CMA Foundation Answer Key
On 17th Dec ICMAI conducted CMA Foundation exam. The Exam pattern for CMA Foundation is completely MCQ based. The question paper consits of 4 subjects. 50 MCQ's (2 marks each) is asked from every subject. Team Koncept has complied the complete cma foundation dec 2023 question paper and answer key. For queries you can contact our faculties Ruchika Maam (AIR 7) and Yash Sir (AIR 24) on 9228446565.
1. What are the sources of law ?
(a) Constitution of India
(b) Constitution of India, judicial precedents, customary law, statutes and ordinance
(c) Statutes enacted by the Parliament of India and State Legislature
(d) Religion
Answer : b
Choice 'b' is correct as The Constitution of India and judicial precedents are two important sources of law in India.
The Constitution of India is the supreme law of the land and provides the framework for the functioning of the Indian government. It is the fundamental law that sets out the rights and obligations of citizens, the powers and functions of the different branches of government, and the relationship between the central government and the states. The Constitution is the source of all laws in India and any law that is inconsistent with it is considered void.
Judicial precedents, also known as case law, are decisions made by courts in previous cases that are binding on future cases with similar facts and legal issues. Judicial precedents are an important source of law because they help to interpret and clarify the law. In India, the Supreme Court is the highest court in the land and its decisions are binding on all other courts in the country. Lower courts are also bound by the decisions of higher courts in their hierarchy.
2. What kind of structure does the Indian Constitution have?
(a) Unitary
(b) Federal
(c) Autocracy
(d) Totalitarian
Answer : b
Choice 'b' is correct as the Indian Constitution has a federal kind of structure, which means that it establishes a division of powers between the national (or Union) government and the state governments. This division of powers is set out in the Constitution's 7th Schedule, which lists the subjects that are within the jurisdiction of the Union and the State governments, respectively. The Constitution also provides for a bicameral legislature, with the Lok Sabha (the lower house) representing the people and the Rajya Sabha (the upper house) representing the states. This ensures that both the national and state governments are represented in the legislative process.
3. Under which Article can we amend the provisions of the Constitution of India?
(a) Article 356
(b) Article 368
(c) Article 254
(d) Article 245
Answer : b
Choice 'b' is correct as The provisions of the Constitution of India can be amended under Article 368. This article outlines the procedure for amending the Constitution. It states that an amendment can be proposed in either house of Parliament and must be passed by each house with a two-thirds majority of the members present and voting, as well as a majority of the total membership of each house.
4. Mention the number of judges in the Supreme Court of India including Chief Justice of India currently.
(a) 32
(b) 23
(c) 34
(d) 46
Answer : c
Choice 'c' is correct as the sanctioned strength of judges in the Supreme Court of India was 34, including the Chief Justice of India
5. Which is the highest civil court in a district?
(a) Sessions Court
(b) Supreme Court of India
(c) District Court
(d) High Court
Answer : c
Choice 'c' is correct as The highest civil court in a district is the District Court, also known as the District and Sessions Court. It is presided over by a District Judge who is appointed by the state government in consultation with the High Court. The District Court is the principal court of civil jurisdiction in the district and has the power to hear civil cases of various kinds, including cases relating to property disputes, contract disputes, family disputes, and other civil matters.
6. While obtaining the consent of the promisee, keeping silence by the promisor when he has a duty to speak about the material facts, amounts to consent obtained by:
(a) Coercion
(b) Misrepresentation
(c) Mistake
(d) Fraud
Answer : d
Choice "d" is correct as mere silence as to facts likely to affect the willingness of a person to enter into a contract is no fraud; but where it is the duty of a person to speak, or his silence is equivalent to speech, silence amounts to fraud.
7. Consider the following
Which of the above amount to fraud?
(a) 1 and 2
(b) 1, 2 and 3
(c) 3 and 4
(d) 1 and 3
Answer :
8. A master asks his servant to sell his cycle to him at less than the market price. This contract can be avoided by the servant on grounds of:
(a) Coercion
(b) Undue influence
(c) Fraud
(d) Mistake
Answer :
9. In Indian Contract Act, the term "Consensus ad idem" means
(a) Parties under a mistake
(b) Parties under a free consent
(c) Parties agreeing upon the same thing in the same sense
(d) None of the above
Answer :
10. A finder of goods can
(a) file a suit to recover his expenses voluntarily incurred.
(b) sell the goods if he likes.
(c) can sue for a reward, if any.
(d) Both (A) and (B)
Answer :
11. Quasi-contracts or implied contracts are exceptional kinds of contracts by which:
(a) One party is bound to pay money in consideration of something done or suffered by the other party.
(b) No contractual relation exists between the parties.
(c) No contract has been made by the parties.
(d) All of the above
Answer :
12. When both the parties to an agreement are under a mistake as to a matter of fact essential to an agreement, the agreement is:
(a) Void
(b) Valid
(c) Voidable
(d) Illegal
Answer :
13. A person contracted to deliver a part of a specific crop of potatoes. The potatoes were destroyed by blight though no fault of the party. The contract is
(a) Valid
(b) Voidable
(c) Void due to frustration of contract
(d) Illegal
Answer : c
Choice "C" is correct as Section 56 deals with Discharge by impossibility of performance - If the impossibility may exist from the very start, it would be impossibility ab initio. Alternatively, it may supervene. Supervening impossibility may take place owing to:
(a) an unforeseen change in law,
(b) the destruction of the subject-matter essential to that performance;
(c) the non-existence or non-occurrence of particular state of things, which was naturally contempleted for performing the contract
(d) the declaration of a war.
Frustration of a contract excuses non-performance and automatically discharges the contract except where the terms of contract override this implied legal provision. Hence destruction of subject matter (potatoes) without contemplation by parties of loss due to blight, will render the contract void due to frustration of law.
14. A borrows from B ₹ 500 to bet with C. Can B recover the amount of his loan?
(a) Yes, the agreement between them is collateral to a wagering agreement and hence enforceable.
(b) Yes, the agreement is not opposed to public policy.
(c) No, the agreement is a voidable agreement and can be avoided by A.
(d) No, the agreement is wagering agreement and falls under section 23 and hence void.
Answer :
15. If a proposal has been accepted subject to certain conditions, then
(a) the contract is voidable.
(b) the contract is valid and conditions are binding.
(c) the contract is not constituted at all.
(d) the contract is valid but conditions are not binding.
Answer :
16. Which statement is correct?
(a) Only abstinence can be consideration.
(b) Only act can be consideration for promise.
(c) Only promise can be consideration.
(d) Out of act, abstinence or promise, any can be consideration
Answer :
17. The validity of contract is not affected by
(a) Mistake of fact
(b) Mistake of Indian Law
(c) Misrepresentation
(d) Fraud
Answer : b
Choice "B" is correct as law is presumed to be known to everybody, thus, ignorance of law is no excuse. Thus, mistake of law is not an excuse. A contract is valid, where there is a mistake of law, and not of fact.
18. In a wagering agreement :
(a) Both the parties win.
(b) Both the parties lose.
(c) None of the parties wins.
(d) One party wins and the other loses.
Answer :
19. Which of the following is correct?
(a) The proposal when accepted becomes a promise.
(b) The valid contract cannot result from identical offers.
(c) The rejected offer cannot be accepted.
(d) All of the above
Answer :
20. An agreement of service under which an employee agrees that he will serve a particular employer for a certain duration and that he will not serve anybody else during that period, is a
(a) Valid agreement
(b) Void agreement
(c) Illegal agreement
(d) None of the above
Answer :
21. An agreement to sell is
(a) an executory contract
(b) an executed contract
(c) neither (A) nor (B)
(d) sometime (A) or sometime (B)
Answer :
22. Where a contract of sale purports to effect a present sale of future goods, the contract operates as
(a) a sale
(b) an agreement to sell
(c) Both (A) and (B)
(d) All of the above
Answer :
23. In case of appropriation of goods, which are the essential requirements?
(a) The goods should confirm to the description and quality stated in the contract.
(b) The goods must be in a deliverable state.
(c) The appropriation must be by the seller with the assent of the buyer.
(d) All the above.
Answer :
24. When a seller can stop the goods in transit?
(a) When the buyer of the goods informs that he will make payment after some time.
(b) The seller has no right to stop the goods in transit.
(c) When the buyer of goods becomes insolvent and goods are in transit.
(d) When the buyer informs that he is now not in need of the goods.
Answer :
25. In case of contract for the sale of specific or ascertained goods the property in goods passes to the buyer
(a) at such time as the parties to the contract intend it to be transferred.
(b) when the price is paid.
(c) when delivery is given.
(d) when the contract is made
Answer :
26. The contract of sale may provide for
(a) the immediate payment of the price.
(b) the delivery or payment by instalments, or that the delivery or payment or both shall be postponed.
(c) the immediate delivery of the goods.
(d) All of the above
Answer :
27. In a contract of sale of goods the seller is under no obligation to point out the defects in his own goods. This doctrine is called as
(a) Doctrine of indoor management
(b) Caveat Emptor
(c) Unjust enrichment
(d) Doctrine of ultra vires
Answer :
28. Sale of goods act defines 'Buyer' as
(a) Person who buys or agrees to buy goods and services.
(b) Person who only agrees to buy goods.
(c) Person who buys or agrees to buy goods.
(d) Person who buys goods and services.
Answer :
29. Can you identify any odd ones among the following?
(a) Specific goods
(b) Un-ascertained goods
(c) Future goods
(d) Ascertained goods
Answer :
30. Unless otherwise agreed
(a) Delivery of the goods and payment of the price are concurrent conditions.
(b) First delivery of goods and then payment of price.
(c) First payment of price and then delivery of goods.
(d) No payment no delivery.
Answer :
31.. A Corporation can be party to a Negotiable Instrument if
(a) authorized by its article of association
(b) if special permission of Board of Directors taken
(c) if special resolution by Share holders is passed
(d) absolutely without any restrictions
Answer : a
Choice 'a' is correct as A corporation or company can be a party to a negotiable instrument, such as a promissory note, bill of exchange, or cheque, if it is authorized to do so by its articles of association or bylaws.
32. Where a cheque is crossed generally the banker on whom it is drawn
(a) shall not pay it otherwise than to a banker
(b) shall not pay it otherwise than to the holder
(c) shall not pay it to a banker
(d) none of the above
Answer : a
Choice 'a' is correct as When a cheque is crossed generally, the banker on whom it is drawn shall not pay it otherwise than to a banker. This means that the payment of the cheque can only be made to another banker, and not directly to the person named as the payee on the cheque.
33. _________ is an instrument in writing, containing an unconditional order, signed by the maker, directing a certain person, to pay a certain sum of money only to, or to the order of a certain person or to the bearer of the instrument.
(a) Promissory Note
(b) Bill of exchange
(c) Cheque
(d) None of the above
Answer :
34. 'At sight' and 'on presentation' under section 21 of the Negotiable Instrument Act, 1881, means
(a) on presentation
(b) on demand
(c) on coming into vision
(d) None of the above
Answer :
35. Generally, the maker of the cheque makes the crossing. If he does not cross
(a) the holder of the cheque can cross it generally or specially.
(b) in certain occasions the banker may also cross it.
(c) Both (A) & (B) can also cross as mentioned above.
(d) None other than the maker can Cross.
Answer :
36. If an instrument may be construed either as a promissory note or bill of exchange, it is
(a) a valid instrument
(b) an ambiguous instrument
(c) a returnable instrument
(d) none of the above
Answer : b
Choice 'b' is correct as An instrument that can be construed as either a promissory note or bill of exchange is referred to as an ambiguous instrument. The Negotiable Instruments Act, of 1881 provides specific definitions for promissory notes and bills of exchange, and an instrument that does not clearly fit into either category may be considered ambiguous.
37. The party which is involved in Bill of Exchange and to whom the order to pay is made is called
(a) Payee
(b) Drawer
(c) Drawee
(d) Endorser
Answer :
38. Crossing of a cheque effects the
(a) negotiability of the cheque
(b) mode of payment on the cheque
(c) both (a) and (b)
(d) none of the above.
Answer :
39. In a negotiable instrument, where amount is stated differently in words and figures
(a) amount stated in words shall be taken into account.
(b) amount stated in figures shall be taken into account.
(c) amount which is larger shall be taken into account.
(d) Instrument is void due to uncertainty.
Answer :
40. Cheque is a
(a) promissory note
(b) bill of exchange
(c) both (a) and (b) above
(d) None of the above
Answer : b
Choice 'b' is correct as a cheque is a type of bill of exchange. A cheque is a financial instrument that is used to transfer money from one bank account to another. It is a written order by the drawer (the person or entity issuing the cheque) to the drawee (the bank) to pay a specified amount of money to the payee (the person or entity to whom the cheque is payable).
41. A cloud computing is availability of computer resources?
(a) Off demand
(b) From demand
(c) On demand
(d) None of the above
Answer : c
Choice 'c' is correct as Cloud computing refers to the delivery of computing resources, including servers, storage, databases, software, and networking, over the internet on an on-demand basis. This means that users can access and use these resources as and when they need them, without having to own and manage their own physical infrastructure.
Cloud computing providers typically offer these resources through a pay-per-use model, which allows users to only pay for the resources they actually consume. This can be particularly useful for businesses and organizations that have varying computing needs over time, as they can easily scale their usage up or down as required.
Overall, cloud computing has revolutionized the way that computing resources are accessed and used, making it easier and more affordable for individuals and organizations to access the computing power they need to run their applications and services.
42. Study of body language of a person is called __________.
(a) Kinesics
(b) Chronemics
(c) Paralanguage
(d) None of the above
Answer : a
Choice 'a' is correct as Kinesics is the study of body language, including gestures, facial expressions, eye contact, posture, and other nonverbal cues that communicate meaning. Kinesics can be used to interpret and understand the thoughts, feelings, and intentions of others, as well as to communicate effectively in social and professional settings. It is an important aspect of communication and can be especially useful in areas such as psychology, sociology, anthropology, and communication studies.
43. The use of 'touch' in communication is one type of Non-verbal Communication. It is known as
(a) Proxemics;
(b) Haptics;
(c) Artifacts;
(d) None of the above
Answer :
44. Need of proper grammar and syntax comes under which C of communication?
(a) Completeness
(b) Coherence
(c) Courteous
(d) Correctness
Answer : d
Choice 'd' is correct as The need for proper grammar and syntax comes under the "Correctness" C of communication. Correctness refers to the accuracy and precision of the message being communicated, including proper grammar, syntax, spelling, and punctuation. Communication that is free from errors and mistakes is more likely to be understood and taken seriously by the audience, which can help to build credibility and trust.
Correctness is essential in various forms of communication, including written and oral communication. In written communication, correctness involves using proper grammar, spelling, and punctuation to convey the message clearly and accurately. In oral communication, correctness involves using proper pronunciation, intonation, and syntax to ensure that the message is clearly understood by the audience.
45. If a message is short and to the point, the message is said to be ___________?
(a) Correct
(b) Concise
(c) Coherent
(d) Complete
Answer : b
Choice 'b' is correct as if a message is short and to the point, it is said to be concise. Conciseness is one of the 8C's of communication, which refers to the use of as few words as possible to convey the message clearly and effectively. Concise communication is important because it helps to hold the audience's attention and make the message more memorable.
Conciseness can be achieved through various techniques, such as avoiding unnecessary details, using simple and direct language, and prioritizing the most important information. By being concise, communicators can ensure that their message is not only more engaging but also more easily understood by the audience.
46. Affirming comments with regard to future behaviour is called ___________.
(a) Positive Feedback
(b) Negative Feedforward
(c) Positive Feedforward
(d) Decoding
Answer : c
Choice 'c' is correct as Positive feedforward is a communication technique that involves providing positive feedback or affirmation with regard to future behavior. It is a proactive approach to communication that focuses on reinforcing positive behaviors and encouraging future growth and development.
Positive feedforward is different from traditional feedback, which focuses on past behavior and often includes constructive criticism. Instead of focusing on what was done wrong in the past, positive feedforward focuses on what can be done right in the future. It is a more positive and uplifting approach to communication that can help to build confidence and motivation.
Examples of positive feedforward might include telling someone that you believe in their ability to achieve their goals, or affirming a specific behavior that you would like to see more of in the future. By providing positive feedback in this way, you can help to create a more positive and supportive environment that encourages growth and development.
47. ____________ is the first step in identifying the information the sender wants to communicate.
(a) Encoding
(b) Transmitting
(c) Decoding
(d) Development of an idea
Answer :
48. At which stage the communicator focuses on correcting the grammar, spellings and punctuations?
(a) Proof Reading
(b) Revising and editing
(c) Preparing the message
(d) None of the above
Answer :
49. Professional behaviour includes behave in a ___________ manner in the workplace?
(a) Neutral
(b) Positive
(c) Negative
(d) None of the above
Answer : b
Choice 'b' is correct as Professional behavior refers to the conduct, attitude, and demeanor that individuals exhibit in the workplace. Behaving in a positive manner is an important aspect of professional behavior, as it can help promote a positive and productive work environment and contribute to overall team success.
Examples of positive behaviors in the workplace might include:
Overall, demonstrating positive behaviors in the workplace can help build trust and respect with others, foster strong working relationships, and ultimately contribute to individual and organizational success.
50. Mr. A and Mr. B belong to two distinct cultural backgrounds. Mr. B believes that his culture is superior compared to the culture of Mr. A. This phenomenon is known as __________.
(a) Defence
(b) Ethnocentrism
(c) Denial
(d) None of the above
Answer : b
Choice 'b' is correct as The phenomenon where an individual believes that their own culture is superior to other cultures is known as ethnocentrism. In this case, Mr. B is exhibiting ethnocentric behavior by viewing his own culture as superior to that of Mr. A's culture. Ethnocentrism can lead to misunderstandings, stereotyping, prejudice, and discrimination towards members of other cultures. It is important to recognize and overcome ethnocentrism in order to promote intercultural understanding and communication.
51. Goods bought for ₹ 32,000 passed through sales day book will result in
(a) No effect on gross profit.
(b) Decrease in gross profit.
(c) Decrease in net profit.
(d) Increase in gross profit.
Answer : d
Choice 'd' is correct as as Goods purchases of Rs.32,000 has to be recorded in purchase account which will be a debit side. If it is passed through the sales book, this will result in an increase of gross profit by Rs.64,000.
52. Credit purchase of fixed asset are recorded in
(a) Journal proper
(b) Purchase book
(c) Cash book
(d) Petty cash book
Answer : b
Choice "b" is Correct as A journal proper is the book of original entry in which only those entries are recorded that cannot be recorded in the special journal. It is also termed as a General Journal. When the journal is divided into various subsidiary books, it remains only a residuary book in which only those transactions are recorded that cannot be recorded in any other subsidiary book. In such a case, the journal is called as Journal proper. Purchase of asset on credit can neither be recorded in the cash book or the purchase book because cash book only records cash transactions and purchase book only records the credit purchase of goods. Thus purchase and sale or return of purchased or sale asset on credit is recorded in journal proper.
53. An expenditure is capital in nature when
(a) The receiver of the amount is going to treat it for the purchase of fixed assets.
(b) It increases the quantity of fixed assets.
(c) It is paid as interest on loans for the business.
(d) It maintains of fixed asset.
Answer : b
Choice "b" is Correct as Expenditure incurred for normal day to day business activity are revenue expenditure. An expense incurred to enhance the capacity and gives the benefits to the business for longer duration is a capital expenditure. This will increase the value of fixed assets.
54. Accounting does not record non-financial transactions because of
(a) Accrual concept.
(b) Going concern concept.
(c) Money measurement concept.
(d) Entity concept.
Answer : c
Choice "c" is Correct as The concept of money measurement states that only those transactions and happenings in an organisation which can be expressed in terms of money such as sale of goods or payment of expenses or receipt of income, etc. are to be recorded in the book of accounts. All such transactions or happenings which can not be expressed in monetary terms, for example, the appointment of a manager, capabilities of its human resources or creativity of its research department or image of the organisation among people in general do not find a place in the accounting records of a firm.
55. The book value of asset was ₹ 145,800, after charging three years depreciation @ 10% per annum on Written Down Value basis. What was the original cost of the machine?
(a) ₹ 1,60,000
(b) ₹ 1,80,000
(c) ₹ 2.00,000
(d) ₹ 2,20,000
Answer :
56. Which one is wrong?
(a) Debit the receiver, credit the giver.
(b) Debit all incomes, credit all expenses.
(c) Debit what comes in, credit what goes out.
(d) Debit all assets, credi tall liabilities.
Answer : b
Choice "b" is Correct as The correct principle is to debit all expenses and credit all incomes. In accounting, expenses are debited to decrease equity, while incomes are credited to increase equity. Therefore, the correct statement should be: "Debit all expenses, credit all incomes."
57. Which of the following is step of Accounting Cycle?
(a) Ledger
(b) Adjusted trial balance
(c) Financial statements
(d) All of the above
Answer : d
Choice "d" is Correct as Accounting cycle consists of the following sequential steps.
(a) Identifying the Transactions: The first step in the accounting cycle is to analyse the events to determine if they are ‘transactions’. Only events that leads to change in the financial position of the accounting unit is called transactions.
(b) Recording transaction in the Journal: The second step in the accounting cycle is to record the transactions in the books of original entry i.e., Journal after identifying the Debit and the Credit element.
(c) Posting to Ledger: In the next step, the transaction is posted in a summarised and classified manner to different accounts of the ledger.
(d) Drafting of Unadjusted Trial Balance: At the next step, the ledger balances are compiled in the trial balance to check whether there is any error during the recording stage. This stage is, however, not mandatory.
(e) Passing of adjustment entries: Identification of necessary adjustments and passing of adjusting entries make up the fifth step in the cycle.
(f) Drafting of Adjusted Trial Balance: Once all adjusting entries are completed, an Adjusted Trail Balance can be prepared. This happens to be the last step before the preparation of the financial statements.
(g) Closing of books: In this stage of the accounting cycle, the ledger accounts are closed and balanced (also referred to as “zeroed out”) at the end of every accounting period.
(h) Drafting the Financial Statements: In the last stage of the accounting cycle, the Income Statement is prepared with the closing balances of the nominal accounts, while the balances of real and personal accounts get reflected in the Balance Sheet. Financial statements are prepared in the following order: Income Statement, Statement of Retained Earnings, Balance Sheet and Statement of Cash Flows.
58. Purchase price of machine ₹ 8,90,000, freight and cartage ₹ 7,000, installation charges ₹ 30,000, insurance charges ₹ 20000, estimated useful life 5 years with no residual value. Calculate the amount of second year depreciation under straight line method.
(a) ₹ 1,69,400
(b) ₹ 1,79,400
(c) ₹ 1,85,400
(d) ₹ 1,77,900
Answer :
59. Bank has directly paid ₹2,250 for rent as per standing instructions. In BRS starting with Pass Book overdraft ____________________.
(a) ₹ 2,250 will be added to Pass Book overdraft
(b) ₹ 4,500 will be added to Pass Book overdraft
(c) ₹ 2,250 will be deducted from Pass Book overdraft.
(d) None of the above
Answer :
60. Goods costing ₹ 20,000 Destroyed by an accident, insurance Claim nil-
(a) ₹ 20,000 will be eredited to joint venture account
(b) No entry will be made in the hooks of joint venture
(c) ₹ 20,000 will be debited in joint venture account as loss
(d) ₹ 15.000 will be credited in joint venture account
Answer :
61. One receipt of goods, the consignee debits which of these accounts.
(a) Purchase Account
(b) Goods Account
(c) Consignors Account
(d) None of the above
Answer :
62. X sends out goods to Y, costing ₹ 2,50.000. Goods are to be sold at cost +25%. The consignor asked consignee to pay an advance for an amount equivalent to 60% of sales value. The amount of advance will be
(a) ₹ 1,80,000
(b) ₹ 2,00,000
(c) ₹ 1,50,000
(d) ₹ 1,87,500
Answer :
63. Joint venture account is of the nature of
(a) Personal A/c
(b) Nominal A/c
(c) Real Alc
(d) Suspense A/c
Answer :
64. At the time of dishonour of an endorsed bill which one of these accounts would be credited by the drawee?
(a) Bill Payable Account
(b) Drawer's Account
(c) Bank Account
(d) Bills Dishonoured Account
Answer :
65. The Debts written off earlier as bed if recovered subsequently are
(a) Credited to Bad Debts recovered Account.
(b) Credited to Debtor's Personal Account.
(c) Debited to Profit and Loss Account.
(d) Credited to Bad debts Account
Answer :
66. Which is intended to be used over long term for earning profits there from?
(a) Revenue Expenditure
(b) Capital Expenditure
(c) Deferred Revenue Expenditure
(d) Both (B) and (C)
Answer : b
Choice "b" is Correct as Capital expenditure is the type of expenditure that results in the acquisition of an asset or an increase in the earning capacity of a business. Capital expenditures are typically for long-term assets such as property, plant, equipment, and intangible assets. These expenditures are considered investments in the business and are recorded on the balance sheet as assets rather than as expenses on the income statement.
67. When Opening stock ₹ 50,000 Closing stock ₹ 40,000; Sales ₹ 2,40,000, if the profit margin is 20% on cost, then purchases will be
(a) ₹ 1,90,000
(b) ₹ 1,82,000
(c) ₹ 2,00,000
(d) ₹ 2,02,000
Answer :
68. The accounting equation “Assets = Liabilities + Owners’ Equity” is formal expression of the
(a) Money Measurement Concept
(b) Matching Concept
(c) Full Disclosure Concept
(d) Dual Aspect Concept
Answer : d
Choice "d" is Correct as Dual Aspect Concept: Dual aspect is the foundation or basic principle of accounting. It provides the very basis of recording business transactions in the books of accounts. This concept assumes that every transaction has a dual effect, i.e., it affects two accounts in their respective opposite sides. Therefore, the transaction should be recorded at two places. It means, both the aspects of the transaction must be recorded in the books of accounts. For example, goods purchased for cash has two aspects which are (i) Giving of cash (ii) Receiving of goods. These two aspects are to be recorded. Thus, the duality concept is commonly expressed in terms of fundamental accounting equation:
Assets = Liabilities + Capital
69. When a cheque i received and it has been deposited into the bank at a later date, then on the later date the______ will be credited.
(a) Bank Account
(b) Cash Account
(c) Either Bank Account or Cash Account
(d) Debtor's Personal Account
Answer :
70. At the end of the accounting year outstanding subscription and outstanding rent of a club will be shown_______ in the balance sheet.
(a) both on liabilities side
(b) both on assets side
(c) outstanding subscription on liabilities side and outstanding rent on assets side
(d) Outstanding subscription on assets side and outstanding rent on liabilities side
Answer :
71. Salaries have been shown in income and expenditure account ₹ 3,00,000. It was outstanding at beginning of the year ₹ 42,000 and end of the year for three months. The salaries paid during the year will be—
(a) ₹ 3,00,000
(b) ₹ 2,67,000
(c) ₹ 3,33,000
(d) ₹ 2,56,500
Answer :
72. Which of the following items are usually related to non-profit organisations?
(1) Endowments
(2) Legacy
(3) Life Membership Fee
(4) Transfer fee
(5) Entrance fee
Select the correct answer from the options given below
(a) (1),(2), (4) and (5)
(b) (2),(3), (4) and (5)
(c) (1), (2), (3) and (5)
(d) (1), (2),(3) and (4)
Answer :
73. In case of sole proprietorship, income tax is
(a) Debited to profit and loss account.
(b) Shown in the balance sheet as a current liability.
(c) Treated as proprietor's personal expense.
(d) None of the above
Answer :
74. Which of the following are included in the trading and profit and loss account?
(a) Revenue expenditures and incomes
(b) Revenue as well as capital expenditures and incomes
(c) Revenue expenditures
(d) Revenue incomes
Answer :
75. (1) Income and Expenditure Account and (2) Receipts and Payments Account, are prepared
(a) On the cash basis.
(b) On the accrual basis.
(c) (1) on the cash basis and (2) on the accrual basis.
(d) (1) on the accrual basis and (2) on the cash basis.
Answer :
76.When at the end of year the entry “Closing stock A/c debit with ₹ 65,000 and Purchases A/c credit with ₹ 65,000” is made in the books then closing stock will be shown
(a) In trading account only,
(b) In balance sheet only,
(c) both in trading accountand balance sheet,
(d) In footnote with balance sheet
Answer :
77. The following information is given in the trial balance of Shekhar Stores on 31st March, 2023:
Bad Debts ₹ 15,500
Debtors ₹ 3,00,000
Provision for Bad and Doubtful Debts on 01.04.2022 ₹ 18,000.
If the Shekhar Stores makes a provision for bad and doubtful debts @ 5% on debtors, the amount for such provision, charged to profit and loss account for the year ending 31.03.2023, will be
(a) ₹ 15,000
(b) ₹ 12,500
(c) ₹ 17,500
(d) ₹ 11,725
Answer :
78. Purchases ₹ 15,20,000 (2) Wages and Salaries ₹ 2,10,000 (3) Sales ₹ 21,60,000 (4) Opening Stock ₹ 2,08,000 (5) Closing Stock ₹ 2,20,000 (6) Audit fee ₹ 15,000. Gross profit will be—
(a) ₹ 4,27,000
(b) ₹ 6,52,000
(c) ₹ 4,42,000
(d) ₹ 6,37,000
Answer :
79. Prepaid Insurance Account is a
(a) Nominal Account
(b) Real Account
(c) Representative Personal Account
(d) Artificial Personal Account
Answer : b
Choice "b" is Correct as Prepaid insurance is the portion of an insurance premium that has been paid in advance and has not expired as the date of the balance sheet. It is an asset for organisation. Assets are real account.
80. A Trial Balance shows
(a) Complete accuaracy of accounts.
(b) Honesty of accounts.
(c) complete accuracy of accounts o well as Honesty of accounts
(d) Only arithmetical accuracy of accounts.
Answer :
81. The person other than the original creditor to whom the amount in the bill is made payable to is known as the_______ of the bill.
(a) Holder
(b) Payee
(c) Drawer
(d) Endorser
Answer :
82. Retirement of bill means
(a) Making payment before the due date.
(b) Cancellation of the bill.
(c) Sending the bill for collection.
(d) Endorsing the bill in fayour of third party.
Answer :
83. Which of these accounts is not opened in the books of consignor?
(a) Consignment Account
(b) Commission Account
(c) Goods Send on Consignment Account
(d) Consignees Personal Account
Answer :
84. The Profit and Loss Account shows the
(a) financial results of the concern for a period.
(b) financial position of the concern on a particular date.
(c) financial results of the concern on a particular date.
(d) cost of goods sold during the period.
Answer :
85. Which of the following is/are prepared by non-profit organizations?
(a) Income & Expenditure Account
(b) Receipts and Payments Account
(c) Balance Sheet
(d) All of the above
Answer :
86. Indirect material cost is a part of
(a) Material Consumed
(b) Prime Cost
(c) Chargeable Expenses
(d) Factory Overhead
Answer :
87. Which of the following is a part of both Prime cost and conversion cost ?
(a) Direct Material
(b) Indirect Labour
(c) Direct Labour
(d) All of the above
Answer : c
Choice 'c' is correct as Direct labor is a part of both prime cost and conversion cost.
Prime cost is the total of all cost items that can be directly charged to product units, and it includes direct materials and direct labor. Direct labor refers to the wages and benefits of the workers who directly produce the product, and it is a necessary cost for the production of any product or service.
Conversion cost is the cost of converting raw materials into finished goods and it includes direct labor and factory overhead. Direct labor, as previously mentioned, is the wages and benefits of the workers who directly produce the product. Factory overhead are the indirect costs of production, such as rent, utilities, and depreciation on factory equipment.
88. In classification by function, costs are divided into
(a) Material, Employee and Expenses.
(b) Manufacturing,AdministratieSelling and Distribution costs.
(c) Fixed, Variable and Semi-variable costs.
(d) Controllable and Uncontrollable coss.
Answer :
89. The main purpose of cost accounting is to:
(a) maximize profits
(b) help in inventory valuation
(c) provide information to management for decision making.
(d) Aid in the fixation of selling price
Answer :
90. Which one is ‘False'?
(a) Fixed costs per unit increase with increase in output.
(b) Out of pocket costs involve payment to outsiders.
(c) Rent on own building is imputed cost.
(d) Tender is an estimation of selling price.
Answer :
91. Statement showing break-up of costs is known as
(a) Tender
(b) Production account
(c) Statement of profit
(d) Cost-sheet
Answer : d
Choice 'd' is correct as A cost sheet is a statement that shows the various components of costs associated with the production of a product or service. It breaks down the costs into different categories such as direct materials, direct labor, and overhead. The cost sheet provides a detailed analysis of all the costs incurred in the production process, and it is an important tool for cost control and pricing decisions.
92. A cost unit is
(a) measure of work output in a standard hour.
(b) A unit of production or service in relation to which costs are ascertained.
(c) Cost per labour hour.
(d) Cost per machine hour.
Answer :
93. From the following information, find out purchases of raw material when raw material consumed is ₹ 53,000, closing stock ₹ 9,000 and opening stock ₹ 6,000:
(a) ₹ 53,000
(b) ₹ 56,000
(c) ₹ 50,000
(d) ₹ 68,000
Answer : b
Choice "b" is Correct as
The purchases of raw material can be calculated using the following formula:
Purchases=Raw Material Consumed+Closing Stock−Opening StockPurchases=Raw Material Consumed+Closing Stock−Opening Stock
Given:
Raw Material Consumed = ₹53,000
Closing Stock = ₹9,000
Opening Stock = ₹6,000
Now, substitute these values into the formula:
Purchases=₹53,000+₹9,000−₹6,000
Purchases=₹56,000
94. Which of the following terms is/are excluded from the cost accounts?
(a) Income tax
(b) Interest on debenture
(c) Cash discount
(d) All of the above
Answer : d
Choice 'd' is correct as Cost accounts relate to transactions connected with the manufacture of goods and services and include only those expenses which enter into production. All these mentioned things are not included in the calculation of cost account.
95. Direct Wages ₹ 2.46,000 and Factory Cost ₹ 5,60,000. If the ratio of Direct Wages and Factory Overhead is 3 : 1 then Direct Material Cost will be
(a) ₹ 3,14,000
(b) ₹ 3,96,000
(c) ₹ 3,73,333
(d) ₹ 2,32,000
Answer :
96. Which costing method is used by Spare-parts manufacturing industry?
(a) Process Costing
(b) Job Costing
(c) Batch Costing
(d) Absorption Costing
Answer :
97. Directors remuneration and expenses form a part of
(a) Production overhead
(b) Administration overhead
(c) Selling overhead
(d) Distribution overhead
Answer : b
Choice 'b' is correct as Director's remuneration and expenses can be considered as part of the administration overhead for a project. These costs would include any compensation or benefits paid to the directors of the company, as well as any expenses they incur while carrying out their duties on behalf of the company. This could include things like travel expenses, office expenses, and other costs associated with their role as directors.
98. Interest on own capital is
(a) Cash Cost
(b) Notional Cost
(c) Sunk Cost
(d) Sunk Cost
Answer :
99. Cost Accounting Standard(CAS)-9 is related to
(a) Captive Consumption
(b) Packing Material Cost
(c) Repairs and Maintenance Cost
(d) Direct Expenses
Answer :
100. Direct expenses are also known as
(a) Overhead expenses
(b) Manufacturing Expenses
(c) Administrative Expenses
(d) chargeable expenses
Answer : d
Choice 'd' is correct as Direct expenses, also known as chargeable expenses, are costs that can be directly associated with the production or sale of a product or service. They are also known as variable costs as they tend to vary with the level of production or sales. These expenses are directly traceable to the product or service, and are a necessary part of the production or sale process.
1. The age of two persons are in the ratio 4:3. If the age of the younger person is 8 years less than the other, then the age of the elder person is
(a) 40
(b) 32
(c) 44
(d) 36
Answer :
2. If 15 men working 8 hours a day can complete a piece of work in 25 days, find how many days will be taken by 12 men working 10 hours a day to complete it.
(a) 20
(b) 30
(c) 25
(d) 15
Answer :
3. Mean proportional between 0.20 and 0.05 is
(a) 0.1
(b) 0.2
(c) 0.3
(d) 0.12
Answer :
4. A person deposited ₹ 1,000 in a bank at 4% p.a. simple interest. What will be the amount after 10 years?
(a) ₹ 1,500
(b) ₹ 1,400
(c) ₹ 1,300
(d) ₹ 1,600
Answer :
5. A sum of ₹ 10,000 deposited C.L. becomes double after 5 years. After 20 years it will become
(a) ₹ 1,20,000
(b) ₹ 2,00,000
(c) ₹ 1,50,000
(d) ₹ 1,60,000
Answer :
6. The 7th term of an A.P. 2, 5, 8, 11,... is
(a) 18
(b) 14
(c) 20
(d) 15
Answer :
7. Find 8th term of the series, 128, 64,32,...
(a) 1/4
(b) -1
(c) -1/2
(d) 1
Answer :
8. A takes 4 hours to cover a distance 80 km and B takes 5 hours to cover the same distance. How much distance would A cover more than B in 15 hours?
(a) 40 km
(b) 60 km
(c) 55 km
(d) 45 km
Answer :
9. If P and Q are two sets then P Q is equal to
(a) P ∪ Q
(b) P – Q
(c) (P – Q) ∪ (Q – P)
(d) (P – Q) ∩ (Q – P)
Answer :
10. If the sets A={2,4,6}, B={2,3,5} and C={1,2,5,6}, then A∪(B ∩ C) is
(a) {2,4,5,6}
(b) {2,5}
(c) {2}
(d) {1, 2, 3, 4, 5, 6}
Answer :
11. If 32x+4=33x, then the value of x is
(a) 1
(b) 2
(c) 3
(d) 4
Answer :
12. If log10 7=a, then log10 1/70 equal to
(a) a/10
(b) 1/10a
(c) -(1+a)
(d) (1+a)-1
Answer :
13. If log2 (log3 (log2 x))=1, find the value the value of x.
(a) 512
(b) 624
(c) 484
(d) 496
Answer :
14. If 10P, is 720, then the value of r is
(a) 3
(b) 4
(c) 5
(d) 5
Answer :
15. In how many ways can the colours of the rainbow be arranged so that the red and blue colours are always separated?
(a) 3000
(b) 4000
(c) 4200
(d) 3600
Answer :
16. There are 7 questions in an examination, out of which 2 are difficult. In how many ways a student can select 4 questions so that 2 difficult questions are included?
(a) 5
(b) 10
(c) 35
(d) 20
Answer :
17. The roots of the equation x2-5x+6=0 are
(a) (6,–1)
(b) (–2,3)
(c) (1,–6)
(d) (2,3)
Answer :
18. If the sum of two roots of the quadratic equation (a+1)2+(2a+3)x+(3a+7)=0 be –1, then the value of a is
(a) 0
(b) 1
(c) –2
(d) –3
Answer :
19. If y = xex, then dy/dx is
(a) ex
(b) (x + 1)ex
(c) x + ex
(d) 1 + ex
Answer :
20. If C(x) and R(x) be the cost function and the revenue function respectively, the break- even point can be found out when (x being the output)
(a) C(x)=R(x)
(b) C(x)>R(x)
(c) C(x)>R(x)
(d) R(x)=0
Answer :
Section II : Fundamentals Of Business Statics
21. Fill in the gap: The _____ of a class is the frequency obtained by adding the frequencies of all classes preceding the given class.
(a) relative frequency
(b) cumulative frequency (greater than)
(c) average frequency
(d) cumulative frequency (less than)
Answer :
22. The numbers of Science, Arts and Commerce graduates in a company are 30, 70 and 50 respectively. If these figures are represented by a pie-chart, then what is the angle corresponding to Science graduates?
(a) 36°
(b) 72°
(c) 120°
(d) 168°
Answer :
23. The arithmetic mean for the series 2, 3, 5,7,9, 4 is
(a) 4
(b) 9
(c) 5
(d) 7
Answer :
24. The median of the data 13, 16, 19, 15, 20,1 20, 17 is
(a) 16.5
(b) 16
(c) 15.5
(d) 17
Answer :
25. If the mean and median of a certain set of observations be ₹ 26.25 and ₹ 32.50 respectively, then the approximate value of mode is
(a) ₹ 45.50
(b) ₹ 44
(c) ₹ 45
(d) ₹ 46
Answer :
26. The sum of deviations of 24 observations measured from 4 is 276. Mean of the observations is
(a) 12.8
(b) 15.5
(c) 12
(d) 14
Answer :
27. The A.M. of 100 observations is 40. Later on, it was found that the two observations 52 and 28 were wrongly copied as 44 and 86. Find the correct mean
(a) 39.5
(b) 40.2
(c) 39.7
(d) 40.6
Answer :
28. The mean deviation of the numbers 95, 33, 88, 68, 32, 80, 48, 70 from the median is
(a) 21
(b) 24
(c) 19
(d) 16
Answer :
29. For a skewed distribution mean = 100, median=98.5 and s.d=9. Then the coefficient of skewness is
(a) –0.50
(b) 0.17
(c) 0.33
(d) 0.50
Answer :
30. If the sum of squares of the deviations of 10 observations taken from mean 50 is 250, then C.V. is
(a) 10%
(b) 12%
(c) 20%
(d) 15%
Answer :
31. If the regression lines are perpendicular to each other, then the correlation coefficient between the variables is
(a) 0
(b) -1
(c) 1
(d) 0.5
Answer :
32. For 10 sets of ranks of two variables x and y the sum of squares of differences between the ranks is 30. Find the rank correlation coefficient.
(a) 7/13
(b) 9/17
(c) 5/7
(d) 9/11
Answer :
33. If the two regression lines corresponding to two variables x and y meet at a point(2, 3), var(x)=4, var (y)=1 and correlation coefficient between x and y is 1/2, find the estimated value of y for x=6.
(a) 8
(b) 10
(c) 4
(d) 12
Answer :
34. If the regression lines are perpendicular to each other, then the correlation coefficient between the variables is
(a) 0
(b) -1
(c) 1
(d) 0.5
Answer :
35. Which one of the following statements is TRUE?
(a) The scatter diagram gives precise degree of correlation.
(b) The scatter diagram is amenable to further mathematical treatment.
(c) The scatter diagram is the graphical representation of the relation between two variables.
(d) All points in a scatter diagram lie on a straight line when the correlation coefficient is zero.
Answer :
36. The slope of the regression line y on x is
(a) bxy
(b) bxx
(c) byy
(d) byx
Answer : a
Choice "a" is correct as The regression line y on x is defined as y=a+bx+e
Here b is the slope of line if given the rate of changes of y with respect to x.
37. The correlation coefficient between two variables lies between
(a) 0 and 1
(b) -1 and 1
(c) -1 and 0
(d) 0 and 0.5
Answer :
38. What is the probability of getting a sum 3 if two dice are thrown together?
(a) 1/18
(b) 1/9
(c) 2/3
(d) 1/36
Answer :
39. Two unbiased coins are tossed. The probability of getting at most one head is
(a) 1/2
(b) 1/3
(c) 3/4
(d) 1/6
Answer :
40. The probability of A hitting the target is 1/5 and the probability of B not hitting the target is 3/4 The probability of hitting the target is
(a) 3/5
(b) 2/3
(c) 1/4
(d) 2/5
Answer :
41. Two cards are drawn from a well shuffled pack of cards. The probability of getting two hearts is
(a) 2/17
(b) 1/17
(c) 3/17
(d) 5/17
Answer :
42. Given P(B) is P(B)=1/3, P(AB)=1/4, then p(A|B) is
(a) 1/2
(b) 3/4
(c) 1/4
(d) 1/3
Answer :
43. The probability of an impossible event is
(a) -1
(b) 1
(c) 0.5
(d) 0
Answer :
44. If X and Y be two independent events, then P(XY) is equal to
(a) P(X)P(Y)
(b) P(X) + P(Y)
(c) P(X)-P(Y)
(d) P(X)/P(Y)
Answer :
45. The chances of getting a defective screw from two boxes A and B are 1/5 and 1/6 respectively. A box is selected at random and a screw is drawn at random from the selected box. It is found to be defective. Find the probability that it came from box A.
(a) 5/11
(b) 2/11
(c) 6/11
(d) 4/11
Answer :
46. Given ∑p1q0=162.6, ∑p0q0=110.4, ∑p1q1=140.4, Find the Laspeyres' price index number.
(a) 147.28
(b) 86.34
(c) 127.17
(d) 127.17
Answer :
47. Consider the following :
| Year | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 |
| Annual | 3.6 | 4.3 | 4.3 | 3.4 | 4.4 | 5.4 |
sales (₹ '0000)
5 - year moving average for the year 2004 is
(a) 3.80
(b) 4.36
(c) 4.00
(d) 4.18
Answer :
48. Given: Laspeyres' quantity index number = 120.69 and paache's quantity index number = 120.62. The Fisher's quantity number is
(a) 100.05
(b) 99.94
(c) 145.57
(d) 120.65
Answer :
49. The prices of a commodity in the year 2010 and 2020 were ₹40 and ₹50 respectively. Find the price relative of 2020 taking 2010 base year.
(a) 80
(b) 120
(c) 125
(d) 100
Answer :
50. The component of a time series associated with the "long term increase in sale of TV sets" is
(a) secular trend
(b) seasonal variation
(c) cyclical fluctuation
(d) irregular component
Answer :
51. Human wants are _____________
(a) unlimited
(b) undefined
(c) limited
(d) none of the above
Answer :
52. If an economy is working at the point left to PPF curve that shows ___________.
(a) Excess production
(b) Unemployment
(c) Full employment
(d) None of the above
Answer : b
Choice 'b' is correct as If an economy is working to the left of its production possibility frontier (PPF) curve, it means that it is not utilizing all of its available resources to produce goods and services.
Unemployment can be one of the causes of working to the left of the PPF, as it means that some workers are not being utilized. Unemployment can be caused by a lack of demand for labor, or by a mismatch between the skills of unemployed workers and the skills needed for available jobs. When unemployment is high, it means that a significant portion of the labor force is not being utilized, which can lead to an inefficient allocation of resources, and a lower level of production than what is possible with the economy's resources.
53. Luxury goods have _________ degree of Elasticity.
(a) Moderate
(b) Low
(c) High
(d) None of the above
Answer :
54. Which one of the following is not a factor in the market supply of a product?
(a) Number of buyers
(b) Price of related products
(c) Cost of production
(d) Market price of the product
Answer :
55. …….. is the functional relationship between physical inputs (i.e. factors of production), and physical outputs (i.e. quantity of good / service produced)
(a) Cost Function
(b) Production Function
(c) Demand – Supply Function
(d) Input- Output Function
Answer : b
Choice 'b' is correct as A production function is a mathematical relationship that describes the relationship between the inputs (such as labor, capital, and raw materials) and the outputs (such as the quantity of goods or services produced) in the production process. The production function can be represented by a function, usually denoted by Q = f(K, L), where Q is the output, K is the capital input, and L is the labor input. This function shows the maximum output that can be produced for a given set of inputs, it also shows the technical relationship between inputs and outputs, and it can be used to determine the most efficient combination of inputs to produce a given output level.
56. Internal Economies and Diseconomies arise due to –
(a) Overall industry-level changes
(b) Changes at the Firm Level
(c) Both (a) and (b)
(d) Neither (a) nor (b)
Answer : b
Choice 'b' is correct as Internal economies and diseconomies of scale refer to the changes in a firm's average cost of production as its output level increases. Internal economies of scale arise due to changes at the firm level that result in lower average costs as output increases. These can include factors such as increased efficiency in production, the ability to spread fixed costs over a larger output, and the ability to negotiate lower prices for inputs.
Internal diseconomies of scale, on the other hand, occur due to changes at the firm level that result in higher average costs as output increases. These can include factors such as decreased efficiency in production, the inability to spread fixed costs over a larger output, and the inability to negotiate lower prices for inputs.
Internal economies and diseconomies of scale can arise from a wide range of factors such as the size of the firm, the technical characteristics of the production process, the nature of the industry, the management and organizational structure of the firm and the location of the firm.
57. The labour surplus is the difference between the value of output and the __________
(a) values of capital used
(b) values of capital used
(c) values of material used
(d) values of material used
Answer :
58. Which of these is associated with a monopolistic competitive market?
(a) Product differentiation
(b) Homogeneous Product
(c) Few Firm
(d) Single buyer
Answer : a
Choice 'a' is correct as Product differentiation is one of the key characteristics of a monopolistically competitive market. In a monopolistically competitive market, firms produce products that are similar but not identical to one another. This allows for product differentiation, which means that firms can charge different prices for their products based on the perceived differences in quality or features. Because of this, firms have some degree of market power, and they can charge prices that are higher than the marginal cost of production.
59. In the long run a firm in perfect competition earns.
(a) Average profit of past five years
(b) 12.33% profits on capital employed
(c) Normal profit only
(d) Abnormal profit
Answer : c
Choice 'c' is correct as In the long run, firms operating in a perfectly competitive market will typically earn only normal profits. A normal profit is the minimum level of profit that is necessary to keep a firm in business. It is the return on investment required by the owners of the firm to cover their opportunity cost of investing in the business. In a perfectly competitive market, firms are unable to earn economic profits (profits above normal) because there are many firms producing the same product, and prices are driven down to the level of the marginal cost of production, leaving firms only with the normal profit.
60. In a competitive market,________ is the price-maker.
(a) industry
(b) trade association
(c) firm
(d) consumer
Answer :
61. When MC=MR. the firm will get ________ profits.
(a) minimum
(b) maximum
(c) zero
(d) normal
Answer :
62. The Demand Curve of a monopoly firm is the _________
(a) Same as its supply curve
(b) same as it average revenue curve
(c) same as its demand curve
(d) none of the above
Answer :
63. Price rigidity is the feature of _________ market.
(a) Oligopoly
(b) Duopoly
(c) Monopoly
(d) Monopolistic Competitive
Answer :
64. Average revenue curve is also known as ________
(a) Supply Curve
(b) Demand Curve
(c) Average Cost Curve
(d) None of the above
Answer :
65. Price discrimination is possible in the ________ market only
(a) perfectly competitive
(b) duopoly
(c) monopoly
(d) oligoply
Answer :
66. The demand for a monopoly product is __________ elastic .
(a) more
(b) less
(c) neither more nor less
(d) sometimes more sometimes less
Answer :
67. In the short run,if the price is above the average total cost, in the monopolistic competitive market, the firm makes _________
(a) losses and exits the market
(b) quick profits and disappears
(c) profits and new firms join the market
(d) profits and bars entry to new firms
Answer :
68. Which of these affects the demand for money?
(a) Rate of interest
(b) Price level
(c) Real income
(d) both (a) and (c)
Answer : a
Choice "a" is correct as The rate of interest can affect the demand for money. A higher interest rate can make it more attractive for people to save money or invest in interest-bearing assets, which can decrease the demand for money. On the other hand, a lower interest rate can make it less attractive to save money or invest in interest-bearing assets, which can increase the demand for money, as people may prefer to hold cash instead of earning a lower return on their savings or investments.
69. Optional money is a _______ .
(a) Non-legal tender money
(b) Legal tender money
(c) Limited legal tender money
(d) Full bodied money
Answer : a
Choice "a" is correct as Optional money refers to forms of currency or payment that are not legal tender, meaning they are not officially recognized or accepted as a means of payment by the government. Examples of optional money include cryptocurrencies, digital or virtual currencies, or alternative forms of payment such as reward points or coupons. These forms of money can still be used for transactions, but acceptance of them may depend on the willingness of the parties involved, and they may not be recognized in all jurisdictions.
70. The EXIM Bank of India wholly - owned by the ________
(a) Government of India
(b) RBI
(c) SBI
(d) IDBI
Answer :
71. The RBI checks inflation by _________
(a) increasing the CRR
(b) increasing the bank rate
(c) both (A) and (B)
(d) none of the above
Answer :
72. Money market includes __________.
(a) bills of exchange
(b) treasury bill
(c) Government securities
(d) All the above
Answer : d
Choice 'd' is correct as The money market includes a variety of short-term debt securities, such as government securities and Treasury bills, which are issued by the government or government-affiliated entities, as well as commercial paper, which is issued by companies, and bills of exchange, which are short-term promissory notes. These securities are considered to be low-risk and highly liquid, and are often used by investors as a safe place to park their cash. They are also used by companies and financial institutions to manage their short-term funding needs.
73. Money market is controlled by ________.
(a) S.B.I
(b) R.B.I
(c) Government
(d) all the above
Answer : b
Choice 'b' is correct as The Reserve Bank of India (RBI) plays a key role in regulating and controlling the money market in India. The RBI uses a variety of monetary policy tools, such as open market operations, cash reserve ratio, and statutory liquidity ratio, to manage the money supply and interest rates in the economy.
74. Manipulation in CRR enables the RBI to _________.
(a) Increase GDP
(b) Check poverty
(c) Check unemployment growth
(d) Influence the lending ability of the commercial banks
Answer : d
Choice "d" is correct as The cash reserve ratio (CRR) is the percentage of deposits that commercial banks are required to keep with the Reserve Bank of India (RBI) as a cash reserve. By manipulating the CRR, the RBI can influence the amount of money that banks have available to lend to customers.If the RBI increases the CRR, it means that banks have to keep a higher percentage of their deposits with the RBI, leaving them with less money to lend. This can be used as a tool to curb inflationary pressures by reducing the amount of money in circulation. On the other hand, if the RBI reduces the CRR, it means that banks have more money available to lend, which can stimulate economic growth by encouraging borrowing and spending.
75. The IDA is affiliated to the ________
(a) IMF
(b) World Bank
(c) RBI
(d) Asian Development Bank
Answer :
76. The ICICI is a ________ sector bank.
(a) private
(b) public
(c) joint
(d) none of the above
Answer :
77. Special Drawing right is the special currency issued by the _________
(a) IDBI
(b) IMF
(c) World Bank
(d) IFCI
Answer :
78. The Macro - business environment does not include _____________
(a) technological environment
(b) global environment
(c) economic environment
(d) marketing intermediaries
Answer :
79. The term PESTEL does not include ___________.
(a) employment factors
(b) legal factors
(c) socio-cultural factors
(d) political factors
Answer :
80. SWOT Analysis does not include _____________.
(a) strengths
(b) workers
(c) opportunities
(d) threats
Answer :
81. __________ is not a dimension of the VUCAFU world.
(a) Volatility
(b) Uncertainty
(c) Conformity
(d) Ambiguity
Answer :
82. Porter’s Five Forces Model does not include
(a) bargaining power of buyers
(b) new entrants
(c) bargaining power of suppliers
(d) bargaining power of workers
Answer :
83. The internal business environment does not include
(a) role of competitors
(b) management structure
(c) business philosophy
(d) capital structure
Answer :
84. Economic environment includes __________
(a) money market
(b) labour market
(c) availability of raw materials
(d) all of the above
Answer :
85. Which of the following institutions has been pivotal to the emergence of the digital payment ecosystem in India?
(a) Reserve Bank of India
(b) National Payments Corporation of India
(c) State Bank of India
(d) Industrial Credit and Investment Corporation of India
Answer :
Section B : Fundamentals of Managment
86. “Management is a multi-purpose organ that manages a business and manages managers and manages workers and work”.This definition of management was given by _______ .
(a) Schulze
(b) Drucker
(c) Massie
(d) Wheeler
Answer :
87. The idea of ‘Management as an Art’ focuses on ___________.
(a) observation
(b) individual skill
(c) cause-effect relationship
(d) none of the above
Answer :
88. Leader’s stewardship choice can facilitate reciprocal stewardship behavior from the employee. Who made this observation?
(a) Jensen & Meckling
(b) Koontz
(c) Pearson & Marler
(d) Clough
Answer :
89. _________ developed the Agency Theory.
(a) Follett
(b) Jensen & Fama
(c) Hicks & Gullet
(d) Mayo
Answer :
90. __________ is a limitation of planning.
(a) Goal - orientation
(b) Rigidity
(c) Flexibility
(d) Pervasiveness
Answer :
91. Which one of the following is off-the-job training?
(a) Job-rotation
(b) Role-playing
(c) Apprenticeship
(d) None of the above
Answer :
92. Which one of the following is involved in the process of organising?
(a) Identifying alternatives
(b) Analysing opportunities
(c) Forecasting
(d) Delegation of Authority
Answer :
93. Which one of the following is the carrier of message sent by one person to another?
(a) Decoding
(b) Feedback
(c) Encoding
(d) Medium
Answer :
94. In the entire process of management, coordination must be there from _____________ .
(a) planning to leadership
(b) organising to control
(c) planning to control
(d) none of the above
Answer :
95. For the _____executives, decentraliastion of authority helps in reduction of the workload.
(a) Top level
(b) Middle level
(c) Lower level
(d) None of the above
Answer : a
Choice 'a' is correct as Decentralization helps in the reduction of the work load of top-level executives or managers, also known as central authority or central management. By delegating decision-making power and authority to individuals or smaller groups at the lower levels of an organization, top-level executives are able to focus on more strategic tasks and responsibilities, and they are not bogged down by the day-to-day decisions that can be handled by lower-level managers or employees.
96. ___________ represents the maximum number of subordinates which can be supervised by a supervisor.
(a) Scalar Chain
(b) Unity of Objective
(c) Unity of Command
(d) Span of Control
Answer :
97. The concept of Managerial Grid was developed by ______________.
(a) Bernard
(b) Tannenbaum & Schmidt
(c) Blake & Mouton
(d) Fiedler
Answer :
98. Achievement Motivation model was developed by ____________
(a) McGregor
(b) McClelland
(c) Herzberg
(d) Vroom
Answer :
99. PERT and CPM are _____ techniques.
(a) Queuing Theory
(b) Simulation
(c) Linear Programming
(d) Network
Answer : d
Choice 'd' is correct as There are two powerful network techniques—Critical Path Method (CPM) and Programme Evaluation and Review Technique (PERT) which are useful for project planning and control.
100. ____________ level managers take non-programmed decisions.
(a) Middle
(b) Top
(c) Lower
(d) None of the above
Answer :
Ruchika Saboo
An All India Ranker (AIR 7 - CA Finals, AIR 43 - CA Inter), she is one of those teachers who just loved studying as a student. Aims to bring the same drive in her students.
Ruchika Ma'am has been a meritorious student throughout her student life. She is one of those who did not study from exam point of view or out of fear but because of the fact that she JUST LOVED STUDYING. When she says - love what you study, it has a deeper meaning.
She believes - "When you study, you get wise, you obtain knowledge. A knowledge that helps you in real life, in solving problems, finding opportunities. Implement what you study". She has a huge affinity for the Law Subject in particular and always encourages student to - "STUDY FROM THE BARE ACT, MAKE YOUR OWN INTERPRETATIONS". A rare practice that you will find in her video lectures as well.
She specializes in theory subjects - Law and Auditing.
Yashvardhan Saboo
A Story teller, passionate for simplifying complexities, techie. Perfectionist by heart, he is the founder of - Konceptca.
Yash Sir (As students call him fondly) is not a teacher per se. He is a story teller who specializes in simplifying things, connecting the dots and building a story behind everything he teaches. A firm believer of Real Teaching, according to him - "Real Teaching is not teaching standard methods but giving the power to students to develop his own methods".
He cleared his CA Finals in May 2011 and has been into teaching since. He started teaching CA, CS, 11th, 12th, B.Com, M.Com students in an offline mode until 2016 when Konceptca was launched. One of the pioneers in Online Education, he believes in providing a learning experience which is NEAT, SMOOTH and AFFORDABLE.
He specializes in practical subjects – Accounting, Costing, Taxation, Financial Management. With over 12 years of teaching experience (Online as well as Offline), he SURELY KNOWS IT ALL.
"Koncept perfectly justifies what it sounds, i.e, your concepts are meant to be cleared if you are a Konceptian. My experience with Koncept was amazing. The most striking experience that I went through was the the way Yash sir and Ruchika ma'am taught us in the lectures, making it very interesting and lucid. Another great feature of Koncept is that you get mentor calls which I think drives you to stay motivated and be disciplined. And of course it goes without saying that Yash sir has always been like a friend to me, giving me genuine guidance whenever I was in need. So once again I want to thank Koncept Education for all their efforts."
"Hello everyone, I am Kaushik Prajapati. I recently passed my CA Foundation Dec 23 exam in first attempt, That's possible only of proper guidance given by Yash sir and Ruchika ma'am. Koncept App provide me a video lectures, Notes and best thing about it is question bank. It contains PYP, RTP, MTP with soloution that help me easily score better marks in my exam. I really appericiate to Koncept team and I thankful to Koncept team."
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"I cleared my foundation examination in very first attempt with good marks in practical subject as well as theoretical subject this can be possible only because of koncept Education and the guidance that Yash sir has provide me, Thank you."
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