MGT101 Final Term Past Paper 2

FINALTERM EXAMINATION Fall 2008

MGT101- Financial Accounting (Session - 4)

Q1. Wages outstanding given in the trial balance will be treated as a (an): (1 marks)

1. Asset
2. Liability
3. Revenue
4. Deferred expense

Q2. What does a credit balance in a partner’s current account represent to a business? (1 marks)

1. Current Assets
2. Current Liability
3. Long-term liability
4. Share of profit

Q3. Rs. (1 marks)

Debentures 1, 50, 000 Equity Capital 2, 00,000 General Reserve 90, 000 Accumulated profit 60,000

What is debt equity ratio

1. 15: 20 (or 3:4)
2. 15:24 (or 5: 8)
3. 15:29
4. 15:35 (or 3: 7)

Q4. Rs. (1 marks)

Share capital of Rs. 10 each 1,000,000 Profit before tax 150,000 Taxes 10,000

Earning per share

1. Rs. 1.50 per share
2. Rs. 1.40 per share
3. Rs. 1.15 per share
4. Rs. 1.25 per share

Q5. Mark up cover ratio = operating profit before financial charges ÷ ? (1 marks)

1. Selling expenses
2. Administrative expenses
3. Financial charges
4. Direct expenses

Q6. In calculating earning per share (EPS), the net profit is divided by which of the following? (1 marks)

1. Number of ordinary shares
2. Number of preference shares
3. Paid up capital
4. Authorized capital

Q7. Which of the following business publishes the Financial Statements? (1 marks)

1. Sole-Proprietorship
2. Partnership
3. Trust
4. Public Limited Company

Q8. The primary purpose of preparing a cash flow statement for an entity is to provide information about: (1 marks)

1. Its financial position at the end of an accounting period
2. Its cash receipts and cash payments during an accounting period
3. Its financial position at the start of an accounting period
4. None of the given options

Q9. How dividend declared is treated in the Balance Sheet of the company? (1 marks)

1. Provision
2. Current liability
3. Reserves and surplus
4. Current assets

Q10. Which of the following option(s) is TRUE about the Sales returns? (1 marks)

1. Sales returns reduce the Gross sales of the firm
2. Sales returns affect the Net income of the firm
3. Sales returns affect the flow of cash
4. All of the given options

Q11. Fixed Assets (WDV) + Working Capital =? (1 marks)

1. Total assets employed
2. Total liabilities
3. Total assets
4. Current assets

Q12. Which of the following is TRUE about a merchandising company? (1 marks)

1. A merchandising company's business is to buy and sell products
2. A merchandising company must use the perpetual system to account for merchandising inventory
3. A merchandising company's business is to provide services
4. A Sugar Mill is an example of a merchandising company

Q13. Capital account of sole proprietors is affected by which of the following items? (1 marks)

1. Profit & Loss account
2. Drawings account
3. Balances of capital account
4. a,b
5. b,c
6. a,c
7. a,b,c

Q14. Which of the following is/are TRUE about the sole trader form of business? (1 marks)

1. A sole trader is liable to pay income tax on his/her earnings
2. Sole traders do not need to consult accountants