Accounting MCQs

During the Year 2004, the income from subscription was Rs. 4,500, subscription received in advance Rs. 360. On 31^st December 2004, the outstanding subscription was Rs. 140. The amount of subscription to be shown in Receipts and Payments a/c for the year 2004 would be

Assertion (A) Premium received on issue of shares is credited to share premium account, but not to profit and loss account.
Reason (R) Since, share premium is not a trading profit, it is not distributed to shareholders.

A company XYZ (parent co.) is required to present consolidated financial statements, except if it meets certain conditions. You need to identify those conditions from the following.
1. It is a subsidiary of another entity and all its other owners, including those not otherwise entitled to vote, have been informed about and do not object to, the parent not presenting consolidated financial statements.
2. Its debt or equity instruments are not treaded in a public market.
3. Its ultimate or any intermediate parent produces Ind AS complaint consolidated financial statements available for public use

A person started business with a cash of Rs. 22,000 and stock of Rs. 3,000 on 1^st January, 1996. During the year he made a profit of Rs. 6,000. His creditors were paid Rs. 4,500 for the office furniture supplied. He took goods worth Rs. 3,500 for his daugher's wedding on 30^th June, 1996. The gross assets of his business on 31^st December, 1996 was:

Give:

Current ratio	2.5
Liquid ratio	1.5
Working capital	Rs. 1,20,000
Fixed Assets	Rs. 3,00,000

Stock in trade will be:

Which of the following are the motives of mergers? Indicate the correct answer:
1. Gain the economies of scale.
2. Utilize under-utilized resources.
3. Break the monopoly.
4. Reduce tax liability

Arrange the following in correct sequence in the event of dissolution of a partnership firm.
1. If surplus, it is distributed among the partners.
2. The assets of the firm are realised.
3. Amount realised is applied towards repayment of liabilities to outsiders and loan taken from partners.
4. Capital contributed by partners is repaid.
Select the correct answer:

A machine was purchased on 1^st January 1987. It was depreciated by written down value method at the rate of 10% P.A. The depreciated value of machine as on 1^st January 1990 is Rs. 13,122. The cost of machine on 1^st January 1990 was

Opening Stock = Rs. 10,000
Purchases = Rs. 90,000
Closing stock = Rs. 28,000
Gross Profit = 10% of sales
The amount of sales will be