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12th August 2014, 12:01 PM
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Re: Common Proficiency Test Question Paper

Here I am providing the list of few questions of Common Proficiency Test .
1. Which of the following is not a Nominal A/c?
a) Outstanding salaries A/c
b) Salaries A/c
c) Interest paid A/c
d) Commission received A/c

2. Amount recovered from Rahul, which wasearlier written off as bad debt is debited to
Cash A/c and credited to ____ A/c
a) Bad Debts b) Bad debts recovered
c) Rahul d) Sales

3. A furniture dealer sold furniture for Rs 25000/-to Sunil for cash. In the books of the dealer____ A/c is debited and _____ A/c is credited
a) Cash, Fixed Asset b) Cash, Furniture
c) Cash, Sales d) Cash, Sunil

4. Mr. X is a dealer in electronic goods (such asrefrigerators, air conditioners, washingmachines, televisions etc) He purchased 2 airconditioners and installed in his showroom. Inthe books of ‘X’ the cost of these 2 airconditioners will be debited to __
a) Drawing A/c b) Capital A/c
c) Fixed Asset A/c d) Purchases A/c

5. Starting with over draft balance of cash bookin B.R.S, a cheque of Rs. 5,500 deposited inbank and duly credited in pass book, but notrecorded in cash book ____ in B.R.S
a) Rs. 5500 will be added
b) Rs. 5500 will be subtracted
c) Rs. 11000 will be added
d) Rs. 11000 will be subtracted

6. X sold goods to Y at cost + 10 % profit.
Y sold goods to Z at 20 % profit on sales.
If cost of the goods to X is Rs. 50,000. What is
the cost of the goods to Z ?
a) Rs. 66,000 b) Rs. 68,750
c) Rs. 65,000 d) Rs. 69,450

7. Debit balance as per cash book is Rs. 1500
Cheque deposited, but not cleared Rs. 100
Cheque issued, but not presented Rs. 150
Dividend collected by bank Rs. 50
Interest allowed by bank Rs. 50
Balance as per pass book?
a) Rs. 1550 b) Rs. 1650
c) Rs. 1600 d) Rs. 1950
8. Calculate the closing stock on 31.03.2011
Particulars 31.03.2010 31.03.2011
Opening stock Rs. 30,000 Rs. 35,000
Purchases Rs. 3,25,000 Rs. 4,20,000
Sales Rs. 4,00,000 Rs. 5,00,000
The profit margin remains unchanged
a) Rs. 35,000 b) Rs. 50,000
c) Rs. 55,000 d) Rs. 60,000
9. Rent paid for the period from 1-10-2010 to
30-09-2011 was Rs. 12,000/-
Rent paid for the period from 1-10-2011 to
30-09-2012 was Rs. 18,000/-
Rent to be debited to the P/L A/C for the year
ended 31-03-2012 =?
a) Rs. 15,000 b) Rs. 13,000
c) Rs. 12,000 d) Rs. 20,000
10. What is the effect on Gross profit, if closing
stock is undervalued by Rs.10,000 and opening
stock is overvalued by Rs.10,000?
a) G.P. will increase by Rs.10,000
b) G.P. will decrease by Rs.10,000
c) G.P. will decrease by Rs.20,000
d) No change in G.P.
11. Debtors as per trial balance = Rs. 80,000
Further information –
i) Bad debts Rs. 2,000
ii) Provision for discount on debtors @ 5% will
be ___
a) Rs. 4,100 b) Rs. 4,000
c) Rs. 3,900 d) Rs. 4,200

12. Calculate G.P. when –
Opening stock Rs. 24,000
Closing stock Rs. 15,000
Sales Rs 6,00,000
Cost of goods sold Rs. 4,55,000
a) Rs. 1,30,000 b) Rs. 1,45,000
c) Rs. 1,54,000 d) Rs. 1,06,000
13. Opening stock Rs. 69,500
Closing Stock Rs. 83,500
Sales Rs. 1,60,000
Purchases Rs. 1,10,000
G.P. on sales =?
a) 35% b) 40% c) 45% d) 30%
14. A diamond ring worth Rs.1,00,000 was stolen
from the shop of M/s Shine Jewelers on 25-
03-2012. Insurance claim of Rs. 60,000 was
admitted, but not paid by the insurance
company till 31-03-2012. In this regard, no
entry was passed in the books of A/c. The
correct journal entry to be passed while
preparing the final accounts on 31-03-2012 is _
a) P&L A/c Dr. 1,00,000
To Purchases A/c 1,00,000
b) Insurance claim Receivable A/c
Dr. 40,000
Loss by theft A/c Dr. 60,000
To Purchases A/c 1,00,000
c) P & L A/c Dr. 40,000
Insurance claim Receivable A/c
Dr. 60,000
To Purchases A/c 1,00,000
d) None of the above
15. From the following information find out the
credit sales
Opening Debtors Rs. 12,000
Closing Debtors Rs. 14,000
B/R accepted by Debtors Rs. 13,000
Cash received from Debtors Rs. 38,400
a) Rs. 39,400 b) Rs. 27,000
c) Rs. 65,400 d) Rs. 53,400
16. Opening Capital Rs. 1,00,000
Interest on Capital Rs. 10,000
Drawings Rs. 20,000
Interest on Drawings Rs. 2,000
Closing Capital Rs. 2,00,000
Net Prof i t ?
a) 1, 00,000 b) 1, 20,000
c) 1, 22,000 d) 1,12,000
17. A draws an accommodation bill on B for 3
months. Proceeds are to be shared equally. A
got the bill discounted at 12 % per annum and
remitted the proceeds of Rs. 48,500/- to B. The
amount of the bill is ____
a) Rs. 1,00,000 b) 97,000
c) Rs. 1,10,000 d) Rs. 98,000
18. When an endorsed bill is dishonoured, the
journal entry in the books of the drawer will be
a) Drawee A/c Dr.
To B/R A/c
b) Drawee A/c Dr.
To Creditor A/c
c) B/R A/c Dr.
To Creditor A/c d) None of these
19. A drew a bill on B. A endorsed the bill to C in
full settlement of his debt of Rs. 35,000 at 2%
discount and paid cash Rs. 5000. What will be
the amount of the bill?
a) Rs. 30,000 b) Rs. 29,700
c) Rs. 29,300 d) Rs. 30,700
20. Tinku & Bunty entered into Joint Venture to
share profits and losses in the ratio of 2 :1.
Tinku supplied 200 refrigerators costing
Rs.2,00,000 to Bunty, incurring freight charges
of Rs.10,000. Bunty sold 190 refrigerators for
Rs.2,40,000 and took over the remaining 10
refrigerators for himself. The result of Joint
venture =?
a) Loss Rs. 40,000 b) Profit Rs. 30,000
c) Profit Rs. 40,000 d) Profit Rs. 40,500
21. If the goods worth Rs. 20,000 were taken by a
co-venture for Rs. 15,000, the Joint Venture
A/c will be credited by
a) Rs. 20,000 b) Rs. 15,000
c) Rs. 25,000 d) Rs. 5,000
22. The cost of the furniture lost by fire is Rs. 18,000
Provision for depreciation on the date of fire is
Rs. 2,700
Insurance claim accepted Rs. 12,000
Amount of loss to be debited to P & L A/c is _
a) Rs. 6,000 b) Rs. 15,300
c) Rs. 3,300 d) Rs. 18,000

23. A machine was purchased on 1-4-2010 for Rs.
14,400 and installation charges amounted to
Rs.1,600. Expected lifetime is 8000 hours.
During the year 2010-11, the machine worked
for 2500 hours. The depreciation for the year
will be _____
a) Rs. 4,500 b) Rs. 5,000
c) Rs. 3,200 d) Rs. 6,250
24. If the rate of depreciation under W.D.V.
method is 15% p.a., the original cost of the
machine is Rs. 10,00,000, Scrap value at the
end of its useful life is Rs. 2,00,000, then the
depreciation for the first year will be ____
a) Rs. 1,50,000 b) Rs. 1,20,000
c) Rs. 1,00,000 d) Rs. 80,000
25. A machine was purchased at the beginning of
the year at Rs.5,30,000. The machine was
wrongly depreciated by 10 % instead of 25 %.
What will be the rectification entry?
a) P & L A/c Dr. 79,500
To Prov. for Depr. A/c 79,500
b) P & L A/c Dr. 26,500
To Prov. for Depr. A/c 26,500
c) Prov. for Depr. A/c Dr. 26,500
To P & L A/C 26,500
d) Prov. for Depr. A/c Dr. 79,500
To P & L A/C 79,500
26. If a purchase of goods for Rs. 500 was wrongly
posted to the credit side of Purchases A/c, the
difference in trial balance will be ____
a) Rs. 500 b) Rs. 250
c) Rs. 1000 d) Rs. 1500
27. Which of the following errors will not be
revealed in Trial balance?
a) Purchases book was overcast by Rs. 100
b) Purchase of goods for Rs. 100 for cash was
debited to Purchases A/c, but omitted to be
entered in cash book.
c) Sales book was undercast by Rs.500
d) Purchase of material for Rs. 300 used for
installation of machinery was debited to
Purchases A/c
28. Ravi Shankar, a sole trader gifted a car to his
son-in-law on the occasion of his daughter’s
marriage. The following entry was passed in
this regard.
Car A/c Dr. 5,00,000
To Cash A/c 5,00,000
What is the rectification entry?
a) Drawings A/c Dr. 5,00,000
To Cash A/c 5,00,000
b) Drawings A/c Dr.5,00,000
To Car A/c 5,00,000
c) Car A/c Dr. 5,00,000
To Drawings A/c 5,00,000
d) Cash A/c Dr. 5,00,000
To Car A/c 5,00,000
29. A Trader has calculated a net profit of Rs.
56,750. Later he found that discounted
received of Rs. 580/- and discount allowed of
Rs. 665 have been recorded on the wrong
sides of these accounts. What would be the
correct profit?
a) Rs. 56,580 b) Rs. 56,665
c) Rs. 56,835 d) Rs. 56,920
30. Sacrificing ratio is calculated in the case of __
a) Admission of a partner
b) Retirement of a partner
c) Death of a partner
d) Insolvency of a partner
31. Average capital employed Rs. 5,00,000
Normal rate of return 10%
Goodwill at 5 years purchase of super profit
Rs. 98,000
Calculate the average profit
a) Rs. 69,600 b) Rs. 1,48,000
c) Rs. 4,40,000 d ) Rs. 48 , 000
32. Rahul and Bajaj are partners in the ratio of
1 : 2. They admitted Birla as a new partner.
The new profit sharing ratio is 1:2:3. Find out
the sacrificing ratio?
a) 1:2 b) 2:1 c) 2:3 d) 3:2
33. Called up capital Rs. 4,00,000
Calls in advance Rs. 25,000
Calls in arrears Rs. 40,000
Paid up capital ?
a) Rs. 3,60,000 b ) Rs. 3,8 5 ,000
c) Rs. 4,15,000 d) Rs. 4,25,000

34. When the debentures are issued at discount and
are redeemable at premium, which of the
following accounts is debited at the time of issue?
a) Debentures A/c
b) Premium on redemption of debentures A/c
c) Loss on issue of debentures A/c
d) Capital reserve A/c
35. When debentures are issued as collateral
security _____
a) No interest is paid on debentures
b) Interest is paid on face value
c) Interest is paid on issue price
d) Interest paid on market price
36. When shares are issued to the promoters for
their services ____ A/c is debited
a) Preliminary Expenses
b) Promoters
c) Goodwill d) Share Capital
37. When shares are forfeited Share Capital A/c is
debited by ____
a) Nominal value of shares
b) Paid up value of shares
c) Called up value of shares
d) Forfeited amount
38. Which of the following statements is false?
a) Issued capital can never be more than
authorized capital
b) In case of under subscription, issued capital
will be less than the subscribed capital
c) Uncalled capital may be converted into
reserve capital
d) Paid up capital is equal to called up capital
less calls in arrears
39. The power of forfeiture of shares is exercised by:
a) Promoters
b) Directors as per the provisions of Articles of
Association
c) The Government d) Shareholders
40. Which of the following statements is true?
a) Fully paid preference shares can only be
redeemed
b) A company can issue irredeemable
preference shares
c) A company cannot redeem preference
shares at premium
d) Preference shares can be redeemed after 20
years from the date of their issue
41. Z Ltd. purchased an asset from D Ltd. for
Rs.4,00,000 by issuing the debentures of Rs.
100 each at discount of 20%. What is the
amount to be credited to Debentures A/c?
a) Rs. 4,00,000 b) Rs.4,50,000
c) Rs. 5,00,000 d) Rs. 5,75,000
42. If debentures of Rs.4,70,000 are issued in
consideration of net assets of Rs. 5,00,000, the
balance of Rs. 30,000 will be credited to ____
a) P & L A/c b) Goodwill A/c
c) General reserve A/c d) Capital Reserve A/c
43. A company issued 10,000 equity shares of Rs.
10 each at a premium of 20% for the
redemption of 15,000 preference shares of Rs.
10 each. If the company has sufficient profits,
the amount to be transferred to Capital
Redemption Reserve A/c will be
a) Rs. 50,000 b) Rs. 1,00,000
c) Rs. 1,50,000 d) Rs. 30,000
44. X Ltd. issued shares of Rs. 20 each at discount
of 10%. Mr. Ram, a holder of 100 shares could
not pay the final call of Rs. 5 per share and his
shares were forfeited. If these shares are
reissued, what is the maximum amount of
discount to be allowed on re-issue?
a) Rs. 8 b) Rs. 2 c) Rs. 15 d) Rs. 13
45. If debentures are issued at a discount of 20%,
the discount on issue of debentures is shown as:
a) Current asset b) Interest asset
c) Current liabilities
d) Miscellaneous expenses
46. Mr. A sends goods to B for Rs. 1,50,000 on sale
or return basis for which no confirmation was
yet received. What is the amount to be added
to the closing stock, if the goods were sent at
profit of
3
1
33 % on cost Rs.?
a) 1,12,500 b) 1,37,500 c) 1,50,000 d) 1,28,000
47. A trader calculated his profit at Rs. 38,750 on
31-03-2012. It is _____
a) A transaction b) An event
c) Transaction as well as event
d) Neither transaction nor event
48. For every debit there will be an equal credit
according to ____ concept
a) Matching b) Cost
c) Money Measurement d) Dual aspect

49. Historical cost concept requires the valuation
of an asset at ______
a) Original cost b) Replacement value
c) Net realisable value d) Market value
50. The comparison of financial statements of one
year with that of another year is possible only
when ____ concept is followed
a) Going concern b) Accrual
c) Consistency d) Materiality
51. Profit / Loss is calculated at the stage of ____
a) Recording b) Classifying
c) Interpretation d) Summarising
52. Which of the following is not the main
objective of accounting?
a) Systematic recording of transactions
b) Ascertainment of profit or loss
c) Ascertainment of a financial position
d) Solving tax disputes with tax authorities
53. An asset was purchased for Rs. 10,00,000, with
a down payment of Rs.2,00,000 and
acceptance of a bill payable for Rs.8,00,000.
What would be the effect on total assets and
total liabilities in the balance sheet?
a) Assets increased by Rs.8,00,000 and
liabilities decrease by Rs. 8,00,000
b) Assets decreased by Rs.8,00,000 and
liabilities increased by Rs. 8,00,000
c) Assets increased by Rs. 10,00,000 and
liabilities increased by Rs. 8,00,000
d) Assets increased by Rs. 8,00,000 and
liabilities increased by Rs. 8,00,000

Part B – Mercantile Laws
54. X threats to kill y’s son if y does not sell his house to
him. Y enters into an agreement to sell the house.
Such an agreement will be treated as an agreement
entered into under.
a) fraud b) undue influence
c) coercion d) misrepresentation
55. _______Agreements are created by situation.
a) law b) written c) void d) implied
56. legal obligations means a duty enforceable by:
a) law b) society c) custom d) court
57. Every partner is an agent of firm as well as
____ of the firm
a) debtor b) principal
c) creditor d) employee
58. If A paid price to car, but he said to deliver the
car in future. It is a ________ contract
a) executory b) executed
c) future d) completed
59. If a person promises to marry but refuses to do
so, then ______ damages has to be paid
a) Special b) exemplary
c) nominal d) none of these
60. A key of warehouse, where the goods are
placed, is given to Buyer is __ type of delivery.
a) constructive b) symbolic
c) actual d) conditional
61. Auction sale will be completed by ______
a) delivery of goods b) price paid to goods
c) fall of hammer d) None of these
62. Match fixing between a player and broker is
a) Valid b) Void
c) Illegal d) Unenforceable
63. ABC are partners. A takes a house on rental
basis for the firm purpose and failed to pay the
rent. House owner can recover rent from
a) A only b) B&C Only
c) A & C Only d) All partners
64. Which of the following is not true in case of minor?
a) Rule of estoppel
b) Ratification of terms on attaining majority
c) Contract with minor is valid
d) All of the above
65. Holiday packages advertised by touring
operators is _____
a) Cross offer b) Counter offer
c) Invitation to offer d) All of the above
66. In case of partnership, unless otherwise
agreed, in the event of losses the loss of the
firm has to be born by all the partners in _____
ratio.
a) equal b) profit sharing
c) capital d) by draw of lots
67. In order to sustain a action for deceit, there
must be a proof of
a) misrepresentation b) coercion
c) Undue influence d) Fraud

For more questions , here is the attachment
Attached Files
File Type: pdf Common Proficiency Test Question Paper.pdf (4.81 MB, 110 views)


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