Accounting & Auditing Paper 2008 - 2

Accounting & Auditing Paper 2008 - 2

1. Comparison of a company’s financial condition and performance across time is a?

a) Ratio analysis
b) Horizontal analysis.
c) Vertical analysis
d) None of these

2. Income and expenditure account in a non trading institution records transaction of?

a) Revenue nature only
b) Capital nature only
c) Both
d) Income of revenue nature and expenditure of revenue and capital nature

3. At the time of admission of a new partner, goodwill raised should be written off in?

a) New profit sharing ratio
b) Old profit sharing ratio
c) Sacrificing ratios. Gaining ratio

4. Second hand machinery worth Rs. 10, 000 was purchased, repairing of the machinery cost Rs. 1,000. The machinery was installed by own workers. Wage for this being Rs. 200, the machinery account should be debited for?

a) Rs. 10,000
b) Rs. 11,000
c) Rs. 11,200
d) None of these

5. If net sales Rs. 100,000 cost of goods sold Rs. 55,000, administrative expenses Rs. 5300, selling expenses Rs. 4375, Interest expense Rs. 500, the operating profits?

a) Rs.35325
b) operating profit does not include interest income
expense and Taxes
c) Rs.45000
d) Rs.39700
e) Rs.34825

6. Which of the ratio best reflects a company’s ability to meet immediate interest payment?

a) Debit ratio
b) Equity ratio
c) Times interest earned
d) None of these

7. Identify which items are subtracted from the list amount and not recorded when computing purchase price?

a) Freight in
b) Trade discount
c) Purchase discounte
d) Purchase return

8. Bonus payable only on the maturity of the policy is termed as?

a) Cash bonus
b) Reversionary bonus
c) Interim bonus
d) Bonus is reduction of premium Rebate on bill discounted

This is more feedback!

This is the feedback!