425: 1 :

QUESTION PAPER BOOKLET CODE :

A
425
Question Paper Booklet No.

Roll No. :

Time allowed : 3 hours Maximum marks : 100

Total number of questions : 100 Total number of printed pages : 20
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PART—I
1. Measurement, Forecasting, Decision Making, 5. The revenue expenditure results ............. .
Comparison and Evaluation, Control and (A) in the reduction in losses
Government Regulation and Taxation are the (B) in the reduction in expenditure
functions of ................ .
(C) in the reduction in profit or surplus
(A) Book-keeping (D) in no reduction in profit or surplus
(B) Accounting 6. Financial Statements may be rounded off to
(C) Accountancy the nearest hundreds, thousands, lakhs or
millions, or decimals thereof where the
(D) Accounting Cycle
turnover of the company .................. .
2. Capital, Reserves and Undistributed Profits (A) Less than one crore rupees
are the examples of ................... .
(B) Less than one hundred crore rupees
(A) Internal Liability (C) One crore rupees or more
(B) Contingent Liability (D) One hundred crore rupees or more
(C) Current Liabilities 7. Profit on Re-issue of forfeited shares is a
(D) External Liabilities profit of a capital nature and, hence, it should
be credited to ................... .
3. ..................... is an activity concerned with
(A) Capital Reserve
recording and classifying financial data related
to business operations in order of occurrence. (B) Capital Redemption Reserve
(C) Revaluation Reserve
(A) Recording
(D) General Reserve
(B) Classifying
8. Subscribed Share Capital is “that portion of
(C) Measurement the issued Share Capital which has actually
(D) Book-keeping been subscribed by the public and
subsequently allotted to the shareholders by
4. General ledger is further divided into two
the entity”. This also includes any ..............
categories namely :
issued to the Shareholders.
(A) Debtors’ Ledger and Creditors Ledger (A) Redeemable shares
(B) Cash Book and Cash Account (B) Preference shares
(C) Nominal Ledger and Private Ledger (C) Bonus shares
(D) Private Ledger and Public Ledger (D) Cumulative shares
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9. If expenses or income that do not arise in 11. As per Table F of the Companies Act, 2013,
the ordinary course and are material, they the maximum rate of interest on calls in
advance prescribed is ................ p.a.
should be stated separately in the profit and
(A) 5%
loss account under the heading : (B) 6%
(A) Prior Period Items (C) 10%
(D) 12%
(B) Extraordinary Items
12. ABC Limited issued at par 2,00,000 equity
(C) Financial Expenses shares of ` 10 each payable at ` 3 on
application, ` 2.5 on the allotment, ` 2 on
(D) Operating Expenses the first call and remaining on the final call.
10. Where any company fails to comply with All the shares were fully subscribed. One of
the shareholders who held 10,000 shares paid
the provisions of this section 53(3) of the the full amount along with the first call itself.
Companies Act, 2013 in respect of the issue The final call was made after four months from
of shares at discount, such company and the date of the first call. The amount of interest
on calls in advance is ........... .
every officer who is in default shall be liable
(A) ` 500
to a penalty which may extend to ......... . (B) ` 1,000
(A) an amount equal to the amount raised (C) ` 833.33
through the issue of shares at a (D) ` 416.67
13. In the case of shares, the rate of underwriting
discount or five lakh rupees, whichever
commission paid or agreed to be paid shall
is less not exceed :
(B) an amount equal to the amount raised (A) five per cent (5%) of the price at which
the shares are issued or a rate
through the issue of shares at a authorized by the articles, whichever
discount or five lakh rupees, whichever is less
is higher (B) five per cent (5%) of the price at which
the shares are issued or a rate
(C) an amount equal to the amount raised authorized by the articles, whichever
through the issue of shares at a is higher
discount or fifty lakh rupees, whichever (C) two and half per cent (2.5%) of the
price at which the shares are issued
is less
or a rate authorized by the articles,
(D) an amount equal to the amount raised whichever is less
through the issue of shares at a (D) two and half per cent (2.5%) of the
price at which the shares are issued
discount or fifty lakh rupees, whichever
or a rate authorized by the articles,
is higher whichever is higher
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14. In case the shares are bought back at 18. When debentures are issued at a discount
discount, the amount of discount on buy-
back will be credited to ................. . and are redeemable at a premium, which of
(A) Capital Redemption Reserve A/c the following accounts is debited at the time
(B) Capital Reserve A/c of issue ?
(C) General Reserve A/c
(A) Debentures A/c
(D) Discount on the issue at discount A/c
15. Vesting has two components ................ . (B) Premium on redemption of
(A) Vesting date and vesting period debentures A/c
(B) Vesting percentage and vesting date
(C) Vesting percentage and vesting price (C) Loss on the issue of debentures A/c
(D) Vesting percentage and vesting period (D) Profit and Loss A/c
16. Which debentures are paid on the basis of
priority as compared to other debentures ? 19. If the sinking fund is non-cumulative,
(A) Redeemable the interest received on Sinking Fund
(B) Registered
Investment ..................... .
(C) First Mortgage
(D) Naked (A) Credited to Sinking Fund A/c
17. PQR Ltd. had issued ` 1,00,000, 8%
(B) Credited to the Profit & Loss A/c
debentures on which interest was payable
half-yearly on 30th September and 31st (C) Credited to General Reserve
March. Tax deducted at source is 10%. The
necessary journal entries relating to debenture (D) Credited to Sinking Fund Investment
interest on 30th September assuming that all
money was duly paid by the company. A/c
(A) Debenture Interest A/c DR ` 4,000 20. ABC Ltd. purchase a building for
and CR Debenture Holder’s A/c
` 4,000 ` 25,00,000 payables as 20% as cash and
(B) Debenture Interest A/c DR ` 4,000 balance by allotment of 10% debentures of
and CR Debenture Holder’s A/c
` 3,600 and Income Tax Payable ` 100 each at a premium of 25%. Calculate
A/c ` 400 the number of debentures to be issued :
(C) Debenture Interest A/c DR ` 8,000
and CR Debenture Holder’s A/c (A) 25,000
` 8,000
(B) 20,000
(D) Debenture Interest A/c DR ` 8,000
and CR Debenture Holder’s A/c (C) 17,500
` 7,200 and Income Tax Payable
A/c ` 800 (D) 16,000
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21. Discount on the issue of debentures is 23. Every buy-back shall be completed within
...................... and can be written off a period of .................... from the date of
the resolution or special resolution, as
against ................... .
the case may be, passed by the Board.
(A) Capital Loss, Capital Profit [Section 68(4)]
(B) Revenue Loss, Revenue Profit (A) Six months

(C) Capital Loss, Revenue Profit (B) One year

(D) Revenue Loss, Capital Profit (C) Eighteen months

(D) Two years
22. In which case, a special resolution is not
24. The amount credited to the Debenture
required at a general meeting of the company
Redemption Reserve shall be utilized by the
to buy-back the shares :
company for the purpose of ................. .
(A) the buy-back is 10% or less of the (A) Purchase of own debentures
company’s total paid-up equity capital (B) Redemptions of shares
and free reserves (C) Purchase of assets for the business
(B) the buy-back is 10% or less of the (D) Redemption of debentures
total paid-up equity capital and free 25. Underwriter Ltd. issued 1,25,000 shares
reserves of the company and such buy- which were underwritten as follows :
back has been authorized by the Board P : 40%, Q : 40% and R : 20%
using a resolution passed at its meeting Details of the marked application are :
P : 40,000 shares, Q : 32,000 shares and
(C) the buy-back is 25% or less of the
R : 8,000 shares.
company’s total paid-up equity capital
Unmarked applications are for 20,000 shares.
and free reserves
The net liability of individual underwriters
(D) the buy-back is 25% or less of the P, Q and R is :
total paid-up equity capital and free (A) 50,000; 50,000; 25,000
reserves of the company and such buy- (B) 40,000; 32,000; 8,000
back has been authorized by the Board (C) 10,000; 18,000; 17,000
using a resolution passed at its meeting (D) 2,000; 10,000; 13,000
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26. Option discount under Employees Stock 29. LMN Limited has a managing director and
Option Scheme (ESOS) means : one part-time director. Net profit before
(A) the excess of the market value of the provision for income tax and managerial
share at the date of grant of the option
remuneration is ` 2,25,00,000. The eligible
under ESOS over the exercised price
amount of managerial remuneration
of the option (including upfront
payment, if any) will be :
(B) the market value of the share at the (A) 24,75,000
date of grant of the option under ESOS
(B) 22,50,000
(C) the excess of the face value of the share
(C) 18,00,000
at the date of grant of the option under
ESOS over the exercised price of the (D) 13,50,000
option (including upfront payment,
30. Following are the data extracted from the
if any)
financial statement of ABC Limited :
(D) the exercised price of the option
(including upfront payment, if any) Authorized capital 50 crore

27. The name of statement which is used as a Paid up share capital 30 crore
temporary statement to judge a company’s Reserve & surplus 10 crore
financial position until the full annual
statements to be issued. Revaluation reserve 2 crore

(A) Temporary statement Working capital loan 1 crore

(B) Budgeted statement Preliminary expenses not

(C) Interim statement written off 1.5 crore
(D) Provisional statement Profit and loss (Loss) (2.5) crore
28. A liability which can be measured only by What will be the amount of effective capital
using a substantial degree of estimation is
to calculate the managerial remuneration ?
called ................... .
(A) 36 crore
(A) Reserve
(B) Provision (B) 39 crore

(C) Contingent liability (C) 37 crore

(D) Current liability (D) 38.5 crore
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31. ABC Ltd. is a manufacturing company 35. H Ltd. acquires 70% of the equity shares
having a turnover of ` 2,100 crore during of S Ltd. on 1-1-2022. On that date, the
the financial year 2021-22. ABC Ltd. has paid up capital of S Ltd. was 5,00,000 equity
a profit for the financial year 2021-22
shares of ` 10 each; the accumulated reserve
` 210 crore, financial year 2020-21
` 180 crore, financial year 2019-20 balance was ` 20,00,000. Assets of S Ltd.
` 135 crore, financial year 2018-19, were revalued on 1-1-2022 and a revaluation
` 105 crore and financial year 2017-18 is profit of ` 14,00,000 was calculated. H Ltd.
` 78 crore. paid ` 40,00,000 to purchase the said
What will be the minimum amount of CSR interest. Which of the following is correct
that must be spent by the company during in relation to the cost of control of the group
the financial year 2021-22 ? consolidated financial statement ?
(A) 4.2 crore
(A) Capital Reserve ` 80,000
(B) 2.85 crore
(C) 2.80 crore (B) Goodwill ` 80,000
(D) 2.49 crore (C) Capital Reserve ` 18,80,000
32. A .................. is a business segment or a (D) Goodwill ` 18,80,000
geographical segment identified on the basis 36. Which Accounting Standard was issued by
of the foregoing definitions for which segment
ICAI on ‘consolidated financial statement’ ?
information is required to be disclosed by
this standard. (A) AS-20
(A) Business segment (B) AS-21
(B) Reportable segment (C) AS-22
(C) Geographical segment
(D) AS-23
(D) Financial segment
37. Stock Reserve for unrealised profit in respect
33. The dividend received out of post-acquisition
profits of the subsidiary is ............... . of inter-company transactions should be
(A) Final Dividend created by ................ .
(B) Deemed Dividend (A) debiting the Consolidated Profit and
(C) Capital Dividend Loss Account and crediting Stock
(D) Revenue Dividend Reserve Account
34. If the net cost of investment of the holding (B) debiting the Stock Reserve Account
company in the equity and preference shares and credited Consolidated Profit and
of the subsidiary company is more than the
Loss Account
share of the holding company in the net assets
of the subsidiary company, the difference (C) debiting the Consolidated Profit and
between the two is .................. . Loss Account and crediting Capital
(A) Goodwill on consolidation Reserve Account
(B) Capital reserve on consolidation (D) debiting the Goodwill account and
(C) Profit on consolidation credit Consolidated Profit and Loss
(D) Loss on consolidation Account
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38. Which statement is true in respect of the 41. If the sales are ` 50,00,000, operating
treatment of equity dividend proposed by
expenses ` 38,50,000, Tax paid ` 3,58,800
the subsidiary company during the current
year ? and dividend paid ` 1,22,000. What will be

(A) It will be simply ignored for the Net Operating Profit After Tax ?
consolidation. It will not be mentioned
(A) ` 11,50,000
even in the notes to accounts to the
balance sheet of the subsidiary (B) ` 10,28,000
(B) Such proposed dividend is simply (C) ` 6,69,200
shown in the notes to accounts to the
Balance Sheet related to the year of (D) ` 7,91,200
the proposal 42. Non-listed public companies appoint at least
(C) The entry will be passed if the same
one-woman director as per Section 149(1)
has not already been passed
of the Companies Act, 2013 read with Rule
(D) Add the proposed dividend amount
with the existing dividend 3 of Companies (Appointment and

39. What is the treatment requirement for revenue qualifications of directors) Rules, 2014.
dividend received by the minority ? (A) Where paid up share capital of ` 10
(A) To be credited to Profit & Loss A/C
crore or more or having turnover of
(B) To be debited to Profit & Loss A/C
` 30 crore or more
(C) To be added in Revenue reserves in
the Balance Sheet (B) Where paid up share capital of ` 100

(D) No treatment crore or more or having turnover of

40. Shareholder Value Added (SVA) is ......... . ` 300 crore or more

(A) Net operating Profit (–) Cost of capital (C) Where paid up share capital of ` 10
(B) Net operating profit after tax (–) Cost crore or more or having tumover of
of capital
` 300 crore or more
(C) Net operating profit after tax &
Dividend (–) Cost of capital (D) Where paid up share capital of ` 100

(D) Net operating profit after tax (+) Cost crore or more or having turnover of
of capital ` 30 crore or more
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43. Companies (Auditor’s Report) Order, 2020 45. While preparing the cash flow statement
(CARO 2020), clause (vii) related to : ‘Interest paid to debentureholders’ will be
(A) Reporting requirements of Maintenance considered as a .................. .
of Cost Record (A) Operating Activity
(B) Reporting requirements on transactions
(B) Investing Activity
with related parties
(C) Financing Activity
(C) Reporting requirement on statutory
dues (D) Investing and Financing Activity

(D) Reporting requirements on the internal 46. In the Balance Sheet of ABC Ltd. A
audit system provision for taxation of ` 4,00,000 and

44. While preparing the Cash Flow Statement, ` 5,00,000 on 31-03-2021 and 31-03-2022

adjustment for Proposed Dividend is : respectively. It made a provision for taxation

of ` 4,50,000 during the year. How much
(A) Add the previous year’s proposed
dividend under net profit before tax and amount of tax is paid during the year ?

extraordinary items and deduct it under (A) ` 5,50,000

Financing Activity (B) ` 3,50,000
(B) Add the current year’s proposed
(C) ` 4,50,000
dividend under net profit before tax and
(D) ` 8,50,000
extraordinary items and deduct the
previous year’s proposed dividend 47. Profit during the year ` 2,20,000. During
under Financing Activity the year, there was an increase in stock by
(C) Add the current year’s proposed ` 72,000 and a decrease in creditors by
dividend under Net Profit before Tax ` 48,000. What is the amount of cash from
and Extraordinary Items and deduct the operating activities ?
current year’s proposed dividend under
(A) ` 3,20,000
Financing Activity
(B) ` 2,24,000
(D) Add the current year’s proposed
dividend under net profit before tax (C) ` 1,76,000

and extraordinary items (D) ` 1,00,000

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48. ABC Limited purchased machinery for 51. As per AS-2, Inventory should be valued
` 50,00,000 and sold an old plant with a at ................. .
book value of ` 13,20,000 at a loss of (A) Cost
` 1,30,000. ABC Limited also received a
(B) Net realizable value
dividend of ` 1,20,000 on investment in
shares. The amount of inflow/outflow in (C) Cost or Net realizable value, whichever
investing activity will be : is lower
(A) ` 14,40,000/` 50,00,000 (D) Cost or Net realizable value, whichever
(B) ` 13,20,000/` 50,00,000 is higher

(C) ` 13,10,000/` 50,00,000 52. Which of the following is a Level-1

enterprise ?
(D) ` 13,20,000/` 48,70,000
49. Cash collected from debtors is ............ . (A) All commercial, industrial or business
reporting entities having : Borrowings
(A) Credit sales (+) Decrease in Account
> 1 crore (at any time during
Receivable or (–) Increase in Account
immediately preceding accounting
Receivable
year), Turnover > 10 crore (during
(B) Credit sales (–) Decrease in Account preceding accounting year)
Receivable or (+) Increase in Account
Receivable (B) All commercial, industrial or business
reporting entities having : Borrowings
(C) Cash sales (+) Decrease in Account
> 10 crore (at any time during
Receivable or (–) Increase in Account
immediately preceding accounting
Receivable
year), Turnover > 50 crore (during
(D) Cash sales (–) Decrease in Account preceding accounting year)
Receivable or (+) Increase in Account
Receivable (C) All commercial, industrial or business
reporting entities having : Borrowings
50. Corporate entities are required to follow
> 10 crore (at any time during current
accounting standards while preparing their
accounting year), Turnover > 50 crore
financial statements as per .................. of the
(during preceding accounting year)
Companies Act, 2013.
(D) All commercial, industrial or business
(A) Section 129
reporting entities having : Borrowings
(B) Section 130
> 1 crore (at any time during current
(C) Section 131 accounting year), Turnover > 10 crore
(D) Section 132 (during preceding accounting year)

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53. Components of financial statements as per 55. IFRS Advisory Council meets in London at
IFRS is ..................... .
least ................... .
(A) Comprises of Balance Sheet, Profit and
Loss A/c, Cash Flow Statement, (A) Once in a year for a period of
Statement of changes in equity and
two days
accounting policy and notes to
accounts (B) Twice in a year for a period of
(B) Comprises of Balance Sheet, Profit and two days
Loss A/c, Cash Flow Statement, and
notes to accounts (C) Once in a year for a period of

(C) Comprises of Balance Sheet, Profit and three days

Loss A/c, Statement of changes in
(D) Twice in a year for a period of
equity and accounting policy and notes
to accounts three days
(D) Comprises of Balance Sheet, Profit and
56. The structures and processes that support
Loss A/c, Cash Flow Statement,
Statement of changes in equity the operations of the international public

54. Match List I with items in List II : sector accounting standards board (IPSASB)
List I List II are facilitated by the .................. .
(a) IFRS 2 (i) Lease
(A) International Accounting Standard
(b) IFRS 4 (ii) Share-Based payments
Board (IASB)
(c) IFRS 8 (iii) Operating Segment
(d) IFRS 16 (iv) Insurance Contract (B) International Federation of Accountants

(a) (b) (c) (d) (IFAC)

(A) (i) (ii) (iii) (iv)
(C) Financial Reporting Council (FRC)
(B) (ii) (iv) (i) (iii)
(D) Financial Accounting Standard Board
(C) (iv) (ii) (iii) (i)
(D) (ii) (iv) (iii) (i) (FASB)

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57. The IFRS Foundation has a three-tier 59. “To establish principles for the financial
governance structure namely : reporting of financial assets and financial
(A) IFRS Foundation Monitoring Board, liabilities that will present relevant and useful
IFRS Foundation Trustees and information to users of financial statements
International Accounting Standard for their assessment of the amounts, timing
Board and uncertainty of an entity’s future cash
(B) IFRS Foundation Monitoring Board, flows.” This is the objective of ............. .
IFRS Foundation Employees and (A) Ind AS 107 Financial Instruments
International Accounting Standard Disclosures
Board (B) Ins AS 109 Financial Instruments
(C) IRS Foundation member, IFRS (C) Ind AS 110 Consolidated Financial
Foundation Trustees and International
Statements
Accounting Standard Board
(D) Ins AS 112 Disclosure of Interests in
(D) IFRS Foundation members, IFRS
Other Entities
Foundation Trustees and International
Standard Board 60. The objectives of Ind As 103, Business
Combinations are .................... .
58. Existing AS 14 requires amortization of
goodwill arising on amalgamation in the nature (A) to improve the relevance, reliability and
of the purchase. Whereas ................ comparability of the information that a
reporting entity provides in its financial
(A) Ind AS 103 requires goodwill to be
statements about a business
tested impairment on a monthly basis
in accordance with Ind AS 36 combination and its effects

(B) Ind AS 103 requires goodwill to be (B) to specify the financial reporting by an
tested impairment on a quarterly basis entity when it undertakes a share-based
in accordance with Ind AS 36 payment transaction

(C) Ind AS 103 requires goodwill to be (C) to specify the financial reporting for the
tested impairment on a half-yearly basis exploration for and evaluation of mineral
in accordance with Ind AS 36 resources

(D) Ind AS 103 requires goodwill to be (D) to require entities to provide disclosures
tested impairment on an annual basis in their financial statements that enable
in accordance with Ind AS 36 users to evaluate
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PART—II

61. The techniques and processes of ascertaining 64. How to calculate the cost per unit to find

costs are called .................. . the value of the closing stock of finished
goods ?
(A) Cost control
(A) Cost per unit = Cost of production/
(B) Costing
unit produced
(C) Marginal cost (B) Cost per unit = Cost of production/
(D) Standard cost unit sold

62. The example of notional expenses (C) Cost per unit = Cost of goods sold/
unit produced
is ................ .
(D) Cost per unit = Cost of sales/unit
(A) Lease Rent
produced
(B) Rent paid for father’s property
65. Cost of sales is .................. .
(C) Rent for own premises (A) Cost of production (+) opening stock
(D) Depreciation of property used for own of finished goods (–) closing stock of

business finished goods (+) selling and

distribution overheads
63. The department which prepares plans and
(B) Cost of production (–) opening stock
specifications for each job, supervises
of finished goods (+) closing stock of
production activities, undertakes time and
finished goods (+) selling and
motion studies, performs job analysis, distribution overheads
etc. is ................... .
(C) Cost of goods sold (–) selling and
(A) Personnel department distribution overheads

(B) Payroll department (D) Cost of goods sold (+) opening stock
of finished goods (–) closing stock of
(C) Time-office
finished goods (+) selling and
(D) Industrial engineering department distribution overheads
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66. From the following data, calculate Prime 69. Match List I (Item) with items in List II
Cost : (Budget Factor or Key Factor) :
List I
The Raw material consumed is ` 20,00,000,
Opening stock of finished goods ` 1,00,000, (Item)

closing stock of finished goods ` 1,40,000. (a) Material

Direct Labour ` 12,00,000 and Indirect (b) Labour
labour is ` 4,00,000. (c) Plant & Machinery
(A) ` 31,60,000 (d) Sales

(B) ` 35,60,000 List II

(Budget Factor or Key Factor)
(C) ` 32,00,000
(i) Low market demand
(D) ` 36,00,000
(ii) Availability of supplies
67. Any casual vacancy in the office of a Cost
(iii) Shortage in certain key process
Auditor shall be filled by the .............. .
(iv) Bottlenecks in certain key processes
(A) Board of Directors
(a) (b) (c) (d)
(B) Central Government
(A) (i) (ii) (iii) (iv)
(C) Audit Committee (B) (ii) (iv) (i) (iii)
(D) Any Directors with prior approval by (C) (iv) (ii) (iii) (i)
the Central Government (D) (ii) (iii) (iv) (i)
68. CRA-1 prescribe the form related 70. The formula of capacity ratio is ........... .
to ................ . (A) (Standard hours for actual output/
(A) inform the Central Government of the Budgeted standard hours) × 100
appointment of cost auditors (B) (Actual hours works/Budgeted
hours) × 100
(B) submission of cost audit report
(C) (Standard hours for actual output/
(C) maintenance of cost record
Actual hours work) × 100
(D) cost audit report furnished to Central (D) (Actual hours works/Standard hours for
Government actual output) × 100
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71. While preparing the production budget, the 74. From the following, calculate the Debt-Equity
unit to be produced is equal to ............ . Ratio :
`
(A) Budgeted Sales quantity (+) Opening
10,000 Equity Shares @ 10 each 1,00,000
stock (–) Closing stock
General Reserves 50,000
(B) Actual Sales quantity (+) Opening Debentures 75,000
stock (–) Closing stock Sundry Trade Creditors 37,500
(A) 0.25 : 1
(C) Actual Sales quantity (+) Closing stock
(B) 0.375 : 1
(–) Opening stock
(C) 0.50 : 1
(D) Budgeted Sales quantity (+) Closing
(D) 0.75 : 1
stock (–) Opening stock 75. From the following data, calculate Inventory
Turnover Ratio : Cost of goods sold
72. Which is not the method of preparation of
` 3,00,000, Purchases ` 3,30,000, opening
cash budget ? stock ` 60,000.
(A) Receipts and Payments Method (A) 4 times
(B) 3 times
(B) Adjustment Profit and Loss Account
(C) 2 times
Method
(D) 6 times
(C) Cash flow Method 76. From the following data, calculate the earnings
per share (EPS)
(D) Balance Sheet Method
50,000 Equity shares of
73. “De nova budgeting” is a better term
` 10 each ` 5,00,000
of ................ . 9% Debentures ` 2,00,000
(A) Zero Base Budgeting Net profit after tax ` 1,18,000
(A) ` 6
(B) Performance Budgeting
(B) ` 5
(C) Master Budgeting
(C) ` 3
(D) Basic Budgeting (D) ` 2

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77. Current liabilities of a company are 81. Sales minus (–) variable cost is equal
` 3,00,000. Its current ratio is 3 : 1 and
to .................... .
the liquid ratio is 1 : 1. The value of the
stock is ................... . (A) Fixed cost (+) Profit
(A) ` 3,00,000
(B) Fixed cost (–) Profit
(B) ` 6,00,000
(C) ` 9,00,000 (C) Fixed cost (+) Loss
(D) ` 12,00,000 (D) Fixed cost
78. If sales are ` 13,20,000 sales returns are
` 1,20,000 and cost of goods sold 82. If the Marginal Cost is ` 2,400 and the
` 6,00,000 and closing stock of finished P/V Ratio is 20%. Sales value will
goods is ` 2,00,000, gross profit ratio be .................. .
will be .................. .
(A) 50% (A) ` 12,000
(B) 40% (B) ` 480
(C) 33.33%
(C) ` 1,920
(D) 20%
79. If the current ratio is very high, (D) ` 3,000
then ................. .
83. The following figures are available from
(A) positive impact on the profitability of
the records of book of account as on 31st
the organization
(B) no impact on the profitability of the March :
organization March 2021 March 2022
(C) adverse impact on the profitability of
the organization ` lakh ` lakh
(D) sometimes profitability may affect Sales 150 200
80. Higher level of management reports
are .................... . Profit 30 50
(A) more detailed, more frequent Calculate Profit Volume Ratio.
(B) more detailed, more frequent and more
(A) 40%
in numbers
(C) more summarized, more frequent and (B) 20%
more in numbers
(C) 25%
(D) more summarized, less frequent and
more in numbers (D) 50%
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84. If Fixed expenses is ` 4,000 and Break- 87. The correct stages in developing an Activity
even point is ` 10,000. What will be the
profit when sales are ` 20,000 ? Based Costing System are ............... .

(A) ` 6,000
(A) identify activities, identify resources,
(B) ` 10,000
(C) ` 4,000 identify cost objects, determine

(D) ` 16,000 resource drivers, determine cost

85. Following are not true in respect of
(activity) drivers, assign costs to the
absorption costing :
(A) Fixed cost is included in the cost of cost objects
products
(B) identify activities, identify resources,
(B) Profitability is measured by profit
earned by various products or identify cost objects, determine cost
departments.
(activity) drivers, determine resource
(C) Stock values in Absorption costing are,
therefore, higher than in Marginal drivers, assign costs to the cost objects
costing
(D) Difference in the valuation of opening (C) identify resources, identify activities,
and the closing stock does not affect
identify cost objects, determine
the unit cost of production
86. Which formula is used to calculate cost under resource drivers, determine cost
Activity Based Costing ? (activity) drivers, assign costs to the
(A) Costs = Total Cost of Activity ×
Activity Cost Driver Rate cost objects

(B) Costs = Resources Consumed ×

(D) identify resources, identify activities,
Activity Cost Driver Rate
(C) Costs = Resources Consumed / Activity identify cost objects, determine cost
Cost Driver Rate
(activity) drivers, determine resource
(D) Costs = Total Cost of Activity / Activity
Cost Driver Rate drivers, assign costs to the cost objects

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425 : 18 :
88. Total assets is ` 22,50,000, Fixed assets 91. The formula using for calculating diluted
` 20,00,000 valued at 10% above the book earnings per share is :
value and miscellaneous expenditure is
(A) profit or loss attributable to ordinary
` 2,50,000 and 12% Debentures ` 4,00,000.
equityholders/weighted average number
The value of NAV as per the Net Assets
Method will be ................. . of ordinary shares outstanding

(A) ` 20,75,000 (B) the weighted average number of

(B) ` 18,50,000 ordinary shares outstanding/profit or

loss attributable to ordinary equity-
(C) ` 18,00,000
holders
(D) ` 16,00,000
(C) profit or loss attributable to ordinary
89. In the capitalization of Earning method, the
equityholders/average number of
Capitalization rate is .................. .
ordinary shares outstanding
(A) Capitalization Rate = Growth Rate –
Discount Rate (D) the average number of ordinary shares

(B) Capitalization Rate = Discount Rate – outstanding/profit or loss attributable to

Growth Rate ordinary equityholders

(C) Capitalization Rate = Earning Rate – 92. The following data available from the record
Growth Rate of ABC Limited :
(D) Capitalization Rate = Growth Rate – 10,000, 9% Preference Shares of ` 100 each
Earning Rate fully paid and 80,000 equity shares of
90. The formula of Price-Earning Ratio is : ` 10 each fully paid, Reserves and Surplus;
(A) Yield per share/Normal rate of return ` 1,00,000. Total assets ` 30,00,000 out
× 100 of total assets ` 40,000 worth of Assets
(B) Rate of earning/Normal rate of return are fictitious. Calculate the intrinsic value per
× 100 equity share.
(C) Market value per share/Earning per (A) ` 23.25
share
(B) ` 10.75
(D) Possible rate of dividend × Paid up
(C) ` 8.25
value per share/Normal rate of
dividend (D) ` 6.75
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93. As per valuation guidelines prescribed by RBI 97. Cash flows become logically comparable
under the Foreign Exchange Management when they are appropriately adjusted for
Act, 1999, the price for the transfer of shares
their difference in ................. .
by a non-resident to an Indian resident shall
not be more than the fair value of shares (A) Timing and Return
if the transfer of fund exceeds .............. .
(B) Timing and Risk
(A) USD 2 million
(B) USD 5 million (C) Risk and uncertainty
(C) USD 10 million (D) Return and uncertainty
(D) USD 25 million 98. (Net Operating Profit after Taxes) – (Equity
94. The total capital employed in the firm is Capital × % Cost of Equity Capital) is the
` 15,00,000. The Normal Rate of return is
formula of .................. .
12% and the profit for the year is ` 1,50,000.
Calculate the value of goodwill as per the (A) SVA
Capitalization method :
(B) MVA
(A) ` 12,50,000
(B) ` 10,00,000 (C) EVA
(C) ` 5,00,000 (D) CAPM
(D) ` 2,50,000 99. ...................... represents the economic
95. The date at which entity and counterparty profits generated by a business above and
have a shared understanding of the
beyond the minimum return required by all
terms and conditions of the agreement is
called ...................... . the providers of capital.
(A) Option date (A) Economic Value Added
(B) Grant date (B) Arbitrage Pricing Theory
(C) Vesting date
(C) Shareholders Value Added
(D) Exercise date
96. The company is required to recognize (D) Market Value Added
employees stock compensation expenses : 100. Prospective Price Earnings Ratio/Prospective
(A) On the date of receipt of order for average earnings growth is a formula for
goods and services
calculation of .................. .
(B) On the date of receipt of goods and
services (A) Price to Book Ratio
(C) On the date of billing for goods and (B) Price Earnings Growth Ratio
services
(C) Dividend Yield Ratio
(D) On the date of receipt of payment for
goods and services (D) Dividend Growth Ratio

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Space for Rough Work

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