Accounts Test

OMTEX CLASSES “THE HOME OF SUCCESS”

Q1. Objectives A.

1. What is Reducing Balance method? 2. What is the Method of Valuation of Goodwill? 3. What do you mean by Fixed Instalment Method? 4. What is Good will? 5. Who is drawer?

B. 1. There are ___________ parties to a bill of exchange. a. Two b. Three c. Four d. Five 2. A person in whose favour the bill is endorsed is called ___________ a. Endorsee b. Endorser c. Drawer d. None of the above 3. Loss on sale of asset is debited to _______________ a. Assets A/c b. P&L A/c c. Depreciation A/c d. Trading A/c 4. Wages paid for Installation of Machinery should be debited to the ____________ account. a. Installation b. Wages c. Salaries d. Machinery.

5. The Indian Partnership Act is in force since ____________ a. 1932 b. 1942 c. 1952

d. 2002

C.

1. 2. 3. 4. 5.

A Goodwill Notary public Retirement of bill Endorsement of bill Honour of the bill

B a. Noting charges b. Making payment on due date c. Does not making payment on due date d. Tangible asset e. Intangible asset f. Making payment before due date g. Transferring the ownership of the bill

OMTEX CLASSES “THE HOME OF SUCCESS”

OMTEX CLASSES “THE HOME OF SUCCESS” D. Prepare bill of exchange from the following details. Drawer Drawee Payee Period Date of Bill Date of Acce. Amt. of Bill

: : : : :

: Vilas Patil, 44, M.G. Road, Nanded. : Pankaj Pawar, 70, Bhavani Galli, Solapur. Ramachandra Rampure, Rampur. 60 days. 28th January, 2005 29th January, 2005 Rs. 2,800.

2. Compute the goodwill the following case good will is valued at three years purchase of average profit of five years. The Profit of the five years were_ 1st Year 5,800 nd 2 Year 7,400 3rd Year 20,000 4th Year 3,500 th 5 Year 7,300 3. Premlal sold goods to Sunderlal worth Rs. 10,000/- and Sunderlal accepted the bill for Rs. 10,000/- at 3 months drawn by Premlal. Premlal Discounted the bill with his bank @ 6 % p.a. on due date the bill was dishonoured and Sunderlal requested Premlal to accept Rs. 4,000 immediately and draw upon him a new bill for the remaining amount at 3months together with an interest at 10% p.a. Premlal agreed and the second bill was duly honoured. Give the Journal entries in the books of Premlal. 4. Rahul Gupta Trading Co., Kalyan purchased furniture on 1.1.1992 for Rs. 25,000. In the same year on 1st July additional furniture was purchased for Rs. 10,000. On 1st July 1993 the furniture purchased on 1.1.1992 was sold for Rs. 15,000 and on the same date new furniture was purchased for Rs. 12,000. The company charges depreciation at 8% p.a. on reducing balance method. Prepare Furniture account and deprecation account for 3 years. Assuming that the accounting year of the company closes on 31st December every year.