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Basics of Accounting Bit Bank 2

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. Prepaid salary account is a --------------. (Personal Account) Interest received account is a ------------. (Nominal Account) Accrued interest is a ----------------. (Personal Account) Interest receivable is a --------------. (Personal Account) Cash account is a--------------------. (Real Account) Bank account is a -------------------. (Personal Account) Advance to employee is a--------------------------. (Personal Account) Advance to suppliers is a ---------------------. (Personal Account) Goodwill is a ----------------------------. (Real Account) Patent, Copyright, Trademark are --------------------. (Real Account) Bad debt and Bad debt recovered are-------------------. (Nominal Account) 12. 13. A free sample account is ----------------------. (Nominal Account) Cash book is a type of ------------- but treated as --------------- (Subsidiary Book, Principal Book of Account) 14. Cash book is used to record -----------. (All receipts and payments of cash) 15. A cheque which is payable across the bank counter is a---------------. (Bearer cheque)
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16. 17.

The balance in petty cash book represents ---------------. (An asset) Purchase book is used to record all ------------. (Credit purchase of goods)

18. 19. 20. 21.

Sale book is used to record all ------------------. (Credit sales of goods) B/R book is a --------------------. (Part of Journal) Purchase book, sale book is a -----------------. (Part of Journal) Goods taken by proprietor for personal use will be recorded in -----------. (Journal proper)

22. 23.

Total of sales book is posted to -----------------. (Sales Account) When a customer returns the goods a ------------------- is sent to him. (Credit note)

24.

When the goods are sent to supplier a ------------------- is sent to him. (Debit note)

25.

Credit purchase of stationary by a stationary dealer is to be recorded in -----------. (Purchase book)

26. 27.

BRS is prepared by a -----------------. (Customer of Bank) BRS is statement showing the causes of differences ----------------. (Between the cash book and pass book)

28.

Installation charges of machinery purchased is --------------------. (Capital expense)

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29.

Expense incurred on trial run of machine is --------------. (Capital expense)

30.

Repair of second hand machinery before put to use is---------------. (Capital expense)

31. 32.

Annual maintenance fee of machine is -------------. (Revenue expense) Cost of ring & pistons of an engine changed to get better fuel efficiency is ----------------. (Capital expense)

33.

Interest on term loan for purchase of machinery where the commercial production has not begun till the last day of Accounting year is ------------. (Capital expense)

34. 35. 36.

Premium received on issue of shares is -----------------. (Capital receipts) Scrap value of machinery is ------------------. (Capital receipt) Insurance claim for machinery damaged by fire is ------------------. (Capital receipt)

37. 38. 39. 40. 41. 42.

Cash received from debtors is -----------------------. (Revenue receipt) Fine imposed is --------------------------. (Revenue expenses) Purchase of goodwill is -----------------. (Capital expense) Import duty on purchase of material is --------------. (Revenue expense) Loss on sale of machinery is --------------. (Revenue loss) Festival advance to employee is -------------. (Prepaid expense)
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43.

Cost incurred on dismantling a machine worn out part is ------------. (Revenue expense)

44.

Amount spent on repainting an old building for first time on purchase is ------------. (Capital expense)

45.

Amount spent on annual repainting of building is -------------------. (Revenue expense)

46.

---------------- Usually arises from unplanned or unexpected event that given rise to the possibility of an inflow of economic benefits to the business entity. (Contingent assets)

47.

In the financial statement contingent assets and liabilities are -----------. (Not recognized)

48.

In the financial statement provisions are ---------------. (Recognized and adjusted)

49.

The trial balance checks the -------------- of the books of Account. (Arithmetical accuracy)

50.

The object of opining suspense Account is ------------------. (To avoid the delay in preparation of financial statement)

51.

The inventory of finished goods is valued at cost or NRV---------------. (Which is lower)

52.

Damaged inventory is valued at ----------------. (Net realizable value)

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53.

Under inflationary condition, FIFO method will show ----------------. (Highest value of closing stock)

54.

Under inflationary condition, LIFO method will show ------------------. (Lower value of closing stock)

55.

Under inflationary condition, FIFO method will show ------------------. (Lowest value of cost of goods sold)

56.

Under inflationary condition, LIFO method will show -----------------. (Highest value of cost of goods sold)

57. 58.

Deprecation is related to ------. (All tangible fixed assets (Except Land)) Deprecation Accounting is ------------------. (A process of allocation of the cost of fixed assets)

59. 60. 61. 62. 63. 64. 65.

Deprecation is a --------------. (Non cash operating expense) For depreciating good will the suitable method is --------. (SLM) For depreciating mine the suitable method is ----------. (Depletion) --------------- is same like deprecation. (Amortization) For depreciating leases the suitable method is ---------. (Annuity method) Trading Account is prepared to ascertain ----------------. (Gross Profit) P/L Account is closed by transferring its balance to---------. (Capital Account)

66.

Provision is a---------------. (Charge against the profit)

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67.

P/L Account shows the -------------------------- for an Accounting period. (Financial performance)

68.

Balance sheet shows the --------------- at a particular date. (Financial position)

69.

Wages and salaries appearing in trail balance are shown on the-------------. (Debit side of treading Account)

70.

Outstanding wages appearing in trail balance is shown on the -------------. (Liabilities side of balance sheet)

71.

Prepaid insurance appearing in trail balance is shown on the ------------. (Assets side of Balance Sheet)

72.

Closing stock appearing in trail balance is shown on the ---------------. (Assets side of Balance Sheet)

73. 74. 75. 76.

Capital work in progress is --------------. (Tangible asset) Drawings are------------------. (Deducted from capital) The debit balance in the P/L Account is a-------------. (Loss) The value of human resources is generally not shown in balance sheet as per -----------------. (Money measurement concept)

77. 78. 79.

Accrued income is shown as a ----------------. (Current asset) Unaccrued income is shown as a ------------------. (Current liability) A promissory note is an --------------- to pay. (Unconditional promise)
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80. 81. 82. 83.

In case of Promissory note, there are --------------. (2 parties) A bill of exchange is an ---------------- to pay. (Unconditional order) In case of bill of exchange there are ------------. (3 parties) The term of bill after sight commences from the date of ----------------. (Acceptance of the bill)

84.

The term of bill after date commences from the date of ---------------. (Drawing a bill)

85.

When the bill is honoured at the maturity date, the drawee debits ------------------. (B/P Account)

86. 87.

The promissory note should be -----------------. (Signed by promisor) A fee paid in cash to notary public is charged by ---------------. (Holder of bill of exchange)

88. 89.

A ------------- has a separate legal entity from its member. (Company) An authorized capital refers to that amount which is stated in the ---------as share capital. (Capital clause of the memorandum of association)

90.

--------------- is not disclosed in the balance sheet of the company. (Reserve capital)

91.

Equity shares can be issued with the differential rights as to --------------. (Dividend and voting)

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92.

-------------- of a company is an invitation to make an offer to subscribe the share or debenture of the company. (Prospectus)

93.

As per section 69(3) of the Co. Act 1956, the amount payable on application on each share must be at least ----------------. (5% of the nominal amount of share)

94.

As per SEBI Guidelines, the amount payable on application on each share must be at least ----------------. (25% of the issue amount of shares)

95.

As per Table A (SEBI Guidelines), the amount of call on a share must not exceed ------------ (25% of the nominal amount of share)

96.

A company can issue share at premium--------------. (Even in the absence of any express authority in its articles)

97.

The maximum rate of interest which can be charged on calls in arrears (As per Table-A) is --------------. (5% p.a.)

98.

The maximum rate of interest which can be paid on calls in advance (As per Table-A) is ----------------. (6% p.a.)

99.

If shares are forfeited, share capital Account is debited with the amount of ---------------. (Called up value of shares)

100. On the approval from Central Government the rate of discount on issue of share can be ----------------. (10% of the nominal value of shares)
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RameshBabuNemani, LecturerinCommerce,Hyderabad.

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