C. Bonus shares 3. No dividend obligation

D. Equity Shares 4. Not being used

Codes:

A B C D

(a) 4 3 1 2

(b) 4 1 3 2

(c) 3 2 1 4

(d) 4 1 2 3

Ans. (d)

36. Which one of the following statements is false?

(a) The process of issue of bonus shares is also known as capitalization of reserves

(b) Fully paid bonus shares are issued only out of capital reserves

(c) Only revenue reserves should be used when bonus is declared in order to make partly paid shares into fully paid shares.

(d) Bonus shares one shares issued without payment.

Ans. (b)

37. The Balance Sheet of a company showed the following balances at the end of the year under the head ‘Reserves and surplus’: General Reserve Rs. 5,00,000; Share Premium account Rs. 50,000; Premium on issue of Debentures account Rs. 20,000; Dividends equalization fund Rs. 40,000; Surplus on revaluation of assets Rs. 30,000 Profit and Loss account (credit) Rs. 60,000. Maximum amount available for distribution as dividend to the shareholders of the company will be:

(a) Rs. 60,000

(b) Rs.1, 00,000

(c) Rs. 6, 00,000

(d) Rs.6, 70,000

Ans. (c)

38. Capital Gearing ratio denotes the relationship between:

(a) assets and capital

(b) loan and capital

(c) equity shareholder’s fund and long term borrowed funds

(d) debentures and share capital

Ans. (c)

39. The following balances appear on the liability side of a company’s Balance Sheet:

Rs.

Equity Share Capital: 10,000 Shares of Rs. 10 each 1.00.000

10% Redeemable Preference shares 1, 00,000

5,000 shares of Rs 20 each

Capital redemption reserve account 40,000

14% Debentures 1, 00,000 Deb. of Rs. 2 each 2, 00,000

RFC loan 1, 50,000

Profit and Loss A/c 50,000

The Debt Equity ratio of the company is

(a) 35: 20

(b) 35: 26

(c) 35: 25

(d) 35: 21

Ans. (c)

40. Consider the following financial information in respect of two companies namely ‘M’ Co. and ‘Z’Co. :

Items of Assets and Liabilities ‘M’ Co. (Rs) ‘Z’ Co. (Rs)

Current Assets 7, 50,000 7, 50,000

Closing inventory 3, 00,000 2, 50,000

Goodwill 5, 00,000 3, 50,000

Current Liabilities 3, 00,000 5, 00,000

Based on the above data, acid test of M Co. in comparison to Z Co. is:

(a) lower

(b) equal

(c) higher

(d) indeterminate

Ans. (c)

41. Match List-I with List-II and select the correct answer using the codes given below the lists:

List-I List-II

(Names of Accounting Ratios) (Nature of Accounting Ratios)

A. Capital gearing ratio 1. Revenue Statement Ratio

B. Stock velocity ratio 2. Coverage Ratio

C. Debtors velocity ratio 3. Market Price ratio

D. Dividend Yield ratio 4. Balance Sheet ratio

5. Balance Sheet and Revenue statement combined ratio

Codes:

ABCD

(a) 4 1 5 3

(b) 5 4 2 1

(c) 1 5 4 2

(d) 3 2 5 1

Ans. (a)

42. For the purpose of calculating ROI capital employed means:

(a) Net Fixed Assets

(b) Current Assets-Current Liabilities

(c) Gross Block

(d) Fixed Assets + Current assets – Current liabilities

Ans. (d)

43. Given that the net profit for a certain year of company ‘X’ Ltd. is Rs. 1,23,000, equity-share capital for the same period is Rs. 10,00,000 and reserve and surplus is Rs. 2,30,000 the rate of ‘return on owners fund’ would be:

(a) 12:3%

(b) 10%

(c) 9.98%

(d) none of the above

Ans. (b)

44. Consider the following data:

Costs: Fixed = Rs. 40,000

Variable Rs. 30,000

Rate of income tax = 30%

Return on capital employed = 10%

Based on the above data the sales volume required to increase the return on capital employed to 18% would be:

(a) Rs. 5,000

(b) Rs. 7,500

(c) Rs. 8,000

(d) Rs. 8,500

Ans. (c)

45. Consider the following details of companies ‘A’ ‘B’ ‘C’ and ‘D’:

A/Rs. B/Rs. C/Rs. D/Rs.

Fixed Assets 100 125 150 200

Net Current 50 55 50 40

Assets

Sales 200 250 250 300

Contribution 150 196 200 180

Fixed Cost 20 27 30 60

If the cut off point of return on investment is l5% then which of the following companies fulfill this criterion?

(a) A and C

(b) B and C

(c) A, B and D

(d) B, C and D

Ans. (c)

46. Which one of the following is an example of sources of funds?

(a) Decrease in share capital

(b) Increase in long term liabilities

(c) Decrease in long term liabilities

(d) Increase in Fixed assets

Ans. (b)

41. Current Assets are Rs. 3, 00,000 and current liabilities are Rs. 1, 50,000. Now, if the debtors realized are Rs. 20,000, then its impact on working capital would be:

(a) an increase of Rs. 20,000

(b) a decrease of Rs. 40,000

(c) an increase of Rs. 40,000

(d) nil

Ans. (d)