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FINANCIAL ACCOUNTING
4. A supermarket pays the wages of its staff by credit transfer from its bank account.
The entries in the supermarket's accounts should be:
C) Assets-Liabilities=Capital
D) Assets+ Capital=Liabilities
A) Rs5000
B) Rs10,000
C) Rs15,000
D) Rs20,000
9. Which of the following accounts will be debited if the business's owner withdraws
cash from business for his personal use?
A) Drawings
B) Cash
C) Business
D) Stock
10. Which of the following is the correct terminology for the right hand side of a hand-
written ledger account?
A. Negative
B. Positive
C. Debit
D. Credit
11. State whether the following will have debit or credit balance ?
(a) Sales (b) Purchase Return (c) Capital (d) Salary (e) Rent Paid (f) Purchases
12. The purchase of a motor car on credit from Toy Automotive Company for use in a
firm should be recorded as
(A) Dr. Maintenance of vehicle expense
Cr. Toy Automotive Company
The follwing transcations took place in the business of A for the month of April
2003.
Ram investes Rs 10,000/- in cash.
He bough goods worth Rs 2000/- from Shyam.
He bought a machine fro Rs 5000/- from Laxaman on account.
He paid to Laxman Rs 2000/- .
He sold goods for cash Rs 3000/-.
He solds goods to A on account Rs 4000/-.
He apid to Shyam Rs 1000/-.
He received amount from A Rs 2000/-.
a. Rs 10,000/- debit.
b. Rs 15000/- credit.
c. Rs 12000/- debit.
d. RS 11000/- debit.
e. RS 14000/- debit.
15. The balances in sales account at the end of the month is
a. Rs 7000/- debit.
b. Rs 3000/- credit.
c. Rs 4000/- credit.
d. Rs 4000/ - debit.
e. Rs 7000/- credit.
a. Rs 5000/- credit.
b. Rs 5000/- debit.
c. Rs 3000/- debit.
d. Rs 3000/- credit.
e. Rs 2000/- credit
17.
Particulars Rs
Opening Capital 80,000/-
Closing Capital 120,000/-
Net Profit during th year 20,000/-
18. Mr Mohan sold goods to Mr Raju for Rs 900/-. Mr Mohan offered a discount of Rs
50/- for spot payment of cash. Mr Raju took delivery of goods by paying cash the
journal entry to record the transcations in the books of Mr Mohan is
Rs Rs
a Cash a/c Dr. 900
To sales a/c 900
Rs Rs
b Cash a/c Dr. 850
Discount a/c Dr. 50
To sales a/c 900
Rs Rs
c Cash a/c Dr. 850
To sales a/c 850
Rs Rs
d Mr. Raju’s a/c Dr. 850
To sales a/c 850
19. a trader purchsed goods woth Rs 50,000/- and paid Rs 1000/- as carrige on them.
He sold the goods for Rs 65000/- and paid Rs 1000/- towards carriegs on them. He also
incurred Rs 9000/- towards other general expenditure. The gross profit of the trader is
a. Rs 15000/-.
b. Rs 6000/-
c. Rs 14000/-
d. Rs 13000/-
e. Rs 4000/-.
a. Rs 30000/-
b. Rs 40000/-
c. Rs 10000/-
d. Rs 50000/-
e. Rs 60000/-
21. The following trial balance have been taken out from the books of XYZ as on 31st
December, 2005.
Dr. Cr. Remarks
Rs Rs
Plant and Machinery 100,000 BS/A
Opening stock 60,000 TRADING/EXP
Purchases 160,000 TRAD/EXP
Building 170,000 BS/ASSET
Carriage inward 3,400 TRADING/EXP
Carriage outward 5,000 P&L/EXP
Wages 32,000 TRAD/EXP
Sundry debtors 100,000 BS/ASSET/
Salaries 24,000 PL/EXP
Furniture 36,000 BS/ASSET
Trade expense 12,000 PL/EXP
Discount on sales 1,900 PL/EXP
Advertisement 5,000 PL/EXP
Bad debts 1,800 PL/EXP
Drawings 10,000 BS/EQ
Bills receivable 50,000 BS/ASSET
Insurance 4,400 PL/EXP
Bank balances 20,000 BS/ASSET
Sales 480,000 TRAD/INC
Interest received 2,000 PL/INC
Sundry creditors 40,000 BS/LIAB
Bank loan 100,000 BS/LIAB
Discount on purchases 2,000 PL/INC
Capital 171,500 BS/EQ
795,500 795,500
Required: Prepare the trading and profit and loss account of the business for the year
ended 31.12.2005 and a balance sheet as at that date.