CA-Common Proficiency Test 0071078061, 9780071078061

Table of contents :
Title
Contents
Part A Part-syllabus Mock Tests
Mock Test Paper–I
Mock Test Paper–II
Mock Test Paper–III
Mock Test Paper–IV
Mock Test Paper–V
Part B Full Syllabus Mock Tests
Mock Test Paper–VI
Mock Test Paper–VII
Mock Test Paper–VIII
Mock Test Paper–IX
Mock Test Paper–X
PART C All India Mock Tests
All India Mock Test–I
All India Mock Test–II

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Published by the Tata McGraw Hill Education Private Limited, 7 West Patel Nagar, New Delhi 110 008. CA-Common Proficiency Test Copyright © 2011 by Tata McGraw Hill Education Private Limited. No part of this publication may be reproduced or distributed in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise or stored in a database or retrieval system without the prior written permission of the publishers. The program listings (if any) may be entered, stored and executed in a computer system, but they may not be reproduced for publication. This edition can be exported from India only by the publishers, Tata McGraw Hill Education Private Limited. ISBN (13): 978-0-07-107806-1 ISBN (10): 0-07-107806-1 Information contained in this work has been obtained by Tata McGraw-Hill, from sources believed to be reliable. However, neither Tata McGraw-Hill nor its authors guarantee the accuracy or completeness of any information published herein, and neither Tata McGraw-Hill nor its authors shall be responsible for any errors, omissions, or damages arising out of use of this information. This work is published with the understanding that Tata McGraw-Hill and its authors are supplying information but are not attempting to render engineering or other professional services. If such services are required, the assistance of an appropriate professional should be sought. Typeset at Tej Composers, WZ-391, Madipur, New Delhi 110063, and printed at Adarsh Printers, C-50-51, Mohan Park , Naveen Shahdara, Delhi – 110 032. Cover Design: Meenu Raghav, Graphic Designer, TMH Cover Printer: SDR Printers Print Code: RACYCRCCRABCL

CONTENTS EDUEX—An Introduction

vii

Process of Evaluation for All India CPT Mock Tests

ix

Section A–Part Syllabus Mock Tests Syllabus Break Up

2

Mock Test Paper I

3

Mock Test Paper II

25

Mock Test Paper III

46

Mock Test Paper IV

68

Mock Test Paper V

90 Section B–Full Syllabus Mock Tests

Mock Test Paper VI

117

Mock Test Paper VII

140

Mock Test Paper VIII

164

Mock Test Paper IX

187

Mock Test Paper X

210 Section C–All India Mock Tests

All India Mock Test–I (Test ID: 123)

235

All India Mock Test–II (Test ID: 456)

254

EDUEX–An Introduction At EDUEX we specialize in providing mock test series to students of CA course all over India, at all levels, i.e. CPT – PCC/IPCC – Final, and also to the students of CS and CWA. The key features of our programme are: Evaluation and feedback from experts All India ranking Taking examination from the comfort of one’s study-table Updates on these examinations and related issues To help students keep pace with the increasing competition and for better results in the CA/CS/CWA examinations, EDUEX has come up with the idea of providing mock tests to the students. The test series offered by us has been designed to help get transformed from a normal, rank hungry, guideless student to one trying to break the shackles of lowliness and achieve what others around had never even dreamt of ! The test series will not only give an opportunity to identify the areas where the students face problems, but will also help to develop the correct temperament that they must have on the examination day! EDUEX serves as a cornerstone for students aspiring for a good career in these fields. It brings forth a wide array of experience, professional etiquette and relevant knowledge. Its distinguished faculty and unique structured curriculum will ease the students through the ordinarily stressful preparation period. To know more about us please visit: www.eduex.in

Process of Evaluation for ALL INDIA CPT MOCK TESTS Apart from part syllabus and full syllabus CPT mock tests, there are two All India CPT Mock Tests for your practice and evaluation, enclosed in this CPT workbook. These All India CPT Mock Tests shall get evaluated by EDUEX faculty team and a rank will be given to each student, based on the performance of all students appearing for the test. The procedure to be followed for getting evaluated is as follows: You will find an envelope with 2 OMR sheets inside this workbook. You need to use these OMR sheets to write AIMCPT ME 1 & 2. Each workbook has a booklet reference number which you need to note from the attached coupon for communicating with us. The same would be required to be provided at relevant place in the OMR sheet. Both the AIMCPT tests have a unique Test ID, which needs to be mentioned at the appropriate places in the OMR sheets: AIMCPT—ME I Test ID—123 AIMCPT—ME II Test ID—456 To facilitate communicating with you and for sharing the results and the correct answers, we would request you to mention your email address and mobile number in the area specified in the OMR sheets. You can either send the answered OMR sheets at the same time for both these mock tests, or separately, as per your convenience. To send these OMR sheets to us you can use the envelope enclosed in the booklet or any other envelope. Please do confirm that our address is correctly mentioned on the envelope. Our address is: EDUEX 304A, Jaina Tower – I, Janakpuri District Centre, Janakpuri, New Delhi, India – 110058 Please note that the OMR sheets shall get evaluated as per the following evaluation cycle: OMR sheets received till Feb 28 OMR sheets received till April 30 OMR sheets received till July 31 OMR sheets received till October 30

- Results likely to be announced by March 31 - Results likely to be announced by May 31 - Results likely to be announced by Aug 31 - Results likely to be announced by Nov 30

Based on the result announcement dates, the results with detailed analysis of the performance of all the students being evaluated, will be shared with the students through email or post. Note: 1. In case the envelope with the OMR sheets is missing from your workbook, you can simply call EDUEX support team and get the required OMR sheets through post, to answer the AIMCPT Mock Tests. 2. Please do not forget to mention your booklet reference number, correspondence address and your mail id/mobile number on the envelope so that we can get in touch with you with any update, as and when necessary. 3. In case you have any query, you can mail us at [email protected] or call us at 9312223087.

PART A Part-syllabus Mock Tests

Syllabus Break Up for the PART SYLLABUS MOCK TESTS* Mock Test-I Fundamentals Of Accounting Accounting concepts Scope of Accounting Concept of accounting standards Accounting policies Valuation Principles & estimates

Merchantile Law Indian Contract Act, 1872

Economics Nature and scope of economics Demand and supply

Quantitative Aptitude Ratio & Proportion Indices Logarithms Equations Inequalities Simple/ Compound Interest

Mock Test-II Fundamentals Of Accounting Books of Accounts Trial Balance Capital/ Revenue Expenditure Bank reconciliation Statement Inventories

Merchantile Law Indian Contract Act, 1872

Economics Factors of production Laws of Production Concepts of Costs Various forms of markets Theory of price Output determination

Quantitative Aptitude Permutation & Combination AP & GP Sets, Functions and Relations

Mock Test-III Fundamentals Of Accounting Consignment Joint Venture Bills of Exchange Sale of Goods on approval basis

Merchantile Law Sale of Goods Act, 1930

Economics Nature of Indian Economy National Income Agriculture and industry in India Tax system of India

Quantitative Aptitude Limits & Continuity Calculus Textual, Tabular & Diagrammatic representation of data Frequency Distribution Histogram, Polygon & Ogive

Mock Test -IV Fundamentals Of Accounting Depreciation Accounting Final Accounts

Merchantile Law Partnership Act, 1932

Economics Population Poverty Unemployment Infrastructure Inflation Budget and Fiscal deficits Balance of payments External debts

Quantitative Aptitude Measures of Central Tendency Correlation and regression Probability and expected value

Mock Test-V Fundamentals Of Accounting Partnership accounts Introduction to Company Accounts

Merchantile Law Partnership Act, 1932

Economics Economic Reforms in India Liberalisation, Privatisation and Disinvestment Globalisation. Indian monetary policy Commercial Banks Functions of RBI

* The above mentioned syllabus break up is indicative in nature and is meant for reference only.

Quantitative Aptitude Binomial, Poisson & Normal Sampling Index numbers

COMMON PROFICIENCY TEST Mock Test Paper–I SESSION - I TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section A-Fundamentals of Accounting (60 marks)

1. Among the various activities covered under Accounting, which of the following accounting activities precedes the activity of “Recording” Identifying and classifying Measuring and summarising Identifying and measuring Identifying and Interpreting 2. Which of the following is a part of accounting process: Recording & Classifying Summarising & Analysing Interpreting All of the above 3. ____________ is a part of accounting which itself is a part of __________. Book Keeping, Accountancy Recording, Book Keeping Valuation, Accountancy None of the above 4. ___________ marks the end of Book Keeping process. Recording Classifying Summarising None of the above 5. An accounting cycle ends with ascertaining the difference between debit and credit column of a ledger account preparation of Trial Balance

balancing a Ledger account preparation of final accounts 6. The financial performance of an enterprise is measured by preparing Balance sheet Income statement All of the above None of the above 7. The act of artificially inflating or deflating the financial performance or financial position of en enterprise is commonly referred to as: Inflation accounting Management accounting Window Dressing None of the above 8. Comparison of actual figures of one firm with those of industry to which firm belongs is commonly referred to as Intra firm comparison Inter firm comparison Pattern comparison Industry comparison 9. FIFO is an example of Work Force valuation Inventory valuation Business valuation All of the above 10. Which of the following options reflect the characteristic of “Current assets”

4

Part-syllabus Mock Tests an asset held for their conversion into cash an asset held for consumption in the production of goods or rendering of services in the course of business cash & bank balances all of the above

17. The four principal qualitative characteristics of accounting information does not include Understandability Relevance Reliability None of the above

11. Under accrual basis of accounting, prepaid expenses will result in Decrease in enterprise’s assets Decrease in enterprise’s profits No change in the enterprise’s profitability Both and

18. The assets and income are not overstated and liabilities and expenses are not understated in accordance with Prudence principle Accounting period principle Objectivity principle Matching principle

12. All of the following are functions of accounting except Decision making Forecasting Ledger posting Measurement 13. General acceptance of accounting principles depends upon how well they meet the criteria of Relevance Feasibility Objectivity All of the above 14. The “Periodicity” principle of accounting requires classification of assets as Current assets and Fixed assets liabilities as short term liabilities and long term liabilities expenses as capital and revenue all of the above 15. ____________ principle is basically an exception to the Full Disclosure Principle Prudence Matching Materiality None of the above 16. As per AS-1, issued by ICAI the three fundamental accounting assumption does not include the assumption of Consistency Prudence Accrual All of the above

19. M/s Ram Prasad & Co. purchased machinery in 2009 at a cost of Rs. 1.5 lacs on credit. At the year end the market value of the machinery was Rs. 1.2 lacs. The accountant of M/s Ram Prasad & Co. created a provision for discount @ 10% on the same at the final of preparation of final accounts for the year 2009. Creating this provision for discount is a violation of Cost principle Materiality principle Conservatism principle Prudence principle 20. A Ltd. purchased merchandises for Rs. 50 lacs on credit. By the end of the year 90% of the merchandises were sold to customers. The balance 10% of the left over merchandises which had a market value of 6 lacs at the year end was valued at Rs. 5 lacs, thus violating the concept of Cost Conservatism Money measurement None of the above 21. Recording of capital contributed by the owner as liability ensures the adherence of principle of Double entry Going concern Consistency Separate entity 22. Mr. Y purchased a truck for Rs. 5 lacs, making a down payment of Rs. 1 lacs and signing a Rs. 4 lacs Bill payable due in 90 days. As a result of this transaction Total assets increased by Rs. 5 lacs

Mock Test Paper-I 5 Total liabilities increased by Rs. 4 lacs Total assets increased by Rs. 4 lacs Total assets increased by Rs. 4 lacs with corresponding increase in liabilities. 23. Accounting standards in India is formulated by: ASB IASC ICAI Central Government 24. Which of the following statement is incorrect? ASB is one of the members of the International Accounting Standards Committee. ASB has agreed to support the objectives of IASC International Accounting Standards are issued by ASB. ASB will review the Accounting Standards at periodic intervals. 25. The major considerations governing the selection and application of accounting policies are: Prudence, Substance over form and Materiality Prudence, Going concern and Consistency Accrual, Going concern and Consistency Prudence, Substance over form and Consistency 26. Which of the following statement is incorrect? According to AS-1 issued by the Institute of Chartered Accountants of India: Only those significant accounting policies which have a material impact on the financial statement should be disclosed. The disclosure of the significant accounting policies should form part of the financial statements The significant accounting policies should normally be disclosed in one place. None of the above. 27. In case of change in Accounting Policy, the amount of change should be disclosed: If change has a material effect in current period and the effect of change is ascertainable. If change has a material effect in current period and the effect of change is not ascertainable, wholly or in part.

If change has no material effect in current period but which is reasonably expected to have a material effect in later periods. If change has no material effect in current period and also not expected to have a material effect in later periods. 28. The disclosure of Fundamental Accounting Assumptions are required to be given: if all the fundamental assumptions are followed in the preparation of financial statements. if all the fundamental assumptions are not followed in the preparation of financial statements. irrespective of whether any fundamental assumptions are followed in the preparation of financial statements. No disclosure is required to be given irrespective of whether any fundamental assumptions are followed in the preparation of financial statements. 29. Which accounting principle is followed in adopting accounting policy of using WDV method of depreciation year after year: Prudence Consistency Going concern Materiality 30. As per the Current Cost measurement base the assets are recorded: at the amount of cash or cash equivalent paid or incurred or fair value of the asset at the time of acquisition. at the amount of cash or cash equivalent that would have to be paid if the same or an equivalent asset was acquired currently. at the amount of cash or cash equivalent that could currently be obtained by selling the assets in an orderly disposal. at the present discounted value of the future net cash inflows that the item is expected to generate in the normal course of business. 31. ABC Ltd. purchased a machine for Rs. 1,00,000 on 1.4.2009. On 31st March 2010 the similar machine could be purchased for Rs. 1,20,000 and the existing machine could be disposed off for Rs. 80,000. The present discounted value of the future net cash inflows that the machinery is expected

6

Part-syllabus Mock Tests to generate in the normal course of business is calculated at Rs. 1,50,000. What will be the value of machine as on 31st March 2010, if historical cost method of valuation is used? Rs. 1,00,000 Rs. 1,20,000 Rs. 80,000 Rs. 1,50,000

38. An example of increase is one liability & decrease in another liability is: Accrued Interest Bills Payable Accepted Outstanding expense None of above

32. In accounting ______ are used to measure the value of an object, ability or idea. ordinal scales cardinal scales Both and None of above

39. For which of the following, closing entries are required to be passed to close the account? Real Account Nominal Account Personal Account None of above

33. Which of the following is not a column in a Journal? Particulars column Ledger folio column Cash column Amount column

40. The rules for debit and credit when the accounts are classified as real is: Debit the receiver, Credit the giver. Debit what comes in, Credit what goes out. Debit all expenses, Credit all gains. Debit all losses, Credit all profits.

34. Accounting estimates are required in respect of: Doubtful debts Inventory Obsolescence Employees Retirement Benefit Obligations All of above

41. In which of the following accounts, all decreases are debited and all increases are credited? Capital Account Liabilities Account Revenue Account All of above

35. Change in accounting estimates: should always be given a retrospective effect. can be given a retrospective effect. can not be given a retrospective effect. None of above. 36. Which of the following accounting equation is correct? Capital = Total assets – Fictitious Assets Capital = Total assets – Total external liabilities Capital = Total assets – Total external liabilities – Fictitious Assets Capital = Total assets + Total external liabilities – Fictitious Assets 37. Goods returned to supplier is an example of: Increase in Asset and Owner’s Liability Decrease in Asset and Owner’s Liability Decrease in Liability and Increase in Owner’s liability

Increase in liability and Decrease in Owner’s liability

42. Which of the following column in a journal is not filled at the time of journalising but is filled at the time of posting? Date column Ledger folio column Debit amount column Credit amount column 43. In the event of any deviation from the accounting standard, it will be the duty of the members of ICAI to make adequate disclosures in their audit reports. it will be the duty of the person preparing accounts to inform the management. it will be the duty of the management to inform the auditors. it will be the duty of the management to make adequate disclosures in their financial statement.

Mock Test Paper-I 7 44. The words ‘To Balance b/f’ or ‘By Balance b/f’ are recorded in the ‘Particulars Column’ at the time of posting of: an opening entry a closing entry an adjusting entry a transfer entry 45. Which of the following is a cash transaction? Goods sold Goods sold to Ram on credit Goods sold to Ram on account None of above 46. Which of the following transaction is recorded in the Sales Book? Sold on credit to ABC & Co. 20 polyster sarees @ Rs.125 each less trade discount of 10%. Sold for cash to XYZ & Co. 20 kota sarees @ Rs 50 each. Sold on credit to Mohan 2 old typewriters @ Rs 500 each. All of above 47. The entries in the sales book are on the basis of the sales invoices issued to the customers and are recorded: at the gross amount. at the amount net of trade discount. at the amount net of quantity discount. at the amount net of trade and quantity discount. 48. When a cheque received on a particular date is not deposited the same day into bank, it is entered on: the debit side of the Cash column. the debit side of the Bank column. the credit side of the Cash column. the credit side of the Bank column. 49. Which of the following statement is incorrect? Cash Account is not opened in the ledger since the ‘Cash Column’ in the Cash Book serves the purpose of a Cash Account. In case of a Cash Book with Bank Column, Bank Account is not opened in the ledger since the ‘Bank Column’ in the Cash Book serves the purpose of a Bank Account. In case of Cash Book with Discount Column, ‘Discount Allowed Account’ and `Discount

Received Account’ are opened in the ledger since the Cash Book does not serve the purpose of Discount Account. None of the above. 50. A sold goods of the list price of Rs 1,00,000 to B subject to trade discount of 10% and cash discount of 5% if payment is made immediately. How much B needs to pay A if he makes the payment immediately? Rs. 90,000 Rs. 95,000 Rs. 85,500 Rs. 85,000 51. Which of the following discount is not shown in the invoice? Trade Discount Cash Discount Both and None of the above. 52. _________ is a special journal which is used for recording all cash receipts and cash payments. Cash Book Cash Ledger Cash Account Journal proper 53. Which of the following statement for a special journal is incorrect? Transactions which are repetitive in nature and are sufficiently large in number are recorded in special journal. Special journals are also known as subsidiary books or day books. The proforma for special journals are specified. None of above. 54. Which of the following account will be debited to account for the wages of Rs. 100 paid to workers for installation of machine purchased? Wages Account Installation charges Account Machinery Account Cash Account 55. On receipt of Rs. 975 from A in full settlement of his account for Rs. 1,000. A’s account should be credited with: Rs. 1,000

8

Part-syllabus Mock Tests Rs. 975 Rs. 25 Rs. 1,025

56. Sales Book is a part of: Cash Journal Goods Journal Bills Journal Journal Proper 57. The source document used for recording entries in Purchase Book is: Invoice received Invoice sent out Debit notes issued Credit notes issued 58. Transfer entries are recorded in: Cash Book

Journal proper Ledger Trial Balance 59. If both the debit as well as the credit aspects of a transaction are recorded in the Cash Book itself, it is called: a transfer entry a compound entry a contra entry an adjusting entry 60. Which of the following statement is correct? Cash Book is a ledger and not a journal. Cash Book is a journal and not a ledger. Cash Book is both a ledger and a journal. Cash Book is neither a ledger nor a journal.

Mock Test Paper-I 9 Section B-Mercantile Law (40 marks) 61. The date of enactment of the Indian Contract Act is 1st September, 1872 1st January, 1873 1st April, 1883 1st April, 1872 62. The Indian Contract Act, 1872 does not apply to North East States Uttarakhand State Jharkhand State Jammu & Kashmir State 63. An agreement enforceable by law is A Contract An agreement A settlement Compromise 64. The term jus in rem means Right against a specific person Right against a specific thing both none 65. Law of contract creates Jus in personam Jus in rem Both None 66. When a person to whom the proposal is made signifies his assent thereto, the proposal is said to be made communicated accepted discharged 67. A proposal when accepted becomes contract agreement a promise none 68. Consideration can be understood something in return of immense value

offered as gift none 69. An agreement is the outcome of the_______ between the contracting parties. consensus compromise dispute none of these 70. A promise made without intention of performing amounts to Fraud Mistake Coercion Mis-statement 71. When a person signifies to another his willingness to do or to abstain from doing anything with a view to obtaining his assent of that other person to such act or abstinence he is said to have made a Contract Agreement Proposal Consideration 72. Which of the following is an expressed offer? Metro Rail running between Connaught Place to Dwarka according to schedule fare. Display of goods for sale in a leading Shopping Mall X offered to sell his old bike to Y for Rs. 15,000 All the three 73. Which of the following is not an implied offer? Metro Rail running between Connaught Place to Dwarka according to schedule fare. Display of goods for sale in a leading Shopping Mall X offered to sell his old bike to Y for Rs. 15,000 All the three 74. In which of the following ways a proposal can be revoked? by communication of notice of revocation. by lapse of time by the death or insanity of the proposer all the three

10

Part-syllabus Mock Tests

75. Which of these are not an essential ingredients of a valid acceptance. It must be absolute and unqualified It can be expressed or implied To be properly communicated None

82. In which of the following cases a stranger to a contract can sue. Agency Family arrangement Beneficiary in case of trust All the three

76. A proposal can be revoked any time any time become communication of acceptance is complete against the proposer any time become communication of acceptance is complete against the acceptor within a reasonable time

83. Consideration must move at the of the promisor Desire Order Behalf Behest

77. Communication of proposal is complete when it comes to the knowledge of the person to whom it is made the person who made it the Solicitor General of India any of these 78. An acceptance may be revoked any time any time before communication of the acceptance is complete against the proposer any time before communication of the acceptance is complete against the acceptor none of these ways 79. Which of these is not an exception to the rule “no consideration no contract” Remission Agency Promise to pay time barred debt None of these 80. For which of these considerations is not required Completed gift Agreement made on account of natural love and affection Promise to subscribe for charitable deeds All the three 81. A Contract without consideration is illegal voidable void in all the cases A void subject to some exceptions

84. A promise to pay 62,000 to B for no reason. This is a Void being no contract at all Voidable Valid Illegal agreement 85. The term Consent means Perfect understanding Meeting of mind Proper communication Agreement 86. The term “Consensus ad idem” means Perfect understanding Meeting of mind Proper communication Agreement 87. An agreement without consent is Void Voidable Valid Illegal 88. An agreement without free consent is Void Voidable Valid Illegal 89. Consent is said to be free when it is not caused by Coercion Undue influence Fraud All the three 90. When there is no consent Salmond describes it as Error in causa Error in consensus

Mock Test Paper-I 11 Consensus ad idem None of these 91. When there is no free consent Salmond describes it as Error in causa Error in consensus Consensus ad idem None of these 92. An agreement caused by mistake of fact is Valid Voidable Void Illegal 93. In which of the following presumption of undue influence is raised. Parents and child Guardian and ward Trustee and beneficiary All the three 94. Coercion is defined in section_______of the Contract Act. 15 18 19 20 95. An agreement with a minor is_______ voidable absolutely void without exception. absolutely void with some exceptions illegal

96. The doctrine of restitution is_______against the minor equally applicable not applicable not applicable subject to some exceptions applicable in some cases 97. A minor is a person who_______ is still a bachelor is yet to get an Electorate Identity Card. has not attained the age of majority satisfies all the above three conditions. 98. A minor person can be a shareholder of a company_______ in all the cases without any restrictions/ conditions if he is properly represented by his guardian who should act on his behalf. on furnishing surety after obtaining PAN number 99. A minor can misrepresent about his_______ marital status financial conditions parentage age 100. Which of the following types of persons are not disqualified from contracting. alien enemies a convicted person insolvent person none

12

Part-syllabus Mock Tests

SESSION - II TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section C-Economics (50 marks)

1. Macroeconomics deals with the study of: consumers resource owners firms full employment

Robbins Samuelson 7. Which branch of economics deals with the central problem of “For whom to produce”? Price Theory Theory of Production Theory of Distribution Growth Economics

2. Macroeconomics is also called ____________ . Price Theory Theory of income and employment Theory of economic growth Theory of Distribution 3. ________ deals with what is or how an economic problem facing a society is actually solved. Positive economics Normative economics Wealth economics Monetary economics 4. Which of the following statement is an example of Normative Economics? India is an overpopulated country. India should spend more money on defence. Prices have been rising in India. Minimum Wage Law increases unemployment. 5. Where facts and data are not available, ___________ of constructing an economic theory is more useful. Inductive Method Deductive Method General method Partial method 6. Who has given economics? Adam Smith Marshall

the

welfare

definition

of

8. ___________ shows the various alternative combinations of goods and services that an economy can produce when the resources are all fully and efficiently employed. Production possibility curve Demand curve Supply curve Marginal cost curve 9. Production possibility curve is based on the assumption that: Economy produces a large number of goods. Resources cannot be shifted from production of one good to the other good. State of technology remains constant. Some of the resources are idle. 10. One of the main features of a capitalist economy is: Public ownership No freedom of enterprise Social welfare motive Consumers are supreme 11. In a socialist economy, production decisions are governed by: Profit motive Price mechanism Planning mechanism Both and

Mock Test Paper-I 13 12. Who said “Economics is neutral between ends”? Adam Smith Pigou Robbins Samuelson 13. In a capitalist economy, distribution of income is: Quite equal Very unequal Considerably equal Considerably unequal 14. Referring to the following diagram which combination of goods cannot be produced with the available resources.

D

.

B A C

Q

18. Elasticity of demand is more when: Few substitutes are available Income of consumers are high Price of the good is less Number of uses of goods are more 19. _________ is a quantitative measure of the degree to which quantity demanded responds to a change in income. Income elasticity Cross elasticity Price elasticity Arc elasticity 20. The value of cross elasticity of demand _________. is always greater than zero is always less than zero ranges from minus infinity to plus infinity can never be equal to zero

Pens P

consumer’s income consumer’s taste and preference

R Pencils

Point A Point B Point C Point D 15. In _________ , we start with particular facts and then make general theory based on the analysis of facts. Inductive method Deductive method Abstract method Analytical method 16. If X is ____________ then an increase in income causes its demand to decrease. Normal goods Necessity goods Inferior goods Complementary goods 17. A shift of the demand curve is caused by changes in factors other than ___________ . price of the good price of other goods

21. Demand is _______ concept. a flow a static partially flow and partially static neither flow nor a static 22. Which of the following is not an assumption of the law of demand? The price of related goods change inversely with demand. The income of consumers remains unchanged. Tastes and preferences of the consumers remain the same. All the units of the goods are homogeneous. 23. The factor which affect the market demand curve but does not affect the individual demand curve is: Price of related goods Income of consumers Tastes and preferences of the consumers Number of consumers in the market 24. What kind of good is car for the household, if its demand rises by 20% with the increase in income of a household by 10%? Normal good Luxury good

14

Part-syllabus Mock Tests Inferior good Necessity

25. The ________ portion of marginal utility curve does not form part of the demand curve. upward sloping downward sloping constant negative 26. A concave indifference curve has: increasing slope decreasing slope same slope vertical slope 27. A consumer can buy any combination of X and Y goods that _____ the budget line. lies on does not lies on lies on or to the left of lies on or to the right of 28. A budget line is also called: consumption possibility line production possibility line consumption line production line 29. _________ is a tabular statement that gives the law of supply. Supply function Supply schedule Supply curve Supply chart 30. Elasticity of supply is measured as: percentage change in quantity demanded/ percentage change in price percentage change in quantity supplied/ percentage change in price percentage change in quantity demanded/ percentage change in quantity supplied percentage change in quantity supplied/ percentage change in quantity demanded 31. Cardinality means utility: can be measured cannot be measured can be ranked cannot be ranked

32. What will be the cross elasticity of demand when quantity demanded of ink pen rises by 10% as price of ink fall by 25%. 0.40 –0.40 2.5 –2.5 33. The value of income elasticity of demand for necessity goods will always be: eY = 0 eY = 1 0 < eY < 1 eY > 1 34. __________ helps to estimate elasticity of demand at a point on a straight line demand curve. Total outlay method Percentage method Geometric method Expenditure method 35. In a perfectly elastic demand, the shape of demand curve is: Vertical Horizontal Rectangular hyperbola Steeper 36. The main reason behind upward sloping of a supply curve is: Substitution effect Goal of profit maximisation Income effect New consumers creating demand 37. Giffen goods is named after ________ . Sir Robert Alfred Marshall Thorstein Veblen Hicks 38. When no unit of X is consumed, Total Utility is ________ and Marginal Utility is ______ . Zero, also zero Zero, minimum Zero, maximum maximum, zero 39. When total utility is rising, marginal utility curve ________ . also rises

Mock Test Paper-I 15 falls is zero becomes negative 40. The law of diminishing marginal utility is based on the assumption of: Standard unit of measurement Homogeneous commodity Continuous consumption All of above 41. The slope of _________ is called Marginal Rate of Substitution of X for Y. Demand curve Supply curve Utility curve Indifference curve 42. Indifference curves ________ . Intersect each other at the highest level of consumer satisfaction. Intersect each other at the lowest level of consumer satisfaction. Intersect each other at the indifference point. Can never intersect each other. 43. Given the budget constraint, equilibrium is attained when the consumer reaches the Highest point on an indifference curve Lowest point on an indifference curve highest possible indifference curve lowest possible indifference curve 44. According to Marshall, ___________ Utility of each commodity is measurable and the most convenient measure is money. The consumer needs to know the precise amount of satisfaction and he can rank his preferences. Both and None of above

45. As per Hick’s analysis, price effect due to change in price of goods is equal to the _____ . substitution effect income effect Both and None of above 46. When elasticity of substitution between two goods X and Y is equal to zero, X and Y are ________ . perfect complements perfect substitutes imperfect complements imperfect substitutes 47. Which of the following is an example of complementary goods? Tea and coffee Pen and ink Rice and Wheat All of above 48. Market demand curve is _____ of the individual demand curves. vertical summation horizontal summation vertical and horizontal summation equal 49. An upward movement along the same demand curve shows: expansion of demand contraction of demand Increase in demand Decrease in demand 50. According to Marshall, the excess of amount the consumer was willing to pay but does not have to pay is called: Marginal surplus Marginal utility Consumer surplus Consumer utility

16

Part-syllabus Mock Tests Section D-Quantitative Aptitude (50 marks)

51. 7 : 5 is a ratio of: equality greater inequality greater equality less equality 52. The sub-duplicate ratio of X : Y is: X2 : Y2 X3 : Y3 X1/2 : Y1/2 X1/3 : Y1/3 53. __________ is the relation between the magnitudes of three or more quantities of the same kind. Inverse ratio Duplicate ratio Triplicate ratio Continued ratio 54. Which of the following are incommensurable quantities? 4:5 22 : 32 81/3 : 641/3 31/2 : 71/2 55. The price of two commodity is in the ratio of 2 : 5. If the price of both the commodities increase by Rs. 12, the new ratio comes to 1: 2. What is the current price of both the commodities? 8 : 20 12 : 30 24 : 60 32 : 80 56. If P : Q = 5 : 8, Q : R = 8 : 11, R : S = 11 : 15, S : T = 15 : 17, then P : T is equal to: 5 : 11 5 : 17 17 : 5 17 : 11 57. The sum of interest income of A, B and C is Rs. 4,100. If their income is reduced by Rs. 30, Rs. 60 and Rs. 50 respectively, the remainder income is in the ratio 2 : 4 : 5. What is the interest income of B? 750

1,500 1,850 2,100 58. What will be the value of (a-1 b)-1/2 . (b-1 c) -1/2 . (c-1 a) -1/2, if a, b and c are real numbers? 1 abc 1/abc (abc) -1/2 59. The value of loga is: 0 1 Infinity –Infinity 60. Logarithms to the base 10 are called _________ . Natural logarithms Common logarithms Standard logarithms General logarithms 61. If log x / (a – b) = log y / ( b – c ) = log z / ( c – a ), then the value of xyz is : 0 1 –1 2 62. The duplicate ratio of 4 : 9 is: 9:4 2:3 16 : 81 9 : 16 63. The price of a product rises by 25% and at the same time the consumption also goes up by 10% in quantity. To what extent the family budget of the person is affected by this increase in price and consumption? Increases by 25% Decreases by 25% Increases by 37.5% Decreases by 35% 64. If the montissa of log 2125 = 3.3275, what will be the montissa of log 21.25? 2.3273

Mock Test Paper-I 17 1.3273 0.3273 32.2321 65. Which of the following is true? ((5)1/2)2/3 = 25 ((15)1/3)2 = 25 ((5)3)2 = 5 {((5)1/3)2 = (25) 1/3} 66. A number consists of two digits. The digit at ten’s place is two times the digit at the units place. The number formed by reversing the digits is 27 less than the original number. What is the original number. 63 52 16 38 67. The graph of y = 2x is a straight line: parallel to x axis parallel to y axis passing through the origin which never passes through the origin 68. The ratio of the income of two persons is 9 : 7, and the ratio of their expenditure is 4 : 3. Each of them saves Rs. 200 yearly. Their yearly incomes are Rs. 1800, Rs. 1400 Rs. 1900, Rs. 1300 Rs. 1600, Rs. 1200 Rs. 1800, Rs. 1200 69. The age of a father 5 years ago was twice the age of his son, five years from today his age will be 25 more than the age of his son. The present age of the father and son is: 45, 30 55, 30 54, 27 60, 30 70. If x + y = 20, such that x and y are positive integers, then the maximum value of x2 + y2 will be: 100 200 300 400

71. A quadratic equation cannot have more than: one roots two roots three roots four roots 72. A piece of cloth costs Rs. 35. If the piece were 4 metre longer and each meter cost Rs. 1 less, the cost would remain unchanged. How long is the piece ? 8 metres 10 metres 12 metres 14 metres 73. The roots of the equation: 3x2 - 10x + 3 = 0 are real, equal and rational. real, unequal and irrational. unequal and imaginary. real, unequal and rational. 74. If and are the roots of the equation 2x2 - 5x + 7 = 0, what will be the equation whose roots are (2 + 3 ) and (3 + 2 ). 2x2 – 15x + 47 = 0 4x2 – 15x + 72 = 0 2x2 – 25x + 82 = 0 2x2 – 20x + 54 = 0 75. If one root of the equation: x2 - 8x + m = 0 exceeds the other by 4, then the value of m is: 8 10 12 14 76. Delhi-Mumbai Rajdhani Express takes 3 hours less than a mail train for a distance of 600 km. If the speed of the mail train is 10 km. per hour less than the speed of the Rajdhani Express, what will be the speed of Delhi-Mumbai Rajdhani Express? 40 Km per hr. 50 Km per hr. 60 Km per hr. 70 Km per hr. 77. Assuming “D” as demand and “P” as price and “S” as supply, the demand and supply curve of a produce is D = 200 (8 - P) and S = 25 (P - 5), the equilibrium price of a produce is: Rs. 89/11

18

Part-syllabus Mock Tests Rs. 89/13 Rs. 9.75 Rs. 6.25

78. The four points A, B, C and D forms a rhombus when: AB = CD and BC = DA AB2 + BC2 = CA2 AB = BC = CD = DA AB = AC and BC = CD 79. The points (-2 , 2), (8 , -2) and (-4 , -3) are the vertices of: a Right - angled triangle an Equilateral triangle an Isosceles triangle a Right – angled isosceles triangle 80. At which point the join of (2 , 0) and (-3 , 5) is divided in the ratio of 2:3 internally? (1 , 4) (0 , 2) (-1 , 3) (-2, 1) 81. If the area of triangle obtained from the three given points is _______ , then the three points lie on a line. negative positive zero None of above

85. If the inequality is =, the end points on this line are included the line drawn will be thick. the end points on this line are excluded the line drawn will be thick. the end points on this line are included the line drawn will be dotted. the end points on this line are excluded the line drawn will be dotted.

and and and and

86. A dealer deals in only two items; ceiling fans and table fans. He has Rs. 25,000 to invest and a space to store at the most 100 pieces. A ceiling fan costs him Rs. 300 and a table fan Rs. 200. He can sell a ceiling fan at a profit of Rs. 50 and a table fan at a profit of Rs. 30. Which of the following linear equation expresses the given situation if x and y be the number of ceiling fans and table fans respectively? x + y = 0 x + y = 0 x + y = 0 x + y 0 87. The following is a graph of inequations:

82. The slope of straight line parallel to y axis is: 0 1 83. What will be the equation of a straight line which cuts off intercepts -4 and 7 from the axes. 7x + 4y + 28 = 0 7x – 4y + 28 = 0 14x – 4y + 28 = 0 7x – 8y + 28 = 0 84. The two lines : 9x + 3y = 11 and 5x – 2y + 7 = 0 are: perpendicular parallel oblique None of the above.

L1: x + 2y = 1000; L 2 : x + y = 800; L 3 : x 40; x > 0; y > 0 89. If interest calculated at the rate of 8% p.a. for 5 years amounts to Rs. 5,740, what will be the principal amount? 11,200 13,760 14,350 15,220 90. What is the rate of interest, if the simple interest on a sum of money for the first year is 1/8th of the sum? 8% 11.5% 12% 12.5% 91. For any sum of money, rate or period, the simple interest and compound interest for _________ are same. first year last year all the years no year 92. For principal “P” at the rate of interest “r”, if interest is compounded half-yearly, then amount after 2 years will be: P ( 1 + r )1/2 P ( 1 + r )2

P ( 1 + r / 2 )4 P ( 1 + r / 4 )4 93. If in the first two years for a sum of money, simple interest amounts to Rs. 160 and compound interest amounts to Rs. 168, the sum of money is: Rs. 500 Rs. 650 Rs. 800 Rs. 950 94. If the installments of a car loan from a bank is due on the last day of the month, it is called _______ . a perpetual annuity a contingent annuity an ordinary annuity immediate annuity 95. A car is purchased for Rs. 1,00,000 cash down and Rs. 6000 per month for 3 years. What will be the cash prices of the car if the payments include interest at 15% compounded monthly and given that (1.0125)-36 = 0.6392 Rs. 1,48,185 Rs. 2,73,184 Rs. 3,28,564 Rs. 3,87,675 96. An investor intends purchasing a 3 years Rs. 1000 per value bond having nominal interest rate of 10%. At what price the bond may be purchased now if it matures at par and the investor requires a. rate of return of 14%. 902.14 904.6 907.12 908.9 97. In how many years a sum become 1.5 times of itself at 10% simple interest? 4 years 5 years 6 years 7 years 98. The instances of HIV cases are growing at the rate of 15% p.a. in slum areas. If during 2009, 500 cases of HIV positive were noticed in Delhi Slum. In how many years the cases of HIV positive will cross 750 in Delhi Slums? 6 5

20

Part-syllabus Mock Tests 4 3

99. A intends to redeem the outstanding redeemable preference shares worth Rs. 125 lakhs after 10 years. He intends to built-up the fund by investing in Government gilt edged securities yielding compound interest of 10%. How much should he invest every year in order to have sufficient fund to redeem the preference shares at the end of 10 years? Rs. 5,82,870

Rs. 6,23,317 Rs. 7,83,317 Rs. 8,42,110 100. If the future value of an annuity is Rs. 74,272 @ 6% interest for 15 years, the annuity is: Rs. 3,220 Rs. 3,420 Rs. 3,620 Rs. 3,820

Mock Test Paper-I 21

COMMON PROFICIENCY TEST Mock Test Paper–I [Answer Key] SESSION - I Section A-Fundamentals of Accounting (60 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30.

Question 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60.

22

Part-syllabus Mock Tests Section B-Mercantile Law (40 marks)

Question 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80.

Question 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100.

SESSION - II Section C-Economics (50 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Question 11. 12. 13. 14. 15. 16. 17. 18. 19. 20.

Mock Test Paper-I 23 Question 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35.

Question 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.

Section D-Quantitative Aptitude (50 marks)

Question 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70.

Question 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90.

24

Part-syllabus Mock Tests

Question 91. 92. 93. 94. 95.

Question 96. 97. 98. 99. 100.

COMMON PROFICIENCY TEST Mock Test Paper–II SESSION - I TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section A-Fundamentals of Accounting (60 marks)

1. Which of the following fundamental accounting assumption allows classification of expenditure/ receipts as Capital and Revenue expenditure/ receipts? Going Concern Consistency Accrual Substance over form 2. Which of the following is debited to Trading/Profit and Loss Account? Capital receipts Capital expenditure Revenue receipts Revenue expenditure 3. Capital expenditure is incurred: to maintain the productivity or earning capacity of a business. to carry out operating activities in the normal course of business. to increase the productivity or earning capacity. All of above. 4. Which of the following is an example of Revenue expenditure? Custom Duty on Imported Machinery. Expenses incurred on Trial before the asset is put to use. Wages for erection of Machinery. Amount spent on replacement of worn out part of machine.

5. Annual Maintenance fee of a machine is a: Capital expenditure Revenue expenditure Deferred Revenue expenditure Prepaid expenses 6. A second hand car is purchased for Rs 25,000, the amount of Rs 2,500 is spent on its repairs, Rs 1,000 is incurred to get the car registered in owner’s name and Rs 1,000 is paid as dealer’s commission. The amount debited to car account will be: Rs. 25,000 Rs. 27,500 Rs. 28,500 Rs. 29,500 7. Revenue from credit sale is ordinarily recorded in the period in which: goods sold is manufactured. sale is made. goods are delivered. cash is collected 8. Which of the following is required to be disclosed by way of Note to the Balance Sheet? Contingent asset Contingent liability Fictitious assets Other liability 9. A provision for contingent liability is recognised in financial statements when: it is first recognised.

26

Part-syllabus Mock Tests the possibility of outflow of a resource embodying economic benefits is remote. the outflow of resources embodying economic benefits has become probable. None of above.

10. ________ is a present obligation of uncertain amount which can be measured reliably by using a substantial degree of estimation. Provision Contingent liability Other liability Fictitious liabilty 11. A trial balance is: an account a statement a ledger a journal 12. A tallied trial balance indicates that: equal debits and credits have been recorded in the books of accounts. all transactions have been correctly recorded. all entries/total have been correctly posed in the ledger. All of above 13. Which of the following Trial balance shows the total amounts of debit items and credit items in each ledger account? Trial Balance by Balance Method Trial Balance by Total Amount Method Both and None of above 14. Which of the following error does not affect the agreement of trial balance? Error of recording Error of casting Error in carrying forward All of above 15. The outstanding balance in suspense account for errors which remains undetected at the end of each financial year is: transferred to trading account. transferred to P/L account. transferred to capital account shown in the Balance Sheet.

16. Goods (Cost Rs. 5,000, Sale Price Rs. 7,000) was returned by Mr. A, a customer and were taken into stock on the same date but no entry was passed in the books. What journal entry needs to be passed to rectify the above error? Sales Return Account Dr. 3,000 To Mr. A Account 3,000 Sales Return Account Dr. 3,600 To Mr. A Account 3,600 Suspense Account Dr. 3,600 To Mr. A Account 3,600 Sales Return Account Dr. 3,600 To Suspense Account 3,600 17. An amount of Rs. 1,240 due from Mr. Ram, written off as bad in a previous year, was recovered and credited to personal account of Mr. Ram. What rectification journal entry needs to be passed for the same? Suspense Account Dr. 1,240 To Bad Debt Recovered Account 1,240 Mr. Ram Account Dr. 1,240 To Suspense Account 1,240 Mr. Ram Account Dr. 1,240 To Bad Debt Recovered Account 1,240 Bank Account Dr. 1,240 To Bad Debt Recovered Account 1,240 18. After the preparation of final accounts, the errors affecting the nominal accounts are rectified with the help of: Profit & Loss Account Profit & Loss Adjustment Account Suspense Account Balance Sheet 19. The total of a folio in the Sales Book Rs. 20,000 was carried forward as Rs. 2,000. This is an: error of complete omission error of partial omission error in carrying forward error of posting 20. __________ can be prepared only when all the ledger accounts have been balanced. Trial Balance by Balance Method Trial Balance by Total Amount Method Both and None of above

Mock Test Paper-II 27 21. Which of the following is an error of principle? Rs. 5,000 recovered from the debtors written off, credited to the Debtors A/c. Purchase of Plant & Machinery shown as trading purchase. Sales return amounting to Rs. 2,000 debited to be shown in purchase day book. Rs. 10,000 received from Shyam credited to Mohan A/c 22. Suspense A/c is a Real Account Personal Account Nominal Account Can be of any type 23. Which of the following column of the cash book cannot have opening or closing balances in credit? Cash column Bank column Discount column All of above 24. Journal records the transactions in a/an: Summarized manner Analytical manner Chronological order random manner 25. When errors in one accounting period is located in the subsequent accounting periods, they are rectified using: Suspense Account Revaluation Account Profit an Loss Account Profit an Loss Adjustment Account 26. What would be the treatment, when a fixed asset is sold for Rs. 90,000, whose cost was Rs. 1,20,000 & WDV Rs. 80,000? Capital receipt of Rs. 90,000 Capital receipt of Rs. 80,000 Revenue receipt of Rs. 10,000 Revenue expenditure of Rs. 10,000 27. Which of the following expenditures is of capital nature? Rs. 2,000 spent on demolition of a building to construct a bigger building on the same site. Rs. 1,000 spent in defending a legal suit.

Rs. 2,000 spent on a painting a factory. Rs. 1,000 paid for removal of stock to another location for sale. 28. Machinery spares are generally accounted for as: Income Expenses Inventory Fixed Assets 29. Which of the following statement is correct? A cheque deposited in bank is recorded in Pass Book at the time when cheque is received by the account holder. A cheque deposited in bank is recorded in Pass Book at the time when cheque is deposited. A cheque deposited in bank is recorded in Pass Book at the time when cheque is sent for collection. A cheque deposited in bank is recorded in Pass Book at the time when cheque is collected. 30. Which of these prepares bank reconciliation statement? Customers Bankers Statutory Auditor Business enterprises 31. The differences between the Bank Balance as per Cash Bank and Bank Balance as per Pass Book are caused by: Timing difference of recording banking transactions. Errors in Cash Book committed by the account holder. Errors in Pass Book committed by the Bank. All of above 32. Which of the following transactions usually appear in the Cash Book but not in the Pass Book? Direct Payment by a customer into the bank. Cheques issued but not yet presented for payment. Cheque deposited for collection, returned dishonoured Discounted Bills dishonoured 33. Which of the following cash balance is taken to Balance Sheet? Cash Book Balance Adjusted Cash Book Balance

28

Part-syllabus Mock Tests Pass Book Balance Any of above.

34. The Adjusted Bank Balance as per Cash Book is ascertained by: adjusting entries in respect of correct items which appear only in Pass Book. rectifying entries in respect of errors committed in the Cash Book. Both and None of above 35. A bank pass book is a copy of: the cash column of a customer’s cash book. the bank column of a customer’s cash book both the cash and bank column of a customer’s cash book. the customer’s account in the bank’s ledger. 36. A Bank Reconciliation Statement is prepared to know the causes for the difference between: the balances as per cash column of Cash Book and the actual cash in hand. the balances as per cash column of Cash Book and the Pass Book. the balance as per bank column of Cash Book and the Pass Book. the balance as per bank column of Cash Book and balances as per cash column of Cash Book 37. Debit balance as per the bank column of Cash Book of Mr. A as on 31.3.2009 is Rs. 2,700. Cheques deposited but not cleared amounts to Rs. 700 and cheques issued but not presented amounts to Rs. 400. The bank allowed interest amounting Rs. 80 and collected dividend Rs. 120 on behalf of Mr. A. Balance as per pass book should be: Rs. 2,200 Rs. 2,600 Rs. 2,780 Rs. 2,900 38. While preparing a Bank Reconciliation Statement, taking the balance as per Cash Book as the starting point, cheques deposited but omitted to be recorded are: Added Subtracted Not required to be adjusted None of the above

39. When balance as per Cash Book is the starting point which of the following is added: Uncollected Cheques Unpresented Cheques Direct payments by Bank Interest charged by Bank 40. While preparing a Bank Reconciliation Statement in case of an overdraft: The treatment with regard to items causing difference between the balances of the two books remains the same. The treatment with regard to items causing difference between the balances of the two books is reversed. the reconciliation should always start with balance as per Pass Book. the reconciliation should always start with balance as per Cash Book. 41. Which of the following represents an overdraft? Debit balance in Cash Book. Credit balance in Cash Book. Credit balance in Pass Book Both and 42. The inventories of _____________ primarily consist of the finished goods purchased for resale. a trading concern a small manufacturing concern a large manufacturing concern an industry 43. _________ represents the pre-determined cost that should be incurred at a given level of efficiency and capacity utilization. Actual cost Standard cost Historical cost Replacement cost 44. Which of the following costs are excluded in determining the cost of inventories and are recognised as an expense in the period in which they are incurred? Storage costs Abnormal costs Selling and Distribution Costs All of above

Mock Test Paper-II 29 45. Under which of the following inventory system, inventories are ascertained by taking actual physical count (or measure or weight) of all the inventory items on hand at a particular date on which information about inventory is required? Periodic Inventory System Perpetual Inventory System Both and None of above 46. Under the Perpetual Inventory System, closing inventory is calculated as: Opening Inventory + Purchases - Closing Inventory Opening Inventory + Purchases - Cost of Goods Sold Opening Inventory + Purchases + Closing Inventory Opening Inventory + Purchases + Cost of Goods Sold 47. In which of the following method of valuation of inventories, higher income is reported in the periods of rising prices. FIFO method LIFO method HIFO method Weighted Average Cost method 48. The stock was physically verified on 24th March 2010 and was valued at Rs 2,00,000. Goods are normally sold by the trader at a profit of 25% on cost. What will be the value of stock to be taken to the Balance Sheet as at 31st March 2010 if on 27th March goods of the sale value of Rs. 1,00,000 were sent on sale or return basis to a customer, the period of approval being two weeks? Rs. 1,00,000 Rs. 1,20,000 Rs. 1,25,000 Rs. 2,00,000 49. Stock as per books may be different from the stock found as per physical verification because of the following reason: Goods sold and recorded in the books but not actually delivered. Returns inwards received and recorded in the books. Return outwards despatched and recorded in the books. All of above

50. To which of the following, the principle of valuation of inventory at lower of historical cost and net realisable value does not apply? Inventory of consumable stores Inventory of by-products Inventory of reusable waste All of above 51. According AS-2, which of the following needs to be disclosed in the financial statements? The accounting policy adopted in measuring inventories. The cost formulae used in measuring inventories. The total carrying amount of inventories and its classification. All of above 52. Which method should be used for valuation of inventories of items that are not ordinarily interchangeable, and are produced and segregated for specific projects? Historical cost method Specific identification method Adjusted selling price method Standard cost method 53. If opening stock is understated, the profit will increase. the profit will decrease. the profit will not change. None of above. 54. ABC Ltd. provides the following data for the month of March 2010: As at March 01, 2010 As at March 31, 2010 Stock

Rs 4,20,000

Rs 2,60,000

Purchases during the month amounted Rs. 6,60,000. During the month of March 2010, the company paid a sum of Rs. 7,00,000 to the suppliers. The goods are sold at 25% above the cost. The sales for the month of March 2010 were: Rs. 8,20,000 Rs. 10,25,000 Rs. 1,20,000 Rs. 1,50,000 55. April 01

Opening stock 80 Units @ Rs. 52 per unit

April 02

Purchases 120 units @ Rs. 58 per unit

April 07

Issued 50 units

30

Part-syllabus Mock Tests The value of inventory at the end of the week Under Weighted Average Method is Rs. 7,800 Rs. 8,700 Rs. 8,340 Rs. 11,120

56. The cost of inventory as per physical verification as on 24th March, 2010 was Rs. 4,00,000. Goods are sold at a profit of 25% on cost. On 21st March, goods costing Rs. 2,00,000 were received for sale on consignment basis. 80% of these goods had been sold on 31st March. On 23rd March, goods of the sale value of Rs. 2,00,000 were sent on consignment basis. 80% of these goods has been sold on 31st March. The cost of inventory as per books is: Rs. 4,00,000 Rs. 2,72,000 Rs. 2,32,000 Rs. 2,40,000 57. Perpetual inventory valuation system does not require Maintenance of inventory records

Physical count or measurement of inventory Suspension of receipts and issue in the entire factory All of above 58. Inventory cost does not include: Duties paid on purchases Invoice priceless discounts Storage cost Transit insurance 59. Which of the following accounting concept guides the Inventory valuation method? Accrual Materiality Conservatism Business entity 60. The essence of base stock method of valuation of inventory is: Valuation of each unit of stock to its original cost. Valuation of inventories at FIFO Keeping the minimum Stock intact. Including minimum gross margin amount in the cost of inventories.

Mock Test Paper-II 31 Section B-Mercantile Law (40 marks) 61. The consideration or object of a contract will be treated unlawful ________ If it is forbidden by law. If it is of such a nature that, if permitted it would defeat the provisions of any law. If it is fraudulent. In all the three cases 62. Which of the following are forbidden by law ________ acts punishable under the Indian Panel Code, and acts prohibited under special legislation or by regulations or order made under authority derived from the legislation. both none

Equally good Equally valid Absolutely void 68. An agreement to refer present or future dispute to arbitration is ________ void voidable valid unenforceable 69. Which of the following agreements have expressly declared void under Indian Contract Act Agreement in restraint of marriage Agreement in restraint of trade Wagering agreements All the three

63. Which of the following types of agreements are opposed to public policy Stiffling prosecution. Trafficking in public offices. Marriage brokerage agreements. All the three

70. Which of these is not an essential element of a wagering agreement. certainty of event mutual gain or loss no control over the event promise to pay money or money worth

64. If the consideration or object of an agreement is unlawful the agreement is valid void voidable void in some cases

71. Which of these is not a wagering agreement. Sale or purchase of goods or stock with intention to take or give delivery. Sale or purchase of goods or stock with no intention to take or give delivery. Crossword competition with prize money Rs. 1,500 All the three

65. X agrees to let his daughter to B for concubinage, this agreement is valid valid only if consideration is adequate. Voidable void being immoral 66. X promises to pay Rs. 50,000 to Y if he takes an oath to not get married till he survive. This agreement is ________ void being opposed to public policy void being strictly forbidden by law voidable at the option of Y valid 67. The term ‘Pari delicto”means________ Equally guilty

72. Wagering agreement areonly void but not illegal void and illegal valid voidable 73. As per the Prize Competition Act, 1955, prize competitions in game of skill is not a wagering provided the prize money does not exceed Rs. 1,000 Rs. 1,500 Rs. 2,100 Rs. 500

32

Part-syllabus Mock Tests

74. A promise to take B to heaven alive provided he pay him Rs. 5,000, this agreement is void because agreement being opposed to public policy agreement to do impossible things agreement being illegal all the three 75. Agreements in restraint of legal proceedings are________ valid void voidable illegal 76. Which of these is/are a contingent contract. A agrees to pay B Rs. 1000 if he traces his missing dog in two days A agrees to pay B Rs. 1000 if he manage to get a Govt. job for him. A agrees to pay Rs. 1000 to B if he help in smuggling of goods. All the three 77. Contract of insurance is a Wagering agreement Contingent contract Contract of gambling Voidable contract 78. Contract of Guarantee is a Wagering agreement Contingent contract Contract of gambling Voidable contract 79. Contingent contracts are________ valid void voidable unenforceable 80. If the performance of a contract depends upon the pleasure and will of another person it is a valid contract voidable contract wagering contract no contract at all 81. A wagering agreement is________in nature. contingent valid

voidable against public policy 82. In a contingent contract the future event is collateral certain both none 83. Conditional contract are also called contracts. contingent wagering quasi unenforceable 84. An offer of performance is known as________of performance. tender discharge remission novation 85. An offer to perform the contract should be conditional unconditional reasonable noticeable 86. Who can demand the performance of a contract. promisee only legal representative of the promisee spouse of the promise any of the above three 87. Performance of contract can be demanded from promisor himself agents of the promisor legal representative of the promisor any one of the above. 88. A tender of performance must be made at the proper time at the proper place in the proper form all the three to be satisfied. 89. Remission means________ acceptance of a lesser amount than what was contracted waiver of interest reduction of penalty none of these

Mock Test Paper-II 33 90. In which of the following circumstances the doctrine of supervening impossibility applies. change of law outbreak of war failure of ultimate purpose all the three 91. When a contract ceases to bind the parties, the contract stands abandoned discharged rescinded waived 92. Relinquishment of a contractual right is called Compromise Waiver Remission Alteration 93. Obligations imposed by the law are called Quasi-contract Contingent contract Executed contract Wagering contracts 94. The position of a finder of lost goods is similar to that of a Bailee Bailor Principle Agent 95. Quasi-contractual obligations are based on the doctrine of unjust enrichment equality before law social welfare

all the three 96. The term “Quantum merit” means as deemed fit in proportion to work done fair payment as much as demanded 97. A supplies B a lunatic with necessities suitable to his conditions in life. A is entitled to be reimbursed from________ B’s property nobody else the parents of B the Government agencies 98. When a minor person has been supplied necessities suitable for his life conditions on credit. The recovery can be made from minors property the minor personally the minors legal representative none of the above 99. A leaves his goods at B’s premises by mistake, B uses the goods for his purpose. A is entitled to recover the price of the goods from B entitled to claim compensation from B entitled to claim damages from B not entitled to claim anything from B 100. When a person fails to perform the contract when the performance is due, this is called actual breach anticipatory breach constructive breach forcible breach

34

Part-syllabus Mock Tests

SESSION - II TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section C-Economics (50 marks)

1. Production includes: Domestic work Voluntary services Goods for self-consumption None of above. 2. Supply of labour curve is: forward bending backward bending upward bending downward bending 3. Land is ______ factor and labour is _______ factor. active, passive passive, active active, also active passive, also passive 4. In a long-run production function: there is one fixed factor and all other factors are in variable supply. there is one variable factor and all other factors are in fixed supply. all the factors are in variable supply. all the factors are in fixed supply. 5. According to the law of variable proportion, a rational producer will always operate in ________. stage of increasing return. stage of diminishing return. stage of negative return. All of above. 6. Which of the following is not a feature of land? It is fixed in supply. It is imperishable. It is an active factor. It is immobile.

7. ________ is actual expenditure of funds which are recorded in books of account. Opportunity cost Fixed cost Outlay cost Implicit cost 8. Total Variable Cost curve is: U-shaped inverse U-shaped S-shaped inverse S-shaped 9. An industrial unit installs a high technology machinery because of which its cost falls. What kind of returns to scales takes place? Increasing Decreasing Diminishing Constant 10. _________ occurs when increase in output is more than proportional to an increase in inputs. Increasing returns to scale Constant returns to scale Decreasing returns to scale None of above 11. The reward for __________ can be negative while the prices of other factors of production are always positive. Land Labour Capital Entrepreneur 12. When TP (Total Product) is maximum, MP = AP MP = 0

Mock Test Paper-II 35 MP < 0 MP > AP 13. In a U-shaped long run AC curve there is no extra capacity to meet seasonal variation in demand. It is called: optimum capacity excess capacity reserve capacity full capacity

20. Which of the following statement is incorrect? Each point on LAC curve corresponds to a point on the SAC. The LAC curve is tangent to the SAC curves. No part of SAC curve can ever be below the LAC curve. SAC curves envelopes LAC curve. 21. Which curve represents short-run cost of the small size plant?

14. When in course of expanding its output, an industry throws so much wastage that it increases the cost of disposing waste materials for other firms in the same area, it is a case of: Internal economies External economies Internal diseconomies External diseconomies 15. The cost which cannot be ignored even if the production is stopped is called: Variable cost Fixed cost Direct cost Indirect cost 16. AC is obtained by dividing TC by the level of: output sales labour land 17. When production is increased beyond the optimum level, it is called: Technical economies Technical diseconomies Financial economies Financial diseconomies 18. Mobilisation of savings is the _____ stage of capital formation. first second third fourth 19. Long-run average cost curve is: a continuous curve a U-shapes curve a planning curve all of above.

SAC 1 SAC 2 SAC 3 All of above 22. Accounting costs are: implicit costs explicit costs both and None of above 23. A firm is currently producing 1,000 units at which the ATC and AVC are Rs. 150 and Rs. 120 respectively. What will be the total fixed cost of the firm? Rs. 30,000 Rs. 60,000 Rs. 1,20,000 Rs. 1,50,000 24. Localisation or concentration of industry gives rise to: Economies of Concentration Economies of information Economies of disintegration Commercial economies 25. Savings by corporate sector depends mainly on level of income level of production profits earned

36

Part-syllabus Mock Tests loans taken

26. Commodities having universal demand will have a _______ market. narrow wider short-term close 27. ________ is the general purchasing power of a good over other goods. Price Money Value Cost 28. One of the assumptions of pure competition among the producers is: Perfect knowledge Perfect mobility of factors of production Homogeneous product Absence of selling cost 29. In a ________ market, firms are ‘price-takers’. Perfect competition Monopoly Monopolistic competition Oligopoly 30. An example of pure oligopoly is an industry producing ________ . Cements Automibiles Refrigerators Computers 31. The entry and exit of firms in a ________ markets are free. Perfect competition Monopolistic competition Monopoly Both and 32. To maximize profit, the firm should produce till a stage where: MR > MC TR > TC MR = MC TR = TC 33. In the very short period, ________ is more active in determining price whereas in the long run _______ plays active role in determining price.

demand, supply supply, demand demand, both demand and supply both demand and supply, demand 34. When demand curve shifts upwards or rightwards, equilibrium price and output _______ . increases decreases remains constant Can’t say 35. If decrease in demand is more than decrease in supply, equilibrium price will _____ . rise fall not change can’t say 36. _________ is a market structure in which there are many firms selling closely related but unidentical commodities. Perfect competition Imperfect competition Monopoly None of above 37. Which of the following features a market must have? Commodity Communication Area All of above 38. Which of the following statement for an oligopoly market structure is incorrect? There are few dominant or large firms. The output may be either homogeneous or differentiated. There are no restrictions to entry of new firms. The price and output decisions of one firm affect the similar decisions of other firms. 39. Minimum price acceptable to the producer to maximize profit is equal to: total cost of production average cost of production marginal cost of production average profit 40. In a perfect competition market structure, a firm earns _________ in the long-run.

Mock Test Paper-II 37 normal profits supernormal profits no profit losses

Milk Wheat Rice Brick

41. A discriminating monopoly is a market structure where: the monopolist charges a very high price for a commodity from all consumers. the monopolist charges a low price for a commodity from all consumers. the monopolist charges a uniform price from all consumers of the commodity. the monopolist charges different prices from different consumers for the same commodity. 42. The aim of a consumer is to: minimise satisfaction maximise satisfaction minimise profit maximise profit 43. A demand and supply schedule curve shows the determination of: balanced price equilibrium price stable price constant price 44. Which of the following is an essential condition for price discrimination? Two or more markets which cannot be separated. Close substitute for the products. No contact among buyers. No control over supply, 45. Which of the commodity?

following

is

a

perishable

46. Demand curve is undefined in which of the following market structures? Perfect competition Monoploy Oligopoly None of the above 47. In an oligopolistic market structure, the kinked demand curve model explains: price fluctuation price stickiness price determination output determination 48. The demand curve of a perfectly competitive firm is ________ at the equilibrium market price. generally elastic generally inelastic infinitely elastic infinitely inelastic 49. In a perfect competition market when the MC curve is upward sloping, the point at which MR is equal to MC is called: Break-even point Shutdown point down point point of stable equilibrium 50. Total supernormal profits is equal to: Total profit X Equilibrium output Profits per unit X Equilibrium output Total Revenue – Total Cost Revenue per unit – Cost per unit

38

Part-syllabus Mock Tests Section D-Quantitative Aptitude (50 marks)

51. ____________ that can be made by taking some or all of a number of things is called a Permutation. A group A selection An arrangement Any of above 52. In which of the following the order of selection of objects is immaterial? Permutation Combination Both and None of above 53. The value of C (8, 5) / P (8, 5) equals to: 1 3/10 5/10 8/10 54. The value of 1 / 8! + 1 / 9! + 1 / 10! Is equal to: 89 / 10! 101 / 10! (8! + 9! + 10!) / (8! x 9! x 10!) (8! x 9! x 10!) / (8! + 9! + 10!) 55. In how many different ways can 4 single seated rooms in a hostel be occupied by 3 students? 12 24 36 48

58. In how many ways can 7 people be arranged in a round table, so that all shall not have the same neighbours in any two arrangements? 180 360 1,440 2,580 59. In a team of 20 members, there are two wicketkeepers and five bowlers. In many ways can a team of 11 members be formed so that there is only one wicket-keeper and at least three bowlers? 2,574 17,160 34,320 54,054 60. A question paper has two parts, A and B, each containing 10 questions. If a student has to choose 8 questions from part A and 5 questions from part B, in how many ways can he choose the questions? 1,252 8,780 11,340 12,780 61. If 7! / X! is equal to 504, then X is equal to: 4 5 6 7

56. The number of permutations of n different things taken r at a time, when a particular thing is never taken in each arrangement is: P (n , r) P (n – 1 , r) P (n – 1 , r - 1) P (n , r - 1)

62. How many numbers can be formed between 100 to 1000 out of 1,3,4,7,8 if repetition of any number is allowed? 80 125 134 176

57. How many words can be formed out of the letters of the word DAUGHTER, so that the vowels always occur together? 720 2,880 4,320 5,480

63. A polygon has 44 diagonals. The number of sides will be: 9 11 12 14

Mock Test Paper-II 39 64. When the reciprocals of the terms of a series form an arithmetical progression, the series is said to be in ________ . Geometrical progression Harmonic progression Discrete progression Inverse arithmetical progression

71. For which of the following four numbers in G.P. the sum is 60 and the arithmetic mean of the first and the last numbers is 18. 2 , 8 , 16 , 34 6 , 12 , 24 , 30 3 , 9 , 18 , 27 4 , 8 , 16 , 32

65. If every term of a series in an arithmetical progression is multiplied by the same quantity, the resulting series will be in: Arithmetical progression Geometrical progression Harmonic progression Dicrete progression

72. The sum of the series: 23 + 43 + 63 + 83 + ……. to n terms is: n2 (n + 1) 2 2n2 (n + 1) 2n2 (n + 1) 2 2n (n + 1) 2

66. A man arranges to pay off a debt of Rs. 900 in 40 monthly installments which forms an A.P. When 30 installments are paid, he dies leaving one third of the debt unpaid. What is the value of first three installments? Rs. 10.50, Rs. 12.00, Rs. 13.50 Rs. 11.25, Rs. 12.50, Rs. 13.75 Rs. 12,75, Rs. 13.25, Rs. 13.75 Rs. 8.25, Rs. 11.25, Rs. 14.25 67. Find three numbers in A.P. whose sum is 15 and the sum of the squares of the extremes is 58. 8,5,2 7,5,3 7,4,2 -2 , 3 , 8 68. The Airthmetic Means between 3 and 23 are: 9 , 13 , 17 8 , 13 , 17 7 , 11 , 15 , 19 15 , 19 , 23, 28 69. If the 4th, 7th and 10th terms of a G.P. are a , b, c respectively, then: b2 = a + c b2 = ac 2b = a + c 2b = ac 70. If p , q , r are in A.P., then the pth, qth and rth terms of any G.P. are in: A.P. G.P. H.P. None of the above

73. The arithmetic mean of the numbers from 101 to 282 is: 165 165.5 191 191.5 74. If first term of an arithmetic series is 9 and the sum total of the series up to first 10 terms is 225, the difference d will be: 2 3 5 8 75. If 4, X, 100 are three terms of a Geometric series then X is equal to: 15 20 25 30 76. The sum of all 2 digits odd number is: 2,540 2,650 2,245 2,475 77. If the second term of a series is the square root of the fourth term and the fifth term is 32, the other terms are (1,3,9,15,32 ….) (2,4,8,16,32 ……) (1,3,9,18,32 ….) (2,6,18,26,32 ….) 78. The sum of first three terms of a GM series is 21 and the sum of their square is 189, the terms are:

40

Part-syllabus Mock Tests 4, 8, 16 3, 6, 12 2, 8, 12 3, 5, 13

Intersection of two sets i.e. A B Complement of two sets i.e. A B Difference of two sets i.e. A - B Difference of two sets i.e. B - A

79. Two sets A and B are said to be equivalent sets if: their ordinal numbers are same. their cardinal numbers are same. their elements are same. their functions are same.

85. If the range of a function f is equal to its co-domain, it is called: an Into Function an Onto Function One to one Mapping Many-one Mapping

80. Which of the following denotes X to be a proper subset of Y? X Y X Y X Y X Y

86. In a class containing 50 students, 15 play Tennis, 20 play Cricket and 20 play Hockey, 3 play Tennis and Cricket, 6 play Cricket and Hockey, and 6 play Tennis and Hockey. 7 of them play no game at all. How many students play Cricket, Tennis and Hockey ? 2 6 12 14

81. The intersection of two sets A and B is the set of all those elements: which belong to A but does not belong to B. which belong to B but does not belong to A. which belong to A as well as to B which belongs neither to A nor to B 82. Which of the following fundamental laws of set theory states that for any two sets A and B: (A B) C = A (B C) Commutative Laws Associative Laws Distributive Laws Idempotent laws 83. De Morgan’s Law of set theory states that for any two sets A and B: (A B)C = AC BC (A B)C = AC BC (A B)C = A B (A B)C = AC BC 84. The following Venn diagram represents A and B being the two subsets of a Universal set U. The shaded portion in the Venn diagram shows: U A

B

87. If S be the set of all straight lines in a plane, the relation R in S defined by “x is parallel to y” is said to be: Inverse Reflexive Symmetric Transitive 88. Given A = {2, 3}, B = {4, 5}, C = {5, 6}, then A x (B C) is equal to: {(5, 2), (5, 3)} {(2, 3), (5, 5)} {(2, 5), (3, 5)} {(5, 5), (2, 3)} 89. The domain of {(1, 8), (3, 6)} is: (1, 6) (6, 8) (1, 3) (3, 8)

7

R is a bijection given by f(x) = x3 + 3, 90. If f : R -1 then f (x) is : (x - 3) -1/3 (x - 3) 1/3 (x + 3) -1/3 (x + 3) 1/3 91. For which value of a, the value of f(2) in Equation f(x) = 3x3 + 2x2 - a is equal to 28?

Mock Test Paper-II 41 2 –2 4 –4 92. The inverse function of Y = 3x - 6 is: X = 3y - 6 Y = 3x + 6 X = (y + 6) / 3 Y = (x + 6) / 3 93. If f(x) = x2 + 3x3, the f(x) is an even function an odd function an irrational function a composite function 94. If A = (a, e, i, o, u) and B = (a, b, c, d, e), then A A is equal to: (a, e) (a, b, c, d, e, i, o, u) (a, e, i, o, u) (a, b, c, d, e) 95. Set A has three elements and Set B has five elements. What is the total number of injection that can be defined from Set A to Set B? 15 36 60 90

96. Which of the following is a null set? A = [ x : x3 = 31 such that x is an even number] B = [ x : x is the capital city of a country] C = [ x : x is approved university in India] D = [ a, b, c, d ……..] 97. How many number of proper subset can be formed of set A = (3, 9, 5, 7) ? 12 15 16 20 98. If A = (a, b, d, e, o, u, t, s, k) than which of the following is not an element of Set A? (e) (m) (k) (e, l, m) 99. The range of function f(x) = x / (1 + x2) is: (1, -1) (1, 2) (1/2,-1/2) (1 /2, 1) 100. What will be the set A if set A = [ x : x + 7 GDPMP GNPMP < NNPMP GNPMP > NNPMP 13. Gross National Product at market price is calculated at price exclusive of: Depreciation Indirect taxes Subsidies Net factor income from abroad 14. _________ is defined as the market value of all final goods and services produced within the domestic territory of a country. Gross Domestic Product Net National Product Gross National Product National Income 15. Net Domestic Product at factor cost is equal to: GDPFC - Indirect taxes + Subsidies NDPMP - Indirect taxes + Subsidies GDPFC + Depreciation NDPMP - Depreciation

Disposition phase Expenditure phase 19.

_________ measures the contribution of production units to total output of an economy. Income method Value added method Expenditure method Investment method

20. Income from property is classified under which of the following components of factor Income? Compensation of employees Operating Surplus Mixed Income Net factor income from abroad 21. Which of the following is excluded under the income method of calculating National Income? Transfer payments Corporation Tax Windfall gains All of above 22. Under the income method of calculating National Income, production for self consumption ___________ . is included in the total National Income. is excluded from the total National Income. does not have any affect on total National Income. only profit amount is included.

_________ is defined as the factor income accruing to the normal residents of the country during a year. Gross Domestic Product Gross National Product National Income Domestic Factor Income

23. _____________ is the excess of value added over and above the value of intermediate consumption. Gross value added Net value added Value of output Value of consumption

17. Income remaining with the individuals after deduction of all taxes levied against their income and their property by the government is called: Personal Income Disposable Income National Income Surplus Income

24. To avoid the problem of double counting, value of ___________ should not be included in the calculation of national income. Intermediate consumption Self consumption Final consumption Change in closing stock

18. Which of the following phase leads to generation of factor incomes? Production phase Distribution phase

25. Total expenditure incurred by the government for producing various services to satisfy collective needs is called: Private Final Consumption Expenditure

16.

Mock Test Paper-III 57 Public Final Consumption Expenditure National Final Consumption Expenditure General Government Final Consumption Expenditure 26. Gross Domestic Capital Formation includes expenditure on gross domestic fixed capital formation, change in stock and ___________ . Gross domestic variable capital formation Final consumption expenditure Acquisition of valuables Net exports 27. The base year of national accounts _________ . does not change. changes every year. is changed periodically changes after every 5 year

All national income accrues to individuals as their personal income. 33. National income takes into account: population, skill and resources of the country. level of unemployment in the country. level of prices in the country. the value of final goods and services. 34. The merits of direct tax is: It covers very small proportion of population. It discourages more work. It is imposed according to the ability to pay of the taxpayer. Its calculation requires expert assistance of tax advisors.

28. A rise in GNP or NNP _________ brings about welfare of an economy. always never may or may not partly

35. The base year of national accounts is changed: to take into account the structural changes which take place in an economy. to depict a true picture of an economy through macro aggregates like GDP, consumption expenditure etc. Both and ( None of the above

29. Excise duty is levied on: production of goods sales of goods import and export of goods income of corporates

36. One of the disadvantages of indirect tax is: It is regressive in character. It is difficult to evade. It creates social consciousness. Its collection is highly uneconomical.

30. An example of indirect tax is: Income tax Corporate tax Wealth tax Sales Tax

37. The primary sector consists of activities related to: agriculture services manufacturing industries export

31. Because of the nature of an Indian economy and lack of adequate, reliable statistical data, it is not possible to calculate National Income by: Income Method Vale added method Expenditure method each of the three methods separately

38. PDS means: Private Distribution System Public Distribution System Price Distribution System Potential Distribution System

32. Which of the following statement is correct? National income is the sum of personal incomes. Personal incomes include transfer income. National income includes transfer incomes.

39. Economic growth means more output in terms of: Quality Quantity Both and ( None of above. 40. Tenancy reforms laid down policy for: Fixation of rent payable by the tenant cultivators.

58

Part-syllabus Mock Tests providing security to tenant cultivators. Both and ( None of above.

41. Uniform ceiling laws were made from 1961 onwards 1972 onwards 1976 onwards 1981 onwards 42. Which of the following statement is correct? Increase in national income always leads to economic growth. If national income rises per capita income must also rise. If population rises per capita income must fall. None of the above. 43. VAT is: one stage sales tax double stage sales tax multi stage sales tax None of the above. 44. The aim of co-operative farming is to: reap the benefits of large scale farming. solve the problem of fragmentation of holding. Both and ( None of above. 45. The apex bank for agricultural credit in India is: RBI NABARD RRB SIDBI 46. The small scale sector contributes nearly ___ to the total exports of India. 8% 26%

34% 48% 47. The principle of Canon of elasticity states that: The tax which an individual is required to pay must be certain and not arbitrary. The tax system should be such that the revenue collected increases or decreases fairly quickly with an increase or decrease in national income. There should be variety of taxes which can be properly coordinated to form an integrated whole. The tax system should be flexible so that it can deal with economic fluctutations. 48. The four canons of taxation given by Adam Smith are namely: Canon of Equality, Simplicity, Productivity and Economy. Canon of Equality, Certainty, Convenience and Economy. Canon of Equality, Certainty, Fexibility and Elasticity. Canon of Equality, Simplicity, Diversity and Economy. 49. In an Indian Tax System, the proceeds of indirect taxes is _____ the proceeds of direct taxes. more than less than equal to approximately half of 50. Income from _________ is exempted from income tax. agricultural sector industrial sector sales to final consumers mining activities

Mock Test Paper-III 59 Section D-Quantitative Aptitude (50 marks) 51. The value of lim ex equals to: x

0

56. lim x

0 1 10 –1 52. The value of lim x

0

(1

X)n X

1

equals to:

53. Which of the following is an example of right-hand limit? lim f (x) = f (a + 0) a 0

lim

f (x) = f (a - 0)

lim

f (x) = f (a - 0)

lim

f (x) = f (a + 0)

x

x

a 0

x

a 0

a 0

54. Which of the following are not properties of continuous functions? If f (x) and g (x) are both continuous at a point x = a, then f (x) + g (x) is also continuous at x = a. If f (x) and g (x) are both continuous at a point x = a, then f (x) - g (x) is also continuous at x = a. If f (x) and g (x) are both continuous at point x = a, then their product f (x) g (x) is also continuous at x = a. None of above 55.

lim

13

23

33 n4

x

0 1/4 1/2 1

n3

logex equals to: (x 1) –1 1 8 10

X n nX Xn

x

1

57. If lim

x9 x

an = a, then a = a

9 91/4 91/6 91/8 58. At what point the given function is discontinuous? x2 1 x 3 (1) (3) (–1) (–3) 59. A wholesale readymade garment dealer has the following price pattern Rs. 15 per piece for 20 or less than 20, Rs. 20 per piece for quantity above 20 but up to 30 pieces, Rs. 10 per piece for quantity more than 30. The price and quantity function is not continuous at quantity x = 20 because: (RHL x - 20 # LHL x 20) (Is not defined at x = 20) (RHL x - 10 # LHL x 10) None of above 60. Which of the equivalent?

following

(i) f is differentiable at x = c equals to:

(ii) f has derivative at x = c (iii) f’ (c) exists. (i) and (ii) (ii) and (iii) (i) and (iii) (i), (ii) and (iii)

expressions

are

60

Part-syllabus Mock Tests

61. The differentiation of x logx is: logx 1 + logx 1 – logx 1/logx

x y

62. The maximum and minimum values of the function f (x) is called the: Stationary values Extremum values Turning points Any of above

1 x

63. If x3 + y3 – 3axy = 0, then dy equals to: dx (ay – x)/(y – ax) (a – x2)/(y2 – a) (ay – x2)/(y2 – ax) (ay2 – x2)/(y2 – ax2)

1 y 68. If y = ex + e x + ex + …. then

dy equals to: dx

x 1 y x e 1 y

64. If x/(x – y) = log (a/x – y), then which of the following is true? dy x =2+ dx y

e 1 y y 1 y 69. If ex is differentiated with respect to to:

dy x =2– dx y

x , it is equal

ex x

dy 2x = dx y

xex x 2ex x

None of above 65. If x = at2 and y = 2at, then

y x

dy equals to: dx

t 1 t at 1 at 66. If xx is differentiated with respect to x, it is equal to: xx log ex log ex x log ex xx log x dy 67. If xm yn = (x + y)m + n then equals to: dx

xex 70. The maximum value of f(x) = x3 – 6x2 + 9x + 15 is: 12 15 19 22 71. If x = t + t-1 and y = t - t-1 , then the value of t = 2 is: 3/5 5/3 –3/5 –5/3 72. The differential coefficients of (x2 + 1)/x is: 1/x2

dy at dx

Mock Test Paper-III 61 1 + x2 1 + 1/x2 1 – 1/x2

1

79.

73. What will be the value of (6 x3 + 7 x2 – 5x) dx ? 3 3 7 2 5 x + x – x+c 2 2 2 3 4 7 3 5 2 x + x – x +c 2 3 2 3 4 7 3 5 2 x + x – x +a 2 3 2 3 4 7 3 5 2 x + x + cx x – 2 3 2 74. The integration of (5x + 3)9 dx equals to: (5x + 3)10 + c {(5x + 3)10/10} + c {(5x + 3)10/50} + c {(5x + 3)9/10} + c 75.

(ex + e-x)2 (ex – e-x) dx = {(ex + e-x)3/2} + c {(ex + e-x)3/3} + c {(ex + e-x)2/3} + c {(ex - e-x)3/3} + c

76. Integral value of elogx/x is: xe + c logx + c logex + c x+c 77. Integral value of dx/{ x( x5 + 1)} is: 1 log |x5/(x5 + 1)| + c 5 1 log |x/(x5 + 1)| + c 10 log |x4/(x4 + 1)| + c 1 log |x5/(x5 + 1)| + c x x3 e

78. The value of 0

x ex 1 1/2

log {(2

x) / 2(2

x)} dx

1

x

dx equals to:

2 logx x logx 2x 0 3

x2

80. The value of

2x dx equals to:

0

0 1 2 x 81. A balloon which always remains spherical, is being inflated by pumping in 900 cubic centimetres of gas per second. Find the rate at which the balloon is increasing when the radius is 15 cm. 3/22 cm./sec. 7/22 cm./sec. 7/12 cm./sec. 4/15 cm./sec. 82. The process of expressing a given fraction

f(x) (x)

as an algebraic sum of simpler fractions is called: a rational fraction a proper rational fraction an improper rational fraction a partial fraction 83. Classification of total population according to age is an example of: classification by attributes classification by variables time series classification by geographical regions 84. The degree of the polynomial is the __________ contained in the polynomial. lowest power of x highest power of x number of constants number of variables 85. The value exactly at the middle of a class interval is called: Class frequency Class limits

62

Part-syllabus Mock Tests Class boundaries Class mark

86. Which of the following denotes “Relative frequency”? Class frequency/Total frequency Total frequency/Class frequency Class frequency/Width of the class Width of the class/Class frequency 87. The ogive is used: to find the median, quartiles, deciles and percentiles, or the value of the variable such that its cumulative frequency is a specified number. to find the cumulative frequency corresponding to a given value of the variable. to find the number of observa tions which are expected to lie between two given values. All of above 88. The following diagram represents which of the four frequency curves?

Symmetrical bell-shaped Asymmetrical single-hum J-shaped U-shaped 89. Considering the table below, what will be the number of candidates securing not more than 48 marks? Marks obtained Candidates Not more than 45 447 Not more than 50 484 Not more than 55 505 Not more than 60 511 Not more than 65 514 454 462 469 515 90. An attribute is: A qualitative characteristic

A quantitative characteristic A measurable characteristic All these 91. The upper part of the table, describing the columns and sub-columns is known as: Title Stub Caption Body of table 92. ‘Stub’ of a table is the: Left part of the table describing the columns Right part of the table describing the columns Right part of the table describing the rows Left part of the table describing the rows 93. A relative frequency distribution presents frequency in terms of: Fractions Whole numbers Percentages Both and 94. Mode of a distribution can be obtained from: Histogram Less than type Ogives More than type Ogives Frequency polygon 95. Class interval in the following series is of: Marks: 0-9 10-19 20-29 30-39 40-49 9.5 10 9 and 10 both None of the above 96. There are 100 educated and 200 uneducated out of 300 workers working in a factory. This method of classification: Chronological classification Qualitative classification Classification according to place Quantitative classification 97. Which of the following statement is true? A frequency polygon is a bar diagram Diagrams, graphs and bars are complementary to each others Median can be determined with help of diagrams.

Mock Test Paper-III 63 Frequency curve is a limiting form of a histogram or frequency polygon 98. Which of the following are not the two dimensional diagrams: Simple bar diagrams Square diagrams Circular diagrams Rectangular diagrams 99. Which of the statistical average is calculated by cumulative frequency curves? Harmonic mean Geometric mean Arithmetic mean Median

100. Considering the table given below, what will be the number of cases between 112 and 134? Class-limit Frequency 90 – 100 16 100 – 110 22 110 – 120 45 120 – 130 60 130 – 140 50 140 – 150 24 150 – 160 10 52 116 120 136

64

Part-syllabus Mock Tests

COMMON PROFICIENCY TEST Mock Test Paper–III [Answer Key] SESSION - I Section A-Fundamentals of Accounting (60 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30.

Question 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60.

Mock Test Paper-III 65 Section B-Mercantile Law (40 marks)

Question 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80.

Question 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100.

SESSION - II Section C-Economics (50 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Question 11. 12. 13. 14. 15. 16. 17. 18. 19. 20.

66

Part-syllabus Mock Tests

Question 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35.

Question 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.

Section D-Quantitative Aptitude (50 marks)

Question 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70.

Question 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90.

Mock Test Paper-III 67 Question 91. 92. 93. 94. 95.

Question 96. 97. 98. 99. 100.

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Part-syllabus Mock Tests

COMMON PROFICIENCY TEST Mock Test Paper–IV SESSION - I TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section A-Fundamentals of Accounting (60 marks)

1. Depreciation is a decrease in the book value of fixed asset due to: use or effluxion of time obsolescence expiration of legal rights All of above 2. Depreciation is a __________ decrease in the book value of an asset. permanent continuous Both and None of above 3. __________ refers to the economic deterioration by the expiration of intangible assets. Depletion Amortisation Obsolescence Any of above 4. The amount of depreciation is usually based on: Current market value of an asset. Historical cost Replacement cost Expected discounted cash inflow 5. When the flat (or blanket) rate of depreciation without the words, per annum is given, depreciation is charged: for the full accounting period irrespective of the date of acquisition. for the period beginning with the date of acquisition and ending with the date of closing accounting period.

for the period beginning with the date of use and ending with the date of closing accounting period. for the half accounting period 6. Which of the following is a method of recording depreciation? Straight line method Annuity method Sum of digit method Charging to asset account method 7. In case of destruction/damage of an insured asset by fire or accident, sale proceeds imply the claim admitted by Insurance company. sale proceeds imply the salvage value (if any). sale proceeds imply claim admitted by Insurance company together with salvage value (if any). None of above 8. A machine is purchased for Rs 5,00,000. Expenses incurred on its cartage and installation Rs 1,00,000. What will be the amount of depreciation @ 10% p.a. according to Straight Line Method for the first year ending on 31st March, 2010 if the machine is purchased on 1st October 2009? Rs. 50,000 Rs. 60,000 Rs. 25,000 Rs. 30,000 9. ABC Ltd. purchased a second-hand machine on 1st July 2007 for Rs 7,20,000 and spend Rs 50,000

Mock Test Paper-IV 69 on its repairs. Depreciation is to be provided @ 10% p.a. according to Straight Line Method. This machine is sold for Rs 5,50,000 on 30th September 2009. Accounting year is financial year. What is the profit or loss on sale of machine? Rs. 66,000 Rs. 46,750 Rs. 27,500 Rs. (11,000) 10. Which of the following method of allocating depreciation is suitable for assets for which the amount of repairs and renewals goes on increasing as the asset grows older? Straight Line method Written Down Value method Annuity method Any of above 11. On 1st April 2007, XYZ Ltd. purchased a secondhand machine for Rs. 80,000 and spent Rs 20,000 on its cartage, repairs and installation. On 30th Sept. 2008 repairs & renewals amounted to Rs. 2,000. On 30th ‘Sept. 2009, the machine is sold for Rs. 50,000. Depreciation is to be provided @ 20% p.a. according to Written Down Value Method. Assuming that the accounts are closed on 31st March every year what journal entry needs to be passed on the date of sale of machine? Depreciation A/c Dr. 6,400 To Profit & Loss A/c 6,400 (Being the depreciation provided) Debtor A/c Dr. 50,000 To Machinery A/c 50,000 (Being the Machinery sold) Profit & Loss A/c Dr. 7,600 To Machinery A/c 7,600 (Being the transfer of loss on sale of Machinery) Depreciation A/c Dr. 6,400 To Machinery A/c 6,400 (Being the depreciation provided) Bank A/c Dr. 50,000 To Machinery A/c 50,000 (Being the Machinery sold) Profit & Loss A/c Dr. 7,600 To Machinery A/c 7,600 (Being the transfer of loss on sale of Machinery)

Depreciation A/c Dr. 12,800 To Machinery A/c 12,800 (Being the depreciation provided) Bank A/c Dr. 50,000 To Machinery A/c 50,000 (Being the Machinery sold) Profit & Loss A/c Dr. 1,200 To Machinery A/c 1,200 (Being the transfer of loss on sale of Machinery) Depreciation A/c Dr. 12,800 To Profit & Loss A/c 12,800 (Being the depreciation provided) Debtor A/c Dr. 50,000 To Machinery A/c 50,000 (Being the Machinery sold) Profit & Loss A/c Dr. 1,200 To Machinery A/c 1,200 (Being the transfer of loss on sale of Machinery) 12. In which of the following method of allocating depreciation, book value of an asset never becomes zero? Straight Line method Written Down Value method Both and None of above 13. The deficiency or surplus arising from retrospective recomputation of depreciation in accordance with the new method should be should be transferred to: the respective asset account. the statement of Profit and Loss. the revaluation reserve account. the accumulated depreciation account. 14. When there is change in the method of depreciation, depreciation should be recalculated in accordance with the new method: from the date of the change in the method of depreciation. from the financial year following the date of the change in the method of depreciation. from the accounting year following the date of the change in the method of depreciation. from the date of the asset coming into use.

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Part-syllabus Mock Tests

15. Which of the following entry is passed for providing depreciation under the Sinking Fund Method? Depreciation A/c Dr. To Asset A/c Depreciation A/c Dr. To Profit and loss A/c Depreciation A/c Dr. To Accumulated Depreciation A/c Depreciation A/c Dr. To Depreciation Fund A/c 16. Under which of the following method, not only the cost of the asset but also interest thereon at a given rate is taken into account for the purpose of calculating depreciation? Sinking Fund method Annuity method Productive Output method Sum of Digit method 17. The rate of depreciation under depletion method is calculated as: (Original cost less residual value)/Useful life in terms of effective hours (Original cost less residual value)/Useful life in terms of productive output Depreciable Amount x Actual Production during the period/Estimated Total Production Number of years’ life remaining x 100 / Sum of Years’ Digits 18. PQR Ltd. purchased a machine for Rs. 2,70,000 on 1st January, 2009 and incurred Rs. 20,000 towards freight, insurance, carriage inwards and installation charges. It was estimated that the machinery will have a scrap value of Rs. 10,000 at the end of its useful life which is 10 years of 7,000 hours each. PQR Ltd. decided to depreciate the machines on ‘Machine Hour Rate Method’. What will be the amount of depreciation to be charged for the first year if there were 3,400 machine hours during the first year? Rs. 13,114 Rs. 13,600 Rs. 28,000 Rs. 14,086 19. On 1st January 2006, ABC Ltd. purchased a machine costing Rs. 1,00,000 and provided depreciation @ 10% p.a. on Straight Line Method basis. At the end of 2009, the company decided to change the method of depreciation from Straight

Line Method to Written Down Value Method retrospectively, the rate of depreciation remaining the same. What is the amount that needs to be adjusted because of change in the method of depreciation? Rs. 5,610 Rs. 2,900 Rs. 1,000 Rs. 5,800 20. On 1st April 2006, A Ltd. purchased a machinery for Rs. 1,00,000 and incurred Rs. 7,000 towards freight and insurance, Rs. 1,000 towards carriage inwards and Rs. 2,000 towards installation charges. It was established that the machinery will have a scrap value of Rs. 10,000 at the end of its useful life which is 4 years. On 1st April 2009, Rs. 2,000 were incurred on repairs and renewals of machine. According to the Sum of Years’ Digits Method, the amount of depreciation to be charged for each of the first, second, third and fourth financial years respectively ending on 31st March will be: Rs. 25,000, Rs. 25,000, Rs. 25,000, Rs. 25,000 Rs. 27,500, Rs. 27,500, Rs. 27,500, Rs. 27,500 Rs. 10,000, Rs. 20,000, Rs. 30,000, Rs. 40,000 Rs. 40,000, Rs. 30,000, Rs. 20,000, Rs. 10,000 21. Where the historical cost of a depreciable asset has undergone a change due to increase in long-term liability on account of exchange fluctuations, the depreciation will be calculated retrospectively on the revised historical cost of the asset. the depreciation on the revised unamortised depreciable amount should be provided prospectively over the residual useful life of the asset. the depreciation on the increased historical cost will be spread equally over the period before and after the date of change in historical cost. the depreciation on the increased historical cost is charged to exchange fluctuation account. 22. Depreciation is related to: Current Assets

Mock Test Paper-IV 71 Intangible Assets Fixed Assets Investments 23. When depreciation is recorded by charging to Provision for Depreciation Account, the asset appears: at original cost at original cost less depreciation at market value at replacement cost 24. Date of Purchase 1.7.2009, Purchase Price of Machine Rs. 1,40,000, Installation charges Rs. 60,000, Residual Value Rs. 81,920, Accounting year – Financial year, Date when Machine was put to use – 1.10.2009, the depreciation under Straight Line Method for the year 2009-2010 Rs. 14,760. The useful life of the Machine is: 6 years 5 years 4 years 3 years 25. On 1.4.2009 the balance of Machinery Account Rs. 5,17,000. It was discovered during 20092010 that Rs. 25,000 being repairs to machinery incurred on 30 June, 2007 had been capitalized. After rectification and depreciation @ 20% p.a. on reducing balances, the balance of Machinery Account as at 31.03.2010 will be: Rs. 4,13,600 Rs. 3,93,600 Rs. 4,00,000 Rs. 3,46,400 26. On 1st April 2007, ABC Ltd. purchased a machinery for Rs. 12,00,000. On 1st Oct. 2009, a new machinery at a cost of Rs. 80,000 was purchased and installed. The company has adopted the method of providing 10% p.a. depreciation on the original cost basis. The closing balance of ‘Provision for Depreciation Account’ as at 31.03.2010 will be: Rs. 1,20,000 Rs. 3,64,000 Rs. 3,60,000 Rs. 3,24,000 27. On 1st January 2006, XYZ Ltd. purchased a machine for Rs. 20,000 and provided depreciation

@ 10% p.a. At the end of 2009, the company decided to change the method of depreciation from Written Down Method to Straight Line Method retrospectively, the rate of depreciation remaining the same. On account of changed method of depreciation ________ Short Depreciation to be provided Rs. 580 Excess Depreciation to be provided Rs. 580 Excess Depreciation to be provided Rs. 290 Short Depreciation to be provided Rs. 1160 28. The suitable method for depreciating leases is: Straight Line WDV Depletion Annuity Method 29. Gross Profit means excess of operating revenues over: direct operating expenses indirect operating expenses direct non-operating expenses indirect non-operating expenses 30. If the Closing Stock appears outside the Trial Balance: An entry needs to be passed to incorporate the Closing Stock in the books. Closing Stock will not be shown in the Trading Account. Closing Stock will be shown in the Balance Sheet only Both and 31. Which of the following items are shown on the Credit Side of Trading Account? Opening Stock Purchases Sales Closing Stock 32. __________ shows the financial performance of business during an accounting period. Trading Account Profit and Loss account Balance Sheet All of above 33. Granting loan to a third party is an: operating activity investing activity

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Part-syllabus Mock Tests financing activity Both and

34. A Balance Sheet is a summary of: balances of Personal, Real and accounts. balances of Personal, Real and Assets accounts. balances of Nominal, Real and Assets accounts. balances of Personal, Nominal and Assets accounts.

Nominal fictitious fictitious fictitious

35. Bills Receivable is: a fixed asset. an Investment. a current asset. Any of above. 36. Assets in the balance sheet are arranged: in the order of their date of acquisition. in the order of their useful lives. in the order of their liquidity. in the order of their net realizable value. 37. In what order the following assets will be arranged in the balance sheet if they are shown in the order of permanence? Furniture and fixtures, Cash in hand , Prepaid Expenses, Investments in Shares of X Ltd. Furniture and fixtures, Investments in Shares of X Ltd., Prepaid Expenses, Cash in hand. Cash in hand, Prepaid Expenses, Investments in Shares of X Ltd., Furniture and fixtures. Investments in Shares of X Ltd., Furniture and fixtures, Prepaid Expenses, Cash in hand. Furniture and fixtures, Prepaid Expenses, Investments in Shares of X Ltd., Sundry Debtors. 38. Information about profit/ loss is not provided in: Trial Balance Trading account Profit/loss account Balance sheet 39. Which of the following is is an appropriation out of profit? Asset Liabilities Reserve Provision

40. Which of the following principle requires that revenue should be recognised in the period in which the sale is deemed to have occurred? Revenue Recognition Principle Matching Principle Accrual concept principle None of the above 41. In the absence of any specific information, a return appearing on the debit side of the trial balance is: shown on the debit side of Trading A/c by way of deduction from the amount of sales. shown on the debit side of Trading A/c by way of deduction from the amount of purchases. shown on the credit side of Trading A/c by way of deduction from the amount of sales. shown on the credit side of Trading A/c by way of deduction from the amount of purchases. 42. Salary has been paid for 11 months from April 2009 to Feb. 2010 @ Rs. 2,500 p.m. Salary for the month of March has not yet been paid. Accounting year is financial year. What adjusting entry needs to be passed to account for the same? Salary A/c Dr. Rs 2,500 To Bank A/c Rs 2,500 Salary A/c Dr. Rs 2,500 To Employee A/c Rs 2,500 Salary A/c Dr. Rs 2,500 To Trading A/c Rs 2,500 Salary A/c Dr. Rs 2,500 To Outstanding Salary A/c Rs 2,500 43. Income which has been earned but not received during the current accounting period is called: Accrued income Unaccrued income Prepaid income All of above 44. Which of the following item relates to the following year? Outstanding expenses Accrued income Unaccrued income All of above 45. How is bad debt presented in the balance sheet? Shown on the Assets side separately. Shown on the Assets side by way of deduction from the ‘Debtors’.

Mock Test Paper-IV 73 Shown on the Liability side separately. Shown on the Liability side by way of deduction from the ‘Creditors’. 46. Following are the extracts from the Trial Balance of a firm, as at 31st March 2010. Name of Account Sundry Debtors Bad Debts

Debit Balance Rs.

Credit Balance Rs.

2,05,000 3,000

After preparation of Trial Balance, it is learnt that Mr X, a debtor has become insolvent and nothing could be recovered from him and, therefore, the entire amount of Rs. 5,000 due from him was irrecoverable. What adjustment entry needs to be passed when a provision for doubtful debts @ 10% needs to be created? Profit & Loss A/c Dr. Rs. 19,700 To Provision for Doubtful Debts A/c Rs. 19,700 Profit & Loss A/c Dr. Rs. 20,000 To Provision for Doubtful Debts A/c Rs. 20,000 Bad Debt A/c Dr. Rs. 19,700 To Provision for Doubtful Debts A/c Rs. 19,700 Sundry Debtors A/c Dr. Rs. 20,000 To Provision for Doubtful Debts A/c Rs. 20,000 47. The net profit of a firm amounts to Rs 32,400 before charging commission. The manager of the firm is entitled to a commission of 8% on the net profits. What will be the amount of commission payable to the manager if he is allowed commission on the net profit after charging such commission? Rs. 2,592 Rs. 2,400 Rs. 3,000 Rs. 2,817 48. Which of the following statement is correct? Goods-in-Transit should be treated as part of closing stock and shown on the debit side of the trading account. Goods-in-Transit should be treated as part of closing stock and shown on the credit side of the trading account. Goods-in-Transit should not be treated as part of closing stock and shown on the debit side of the trading account. Goods-in-Transit should not be treated as part of closing stock and shown on the credit side of the trading account.

49. Which of the following journal entry is required to be passed to account for the employer’s contribution to Provident fund? Salary and Wages A/c Dr. To Employer’s contribution to P.F. A/c Salary and Wages A/c Dr. To Employee’s contribution to P.F. A/c Employee A/c Dr. To Employer’s contribution to P.F. A/c Employees’ contribution to P.F. A/c Dr. To Bank A/c 50. Operating profit is equal to: Sales – Cost of goods sold Gross profit – operating expenses Net profit + operating revenues Gross profit – Non-operating cost 51. Opening Stock Rs. 2,00,000, Sales Rs. 7,00,000, Gross Profit @ 25% on sales, Purchases Rs. 6,00,000, Closing stock is: Rs. 2,75,000 Rs. 4,75,000 Rs. 2,40,000 Rs. 4,40,000 52. A’s Trial Balance information:

contains

the

following

Discount allowed Rs. 500, Provisions for discount on debtors Rs. 1,100. It is desired to make a provision for discount on debtors of Rs 1,800 at the end of the year. The amount to be debited to the Profit & Loss Account is: Rs 1,200 Rs 3,200 Rs 700 Rs 2,200 53. Which of the following Reserve has debit balance? Investment Fluctuation Reserve Contingency Reserve General Reserve Reserve for Discount on Creditors 54. Who are the users of financial statements? Short-term creditors Long-term creditors Management All of above

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Part-syllabus Mock Tests

55. ‘Marshalling’ refers to: putting together items of a similar nature under a common heading. the order in which the various assets and liabilities are shown in the Balance Sheet. Both and None of above 56. Which of the following does not show the opening and closing stock of finished goods? Manufacturing Account Trading Account Both and None of above 57. The debit side of manufacturing Account: is always equal to its credit side is always more than its credit side is always less than its credit side None of these 58. Cost of raw materials consumed Rs. 1,20,000, Closing Stock of raw materials Rs. 42,000. Opening

Work-in-progress Rs 74,000, Closing Work-in progress Rs 25,000, Manufacturing overheads Rs 8,000, Sales of scrap Rs 3,000, Selling Overheads Rs 12,000. The cost of manufactured goods is: Rs 1,62,000 Rs 1,69,000 Rs 1,74,000 Rs 1,77,000 59. Which of the following does not appear in the Manufacturing account: Sale of scrap Depreciation on Factory Land & Building Salary of works manager Closing stock of finished goods 60. The manufacturing Account is closed transferring its balance to the: debit side of Trading account debit side of profit & Loss account credit side of Trading account credit side of profit & Loss account

by

Mock Test Paper-IV 75 Section B-Mercantile Law (40 marks) 61. Indian Partnership Act, came into force with effect from1st October, 1932 1st November, 1933 1st December, 1932 1st January, 1990. 62. Which of these is not applicable to a Partnership firm Limit on the maximum number of partners. Only male members can become partners. Created by an agreement. Partners have unlimited liability. 63. Which of these statements is not true about a partnership firm Governed by Indian Partnership Act. Registration not mandatory. Perpetual existence. Can be dissolved any time. 64. Which of these is not a type of partnership? partnership at will particular partnership partnership for a fixed term perpetual partnership 65. A sub-partner is one whosubstitutes the other is admitted without the approval of others. shares the profit of others. has just been admitted. 66. Which of these is not a type of partner? Nominal partner Sleeping partner Partners for profit Senior partner 67. Which of these particulars are not included in partnership deed? Date of marriage of a partner. Profit sharing ratio. Manner of settlement of mutual disputes. Name and address of all the partners. 68. Which of these rights are not affected by nonregistration of a firm? Right to sue the firm.

Right to sue other partners. Right of other party to sue the firm or any partner. Right to sue third party. 69. Which of these rights is/are not available to a minor partner under the Partnership Act? to receive the agreed share of profit access to accounts access to all the books of account sue for the share of profit 70. Sleeping partner is one whois always sleeping. does not take part in conduct of the business. who does not share profit. does not share loss. 71. In a partnership form of business, the business must be carried by All or any of them acting for all Senior Partner only Managing Partner of the firm Partner nominated by all 72. Right in a Joint Hindu family business are created by Agreement Status Will of the karta Majority decision 73. Which of these can be considered as a real test of partnership? mutual agency relationship written contract existence of business profit sharing 74. The relationship of partnership arises from Court orders Constitutional provisions Contractual relationship Operation of law 75. What is the minimum capital required to form a partnership firm. Rs. 50 lakhs Rs. 50 crores

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Part-syllabus Mock Tests Rs. 5 crores No such limit

76. According to section 12 of the Partnership Act, which of these rights are not available to a partner. Right to have access to books of account. Right to claim salary Right to take part in conduct of business of the firm. 77. A Partner owes the following duties towards the partnership except. to be just and faithful to take care of senior partner to indemnify for fraud duty to attend diligently 78. Which of these acts is/are covered under implied authority of a partner. to submit dispute relating to the firm to arbitration. to open a bank a/c on behalf of the firm to acquire immovable property of the firm none 79. Which of these acts is/are covered under the implied authority of a partner? to purchase and sell goods on behalf of the firm. to employ staff for the firm. receive payment on behalf of the firm all the three 80. A firm may be reconstituted in the following ways except. Marriage of a partner Expulsion of a partner Death of a partner Insolvency of a partner 81. Which of these is the test of good faith for expulsion of a partner. expulsion in the interest of the firm partner to be served notice partner being given opportunity of being heard all the three 82. A partnership firm must have at least ....partners 2

3 4 6 83. Dissolution of partnership between all the partners of a firm is called Dissolution of firm Dissolution of partnership Dissolution of agreement Dissolution of contract 84. In case of partnership at will, notice of intention to dissolve the firm should be served in writing verbal notice enough through legal notice any of the above three ways 85. Loss arising out of partners insolvency is made up by all the surviving partners all the solvent partners high net worth partners legal representative of insolvent partners 86. The Registrar of firm is deemed to be a Public servant Civil servant Senior citizen Information officer 87. The Registrar of firm is appointed by Central Govt. State Govt. Local authority. Parliament. 88. Which of the following words are not permissible in a firms name Golden Diamond Royal Modem 89. The Register of firm is open to inspection by Creditors Partners of the firm The Registrar of firms All the three 90. An unregistered firm can not file a suit against a third party

Mock Test Paper-IV 77 a partner of the firm both a or b 91. Non-registration of a firm does not affect the right of the firm to institute a suit or claim of set off not exceeding Rs. 1,000 Rs. 10,000 Rs. 100 Rs. 10 92. For which of these a public notice is not required. Admission of a partner Retirement of a partner Death of a partner Expulsion of a partner 93. A partnership firm may be registered with Registrar of Partners. Registrar of firms Registrar of companies. District Court. 94. In case of non-registered partnership firm.... A partner can file a suit against the firm. A partner can file a suit against any partner of the firm. The firm can file a suit against third parties. Third party can file a suit against the firm. 95. An unregistered firm cannot claim Set on Set off in excess of Rs. 100 Set on and set off None of the above 96. The non-registration of a firm does not affect the right of the firm to file a suit for the recovery of more than Rs. 100 to file a suit for the recovery of less that Rs.

100 to file a suit against a partner for recovery of money due by him to claim a set-off exceeding Rs. 100 97. An unregistered firm has sold some goods to a customer. A suit against the customer for the recover of price of goods is: maintainable if the firm is registered after filing the suit maintainable if the firm is registered before filing the suit not maintainable at all irrespective of the registration before or after filing the suit none of these 98. A partnership at will is one: Which does not have any deed Which does not have any partner Which does not provide for how long the business will continue Which cannot be dissolved. 99. A partnership at will is one 1. 2. 3. 4.

Duration not fixed Duration fixed Dissolved at any time Can be dissolved only on the happening of an event 1&2 2&3 3&4 1&3

100. There is no provision in the partnership deed regarding the duration of partnership. This is partnership at will partnership for an indefinite period partnership by estoppel partnership not recognised by law

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Part-syllabus Mock Tests

SESSION - II TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section C-Economics (50 marks)

1. The first stage of the theory of demographic transition is the stage of: Low birth rate and low death rate Low birth rate and high death rate High birth rate and low death rate High birth rate and high death rate 2. Which stage of the theory of demographic transition is called the stage of population explosion? First stage Second stage Third stage Fourth stage 3. Population growth is a major obstacle to economic development because of: Increasing land-man ratio High per capita income Increased illiteracy Reduced underemployment 4. The first population census in India was conducted in the year: 1878 1872 1987 1991 5. ___________ refers to the number of people living per square kilometer of land area. Size of population Density of population Life expectancy Growth of population 6. Age composition of the population determines: the proportion of males and females in the total population. the proportion of rural and urban population in the total population.

the proportion of working population in the total population. the proportion of literates in the total population. 7. The stage of ________ of the population policy of the government believed that there was no harm if country’s population was rising. Indifference Neutrality Both and None of above 8. The infrastructure for family planning programme was created in: 1957-58 1961-62 1964-65 1971-72 9. The family planning programme consisted of: Promotion of early marriage Promotion of agriculture Promotion of education among children Making health services available to infants. 10. In India, the concept of _______ is used to measure poverty. Absolute poverty Relative poverty Income distribution Consumption expenditure 11. Poverty line is formed by: Maximum per capita consumption expenditure Minimum per capita consumption expenditure Maximum per capita production income Minimum per capita production income

Mock Test Paper-IV 79 12. One of the causes of rural poverty is: Low level of disguised unemployment Low birth rate and death rate Low level of productivity High status of women 13. When employment tends to be a long-term feature of a country, it is called: Long-term unemployment Chronic unemployment Subsisting unemployment Permanent unemployment 14. In a disguised unemployment, marginal productivity of a labour is: positive zero negative either or 15. Under which of the following concepts, unemployment is measured in number of persons i.e. persons who remain unemployed for a major part of the year. Usual Principal Status Basis Current Yearly Status Basis Current Weekly Status Basis Current Daily Status Basis 16. One of the major cause of unemployment is: Decrease in labour force Limited use foreign technology Emphasis on labour intensive projects Lack of financial resources 17. Which of the following is a non-commercial source of energy? Firewood Oil Coal Gas 18. The Central Government operates through which of the following corporations for electricity? National Thermal Power Corporation Natural Hydroelectric Power Corporation Nuclear Power Corporation of India Limited All of above 19. Which of the following programme was started in 2005 for providing electricity to all areas? Indira Gandhi Vidhyutikaran

Rajiv Gandhi Vidhyutikaran Pradhan Mantri vidhyut yojna Sampporna Gramin ujagar yojna 20. Which of the following statement for Indian railways is incorrect? It is Asia’s largest railway. It is world’s third largest railway. It has two segment. It suffers from over crowding and poor service. 21. An international greenfield airport is operational at: Hyderabad Bangalore Goa Kochi 22. The two PSUs in telecom sector in India are: BSNL and MTNL BSNL and TRAI TRAI and MTNL TRAI and NIXI 23. National Policy on Education made in 1986 and modified in 1992 stressed on: universal access to education improvement in the quality of education imparting technical education to all Both and 24. __________ arises when there is an excess of demand for goods over their supply. Demand-pull inflation Supply-pull inflation Demand-push inflation Supply-push inflation 25. One of the main cause of cost-push inflation is: Growth in black money Increase in population Higher profit margin Increase in money supply 26. A rise in price is called creeping inflation when the rate of inflation is: Minimum 3% per annum Maximum 3% per annum Minimum 10% per annum Maximum 10% per annum

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Part-syllabus Mock Tests

27. When price rises without any government control over them, it is called: Galloping inflation Hyper inflation Open inflation Suppressed inflation

35. In a situation of excess demand, RBI raises: Cash Reserve Ratio Statutory Liquidity ratio Marginal requirement All of above

28. Variations in the price level in India are measured in terms of: Wholesale Price Index National Income Deflation Consumer Price Index All of above

36. Which of the following is an instrument of fiscal policy used to control inflation? Bank Rate Policy Open Market Operations Variable Reserve Ratio Expenditure Policy

29. Wholesale Price Index covers all commodities but does not cover: Services Non-tradable goods Both and Non of above

37. Which of the following measures to curb inflation puts a check on increase in disposable income of the households? Wage freeze Dividend freeze Income freeze Price freeze

30. Which of the following factor leads to inflation? Decreasing pace of urbanisation Rising prices of imports Regular agricultural supply Growth of industrial production 31. The benefit of inflation is: It helps in raising capital formation. It leads to rise in black money. It leads to high cost economy. It disrupts execution of projects. 32. Quantitative instruments are those instruments which affect the amount of credit in the _______ . whole economy specific areas of economy. privately owned sectors of economy nationalized sectors of economy 33. Which of the following factor lead to cost-push inflation? Irregular agricultural supply Rise in administered prices Hoarding of essential goods All of above 34. The rate of interest at which the RBI lends to the commercial banks is called: Prime Lending rate Bank rate Borrowing rate

RBI rate

38. _________ is defined as the portion of total deposits which a commercial bank has to keep with itself in the form of liquid assets. Cash Reserve Ratio Statutory Liquidity ratio Marginal requirement Statutory Deposit ratio 39. Which of the following steps have been taken by government to increase the supply of goods in order to curb inflation? Increase agricultural production through better seeds, fertilizers and irrigation facilities. Increase industrial consumer goods production through raising the utilisation of idle capacity. Import of vital goods should be easy. All of above 40. The actual financial statement of the government of India is called: the Budget Statement the Annual Statement the Fiscal Statement the Public Statement 41. Which of the following is a component of revenue receipts? Market Borrowings Taxes on capital transactions

Mock Test Paper-IV 81 Subsidies Provident Funds 42. _________ measures addition to liabilities of the government of India. Budgetary Deficit Fiscal Deficit Revenue Deficit Capital Deficit 43. Budgetary Deficit is equal to: Revenue Deficit + Capital Deficit Revenue Deficit + Fiscal Deficit Capital Deficit + Fiscal Deficit Revenue Receipts – Revenue Expenditure 44. Which of the following is a part of Balance of Payment account? Revenue account Expenditure account Settlement account Fixed account 45. Which of the following account record transactions representing foreign financial assets and liabilities? Current account Capital account Settlement account Foreign account 46. Merchandise under the current account of Balance of Payment includes only:

Services Investment income Export and import of goods Transfer payments 47. Banking capital includes: resident’s capital transactions. foreign financial assets and liabilities of the government. credit granted by international institutions to central government. All of above. 48. The net balance of capital account shows: a country’s overall balance of payment position. a country’s overall capital position. current financial surplus or deficit. current level of country’s national income. 49. BOP accounting system: follows single entry bookkeeping follows double entry bookkeeping. only prepares memorandum accounts. does not follow any method of bookkeeping. 50. Devaluation of rupee will make: exports profitable exports expensive imports profitable None of above

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Part-syllabus Mock Tests Section D-Quantitative Aptitude (50 marks)

51. In a school 85 boys and 35 girls appeared in a public examination. The mean marks of boys was found to be 40 %, whereas the mean marks of girls was 60 %. What will be the average marks percentage of the school? 40% 45% 50% 60% 52. In the case of grouped data, the mean x is given by: d a+ n a–

d n

a+

fd n

a–

fd n

56. What will be the value of median, if the value of mode and mean is 60 and 66 respectively, 61 62 64 65 57. A train travels first 300 kilometers at an average rate of 30 k.p.h. and further travels the same distance at an average rate of 40 k.p.h. What is the average speed over the whole distance? 32.654 k.p.h. 34.286 k.p.h. 36.457 k.p.h. 37.786 k.p.h. 58. For calculation of Quartiles, the values must be arranged in ________ order only. ascending descending Any of above None of above

53. Find the value of p for the following distribution whose mean is 16.6. f:

12

16

20

24

16

8

4

x:

8

12

15

p

20

25

30

16 17 18 19 54. For a given set of observations, the sum of deviations is minimum when the deviations are taken from: Mean Median Mode All of above 55. In the case of discrete frequency distribution, mode is the value of the variable corresponding to the: Maximum frequency Minimum frequency Average frequency Weighted average frequency

59. For a moderately skewed distribution, which of the following relationship holds? Mean — Mode = 3 (Mean — Median) Median —Mode = 3 (Mean — Median) Mean — Median = 3 (Median — Mode). Mean — Median = 3 (Mean — Mode) 60. What is the value of the first quartile for observations 15, 18, 10, 20, 23, 28, 12, 16 ? 10 12.75 15 17.25 61. An investor buys Rs. 1200 worth of shares in a company each month. During the first 5 months, he bought the shares at a price of Rs. 10, Rs. 12, Rs. 15, Rs. 20 and Rs. 24 per share. After 5 months the average price paid for the shares in rupees is: 12.45 13.74 14.63 15.12

Mock Test Paper-IV 83 62. Which of the following is a relative measure of dispersion? Range Mean Deviation Quartile Deviation Coefficient of Standard Deviation 63. Karl Pearson’s measure gives: coefficient of standard deviation. coefficient of standard deviation. coefficient of variation. none of these. 64. ……………… is defined as half the difference between the lower and upper quartiles. Mean Quartile deviation Standard deviation Range 65. The appropriate measure of dispersions for open-end classification is: Mean deviation Standard deviation Quartile deviation All these measures 66. A batsman scores runs in 10 innings 38, 70, 48, 34, 42, 55, 63, 46, 54 and 44, then the mean deviation is : 4.8 7.2 7.6 8.6 67. Suppose a population A has 100 observations 101, 102, 103, ...., 200 and another population B has 100 observations 151, 152, 153, ……, If VA and VB represent the variance of the two populations respectively, then VA / VB is equal to: 1 2/3 4/9 9/11 68. If two samples of sizes 30 and 20 have means as 55 and 60 and variances as 16 and 25 respectively, then what would be the S.D. of the combined sample size 50? 4.18 5

5.06 5.35 69. The coefficient of variation of a series is 58. Its S.D. is 21.2. Its arithmetic mean is: 36.6 22.8 28.9 34.5 70. Correlation coefficient can be found out by: Rank Method Scatter Diagram both and none of these. 71. Bivariate Data are the data collected for : two variables at the same point of time two variables at different points of time. more than two variables at the same point of time. more than two variables at different points of time. 72. If the plotted points in a scatter diagram lie from upper left to lower right, then the correlation is : Zero Positive Negative none of these. 73. The Cov (X, Y) of the following data is: (3, 5), (6, 7), (9, 9), (72, 11), (15, 13), (18, 15), (21, 17), (24, 19) 31.2 31.5 32.1 32.6 74. The coefficient of correlation (x, y) when: Cov (x, y) = 10, Var (x) = 6.25 and Var (y) = 31.36 is: 5/7 2/7 3/7 6/7 75. The coefficient concurrent deviations from the following data: Number pairs of observations = 96; Number of pairs of deviations = 36, is given by: 0.484

84

Part-syllabus Mock Tests 0.521 –0.492 –0.514

76. If r = 0.3, N = 10, then the probable error of r is: 0.126 0.197 0.176 0.184 77. If the sum of squares of the rank differences in Mathematics and Physics marks of 10 students is 22, then the coefficient of rank correlation is 0.84 0.925 0.95 0.972

locality. Mean height = 165 cm, Mean weight = 80 kg, Standard deviation of height = 8 cm, Standard deviation of weight = 10 kg. Correlation coefficient between height and weight = 0.6. The most likely weight of a person whose height is 170 cm is: 74.25 kg. 79.65 kg. 83.75 kg. 84.95 kg. 84. If the coefficient of non-determination is 0.502, then the coefficient of allienation is: 0.51 0.62 0.71 0.84

78. The two lines of regression become identical when: r=1 r = -1 r=0 or

85. The standard error of estimate of Y on X is given by: 2 x (1–r ) 2 y (1–r ) 2 x (1+r ) 2 y (1+r )

79. The regression line of y on x is derived by: the minimisation of vertical distances in the diagram. the minimisation of horizontal distances in the scatter diagram. both and . None of these.

86. If one of the outcomes cannot be expected to occur in preference to the other in an experiment the events are: compound events favourable events unfavourable events equally likely events.

80. The regression coefficient of y on x is given by : ( x/ y) ( y/ x) r ( x/ y) r ( y/ x)

87. P(B/A) is defined only when A is a sure event A is not an impossible event B is a sure event B is an impossible event.

81. If byx = 0.8, bxy = 0.46, then r is: 0.58 0.60 0.61 0.51

88. If two events A and B are independent, then they can not be exhaustive they can not be mutually exclusive they can be mutually exclusive Both and .

82. The two lines or regression are x + 2y = 7 and 2x + y = 7. The regression equation of Y on X is : 2x + y = 7 x + 2y = 7 2x + 2y = 7 2x + y = 0

89. Two dice are thrown at a time and the sum of the numbers on them is 6. The probability of getting the number 4 on anyone of the dice is: 1/5 2/5 1/6 1/3

83. Assuming that there is a linear relationship between height (X) and weight (Y) of residents of a certain

Mock Test Paper-IV 85 90. If P(A B) = 0.8, P(A + P( B ) = 0.4 0.5 0.8 0.9

B) = 0.3, then P( A )

91. Mr. A gave his telephone number to Mr. B. Mr. B remembers that the first two digits were 40 and the remaining four digits were two 3s, one 6 and one 8. He is not certain about the order of the digits. Mr. B dials 403638. The probability that he will get A’s house is 1/6 1/8 1/12 1/14 92. If A and B are two mutually exclusive events, then P(A + B) is equal to P(A)P(B) P(A) + P(B) P(A) P(B’) + P(A’) P(B) P(A) P(B’) - P(A’) P(B) 93. An urn contains 7 green and 5 yellow balls. Two balls are drawn at a time. The probability that both balls are of same colour is: 2/ 35 11/49 7/25 31/66 94. In a random throw of 2 dice is the expectation of the sum of the points on them is 5 7 5/4 7/2 95. A random variable has the following probability distribution: x 4 5 6 8 P 0.1 0.3 0.4 0.2 The expected value of X is: 3.4

4.6 5.9 6.2 96. The probability that there is at least one error in an account statement prepared by A is 0.3 and for B and C, they are 0.4 and 0.45 respectively. A, B and C prepared 20, 10 and 40 statements respectively. The expected number of correct statements in all is: 28 34 42 51 97. The p.m.f. f (x) of a discrete random variable X is given by X 1 2 3 f (x) 1/2 1/3 1/6 Find E (x) and V(x). 1.47: 0.56 1.67: 0.56 1.62: 0.54 1.37: 0.54 98. A contractor spends Rs. 3000 prepaid for a bid on a construction project which after deductions manufacturing expenses and cost of bidding, will yield a profit of Rs. 25,000, if the bid is won. If the chance of winning is ten per cent, compute his expected profit. Rs. 130 Rs. 200 Rs. 240 Rs. 340 99. If x and y are independent, then E(xy) = E(x) x E(y) E(xy) = E(x) + E(y) E(x + y) = E(x) - E(y) E(x - y) = E(x) + E(y) 100. If a and b are constants, then V(a X + b) equals: a V(X) a V(X2) a2 V(X) a2 V(X2)

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Part-syllabus Mock Tests

COMMON PROFICIENCY TEST Mock Test Paper–IV [Answer Key] SESSION - I Section A-Fundamentals of Accounting (60 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30.

Question 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60.

Mock Test Paper-IV 87 Section B-Mercantile Law (40 marks)

Question 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80.

Question 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100.

SESSION - II Section C-Economics (50 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Question 11. 12. 13. 14. 15. 16. 17. 18. 19. 20.

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Part-syllabus Mock Tests

Question 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35.

Question 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.

Section D-Quantitative Aptitude (50 marks)

Question 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70.

Question 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90.

Mock Test Paper-IV 89 Question 91. 92. 93. 94. 95.

Question 96. 97. 98. 99. 100.

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Part-syllabus Mock Tests

COMMON PROFICIENCY TEST Mock Test Paper–V SESSION - I TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section A-Fundamentals of Accounting (60 marks)

1. A partnership firm: is a person in the eyes of law. is not a person in the eyes of law. is an artificial judicial person in the eyes of law. is a separate legal entity in the eyes of law. 2. The maximum limit of partners in case of a partnership for a banking business is: 2 5 10 20 3. Where there is neither a partnership deed nor any express agreement: Salary/Commission are paid to partners on the basis of capital contribution. Salary/Commission are paid to partners on the basis of profit sharing ratio. a fair amount of remuneration for taking part in the conduct of business is allowed only to the working partners. No remuneration for taking part in the conduct of business is to be allowed to any partner. 4. Which of the following statement is correct? No suit can be filed by an unregistered firm. No suit can be filed by the partners of an unregistered firm. A third party can file a suit against the unregistered firm or its partners. All of above

5. On the death of a partner, the partnership firm stands dissolved. the partnership firm is assumed to be continued by its existing partners. the legal heir of deceased partner by default takes his position in the firm. None of above 6. Which of the following account can never show a negative balance? Fixed Capital Account Fluctuating Capital Account Both and None of above 7. Drawings against profits: reduces capital. does not reduces capital. does not affect capital. None of above 8. Where a fixed amount is withdrawn on the first day of every month, during the period of 12 months, the interest on total amount of drawings is calculated for an average period of : 5 1/2 months. 6 months. 6 1/2 months. 7 1/2 months. 9. Mr. X and Mr. Y started business on 1st April, 2009 with capitals of Rs. 6,00,000 and Rs 4,00,000 respectively. What will be the Interest on Drawings of Mr. X @ 10% p.a. for the year ended 31st Dec.

Mock Test Paper-V 91 2009 if he withdrew Rs. 6,000 at the end of every quarter. Rs. 675 Rs. 450 Rs. 900 Rs. 600 10. X and Y started business on 1st April 2009 with capitals of Rs. 6,00,000 and Rs. 5,00,000 respectively. On 1st May 2009, X introduced an additional capital of Rs. 2,00,000 and Y withdrew Rs. 60,000 from his capital. On 1st October 2009, X withdrew Rs. 1,00,000 from his capital and Y introduced Rs 1,50,000. Interest on capital is allowed @ 6% p.a. What will be the interest on capital payable to X and Y respectively for the year ending 31st March, 2010? X : Rs. 47,000, Y : Rs. 31,200 X : Rs. 44,000, Y : Rs. 31,200 X : Rs. 44,000, Y : Rs. 34,500 X : Rs. 36,000, Y : Rs. 30,000 11. If the partnership agreement provides for interest on capital as a charge, No Interest on Capital will be allowed. Interest on Capital will be allowed only if there are profits. Full Interest on Capital will be allowed whether there are profits or losses. Profit will be distributed in the ratio of interest on Capital of each partner. 12. If there is no agreement as to the rate of interest to be allowed on Partner’s Loan, No Interest on Partner’s Loan will be allowed. Partner is entitled to interest on loan @ 6% p.a. Partner is entitled to interest on loan @ 10% p.a. Partner is entitled to interest on loan at the market rate.

any commission. Y is entitled to a salary of Rs 6,000 p.a. together with a commission of 8% of Net Profit after charging all commissions. Net profit before charging any commission for the year 2009 was Rs. 75,000. What will be the amount of net profit (after charging all commissions) distributed to X and Y respectively? X : Rs. 31,250, Y : Rs. 31,250 X : Rs. 25,250, Y : Rs. 25,250 X : Rs. 22,250, Y : Rs. 22,250 X : Rs. 22,050, Y : Rs. 22,050 15. Profit & Loss Appropriation Account is credited with: Gross profit Net Profit Interest on Capital Salary or commission to partners 16. X, Y, and Z are partners. Their fixed capitals as on 31st Dec. 2009 were: X: Rs. 50,000, Y: Rs. 1,00,000 and Z: Rs. 1,50,000. Profits for the year 2009 amounting to Rs. 60,000 were distributed. What necessary adjusting entry needs to be passed if Interest on Capital was not credited @ 10% p.a. though there was such provision in the partnership deed? Profit and loss appropriation A/c Dr. Rs. 5,000 To X’s Capital A/c Rs. 5,000 To Y’s Capital A/c Rs. 10,000 To Z’s Capital A/c Rs. 15,000 Profit and loss appropriation A/c Dr. Rs. 5,000 To X’s Current A/c Rs. 5,000 To Y’s Current A/c Rs. 10,000 To Z’s Current A/c Rs. 15,000 X’s Current A/c Dr. Rs. 5,000 To Z’s Current A/c Rs. 5,000 Y’s Current A/c Dr. Rs. 5,000 To Z’s Current A/c Rs. 5,000

13. Interest on Partner’s loan must be transferred to: the Partner’s capital account. the Partner’s current account. the Profit & Loss Account. the Profit & Loss Appropriation Account.

17. When guarantee for a minimum amount of profit to a partner is given by all the partners in an existing profit sharing ratio, such guarantee is said to be: personal guarantee partner’s guarantee firm guarantee partnership guarantee

14. X and Y are partners in a firm. X is entitled to a salary of Rs 1,000 p.m. together with a commission of 10% of Net Profit before charging

18. X, Y and Z entered into partnership on 1st Jan. 2009 to share profits and losses in the ratio of 12:8:5. It was provided that in no case Z’s

92

Part-syllabus Mock Tests share in profits be less than Rs. 25,000 p.a. There was a loss of Rs. 1,00,000 for the period ended 31st Dec. 2009. What adjusting journal entry needs to be passed in the books of the firm if any excess amount payable to Z on account of guarantee is to be borne by X and Y in the ratio of 2:3? X’s Capital A/c Dr. Rs. 10,000 Y’s Capital A/c Dr. Rs. 15,000 To Z’s Capital A/c Rs. 25,000 X’s Capital A/c Dr. Rs. 18,000 Y’s Capital A/c Dr. Rs. 27,000 To Z’s Capital A/c Rs. 45,000 Z’s Capital A/c Dr. Rs. 25,000 To X’s Capital A/c Rs. 10,000 To Y’s Capital A/c Rs. 15,000 Z’s Capital A/c Dr. Rs. 45,000 To X’s Capital A/c Rs. 18,000 To Y’s Capital A/c Rs. 27,000

19. Which of the following method of valuation of goodwill is based on the assumption that a new business will not be able to earn profits during the first few years of its operations? Average Profit Method Super Profits Method Capitalisation Method All of above 20. The following were the profits of a firm for the last three years: Year ending (31 March) 2007

2008

2009

Profit (Rs.) 6,00,000

(including an abnormal gain of Rs 1,20,000) 5,40,000 (after charging an abnormal loss of Rs 2,00,000) 7,20,000 (excluding Rs 2,00,000 payable on the insurance of plant and machinery)

What will be the value of firm’s goodwill on the basis of four years’ purchase of the average profits for the last three years. Rs. 22,13,333 Rs. 13,05,000

Rs. 25,86,667 Rs. 23,20,000 21. A firm earns profits of Rs. 1,40,000. The Normal Rate of Return in a similar type of business is 10%. The value of total assets (excluding goodwill) and total outsiders’ liabilities as on the date of valuation of goodwill are Rs. 12,00,000 and Rs. 3,80,000 respectively. What will be the value of goodwill according to capitalization of Super Profits Method? Rs. 2,00,000 Rs. 5,80,000 Rs. 7,20,000 Rs. 14,00,000 22. Premium paid on Joint Life Policy jointly covering the lives of the partner of a partnership firm is treated as an: expense investment Either of or None of above 23. Revaluation Account is: a real account a nominal account a personal account None of above 24. The ratio in which the old partners have agreed to sacrifice their shares in profit in favour of a new partner is called the: gaining ratio sacrificing ratio New profit sharing ratio Old profit sharing ratio 25. Adjusted old Capitals of A and B are Rs 90,000 and Rs 70,000 respectively. What will be the Incoming Partner’s proportionate capital, if he has to contribute proportionate capital for his 1/5th share. Rs. 40,000 Rs. 80,000 Rs. 1,60,000 Rs. 2,00,000 26. ________ is calculated at the time of retirement or death of a partner. Gaining ratio Sacrificing ratio

Mock Test Paper-V 93 Both of above None of above 27. A, B and C share profits and losses in the ratio of 1/2, 3/10 & 1/5 respectively. B retires and his share is taken up by A and C in the ratio of 2: 1. Then immediately, D is admitted for 1/4th share of profits, half of which was gifted by A and the remaining share was taken by D equally from A & C. What will be the new profit sharing ratio after D’s admission. 24 : 15 : 20 41 : 21 : 19 41 : 19 : 20 19 : 20 : 41 28. In case the new profit sharing ratio of continuing partners differ from their old profit sharing ratio, outgoing partner’s share of profits must be adjusted through the capital accounts of: all the partners. gaining partners only outgoing partner. None of above 29. Public notice of retirement must be given: only by the retiring partner only only by any partner other than retiring partner by retiring partner or any of the other partners none of these 30. All of the following except one is the method of recording joint life policy. Premium paid charged to revenue. JLP Account maintained at the surrender value. JLP Account maintained at the surrender value along with the Reserve. Surrender value distributed among the partners in the profit sharing ratio. 31. A Public Company must be registered with a minimum share capital of Rs. 50 lakhs Rs. 10 lakhs Rs. 5 lakhs Rs. 1 lakhs 32. The maximum amount of capital that a company can raise is called Authorized capital

Subscribed capital Called up capital Issued capital 33. Minimum amount to be called up at the time of share application is 10% 15% 25% 40% 34. When the full amount due in any call is not received the shortfall is debited to: Shortfall A/c Suspense A/c Calls in Arrears A/c Accrued Calls A/c 35. On an equity share of Rs. 20, the company has called up Rs. 14 but actually received 16, the share capital would be credited by Rs. 20 Rs. 14 Rs. 16 Rs. 4 36. XYZ Ltd. purchased a new machinery from a vendor for Rs. 5,50,000. The company allotted him equity shares at a premium of 10% instead of paying him in cash. The vendor will be allotted _________ equity shares of Rs. 10 each. 50,000 52,000 45,000 55,000 37. Every buy-back of shares should be completed within ____ months of passing the special resolution. 2 4 6 12 38. Premium on redemption of redeemable preference shares can be paid out of: Profit and Loss A/c Existing Share Premium A/c Proceed of fresh issue of shares including premium Any of above

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Part-syllabus Mock Tests

39. From the following details calculate the number of equity shares of Rs. 10 each to be issued in order to redeem the preference shares 12 % Redeemable preference shares of Rs. 10 each = Rs. 150,000 Security premium A/c = Rs. 15,000 General Reserve A/c = Rs. 10,000 Profit and loss A/c = Rs. 14,000 Redeemable preference shares are to be redeemed @10% premium 13,000 14,000 12,600 13,400 40. Which of the following statement is not true? Interest on debenture is not shown in Profit and Loss A/c There is restriction on utilization of pre mium on issue of shares Company can buy back its debentures Interest on debenture holders is to be paid whether there is profit or loss to the company 41. Debentures which are not secured by any charge upon any assets of the company are called: Secured debenture Bearer debenture Naked debenture Floating debenture 42. ABC Ltd. issued 2,00,000 debentures of Rs. 100 each at a discount of 10% to be redeemed at the end of 10th year from the date of issue at par. The loss on issue of debenture will be written off as: Rs. 20,00,000 in the year of issue. Rs. 20,00,000 at the end of 10th year Rs. 2,00,000 every month. Rs. 2,00,000 every year. 43. XYZ Ltd. issued 1,00,000 11 % debentures of Rs. 100 each. The total amount of interest payable on the debentures will be: Rs. 11 Rs. 11,000 Rs. 1,10,000 Rs. 11,00,000 44. Debentures which are convertible into shares at the option of the shareholders according to the terms of the issue are known as:

Flexible debenture Optional debenture Convertible debenture Equitable debenture 45. Which of the following refers to that portion of uncalled share capital, which shall not be capable of being called up except in the event and for the purposes of the company being wound up. Suspense capital Uncalled capital Reserve capital Unissued capital 46. Which of the following is not a condition for Issue of Sweat Equity Shares? the shares must belong to a class already issued. the issue must be authorised by a special resolution. at least 5 year must have elapsed since the date of commencement of business. None of above 47. When shares are forfeited, the share capital account is debited with _________ and the share forfeiture account is credited with _______. Paid-up capital of shares forfeited; Called up capital of shares forfeited Called up capital of shares forfeited; Amount received on shares forfeited Amount received on shares forfeited; Calls-in arrear of shares forfeited Called in arrears of shares forfeited; Amount received on shares forfeited 48. ABC Ltd. forfeited 40 shares of Rs. 10 each issued at a premium of 20% to Mr. X who had applied for 48 shares. Mr. X paid Rs. 2 per share on application and did not pay the allotment money of Rs 5 per share (including premium) and the first and final call of Rs 5 per share. Out of these, 20 shares were reissued to Mr. Y, credited as fully paid for Rs. 9 per share, the Profit on re-issue is Rs. 60 Rs. 300 Rs. 28 Rs. 124 49. XYZ Ltd. decides to redeem 650, 15% Redeemable Preference shares of Rs. 100 each at a premium of 10%. It has a General Reserve of Rs. 70,000 and

Mock Test Paper-V 95 a Securities Premium of Rs 4,000. What will be the amount required to be transferred to Capital Redemption Reserve Account if it is decided to issue 2,500 Equity Shares of Rs 10 each at par for the purpose of redemption. Nil Rs. 40,000 Rs. 45,000 Rs. 60,000 50. Which of the following accounts can be transferred to Capital Redemption Reserve account? Profit prior to incorporation Forfeited shares account General reserve account Securities premium account 51. PQR Ltd. issues a zero coupon bond having 10 years maturity with face value of Rs 5,000. At what price the company should issue the bond, if the required rate of return is 10% p.a. Rs. 2,445.70 Rs. 1,927.50 Rs. 4,435.20 Rs. 3,250.00 52. Debenture Redemption Premium Account appears under the head: Miscellaneous Expenditure on the assets side of the Balance Sheet Debtors on the assets side of the Balance Sheet Secured Loans on the liabilities side of the Balance Sheet Reserves on the liabilities side of the Balance Sheet 53. No journal entry is required to be passed when debentures are issued: at premium at discount at par as collateral security 54. Interest accrued but not due on debentures appears under the subhead: Secured Loans Unsecured loans Current Liabilities Non-current liabilities

55. Debenture Trustees are to be appointed in case of issue of: all Debentures Debentures with maturity of less than 18 months Debentures with maturity of more than 18 months None of above 56. Which of the following is true with regard to 10% Debentures issued at a discount of 20%? The carrying amount of debentures get reduced by 20% The carrying amount of debentures remain the same. At the time of redemption, the debenture holder will be paid 20% more than the issue price. At the time of redemption, the debenture holder will be paid the issue price 57. Interest on Debentures is calculated on: its issue price its book value its face value its market value 58. XYZ Ltd. took over the assets of Rs 3,00,000 and liabilities of Rs 10,000 of PQR Ltd. for an agreed purchase consideration of Rs 2,70,000 to be satisfied by the issue of 15% Debentures of Rs 100 each at 20% premium. Goodwill A/c is to be debited with Rs 20,000. Capital Reserve A/c is to be debited with Rs 20,000 Goodwill A/c is to be credited with Rs 20,000 Capital Reserve A/c is to be credited with Rs 20,000 59. Cumulative Preference Share is one on which: Arrears of dividend accumulate Arrears of dividend do not accumulate Arrears of share premium account get accumulated. losses gets accumulated 60. On issue of shares, the application money must not be less than: 2 % of the nominal value of shares 5% of the nominal value of shares 2% of the issue price of shares 5% of the issue price of shares

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Part-syllabus Mock Tests Section B-Mercantile Law (40 marks)

61. There is no provision in the partnership deed regarding the duration of partnership. This is partnership at will partnership for an indefinite period partnership by estoppel partnership not recognised by law 62. Suppose you have entered into a partnership agreement with me and the partnership-deed provides neither for the duration nor for the determina - tion of our partnership. What is the technical expression for this kind of partnership? Partnership fora fixed term Partnership at will Particular Partnership Any of these 63. A partnership at will may be dissolved by any partner by giving: an oral notice to all other partners of his intention to dissolve the firm a notice in writing to any of the partners of his intention to dissolve the firm a notice in writing to majority of the partners of his intention to dissolve the firm a notice in writing to all other partners of his intention to dissolve the firm 64. Types of partners includes Active Partner Sleeping Partner Nominal Partner All of the above 65. Active partner is one who: Takes part in the business of the firm Actively participates in co-curricular activities Actively shares the profits Makes a show of authority 66. Who does not take active part in conduct of the business. Minor partner Sub partner Ostensible partner Partner by estoppel 67. Partner by holding out is also known as Active Partner

Dormant Partner Partner by estoppel Partner by stoppage 68. The position of a minor in a partnership firm is to be determined taking into account 1. The Indian Contract Act, 1973 2. The Indian Partnership Act, 1932 3. Minor’s agreement 4. The Majority Act, 1875 1&2 2&3 3&4 1&4 69. A minor can be admitted to the benefits of partnership with the consent of: majority of the partners all the partners all working partners none of these 70. The rights of a minor when admitted to the benefits of the partnership include Right to share of the property and profits of the firm as may be agreed upon. Right to have access to and,inspect and copy of the account of the firm. Right to cast his vote on the question of appointment of the managing partner. & but not . 71. If a minor on attaining majority, effect to become a partner, he becomes personally liable to third parties for all those acts of the firm which are done: after the date of his attaining majority ’after the expiry of 6 months of date of his attaining majority after his admission to the benefits of partnership none of these 72. Which of the following statement is not true about minor’s position as a partner 1. He cannot become a full fledged partner in a new firm 2. He can become a full fledged partner in an existing firm

Mock Test Paper-V 97 3. He has to bear all liabilities like other partners 4. He can become a partner on becoming a major 1& 2 2& 3 3& 4 1& 4 73. The liabilities of a minor when admitted to the benefits of the partnership Is confined to his share of the profits and property in the firm Is same as that of any other partner in the firm Is similar as that of any other partner in the firm Is unlimited 74. A minor when admitted to the benefits of the partnership Is liable for all the liabilities of the firm in person Is liable for all the liabilities of the firm through his properties Is never liable for any of the liabilities of the firm Is liable in accordance with the provisions of subs-section (3) of Section 30 of the Indian Partnership Act, 1932 75. A minor is: A servant of a firm Representative of the firin Entitled to carry on the business of the firm Entitled to the benefits of the firm 76. The mutual rights and duties of partners are governed only-by Partnership Agreement only by the Partnership Act, 1932 both Partnership Agreement and the Partnership Act, 1932 either Partnership Agreement or the Partnership Act, 1932 77. Relations of partners to one another is dealt is governed by the following Section of The Indian Partnership Act, 1932 1-8 9-17 18-27

28-36 78. The provision of Sec. 9 and 10 lay down the: Mandatory duties of partners General duties of partners General Rights of partners None of these 79. Unless otherwise agreed by the partners: A partner must indemnify the firm for loss caused to it by his fraud in the conduct of the business of the firm A partner must indemnify the firm for any loss suffered by the firm due to his wilful neglect in the conduct of the business of the firm Every partner must carry on the business of the firm to the greatest common advantage A partner must render true accounts and full information of all things affecting the firm to any partner or his legal representative 80. Unless otherwise agreed, a partner: can carry on same business as that of the firm can not carry on same business as that of the firm can not carry on any business other than that of firm none of these 81. A change in the nature of business of the firm may be made only with the consent of: majority of partners all partners senior partners working partners 82. Unless otherwise agreed: a working partner in entitled to receive remuneration for taking part in the conduct of the business where a partner is entitled to interest on capital, such interest shall be payable as a charge against the profits A partner is entitled to claim interest on firm advances made by him to the firm @ 6% p.m. A partner is not entitled to interest on loan r, 6% p.a. after the date of dissolving of firm 83. Unless otherwise agreed, every partner must account for and pay all profits earned by firm: in any business

98

Part-syllabus Mock Tests in competing business in any business other than the business of the firm none of these

84. Which of the following is not the right of a partner i.e., which he cannot claim as a matter of right? Right of take part in business Right to have access to account books Right to share profits Right to receive remuneration 85. The general rights of continuing partners include Right to get remuneration Right to get interest on capital. Right to prevent the introduction of a new partner. Right to carry on competing business. 86. Every partner has the right to: Take part in the business of the firm To share exclusive profits To use the property of the firm for personal purposes pay taxes 87. In the absence of any agreement, the partners are entitled to share profits equally in the ratio of capital in the ratio of time spent none of these 88. Where a partner is entitled to interest on capital subscribed by him, such interest will be payable: only out of profit only out of capital out of profits or out of capital none of these 89. Interest on capital subscribed by a partner may be provided for in the partnership deed is @ 6% per annum, provided it is payable only out of profits @ 8% per annum, provided it is payable only out of profits @ 8.5% per annum, provided it is payable only out of profits At any rate, provided it is payable only out of profits

90. What constitutes firm’s property: Property belonging to a partner who enters into an existing partnership Any property used for the purpose of the business of the firm Fixed assets brought in by partner to the common stock of firm the property acquired by partner out of money, withdrawn from the firm’s bank account for personal use 91. Goodwill of the partnership business can be regarded as The property of the firm The property of the firm, subject to a contract between the partners to this effect The property of the firm, irrespective of a contract between the partners to this effect The property of the firm, subject to order of the High Court to this effect 92. Doctrine of implied authority of a partner applies to the Act of settling accounts with the person dealing with the firm Act of acquiring immovable property on behalf of the firm Act of admitting a liability in suit against the firm Act of entering into partnership on behalf 93. Which of the following acts are not included in the implied authority of a partner? To buy or sell goods on accounts of partners To borrow money for the purposes of firm To enter into partnership on behalf of firm To engage a lawyer to defend actions against firm 94. Implied authority of a partner does not empower him: to file a suit a behalf of the firm to open a bank account in firm’s name to acquire/transfer any movable property on firm’s behalf to submit a dispute to arbitration relating to the business of the firm 95. Which of the following acts are not included in the implied authority of a partner? To buy or sell goods on accounts of partners.

Mock Test Paper-V 99 To borrow money for the purposes of firm. To enter into partnership on behalf of firm. To engage a lawyer to defend actions against firm. 96. Implied authority of the partner does not empower him to Submit a dispute relating to the business of the firm to arbitration. Withdraw a suit or proceedings filed on behalf of the firm. Both & . None of the above. 97. For statutory restrictions on implied authority of a partner: the firm is not liable to third party if the third party has knowledge of the restrictions the firm is, liable to third party if third party has no knowledge of restriction the firm is not liable whether or not the third party has knowledge of the restriction none of these

98. Each of the Partner is Principal as well agents Only Agents of the firm Only Representatives of the firm Only Co-partners of the firm 99. Every partner is: jointly liable to third parties severally liable to third parties jointly and severally liable to third parties none of these 100. Which of the following is correct: The liability of partners of a firm is unlimited. Generally the liability of a member of a company is limited but it can be unlimited. All of the above. The liability of partner of firm is same as a member of any company.

100 Part-syllabus Mock Tests SESSION - II TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section C-Economics (50 marks)

1. Which of the following is regarded as the year of crisis for the Indian economy? 1961 1972 1982 1991

Principles governing the dividend payments were made more stringent. Derivative products have been introduced. Rate of interest in saving deposits of commercial banks has been increased.

2. The government of India announced the New Industrial Policy on: 24th July 1969 23rd March 1969 24th July 1991 23rd March 1991

6. Export Promotion Capital Goods scheme was liberalized in 1992 to: encourage imports of capital goods encourage exports of capital goods encourage production of capital goods encourage new technology for manufacture of capital goods

3. Under the New Industrial Policy, industrial licensing has been: introduced. abolished. amended. made more stringent.

7. ________ has the objective of facilitating external trade and payment. FERA FEMA Both and None of above

4. The foreign investment and foreign technology agreements under the New Industrial Policy does not include the following provision: Foreign equity holding upto 51% by international trading companies is allowed. The guidelines on external commercial borrowing have been made more stringent. The guidelines on Euro issues have been liberalized. Automatic clearance will be given to high technology industries where imported capital goods are required.

8. ‘Vishesh Krishi Upaj Yojna’ has been started to promote: agricultural production modernization of agriculture agricultural imports agricultural exports

5. The economic reforms after the year of crisis in the banking sector include: Non-resident Indians can upto 51% participate in the primary equity of a new bank.

9. The New Industrial Policy has been criticized because: It encouraged mergers, acquisition, amalgamations and takeovers. It has opened a number of areas for the private sector. Many small scale units have closed down due to excessive competition. None of above.

Mock Test Paper-V 101 10. Privatisation has been considered favourable because: It encourages growth of monopoly power in the hands of big business houses. It introduces accountability and responsibility in PSUs. Private sector produces with profit motive. Private sector does not take up risky projects. 11. __________ is the sale of a part of equity holdings held by government in any PSUs to private investor. Privatisation Nationalisation Disinvestment Liberalisation 12. ________ is the method of disinvestment in which the government’s own financial institutions buy the governments’ stake in selected PSUs. Cross-holding Warehousing Golden share Strategic Sale 13. The term ‘Globalisation’ emphasises on free flow of: goods and services capital technology all of above 14. Which of the following statement against Globalisation is incorrect? It has devastated local producers as they are unable to compete with cheap imports. It has led to mounting workers unrest. The provisions of social safety net have been strengthened. Due to privatization, budget cuts and loss of purchasing price, public employees are worse off. 15. IMF commenced its financial operations on: December 27, 1945 December 27, 1947 March 1, 1945 March 1, 1947

16. One of the main functions of International Bank for Reconstruction and Development (IBRD) is: To promote foreign investment and credit by providing guarantee of repayment to the private investors. To lend to countries with balance of payment difficulties. To monitor economic and financial developments. To administer the ‘Trade Review Mechanism’. 17. __________ acts as a watchdog of international trade. IMF IFC WTO IBRD 18. Which of the following statement for World Bank and India is incorrect? India is one of the founder members of the World Bank. India holds a permanent seat on the Board of Executive Director of the World Bank. India is the third largest borrower of the World Bank. India has the privilege of presiding the annual general meeting of the Board. 19. IMF is responsible for ensuring the stability of: international trade international financial system international peace global environment. 20. Which of the following features of World Trade Organisation is incorrect? It is global in its membership. It administers a unified package of agreements to which all members are committed. It is a management consultant for world trade. Its scope is not as wide as GAAT. 21. Sick public units are referred to the: Board for Industrial and Financial Reconstruction Board for Industrial Reforms Industrial and Financial Reform committee Board for Rehabilitation of Sick Industries

102 Part-syllabus Mock Tests 22. In which of the following year, realization from disinvestment exceeded the targeted amount. 2001-2002 2002-2003 2003-2004 2004-2005

29. Growing economic interdependence countries in the world is referred to as: Privatisation Liberalisation Globalisation Disinvestment

23. The effect of globalization on Indian economy is: India’s foreign currency reserves have increased. India’s share in world trade has increased. External debt has decreased. FDI has increased.

30. Which of the following is correct in relation to public sector in the post-reform period? Board of pubic sector companies will be made professional. Board of pubic sector companies will be given greater power. The management of pubic sector companies will be provided greater autonomy through through Memorandum of Understanding. All of above.

24. EMR stands for: Exclusive Marketing Rights Export Marketing Rights Extensive Marketing Rights Export Management Right 25. The pre-condition for privatization to be successful requires: liberalization and de-regulation of the economy. capital markets should be sufficiently developed. Both and None of above. 26. At present there are only _____ industries for which industrial licensing are compulsory. 3 6 9 18 27. Fiscal policy refers to: Policy relating to public revenue and public expenditure. Policy relating to money and banking in the country. Policy relating to agricultural and industrial development. Policy relating to foreign investments. 28. ________ means relaxation government restrictions. Privatisation Liberalisation Globalisation Disinvestment

of

previous

among

31. FEMA stands for: Future Export Management Act Foreign Exchange Monetary Act Foreign Exchange Management Act Funds Exchange Management Act 32. The SEZ scheme was introduced to replace: Duty Drawback scheme Export Promotion Capital Goods scheme 100% Export-oriented acheme Export Processing Zones 33. At present, there are _____ special economic zones operating in India. 824 1016 1478 1759 34. The number of countries who are member of World Bank are: 82 146 181 234 35. GATT was converted from a provisional agreement into a formal international organisation which is currently known as: International Monetary Fund World Trade Organisation International Bank for Reconstruction and Development

Mock Test Paper-V 103 International Development Association 36. Who is responsible for the conduct of the general operations of the World Bank? The Board of Executive Directors The Board of Governers Representatives of each member countries The Execution Committee 37. The stock of money held by _______ at a point of time in an economy is referred to as the money supply. the public the government the commercial banks All of above 38. _________ issues Rupee 1 notes and coins. Reserve Bank of India State Bank of India Government of India State Governments 39. Which of the following item is included in the money supply of a country? The stock of gold held with the central bank. Currency held by business firms. Currency held by commercial banks as their cash reserves. All of above 40. The measure of money supply ____ emphasise on the ‘medium of exchange’ function of money and ___ emphasise on the ‘store of value’ function of money. M1, M2 M1, M3 M1, M4 M2, M4 41. Which of the following measures of money supply does not include term deposits maturing within one year? M1 M2 M3 M4 42. Which of the following statement is incorrect? Banks act as a bridge between the investors and the savers.

Banks have the capability to add to the total money supply of an economy. Accepting deposit and lending are the only functions that a bank performs. Banks are used as an instrument of monetary policy. 43. Nationalisation of commercial banks has resulted in: branches operating in rural areas. increased bank lending diversification of banking functions. All of above 44. One of the major shortcomings of commercial banks is: It creates credit by providing more loans and advances to industries than their cash position permits. Most of the commercial banks have excessive overdues. It do not lend to business firms with a dubious background. It encourages savings and accumulation of wealth by the public. 45. _________ act as a banker to the central and state government. World Bank Reserve Bank of India State Bank of India Commercial Bank 46. Which of the following statement is incorrect? RBI act as banker to all commercial banks operating in the country. RBI provide funds to commercial banks and assist them in their daily operations. RBI is the custodian of the country’s stock of gold and international currencies. RBI act as government’s financial advisor. 47. __________ promotes investment, while _________ discourages investment. cheap money policy, dear money policy cheap money policy, bear money policy dear money policy, cheap money policy bear money policy, cheap money policy

104 Part-syllabus Mock Tests 48. Something which is freely used and generally accepted on a medium of exchange or as a unit of account is called: Credit Money Bonds Loan 49. The total number of banks nationalized is: 6 14

20 24 50. Policy measures taken by the Central Bank of a country to control and regulate the supply of money is called the: Financial policy Monetary policy Fiscal policy Budgetary policy

Mock Test Paper-V 105 Section D-Quantitative Aptitude (50 marks) 51. In _________ every elementary unit of the population is arranged in order and the sample units are distributed at equal and regular intervals. Stratified Sampling method Systematic Sampling method Multi-stage Sampling method Purposive Sampling method 52. A sample consists of all units of the population. 5 per cent units of the population. 50 per cent units of the population. any fraction of the population. 53. What precaution(s) make(s) cluster sampling more efficient ? Choosing clusters having largest within variation. Choosing clusters having least variation clusters. By taking clusters of small size. All of these. 54. The discrepancy between estimates population parameters is known as: Formula error Human error Sampling error Enumeration error

and

55. The central limit theorem assures us that the sampling distribution of the mean is always normal. is always normal for large sample sizes. appears normal only when N is greater than 1,000. approaches normality as sample size increases. 56. Increase in reliability and accuracy of results from a sampling study with the increase in sample size is known as the principle of : optimisation Statistical regularity Inertia of large numbers Law of decreasing returns

57. Finite population multiplier is: square of (N - 1) / (N - n) square of (N - n) / (N - 1). square root of (N - 1) / (N - n) square root of (N - n) / (N - 1) 58. If S.D. = 20 and sample size is. 100, then standard error of mean is 1/5 2 7 9 59. If a random sample of 500 oranges produces 25 rotten oranges, then the estimate of S.E. of the proportion of rotten oranges in the sample is: 0.04 0.00267 0.01 0.0085 60. A random sample of the heights of 100 students from a large population of students having S.D. as 0.35m show an average height of 1.75m. What are the 95% confidence limits for the average height of all the students forming the population? [1.45m, 1.92m] [1.55m, 1.84m] [1.58m, 1.84m] [1.58m, 1.92m] 61. A firm wishes to estimate with an error of not more than 0.03 and a level of confidence of 98%, the proportion of consumers that prefers its brand of household detergent. Sales reports indicate that about 0.20 of all consumers prefer the firm’s brand. What is the requisite sample size? 856 965 976 854 62. A population consists of 1, 3, 5, and 7. The possible number of samples of size 2 which can be drawn with replacement is: 8 12

106 Part-syllabus Mock Tests 16 26 63. The ages (in years) of boys was recorded as 15, 11, 7 and 3. Possible samples of size two from this population without replacement are: (15, 11), (15, 7), (15, 15), (7, 7). (15, 11), (15, 7), (15, 5), (11, 7), (11, 3). (15, 11), (15, 7), (15, 5), (11, 7), (11, 3), (7, 3), (15, 15). (15, 11), (15, 7), (15, 5), (11, 7), (11, 3), (7, 3), (15, 15), (7, 7). 64. A random sample of 200 articles taken from a large batch of articles contains 15 defective articles. What is the estimate of the sample proportion of defective articles ? 0.005 0.01 0.02 0.04 65. In a sample survey of 1000 house wives in a city, 23% prefer a particular brand of pressure cooker. Find 99% confidence limits for the percentage of all house wives in the city preferring that brand of cooker. [19.57, 26.43] [18.57, 24.47] [19.45, 25.24] [19.64, 26.48] 66. In discrete case the probability of the entire space is 0 -1 1 67. Parameter is a characteristic of: sample population probability distribution Both and 68. When there are a fixed number of repeated trials of any experiment under identical conditions for which only one of the two mutually exclusive outcomes, success, or failure can result in each trial then it involves : Normal Distribution Binomial Distribution

Poisson Distribution None of these 69. When p = 0. 1, the Binomial distribution is skewed to the left right both None of these 70. ________________ distribution is sometimes known as the “distribution of rare events”. Poisson Binomial Normal None of these 71. Probability density function is always greater than 0 greater than equal to 0 less than 0 less than equal to 0. 72. For a standard normal distribution, the points of inflexion are given by: – and μ – and μ + 0 and 1 –1 and 1 73. The number of methods for fitting the Normal curve is : 2 3 4 5 74. In Binomial distribution if mean = 20, S.D. = 4 then q is equal to 1/5 2/7 4/5 5/7 75. A random variable X has its range {0, 1, 2, 3} and the probabilities are given by: P(X = 0) = 2k4, P(X = 1) = 3k2 – 5k3, P(X = 2) = 2k - 3k2, P(X = 3) =3k -1. Find k. 1/2 1/3 1/4 1/5

Mock Test Paper-V 107 76. A box contains 10 tickets. 2 of the tickets carry a price of Rs. 8 each, 5 of the tickets carry a price of Rs. 4 each and 3 of the tickets carry a price of Rs. 2 each. If one ticket is drawn what is the mean value of the price. 3.2 2.5 4.2 5.1 77. The probability distribution of a discrete random variable X is given by X -1 0 1 2 P(x) 1/3 1/6 1/6 1/3 then the value of 6E (X2) - Var (X) is 11/117 123/54 113/12 17/35 78. The range of a random variable X is {0, 1, 2, 3 ....} and P(X = k) ={c(k + 1)}/2k, (k = 0, 1, 2, 3, .....). Then, P(X >= 2) = c+1 C-1 1 + 2c 1 – 2c 79. The binomial distribution with mean = 20 and S.D. = 4 is: {(3/5) + (1/5)}100 {(4/5) + (1/5)}100 {(4/5) + (1/5)}50 {(4/5) + (3/5)}50 80. Out of 1,000 families of 3 children each, how many families would you expect to have two boys and one girl assuming that boys and girls are equally likely ? 175 250 375 459 81. The probability that a candidate secures a seat in Engineering through `EAMCET’ is 1/10. 7 candidates are selected at random from a centre. The probability that exactly two will get seats is 19 (0.1)2 . (0.8)5 21 (0.1)3 . (0.5)5 21 (0.1)2 . (0.9)5

23 (0.1)5 . (0.9)5 82. If the mean of a Poisson’s distribution is , then its standard deviation is: 1/ 2 83. X is a Poisson variate and P(X = 0) = 0.2, then the variance of the Poisson distribution is: Log (0,2) Log e5 Log 5 Log 10 84. In a certain book, the frequency distribution for the number of words per page may be taken as approximately normal with mean 800 and standard deviation 50. If 3 pages are chosen at random, what is the probability that none of them has words between 830 and 845 ? 0.6576 0.9238 0.7536 0.8560 85. Suppose that a doorway being constructed is to be used by a class of people whose heights are normally distributed with mean 70” and standard deviation 3”. How much height the doorway should be, without causing more than 25% of the people to bump their heads? 72.025” 78.050” 62.50” 67.025” 86. Price relative is equal to Price in given year x 100 Price in base year x 100 (Price in given year/Price in base year) x 100 (Price in base year/Price in given year) x 100 87. Factor Reversal test is satisfied by Fisher’s ideal index Paasche’s index Laspeyre’s index None of these. 88. The formula independent of the unit in which or for which price and quantities are quoted is: Unit Test

108 Part-syllabus Mock Tests Factor Reversal Test Time Reversal Test None of these. 89. The value index is expressed in terms of: {( P1Q0) / ( P0Q0)} x 100 {( P0Q0) / ( P1Q1)} x 100 {( P1Q1) / ( P0Q0)} {( P0Q1) x ( P1Q1)}/ {( P0Q0) x ( P1Q0)} 90. Bowley’s index number is expressed in terms of: (Laspeyre’s + Paasche’s)/2 (Laspeyre’s - Paasche’s)/2 (Laspeyre’s x Paasche’s)/2 (Laspeyre’s / Paasche’s)/2 91. __________ is particularly suitable for the construction of index numbers. A. M. G.M. H.M. None of these 92. Given the following information: Material Required Cement

Unit

Quantity Required 3

50 kgs m

Timber

Price (Rs.) 2009

2010

250 kgs

50

80

70 m3

300

400

Steel Sheet

Quintals

5 Quintals

340

420

Bricks

per, 000

20,000

120

240

Also, P0q = 25,350, weighted price index is: 119.8 139.8 125.7 149.6

P1 q = 35,300. The

93. The consumer price index for 2010 on the basis of 2009 from the following data is Commodities Quantities Prices in Prices in consumed 2009 2010 in 2009 A

6

5.75

6.00

B

6

5.00

8.00

C

1

6.00

9.00

D

6

8.00

10.00

E

4

2.00

1.50

F

1

20.00

15.00

118.77 128.77 108.77 138.77. 94. During a certain period the cost of living index number goes up from 110 to 200 and the salary of the worker is also raised from Rs. 325 to Rs. 500. Does the worker gain looses fully compensated gain lay 10% 95. Suppose, a business executive was earning Rs. 2,050 in the base period, what should be his salary in the current period if his standard of living is to remain the same? Given W = 25 IW = 3544. Rs. 2906 Rs. 2606 Rs. 2806 Rs. 2706 96. The relative importance of the following eight groups of family expenditure was found to be: Food 348, Rent 88, Clothing 97, Fuel and light 65, Household durable goods 71, Miscellaneous goods 35, Services 79, Drinks and tobacco 217. The corresponding percentage increase in price for Oct. 2010 gave the following values :- 25, 1, 22, 18, 14, 13, ? and 4. The percentage increase in group services, if the percentage increase for whole group is 15.278 is 11% 2%. 17% 21%. 97. A large change in the price of commodities that are held in large quantities in the current year but are held. in smaller quantities in the base year will lead to: a greater change in the Paasche’s index relative to the Laspeyre’s index. a smaller change in the Paasche’s index relative to the Laspeyre’s index. an equal change in the Paasche’s index relative to the Laspeyre’s index.

Mock Test Paper-V 109 a Laspeyre’s index equal to 0. 98. Element of subjectivity is involved in index numbers due to: selection of weights choice of base year choice of commodities All the above 99. Geometric cross formula for index number is known as

Walsh ideal formula Fisher’s ideal formula Bowley’s standard formula None of these 100. Factor Reversal Test was invented by A.L. Bowley Walsh John I. Griffin Irving Fisher

110 Part-syllabus Mock Tests

COMMON PROFICIENCY TEST Mock Test Paper–V [Answer Key] SESSION - I Section A-Fundamentals of Accounting (60 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30.

Question 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60.

Mock Test Paper-V 111 Section B-Mercantile Law (40 marks)

Question 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80.

Question 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100.

SESSION - II Section C-Economics (50 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Question 11. 12. 13. 14. 15. 16. 17. 18. 19. 20.

112 Part-syllabus Mock Tests Question 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35.

Question 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.

Section D-Quantitative Aptitude (50 marks)

Question 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70.

Question 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90.

Mock Test Paper-V 113 Question 91. 92. 93. 94. 95.

Question 96. 97. 98. 99. 100.

PART B Full Syllabus Mock Tests

COMMON PROFICIENCY TEST Mock Test Paper–VI SESSION - I TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section A-Fundamentals of Accounting (60 marks)

1. Inter se relations of partners between themselves is that of a: Close relatives Close friends Agents of each other Junior-senior relationship 2. In the case of _________, either outflow of resources to settle the obligation is not probable or the amount expected to be paid to settle the liability cannot be measured with sufficient reliability. Contingent assets Contingent liabilities Provision liability 3. Which of the following is not a column of twocolumn cash book? Cash column Bank Column Discount column None of these 4. Which of the following account has a credit balance? Purchase A/c Sales A/c Cash in hand A/c Goodwill A/c 5. The premium, if any payable on redemption must be provided for out of: Securities Premium only. Divisible Profits only.

Securities Premium or Divisible profits. Securities Premium or any profits. 6. A tallied trial balance will not reveal: errors on account of wrong carrying forward. errors on account of wrong casting. errors on account of wrong balancing. errors of principle. 7. A and B enter into a joint venture sharing profit and losses in the ratio 3:2. A purchased goods costing Rs 2,00,000. B sold 95% goods for Rs 2,50,000. A is entitled to get 1% commission on purchase and B is entitled to get 5% commission on sales. A drew a bill on B for an amount equivalent to 80% of original cost of goods. What will be the final remittance? B will remit Rs 67,300 to A B will remit Rs 55,300 to A B will remit Rs 55,400 to A B will remit Rs 54,800 to A 8. Provision for bad debts is the application of which of the following concept/ convention? Conservatism Dual concept Going concern Materiality 9. The source document used for recording entries in Sales Book is: Invoice received Invoice sent out Debit notes issued

118 Full Syllabus Mock Tests Credit notes sent out 10. When goodwill is to be written off after the admission of a partner in which ratio it is transferred to capital account of the partners? Equally Sacrificing ratio New profit sharing ratio Old profit sharing ratio 11. Voluntary return of shares for cancellation by the shareholder is called: Surrender of share Distribution of share Cancellation of share Forfeiture of share 12. X Ltd issued 500, 15% Debentures of Rs 100 each on 1st May 2009 at a discount of 10% redeemable at a premium of 5% after 4 years. Interest was payable half yearly on 30th June and 31st December. The amount of Interest accrued but not due to be shown in the balance sheet as at 31.3.2010 is: Rs 1,875 Rs 2,250 Rs 1,145 Rs 3,065 13. A partner may retire from an existing firm: with consent of all partners. as per express agreement. by written notice in partnership at will. all of the above. 14. From the following details calculate net profit of ABC Ltd. Opening stock 150,000 Manufacturing expenses Rs. 30,000 Selling and distribution expenses Rs. 20,000 Administrative expenses Rs. 10,000 Financial expenses Rs. 5,000 Depreciation on office building Rs. 6,000 Provision for bad debts Rs. 4,000 Sales Rs. 280,000 Gross profit on sales 25% Rs. 15,000 Rs. 22,000 Rs. 25,000 Rs. 27,000

15. Limitations of accounting include: Ignores Qualitative Elements Ignores price level changes Involves subjectivity All of above 16. A, B and C are partners sharing profits and losses in the ratio 9:4:3. They took joint life policy of Rs. 5,44,000. C died. What is the share of C in the JLP amount? Rs. 54,000 Rs. 1,02,000 Rs. 1,24,000 Rs. 87,000 17. The total of Sales Book is posted to: Customer’s Account Supplier’s Account Purchase Account Sales Account 18. The total of discounts column on the credit side of the cash book is posted to the: debit of the discount received account. credit of the discount allowed account. debit of the discount allowed account. credit of the discount received account. 19. A draws a bill of exchange of Rs. 25,000 on B for 30 days on 15th August 10. The due date of the bill will be: 16/9/10 17/9/10 14/9/10 15/9/10 20. Expenses are reflected in the form of: Inflow of assets or decrease of liabilities. Outflow of assets or incurrence of liabilities. Inflow of assets or incurrence of liabilities. Outflow of assets or decrease of liabilities. 21. Free transferability of share is the characteristic of the company. It is possessed by: All private companies. All public companies. All companies. None of these 22. Decrease in liability at the time of retirement of a partner is: Debited to profit and loss A/c

Mock Test Paper-VI 119 Debited to goodwill A/c Debited to revaluation A/c Credited to revaluation A/c 23. Salary paid to Mohan an employee of the firm will be debited to: Cash A/c Salary A/c Mohan A/c None 24. A & B are partners sharing profits and losses in the ratio 5 : 3. On admission C brings Rs.1,40,000 cash and Rs.96,000 against goodwill. New profit sharing ratio between A, B and C are 7:5:4. Find the sacrificing ratio as A: B. 2:3 3:1 2:5 1:2 25. According to section 78 of the Companies Act, the amount in the Securities Premium A/c cannot be used for the purpose of: Issue of fully paid bonus shares. Writing off preliminary expenses. Writing off commission or discount on issue of shares. Writing of losses of the company. 26. Goods costing Rs 10,000 are taken over by X at 20% less. Rs 10,000 will be credited to Joint Venture A/c. Rs 10,000 will be credited to X’s A/c. Rs 8,000 will be credited to X’s A/c. Rs 8,000 will be credited to Joint Venture A/c. 27. In the Balance sheet of a company, Debenture Premium Account appears under the head: Share Capital. Reserves & Surplus. Secured Loans. Miscellaneous Expenditure. 28. Which of these is not an abnormal loss? Over issue Evaporation Loss in Transit Misappropriation by godown keeper 29. Redeemable preference shares are those shares on which capital is to be paid back:

Within the stipulated period of not more than 5 years. Within the stipulated period of not more than 15 years. Within the stipulated period of not more than 10 years. Within the stipulated period of not more than 1 year. 30. Sales to Meena Rs 143 was credited as 413: will not affect the profit. will not affect the trial balance. is an error of omission. None of these. 31. Under annuity basis goodwill is calculated by: No. of years purchased multiplied with super profits. No. of years purchased multiplied with average profits. Summation of the discounted value multiplied with super profits. Super profit divided with expected rate of return. 32. Debentures cannot be redeemed at: Par Premium Discount More than 10% premium 33. Original cost = Rs. 1,26,000. Salvage value = Rs. 6,000. Depreciation for 2nd year @ 10% p.a. under WDV method = Rs. 12,540 Rs. 11,340 Rs. 10,200 Rs. 12,320 34. Gross Profit is equal to: Sales – Cost of Goods sold Sales – operating cost Cost of Goods Sold – Sales Cost of Goods Sold + Operating profit 35. From the following details calculate the capital expenditure to be capitalized. (i) Basic price of the Machine Rs. 1,50,000 (ii) Customs duty Rs. 20,000 (iii) Sea freight Rs. 20,000 (iv) Insurance Rs. 5,000 (v) Erection charges Rs. 5,000

120 Full Syllabus Mock Tests Rs. 170,000 Rs. 220,000 Rs. 190,000 Rs. 200,000 36. The profits for the last three years are: 2007-08 Profits Rs. 40,000; 2008-09 Profits Rs. 60,000 & 2009-10 Profits Rs. 66,500. The total liabilities of the firm are Rs.10,00,000 of which outsiders liabilities is Rs. 5,42,500. The rate of interest expected from capital invested is 10%. The value of goodwill on capitalization basis is: Rs. 95,300 Rs. 84,200 Rs. 97,500 Rs. 112,400 37. XY formed a joint venture to construct railway line for Metro railway in Delhi and agreed to share profit and loss in the ratio of 2:3. X purchased goods worth Rs. 2,00,000 and send the same to Y on payment of freight and insurance of Rs. 10,000. Y also purchased material worth Rs. 45,000 and incurred Rs. 5000 as incidental expenses. Y sold the construction material to Railway for Rs. 3,20,000. What is the profit on Joint venture? Rs. 54,000 Rs. 60,000 Rs. 62,000 Rs. 74,000 38. When stock is valued at cost in one accounting period and at lower of cost and net realisable value in another accounting period: Matching principle conflicts with consistency principle. Prudence principle conflicts with consistency principle. Consistency principle conflicts with Accounting Period Assumption. None of the above. 39. Opening Inventory Rs. 1,00,000, Purchases Rs. 4,00,000, Sales Rs. 3,00,000. Selling Price – 33 1 /3 % on cost. Goods costing Rs. 25,000 destroyed by fire. The estimated cost of closing inventory is: Rs. 2,50,000 Rs. 2,75,000 Rs. 2,35,000 Rs. 2,80,000

40. From the following details calculate weighted average cost of inventory. Receipts Rate 300 units Rs. 11 per unit 550 units Rs. 12.5 per unit 400 units Rs. 11.50 per unit 500 units Rs. 12.00 per unit. Rs. 10.62 per unit Rs. 11.24 per unit Rs. 11.87 per unit Rs. 11.92 per unit 41. Which account is the odd one out? Goodwill A/c Patents A/c Technical know-how A/c Work-in-progress 42. Which of the following item is to be appear in the Bank Reconciliation Statement if the balance as per Amended Cash Book is taken as the starting point: Interest allowed and Direct Payments by Bank. Direct Payment by our Debtors into the bank. A wrong entry in the Pass Book. Bank Charges and Interest charged by Bank. 43. It is essential to standardize the accounting principles and polities in order to ensure: Consistency Transparency Comparability All of the above 44. ABC Ltd. forfeited 500 shares of Rs 10 each on which first call of Rs 3 per share was not received, the second and final call of Rs 2 per share has not yet been called. Out of these 125 shares were re-issued to X as Rs 8 paid-up for Rs 7 per share. The Profit on re-issue is: Rs. 1,500 Rs. 500 Rs. 900 Rs. 350 45. When depreciation is recorded by charging to Asset Account, the asset appears: at original cost. at market value.

Mock Test Paper-VI 121 at realizable value. at original cost less depreciation. 46. Which of these transactions would cause increase in owner’s equity? Profit from a successful business operation Fresh investment made by the owner Bringing in new asset in the business All the three 47. Which of the following is a credit transaction? Sold goods Sold goods for cash Sold goods to Ram Sold goods to Ram for cash 48. With reference to consignment, which of the following is correct? A sales Invoice is sent by consignee. A Sales Invoice is sent by consignor. A proforma Invoice is sent by Consignee. A Proforma Invoice is sent by consignor. 49. X and Y are partners of a partnership firm sharing profits in the ratio of 5:3 with capital of Rs. 5,00,000 & Rs. 4,00,000 respectively. Z was admitted on the following terms: Z would pay Rs. 100,000 as capital and Rs. 32,000 as Goodwill, for 1/5th share of profit. The balances of capital accounts after admission of Z will be in the ratio of: 3,10,000 : 4,70,000 : 2,24,000 4,12,000 : 1,15,000 : 5,40,000 5,20,000 : 4,12,000 : 1,00,000 3,20,000 : 3,64,000 : 1,20,000 50. With reference to manufacturing account which of the following is not true? Opening and Closing stock of Raw-material appear. Opening and Closing stock of Work-inprogress appear. Opening and Closing stock of Finished Goods appear. None of these 51. When FIFO method is followed, during period of rising prices: reported profits rise due to lower cost of goods sold. reported profits fall due to higher cost of goods.

inventory is valued at old cost in the balance sheet. none of these. 52. Opening Stock Rs. 90,000, Cash Sales Rs. 36,000, Credit Sales Rs. 7,20,000, Returns outwards Rs. 6,000, Wages & Salaries Rs. 2,400 Carriage Inward Rs. 1,200, Freight Inwards Rs. 1,800, Cartage Inwards Rs. 600, Cash Purchases Rs. 30,000, Credit Purchases Rs. 6,00,000, Returns Inward Rs. 12,000, Cost of Closing Stock as on 31st March 2010 Rs. 54,000 but its market value is Rs 50,400, Freight outward Rs 600. The Gross Profit for the year ending on 31st March 2010 is: Rs. 46,700 Rs. 74,400 Rs. 112,300 Rs. 52,800 53. X draws and accommodation bill on Y. The proceeds are to be borne between Y and X in the ratio of 3 : 1. The amount of bill Rs 60,000, discounting charges Rs 1,200. Discount borne by Y will be: Rs 1,600 Rs 900 Rs 750 Rs 1,200 54. Capital brought in by the proprietor is an example of: Increase in asset and increase in liability. Increase in asset and decrease in liability. Increase in one asset and decrease in another asset. Increase in liability and decrease in asset. 55. Which of the following equation is correct? Capital + Long-term Liabilities + Current Liabilities + Creditors = Fixed Assets + Current Assets Capital + Long-term Liabilities = Fixed Assets + Current Assets + Cash - Current Liabilities Capital + Long-term Liabilities = Fixed Assets + Working Capital Capital + Long-term Liabilities + Working Capital = Fixed Assets 56. An example of Increase in assets and increase in owner’s capital is: Goods brought in by owner.

122 Full Syllabus Mock Tests Capital introduced by owner. Goods purchased for cash. Goods purchased on credit. 57. Which of the reasons are for bank pass book showing higher balance than Cash book? Cheque issued but not paid Cheque deposited but not cleared Direct payment made by Bank Interest charged by Bank 58. To eliminate loading on Goods sent on Consignment A/c: Consignment A/c is debited and goods sent on Consignment A/c is credited Consignment A/c is Credited and Goods sent on consignment A/c is debited. Consignment A/c is Credited and Stock Reserve A/c is debited.

Consignment A/c is Debited and Stock Reserve A/c is credited. 59. Under sales on return or approval basis, when transactions are few, the seller, while sending the goods, treats them as: an ordinary sale but no entry is passed in the books. an ordinary sale and entry for normal sale is passed in the books. Approval sale and no entry is passed. None of these. 60. While preparing a Bank Reconciliation Statement taking the balance as per Cash Book as the starting point, uncollected cheques are: Added Subtracted not required to be adjusted none of these

Mock Test Paper-VI 123 Section B-Mercantile Law (40 marks) 61. Where the Seller is bound to send the goods to the Buyer as per the agreement, and there is no specific time limit goods shall be delivered within a suitable time a minimum time adequate time a reasonable time. 62. Q2. Arjun, by a letter dated 20th March, offers to sell his car to Bharat, who posts his acceptance on 25th March. Here B can revoke his acceptance at any time till his letter reaches A B cannot revoke his acceptance as he becomes bound by posting his acceptance letter Neither nor We cannot decide without further information 63. Which of the following is not required to be given in an application for registration of a Firm? Place of business or principal place of business Profits earned by the Firm for the past three financial years Names in full and permanent address of the Partners Duration of the Firm, if any. 64. X, by a letter, offers to sell his mobile to Y for Rs.20,000. Without knowing X’s offer, Y, by a letter, offers to buy the same mobile from X for Rs.20,000. Here a binding contract comes into existence Y’s letter is equivalent to acceptance of X’s offer. ‘no binding contract comes into existence as Y’s letter is merely a cross offer no binding contract comes into existence as consideration is insufficient the Indian Contract Act is silent on such issues 65. X agrees to sell and deliver to Y 300 quintals of wheat, but only 200 quintals are delivered. Y has the wheat weighed and accepts the quintals sent. Y afterwards objects that the whole of the 300 quintals was not delivered and he refuses to pay for 200 quintals. Is Y’s refusal to pay valid?

Yes No. Partly Yes None of the above 66. The Partnership Act extends to the whole of India except the state of Gujarat Maharashtra Jammu & Kashmir Tamil Nadu. 67. Which of the following statement is true? There can be a stranger to a contract. There can be a stranger to a consideration. There can be a stranger to a contract & consideration. None of the above. 68. In case of a Company under liquidation, and sale is made by the Receiver or Liquidator of the Company __________ Company retains title in goods. Buyer gets a good title to goods. Receiver/Liquidator gets a good tide to goods. There is no sale at all. 69. An Acceptance must be Conditional Unconditional Either or Neither nor 70. ‘X’ offered through an advertisement in the Statesman to sell certain “antique items” on a particular day at a particular place in Chennai. In response to the advertisement, Y travelled from Mumbai to Chennai and found to his immeasurable annoyance that such sale was not conducted. In such case, Y can sue ‘X’ for not conducting the sale as per the advertisement. True Partly True False None of the above 71. Ram and Rahim enter into a joint trading adventure for sale of sesame seeds grown in both their fields

124 Full Syllabus Mock Tests during its harvest season. The Partnership comes to an end after the sale. This arrangement is called Particular Partnership Partnership at Will Undisclosed Partnership Joint Venture. 72. Under Sale of Goods Act, 1930 the terms “Goods” means every kind of movable property and it includes Stock and Shares Growing Crops, Grass Both and . None of the above 73. Which of the following statement is false? Consideration Must move at the desire of the Promisor. May move from any person. Must be illusory. Must be of some value. 74. Arjun sells to Bharat certain specific goods which are locked up in godown. Arjun gives Bharat the key of the godown. Does the action A constitute delivery of the goods to Bharat? Yes No Partly Yes None of the above 75. Collateral Transactions to a Lottery _________ are also tainted with illegality are valid are not affected are enforceable for amounts below Rs. 500 76. B (a New York merchant) places an order with A (a Delhi merchant) for 100 bales of cotton. B sends his ship to Mumbai for cotton. A delivers the cotton on board the ship, and takes Bill of Lading from the master, making the cotton deliverable to A’s order. Is there a valid delivery? Yes No Partly Yes None of the above 77. Which of the following statements is true? An agreement enforceable by law is a contract an agreement is an accepted proposal

Both and Neither nor 78. Where in an auction sale, the Seller appoints more than one bidder, the sale is void illegal conditional voidable 79. An Offer accepted without knowledge does not confer any legal rights on the Acceptor. True, as the offer cannot be accepted without its knowledge False, as there is no such legal provision/ decision in this regard. Partly True None of the above 80. After the registration of a Firm, a change in the Firm name and principal place of business requires almost a new registration. True Partly True False None of the above 81. Arjun, by a letter dated 25th December, offers to sell his house to Bharat for Rs.50 Lakhs. The letter reaches Bharat on 27th December, who posts his acceptance on 28th December, which reaches Arjun on 30th December. Here, the communication of acceptance is complete against Arjun on 28th December, and against Bharat on 25h December 27th December 28h December 30’h December 82. “X” promised to pay a subscription of Rs.5,000 to the Rajiv Gandhi Memorial Fund. He later changed his mind. Could the amount be recovered from “X”? Yes No Partly Yes None of the above 83. Is the term used in English Law to denote actual or threatened violence over the person or another including his wife, parent or child, with a view to obtain his consent to an agreement. Undue Influence

Mock Test Paper-VI 125 Coercion Duress Misrepresentation.

27th December 28th December 30th December

84. Which of the following is not an exception to the rule — No consideration, No Contract? Compensation for involuntary services Love & Affection Contract of Agency Gift

90. A breach of Warranty may be treated as breach of Condition. True Partly True False None of the above

85. Standing Offer means _________ Offer allowed to remain open for acceptance over a period of time Offer made to the public in general When the Offeree offers to qualified acceptance of the offer Offer made to a definite person.

91. A Partnership at Will is one _________ Which does not have any Deed Which does not have any Partner Which can be terminated at any time Which cannot be dissolved

86. Death or insanity of the Proposer operates as revocation of the proposal _________ irrespective of whether the Acceptor has the knowledge of the same prior to his acceptance. only if the Acceptor knows about it before acceptance. Neither nor We cannot decide with this information 87. There was a sale of 25 tonnes of Rice for October/ November shipment. The Seller shipped 20 tonnes in November and 5 tonnes in December. Would the Buyer be entitled to reject the whole 25 tonnes? Yes No Partly Yes None of the above 88. Death of Partner has the effect of _________ Dissolving the Firm Result in continuance of the business of the Firm Making the business illegal Computation of profits upto the date of death 89. Arjun, by a letter dated 25th December, offers to sell his house to Bharat for Rs. 500 Lakhs. The letter reaches Bharat on 27th December, who posts his acceptance on 28th December, which reaches Arjun on 30th December. Here, the communication of Offer is complete on 25th December

92. In case of unconditional contract of sale, the property passes to the Buyer at the time of making the contract. For this rule to apply, the goods must be specific in a deliverable state physically transferred to Buyer both and 93. Under the Doctrine of Caveat Emptor the Seller is Responsible for the bad selection of goods by the Buyer. Not responsible for the bad selection of goods by the Buyer. Either or . Neither nor 94. A Voidable Contract is one which can be avoided at the option of aggrieved party can be avoided at the option of both the parties cannot be enforced in a Court of Law Courts prohibit. 95. A Partner can be expelled if Such expulsion is in good faith The majority of the Partner agree on such expulsion Such Partner is insolvent Compensation is paid 96. When the Unpaid Seller has parted with the goods to a carrier and the Buyer has become insolvent he can exercise Right of lien

126 Full Syllabus Mock Tests Right of stoppage in transit Right of resale All of the above 97. An Offer may lapse by Revocation Counter Offer Rejection of Offer by Offeree All of these 98. Arjun writes to Bharat, “I am willing to sell my car as it is today for Rs.65,000”. B replies, “I can buy it for Rs.55,000”. A keeps quiet. Subsequently, B writes “I will buy the car at Rs.65,000”. There is a binding promise in this case. True

Partly True False None of the above 99. In a Hire Purchase Agreement, the Hirer _________ has an option to buy the goods must buy the goods must return the goods is not given the possession of goods 100. A Promisor is not normally bound by his promise unless some consideration is offered by the Promisee. True Partly True False None of the above

Mock Test Paper-VI 127

SESSION - II TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section C-Economics (50 marks)

1. The paradox of Diamond is more costly than water is explained by: Scarcity Marginal utility concept Relative cost of production All the three 2. Which of the following is an example of physical capital? education training bridges All of above 3. New Industrial Policy (NIP), 1991 was a policy of: privatization liberalisation globalisation All of above 4. Shape of TFC is: horizontal line downward sloping U shaped rectangular hyperbole 5. What is that point called where P = AC? breakeven point profit earning point loss making point shut down point 6. In which of the following type of economy, income inequalities are widespread. Developed economy Underdeveloped economy Developing economy All of above

7. One of the main features of demand for a commodity is: Demand depends upon utility of the commodity. Demand does not always means effective demand. Demand means demand for intermediate goods. Demand is a supplied quantity. 8. Which of the following is the stage of fast industralisation and urbanization? Stage of High Birth Rate and High Death Rate Stage of High Birth Rate and Low Death Rate Stage of Low Birth Rate and High Death Rate Stage of Low Birth Rate and Low Death Rate 9. Violation of FEMA is a: Criminal offence Civil offence Non-bailable offence Punishable with death sentence 10. Inter linked phases of product method is also known as: gross outflow method net outflow method gross output method net output method 11. If income of a household rises by 30% and demand falls by 10% then value of income elasticity of demand is: 1 - 0.33 + 0.33 -3 12. Investment of savings is the _______ stage in the process of capital formation.

128 Full Syllabus Mock Tests first second third fourth 13. Central Budget is presented by: Finance Minister Finance Secretary President of India Prime Minister 14. Agricultural productivity refers to: productivity of labour capacity of labour to produce capacity of land to produce capacity of capital to produce 15. Which of these can be described as Implicit cost? Notional rent of self-occupied building Rent of the factory building Electricity charges paid to electricity board Payment of wages to the workers employed 16. Any point above LAC curve is: attainable and efficient attainable but inefficient unattainable but very efficient unattainable and inefficient 17. Decision making under WTO is carried out generally through: Voting Consensus Opinion poll Vito power 18. Which of the following is used to measure relative poverty? Alpha coffecient Gama coffecient Gini Coefficient Hash coffecient 19. The table below show the Marginal utility derived at different level by a consumer: Quantity Purchased 1 2 3 4 5 Marginal utility(Utls) 18 15 13 10 8 Price in Rs. per unit 8 8 8 8 8 What is the consumer surplus when the consumer purchases 1 unit? 8 6

10 12 20. One important condition for successful price discrimination about market structure is: there must be perfect competition in different market. there must be perfect competition in at least two market. there must be imperfect competition in different market. there must be oligopoly in all markets. 21. Income effect when wage rises means: work hours rise work hours fall work hours first rise and then fall work hours remain the same 22. When price discrimination extends to two or more countries it is called: Export price Export differentiation WTO price Dumping 23. The formula of arc elasticity of demand is: (q1 + q2)/(q1 – q2) x (p1 + p2)/(p1 – p2) (q1 - q2)/(q1 + q2) x (p1 + p2)/(p1 – p2) (q1 - q2)/(q1 + q2) x (p1 - p2)/(p1 + p2) (q1 + q2)/(q1 – q2) x (p1 - p2)/(p1 + p2) 24. In case of essential goods, the elasticity of demand is: zero one high infinity 25. Marginal utility of the commodity is the: minimum price a consumer is willing to pay for a commodity to maximise satisfaction. maximum price a consumer is willing to pay for a commodity to maximise satisfaction. minimum price a consumer is willing to pay for a commodity to achieve a desired level of satisfaction. maximum price a consumer is willing to pay for a commodity to achieve a desired level of satisfaction. 26. Assuming consumption C = Rs. 4500, Investment I = Rs. 1000, Government purchase G = Rs. 1200,

Mock Test Paper-VI 129 Exports = Rs. 450, Depreciation = Rs. 600, and Indirect Tax = Rs. 500, then GDP will be: Rs. 6200 Rs. 5400 Rs. 6600 Rs. 5800 27. The demand curve is also called: TR curve MR curve AR curve Total product curve 28. FERA was enacted in: 1964 1973 1981 1994 29. Which of the following refers to the number of persons who cannot find work on a day or some days during the survey week? Unemployment on Usual Principal Status Basis Unemployment on Current Weekly Status Basis Unemployment on Current Daily Status Basis Unemployment on Current yearly Status Basis 30. Production function: is the process of getting desired output from given quantity of inputs in a particular time period. is the process of getting maximum output from given quantity of inputs in a particular time period. is the process of getting maximum output from maximum quantity of inputs in a particular time period. is the process of getting maximum output from given quantity of inputs in minimum time period. 31. The disinvestment process was first initiated in: 1984-85 1991-92 1967-68 1994-95 32. The difficulty in estimation of national income in India is due to: clear differentiation between economic and non-economic activities.

centralised production. no data on backward areas reliable data collecting agencies 33. Cheap money policy is followed to: To reverse depression To appease the public To increase disposal income of the households Counter inflation 34. When a person smokes in a non-smoking zone, he causes disutility to other, it is an example of: Internal diseconomy External diseconomy External economy Internal economy 35. The law of Diminishing Marginal Utility states that as the consumer has more and more units of a commodity, the total utility of the commodity falls. the marginal utility of the commodity falls. the marginal utility of the commodity increases. None of above. 36. The problem of what and how to produce is studied under which branch of Economics? Price Theory Theory of Growth Theory of Production Theory of Distribution 37. One of the main cause of demand-pull inflation is: Higher wage rates Fall in the availability of basic inputs Higher profit margin Growth in black money 38. In the figure given below, which point is the point of stable equilibrium of the firm?

130 Full Syllabus Mock Tests Point B Point e Point d Point C 39. If quantity demanded of ink pen rises by 5% when price of ball pen rises by 20%, then the cross elasticity of demand is equal to: + 0.25 + 0.20 - 0.18 - 0.20 40. The concept of absolute poverty is relevant for: developed countries developing countries socialist countries mixed economies 41. Deposit component of supply of money consists of: coins currency (or paper) notes bank deposits All of above 42. In 1975, the government established _____________ to specifically meet the requirements of the farmers and villages. Regional Rural Banks (RRB) National Bank for Agriculture and Rural Development (NABARD) State Bank of India (SBI) Co-operative societies 43. Whose definition studies normative aspect of economics? Robins Adam Smith Marshall Samuelson 44. Market supply curve is obtained by: horizontal summation of all individual supply curves. vertical summation of all individual supply curves. horizontal summation of all market demand curves. vertical summation of all market demand curves.

45. In which year, did the realization from disinvestment exceed the targeted amount? 1999-2000 2000-01 2003-04 None of the above 46. Buying and selling of eligible securities in the bill market by the RBI is called: Bank Rate Policy Open Market Operations Money Market Operations Marginal requirement 47. Which of the following factor’s lead to extension of a market? Developed means of communication Perishable nature of commodity Restricted trade policy All of above 48. All points on ___________ yield same level of satisfaction. a demand curve a supply curve an indifference curve a marginal utility curve 49. An accounting statement that provides a systematic record of all economic transactions between the residents of a country and the rest of the world in a given period of time, usually one year is called: Balance of trade Balance of payment Budget None of above 50. __________ measures relative contribution of factor owners. Income method Value added method Production method Expenditure method 51. y If y = (5x4 - 6x2 - 7x + 8) / (5x - 6), then

dy is: dx

(75x4 - 120x3 - 30x2 + 72x + 2) (5x - 6)-2 (75x4 - 120x3 - 30x2 + 72x - 2) (5x - 6)-2 (75x4 - 120x3 - 30x2 - 72x + 2) (5x - 6)2 (75x4 - 120x3 - 30x2 + 72x + 2) (5x + 6)2

Mock Test Paper-VI 131 Section D-Quantitative Aptitude (50 marks)

52. The process of expressing a given fraction

f(x) (x)

as an algebraic sum of simpler fractions is called: a proper rational fraction an improper rational fraction a partial fraction none of these 53. In 2,000, out of total of 1,750 workers of a factory, 1,200 were members of a trade union. The number of women employed was 200 of which 175 did not belong to a trade union. In 2004, there were 1,800 employees who belong to a trade union and 50 who did not belong to a trade union. Of all the employees in 2004, 300 were women of whom only 8 did not belong to trade union. On the basis of this information, the ratio of female members of the trade union in 2000 and 2004 is: 25: 292 175 : 8 292:25 8 : 175 54. The logarithms to the base e, where e is the sum of the infinite series are called: Common Logarithms. Natural logarithms. Integral logarithms. Base logarithms. 55. If logy (uv) = x logyu, then logv(uv) = x x–1 x x

1

x–1 x x

1 x

56. In a correlation analysis, the value of the Karl Pearson’s coefficient of correlation and its probable error were found to be 0.90 and 0.04 respectively. The value of n is: 10 11

9 8 57. If x (1+y) + y (1+x) = 0, then

dy = dx

1 (x 1)2 1 (x 1)2 1 (x 1)(y 1) 1 (x 1)(y 1) 58. A population consits of 12, 14, and 16. Then the possible number of samples of size 2 which can be drawn without replacement are: 3 6 9 12 59. If (5.678)x = (0.5678)y = 10z then: 1 1 1 1 x y z 1 x

1 y

1 z

-1

1 x

1 y

1 z

0

1 x

1 y

1 z

0

60. There are 10 electric bulbs in a box in which 3 are defective bulbs. If 3 bulbs are selected at random from the box, then the expected number of defective bulbs is: 0.7 0.9 0. 6 0.5 61. The odds in favour of one student passing a test are 3 : 7. The odds against another student passing it are 3 : 5. The probability that both pass is:

132 Full Syllabus Mock Tests 5/16 21/80 9/80 3/16

A B Both (A) and (B) Neither (A) nor (B)

62. The limitations of the classical definition of probability is that: it is applicable if the elementary events are equally likely it is applicable when the total number of elementary events is finite it is applicable if the elementary events are mutually independent Both (A) and (B) 63. After qualifying out of 400 professionals, 112 joined industry, 120 started practice and 160 joined as service. There were 32 who were in both practice and service, 40 in both practice and industry and 20 in both industry and service. There were 12 who did all the three. How many could not get any of these? 65 88 118 124 64. The cost of living Index Number from the following data is: Price Items

Base Year

Current Year

Weight

Food

30

47

4

Fuel

8

12

1

Clothing

14

18

3

House Rent

22

75

2

Sundries

25

30

1

65. Which of the following companies A and B is more consistent so far as the payment of dividend is concerned? Dividend 5 9 6 12 15 10 8 10 paid by A: 4

8

7

15 18

9

6

67. A mixture contains milk and water in the ratio 5 : 1. On adding 5 litres of water, the ratio of milk and water becomes 5 : 2. The quantity of milk in the original mixture is: 18 litres 21.6 litres 25 litres 29 litres 68. A series of numerical figures which show the relative position is called: index number relative number absolute number None of these 69. A large number of measurements is normally distributed with mean of 65.5 cm. and a standard deviation of 6.2 cm. Find the percentage of measurements that fall between 54.8 cm and 68.8 cm. 0.5601 0.6601 0.760 none of these 70. The equation of a curve passing through the point (1, 0) and if f’(x) = x – 1 is given by: y = x2 – 2x + 1 y = x2/2 – x + 1 y = x2/2 – 2x + 1 y = x2 – x + 1/2

128.98 126.98 118.98 116.98

Dividend paid by B:

66. Median of 2, 5, 8, 4, 9, 6, 7, is: 9 8 7 6

6

71. A population is divided into clusters and it has been found that all items within a cluster are alike. Which of the following sampling procedures would you adopt? Cluster sampling. Simple random sampling. Systematic sampling. Stratified sampling

Mock Test Paper-VI 133 72. A set having no element is called ________ and is denoted by . a null set a void set an empty set All of above 73. A function f (x) defined in (0, 3) as follows: f(x) = x2 when 0 < x < 1 = x when 1 0 86. The mean life time of 100 Watt light bulbs produced by Larsen and Toubro is 200 hours. It is known that the standard deviation is 20 hours: Assuming that the life time of light bulbs are normally distributed, what are the probabilities that a single 100 Watt light bulb extracted from the production lot will burn out for a time greater than 250 hours. 0.0001 0.0062 0.0002 0.0005 87. If C = 0, N = 7, then coefficient of concurrent deviation is: +1 –1 + 0.5 –0.5

90. The advantage of the data array is that it allows us to find the: the highest value. the lowest value. the highest and the lowest value. None of these 91. The perimeter of a rectangular field is 140 m. If the length of the field is increased by 2 m and its breadth decreased by 3 m, the area is decreased by 66 sq. m. Find the length and breadth of the field. 45 cm, 28 cm 30 cm, 35 cm 50 cm, 40 cm 40 cm, 30 cm 92. The differential coefficient of a constant is: one minus one zero the constant itself 93. The number of ways in which n books can be arranged on a shelf, so that two particular books shall not be together is: (n + 2) x (n – 1)! (n - 2) x (n – 1)! (n + 1)! n! 94. Regarding the number of strata, which statement is true? More the number of strata, poorer it is. Lesser the number of strata, better it is. More the number of strata, better it is.

Mock Test Paper-VII 159 Not more than ten items should be there in a stratum. 95. The co-ordinates of the circumcentre of a triangle whose co-ordinates are (3, - 2), (4, 3) and (- 6, 5). are: (3/2, 3/2) (5/2, 3/2) (- 3/2, 3/2) (5, 3). 96. log52 is: a rational number an irrational number an integer a prime number 97. lim x

ex

0

0 1 e 1/2

(1 x

2

x)

=

98. A machine costs of Rs. 520000 with an estimated life of 25 years. A sinking fund is created to replace it by a new model at 25% higher cost after 25 years with a scrap value realization of Rs. 25000, what amount should set aside every year if the sinking fund investment accumulate at 3.5% compound interest p.a.? 16000 16050 16500 16005 99. If (17)3.5 x (17)x = 178, then the value of x is: 2.67 4.5 3.56 6.2 100. Two numbers are respectively 20% and 50% more than a third number. The ratio of the two numbers is: 2:3 4:5 3:5 5:7

160 Full Syllabus Mock Tests

COMMON PROFICIENCY TEST Mock Test Paper–VII [Answer Key] SESSION - I Section A-Fundamentals of Accounting (60 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30.

Question 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60.

Mock Test Paper-VII 161 Section B-Mercantile Law (40 marks)

Question 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80.

Question 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100.

SESSION - II Section C-Economics (50 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Question 11. 12. 13. 14. 15. 16. 17. 18. 19. 20.

162 Full Syllabus Mock Tests Question 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35.

Question 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.

Section D-Quantitative Aptitude (50 marks)

Question 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70.

Question 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90.

Mock Test Paper-VII 163 Question 91. 92. 93. 94. 95.

Question 96. 97. 98. 99. 100.

164 Full Syllabus Mock Tests

COMMON PROFICIENCY TEST Mock Test Paper–VIII SESSION - I TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section A-Fundamentals of Accounting (60 marks)

1. Income tax paid by a proprietor Rs 3,000 appearing in the Trial balance is: to be debited to Profit & Loss Account. to be credited to Profit & Loss Account. to be added to Capital. to be deducted from Capital. 2. In the financial statements, contingent asset is: Recognised. Not recognised. Adjusted. None of the above. 3. Obsolescence of a depreciable asset may be caused by: I. Technology changes. II. Improvement in production method. III. Change in market demand for the product or service output. IV. Legal or other restrictions. Only (I) above Only (III) above Both (I) and (II) above All (I), (II), (III) and (IV) above 4. Closing stock A/c appearing in the Trial Balance will: Be credited to Trading A/c only. Be credited to Trading A/c and shown on the Assets side as Closing stock. Be shown on the Assets side as closing stock.

Shown on debit side of Trading A/c. 5. When balance as per Pass Book is the staring point which of the following is added: Unpresented cheques Uncollected cheques Interest Allowed by Bank Direct Deposits by customers 6. The areas wherein different accounting policies can be adopted are: Valuation of investments. Valuation of inventories. Providing depreciation. All of the above. 7. Which of the following errors will not affect the Trial Balance? Wrong totaling of an account. Wrong balancing of an account. Writing an amount in the wrong account but on the correct side. None of these. 8. X and Y shared profit and losses in the ratio of 3: 2. With effect from 1st January 2010 they agreed to share profits equally. The goodwill of the firm was valued at Rs 30,000. The necessary single adjusting entry will involve: Debit Y and Credit X by Rs 3,000. Debit Y and Credit X by Rs 300. Debit X and Credit Y with Rs. 3,000. Debit X and Credit Y with Rs. 300.

Mock Test Paper-VIII 165 9. Company should created DRR equivalent to ______ of the amount of debenture issue before redemption of debenture can commence. 60% 55% 50% 70% 10. All the following items are classified as fundamental accounting assumptions except: Accrual Going concern Consistency Business entity 11. X Ltd. which depreciates its machinery at 10% p.a. on straight line basis had on 1st April 2009 some balance to the debit of Machinery Account. It purchased a new machine for Rs. 1,90,000 on 1.8.2009 and installed the same on 1.10.2009 after incurring an expenditure of Rs. 10,000. After providing depreciation, the closing balance of Machinery Account as at 31.3.2010 is Rs. 10,30,000. The original cost of old machines purchased on 1.4.2007 is: Rs. 11,80,000 Rs. 12,35,000 Rs. 11,96,000 Rs. 12,00,000 12. Which of the following is revenue expenditure? Freight paid on purchase of Plant and Machinery. Legal expenses paid to acquire a property. Expenses incurred to reduce working capital requirement. Annual whitewash of the factory building. 13. The assets on 31.12.2010 Rs 60,000 and capital is Rs 45,000. Its liabilities on that date shall be: Rs 60,000 Rs 1,15,000 Rs 15,000 Rs 45,000 14. A’s Trial Balance contains the following information: Discount received Rs. 1,000, Provision for discount on creditors Rs. 1,600. It is desired to maintain a provision for discount on creditors at Rs. 1,100. The amount to be credited to the Profit & Loss Account is: Rs. 1,500

Rs, 1.200 Rs. 500 Rs. 800 15. Financial statement depicts all the following except: Export earnings Foreign Exchange outgo Total net worth Contribution to GDP 16. From the following details calculate the number of equity shares of Rs. 10 each to be issued in order to redeem the preference shares. 11% Redeemable preference shares of Rs. 10 each Rs. 1,50,000 Security premium A/c Rs. 15,000 General Reserve A/c Rs. 15,000 Profit and loss A/c Rs. 35,000 Redeemable preference shares are to be redeemed @ 10% premium. 9,500 11,000 10,000 12,000 17. Prudence is a concept to recognise: unrealised profits and not losses realised losses and not profits all losses and not profits None of the above 18. In the balance sheet of a company, Discount on Issue of Debentures Account appears under the head: Share Capital Reserves & Surplus Miscellaneous Expenditure Secured Loans 19. Closing capital Rs 20,000, Loss during the year Rs 1,000, Drawings Rs 3,000, Additional Capital introduced Rs 4,000, Opening Capital will be: Rs 21,000 Rs 20,000 Rs 23,000 Rs 24,000 20. Trade Marks Account is: Real A/c Personal A/c

166 Full Syllabus Mock Tests Nominal A/c None of these 21. Which of the following statement is not true about a bill of exchange? It is a conditional order to pay. If liability of a drawer is secondary and conditional. It can be made payable to bearer. It need to be accepted. 22. Which of the following errors will be revealed by the trial balance: Errors of Principle. Errors of complete omission. Compensating Errors. Posting a correct amount to the correct account but on incorrect side. 23. Ram-material consumed is equal to: Opening Stock of Raw-Materials – Closing stock of Raw-materials – Direct Expenses + Purchases. Opening Stock of Raw-Materials – Closing stock of Raw-materials – Direct Expenses – Purchases. Direct Expenses – Closing Stock + Purchases + Opening Stock. Purchases + Closing Stock + Direct expenses – Opening Stock. 24. A purchase of Rs. 10,000 has been wrongly posted to the debit of Supplier’s Account but had been correctly entered in the Purchases Account. The Trial Balance would show: the debit side to be Rs. 10,000 more than credit side. the credit side to be Rs. 10,000 more than debit side. the debit side to be Rs. 20,000 more than credit side. the credit side to be Rs. 20,000 more than debit side. 25. As per AS-2, the historical cost of manufactured inventories should be arrived at on the basis of: Marginal costing Standard costing Absorption costing Estimated costing 26. What does the balance in Memorandum Joint Venture A/c show?

Profit and loss Closing stock Balance due to other co-venturer Un-reconciled balance 27. X Ltd. decides to redeem 650, 15% Pref. Shares of Rs 100 each at 10% premium. It has a General reserve of Rs 45,000 and Securities Premium of Rs 1,000. If the new equity shares are to be issued at 25% premium, the minimum number of Equity shares of Rs 10 each to be issued for the purpose of redemption is: 3250 2000 1500 2650 28. Rates of depreciation to be charged on fixed assets are provided in: Schedule VI of the Companies Act. Schedule XVII of the Companies Act. Schedule XIV of the Companies Act. Schedule XII of the Companies Act. 29. A dishonour of a discounted Bills Receivable is recorded in: Three column Cash Book Journal Proper Bills receivable Book Bad Debt A/c 30. Interest on drawing of the partners is a: Profit to business Loss to business Profit to partners Loss to bank 31. X Ltd. forfeited 10 shares of Rs. 10 each issued at a discount of 10% to Y on which a second & final call of Rs. 4 was not yet called and a first call of Rs 4 was not received. 8 of these shares were reissued as Rs. 8 called up for Rs. 7.50 per share. On forfeiture the Share Capital will be: Debited with Rs 45 Debited with Rs 60 Credited with Rs 48 Credited with Rs 60 32. The price shown in the Proforma invoice is generally: Cost price Market price

Mock Test Paper-VIII 167 Purchase price Selling price 33. X & Y were partners in a firm sharing profits and losses in the ratio of 4: 3. Z was admitted for 1/3rd share in the profits. On the date of Z’s admission, the Balance Sheet of X and Y showed a Balance of Rs 4,200 in Profit and Loss Account shown on the Assets side of Balance Sheet and a General Reserve of Rs 42,000. The final effect on X’s Capital A/c will be: Increase of Rs 16,300 Increase of Rs 24,500 Increase of Rs 21,600 Increase of Rs 16,400 34. A, B and C were partners sharing profits and losses in the ratio of 3: 2: 1. A retired and firm received the joint life policy as Rs 15,000 appearing in the balance sheet at Rs 20,000. JLP is credited and cash debited with Rs 15,000, what will be the treatment for the balance in Joint Life Policy? Debited to revaluation account. Debited to partner’s capital account in profit sharing ratio. Credited to partner’s current account in profit sharing ratio. Either or 35. A and B enter into a joint venture sharing profit and losses equally. A purchased 10,000 kg of rice @ Rs 50 per kg. B purchased 2000 kg of wheat @ Rs 60 per kg. A sold 2000 kg of wheat @ Rs 70 per kg and B sold 10,000 kg of rice @ Rs 60 per kg. The profit on venture when same sets of books is maintained will be: Rs 4,30,000 Rs 1,20,000 Rs 3,70,000 Rs 2,40,000 36. Which of the following cost will not be included in valuation of inventory? Duties and taxes Cartage Salesman’s commission Transit insurance charges 37. Accounting covers only the following activities: Recording and Classifying Recording, Classifying, Summarising and Analysing

Summarising, Analysing and Interpreting Identifying, Measuring and Communication 38. There is no provision in the partnership deed regarding the duration of partnership. This is: partnership at will. partnership by estoppel. partnership for an indefinite period. partnership not recognised by law. 39. A and B are partners sharing profits in the ratio of 3: 2. They admit C who takes 2/7th from A and 1/7th from B. The new profit sharing ratio will be: 15 : 9: 8 11 : 9: 15 9 : 11: 15 11 : 8: 15 40. The term “__________” is used for the process of measuring and recording the exhaustion of natural resources. Depreciation Amortization Depletion Obsolescence 41. Days of grace are added to: the due date to arrive at the date of maturity. the date of drawing to arrive at the date of maturity. the date of maturity of the bill to arrive at due date. the date of acceptance to arrive at the date of maturity. 42. Increase in value of a liability at the time of admission of a partner is: Debited to revaluation A/c Credited to revaluation A/c Debited to profit and loss A/c Credited to partners capital A/c 43. The total of Return Inward Book is posted to: Purchase Returns Account Customer’s Account Sales Returns Account Supplier’s Account 44. X sent out goods costing Rs 90,000 to Y at a profit of 25% on invoice price. 1/10th of goods were lost in transit. 2/3rd of the goods received are sold at 20% above Invoice Price. The amount of sale value will be:

168 Full Syllabus Mock Tests Rs, 94,600 Rs, 86,400 Rs, 98,200 Rs, 89,500 45. The closing balance of the Petty Cash Book is: Profit/Gain Expense /Expenditure Asset Liability 46. A draws a bill on B for Rs 1,50,000. A wants to endorse it to C in settlement of Rs 1,75,000 at 2% discount with the help of B’s acceptance and balance in cash. How much cash A will pay to B? Rs 21,500 Rs 22,400 Rs 23,200 Rs 20,800 47. X sends goods on approval basis as follows: The Stock of goods sent on approval basis on 31st January will be: Date Customer’s Sale price Goods Goods Jan. Name of Goods Accepted Returned 2010 Sent 9

A

Rs.

Rs.

Rs.

10,000

8,000

2,000

9,000

11

B

9,000

16

C

8,000

23

D

9,000

2,000

8,000 7,000

The stock of goods sent on approval basis on 31st January will be: Nil Rs. 200 Rs. 1,600 Rs. 2,000 48. X Ltd has redeemed 12% preference shares of Rs. 1,00,000 at a premium of 4%. To meet the redemption it has issued Rs 1,00,000 worth of shares of Rs 20 each at a premium of 5%. The balance outstanding to the credit of Securities Premium Account after adjusting premium on redemption of preference shares is: Nil Rs. 760 Rs. 1,000 Rs. 74,000

49. If Ram has purchased goods for cash, the entry will be recorded in the: Cash Book Sales Book Purchase book Journal 50. X Ltd. was formed with a capital of Rs.1,00,000 divided into shares of Rs. 10 each. Out of these 2,000 shares were issued to the vendors as fully paid as purchased consideration. 6,500 shares was offered to the public and of these 6,000 share were applied for and allotted. The directors called Rs 6 per share and received the entire amount except a call of Rs 2 per share on 500 share. The amount of issued capital is: Rs. 60,000 Rs. 65,000 Rs. 80,000 Rs. 55,000 51. From the following details calculate the value at which the plant and machinery should be accounted for in the books of account. (i) Basic price of the Machine Rs. 150,000 (ii) Excise duty Rs. 20,000 (iii) Freight and Insurance Rs. 25,000 (iv) Cash discount given Rs. 10,000 (v) Erection charges Rs. 5,000 (vi) CENVAT credit taken Rs. 20,000 Rs. 145,000 Rs. 150,000 Rs. 170,000 Rs. 190,000 52. Financial Statements are part of: Book-Keeping Accounting Both of above None of above 53. The commission allowed by consignor to the consignee to bear the bad debts on account of credit sales is called: Normal Commission Over-riding Commission Del-Credere Commission None of these 54. X Ltd. purchased 100 units @ Rs. 10 for cash, 200 units @ Rs. 20 subject to 10% trade discount and

Mock Test Paper-VIII 169 5% cash discount against current dated cheque. The total amount of purchases is: Rs. 3,800 Rs. 4,600 Rs. 3,200 Rs. 4,500 55. In which of the following cases straight line method of depreciation is not appropriate? Assets on which repair and maintenance cost increases with age. Assets on which repair and maintenance cost decreases with age. High value equipment. Low cost office equipment. 56. Employees took stock costing Rs 1000 (sale price Rs 1200) in this case, Salaries A/c to be debited with Rs 1,200. Purchases A/c to be credited with Rs 1,000. Sales A/c to be credited with Rs 1,200. Sales A/c to be credited with Rs 1,000. 57. When a firm maintains a double column cash book, it need not maintain: Cash Account in the Ledger. Bank Account in the ledger.

Discount Account in the ledger General Journal 58. Which one of these is not a cause of difference in balance as per pass book and as per cash book? Errors in cash book Errors in pass book Cheques deposited and cleared Cheques issued but not presented for payment 59. Which of the following is not the salient feature of bank reconciliation statement? Any undue delay in the clearance of cheques will be shown up by the reconciliation. Reconciliation is done by the bankers. Reconciliation statement will help in finding the person doing any fraud. It helps in finding out the actual position of the bank balance. 60. Unless otherwise agreed, a retiring partner can: use the firm’s name. represent himself as carrying on firm’s business. solicit the old customers. carry on competing business.

170 Full Syllabus Mock Tests Section B-Mercantile Law (40 marks) 61. P agrees to sell apples to Q at price to be fixed by R. Subsequently, R refuses to value the goods and fix the price. Could the agreement be avoided? Yes No Partly Yes None of the above 62. Quasi Contractual Obligations are also termed as Certain Relations Resembling Those Created by Contracts. Law of Restitution ‘Either or Neither nor 63. Which of the following persons are not competent to contract? Minors Persons of unsound mind Persons disqualified by law All of these 64. Which of this falls outside the implied authority? Pledging as security, goods of the Firm for loans Drawing, accepting and endorsing negotiable instruments on behalf of the Firm Acquire immovable property on behalf of the Firm. Hiring Solicitors to defend actions against the Firm. 65. Q5. A Minor’s liability for “Necessaries” supplied to him — Arises after he attains majority age. Is against only Minor’s property. Does not arise at all. Arises if minor gives a promise for it. 66. When the consent of a party is not free, the contract is void voidable valid unlawful 67. A, enfeebled by disease or age, is induced by B, his attendant, to agree to pay B an unreasonable

sum for his professional services. Can B enforce the agreement? Yes No Partly Yes None of the above 68. Section of the Partnership Act, 1932 defines the term “Third Party”. 2(a) 2(b) 2(c) 2(d) 69. Which of the following do not constitute a ground for dissolution by Court? Misconduct by Partner Transfer of interest by Partner Just and equitable grounds Suit by the dormant partner 70. For the purposes of entering into a contract, a Minor is a person who has not completed the age of 16 years 18 years 20 years 21 years 71. In case of transfer of Partners’ Interest u/s 29, the Transferee is entitled to interfere with the conduct of the business. True Partly True False None of the above. 72. Moral Pressure is involved in the case of — Coercion Undue Influence Misrepresentation Fraud 73. A agrees to sell his car worth Rs.100,000 to B for Rs. 20,000 only, and A’s consent was obtained by coercion. Here, the agreement is void voidable

Mock Test Paper-VIII 171 valid unlawful 74. If by an agreement, a person is bound to do something which is against his personal or professional duty, or which intervenes in another’s personal or professional interest, it is void valid enforceable voidable. 75. A and B, being traders enter upon a contract. A has private information of a change in prices which would affect B’s willingness to proceed with the contract. Is a bound to inform B? Yes No Partly Yes None of the above 76. A breach of Condition may be treated as breach of Warranty. True Partly True False None of the above 77. The implied condition that goods shall be fit to the Buyer’s specific purpose, is applicable only where the Buyer tells his purpose to the Seller and relies upon Seller’s skill and judgement. True, as it is the requirement of law. False, as it is Buyer’s duty to select goods which serve his purpose. Partly True None of the above 78. If th e co n t ra ct i s avo i d ed o n gr ou n d s o f , it is at the discretion of the Court to direct the aggrieved party to restore or refund the benefit received. Undue Influence Coercion Fraud Misrepresentation. 79. Sometimes, a party is entitled to claim compensation in proportion to the work done by him. It is possible by a suit for Damages Injunction

Quantum Meruit Rescission 80. Ordinarily, a Minor’s agreement is ________ Void ab initio Voidable Valid Unlawful 81. Neither the Firm nor the Partners of an unregistered Firm, when sued, can claim a set-off. True Partly True False None of the above 82. Voluntary transfer of possession by one person to another is popularly known as Transfer Possession Delivery Any of the above 83. Selection of goods with the intention of using them in performance of the contract and with the mutual consent of the Seller and the Buyer is known as Distribution Appropriation Amortization Storage 84. A grocer supplied monthly rations for five months to B who was aged 17 years and 5 months. B having failed to pay the bills for the supplies, the grocer decided to sue him for the realisation of his dues. The Grocer can recover the amount. True Partly True False None of the above 85. A is not a Partner in a particular Firm. But he represents himself or knowingly permits himself to be represented as a Partner in that particular Firm to B who on the faith of such representation, gives credit to the Firm. Is A liable as Partner? Yes No Partly Yes None of the above

172 Full Syllabus Mock Tests 86. ‘No Consideration No Contract’ does not apply to completed gifts, i.e. gifts given and accepted. True Partly True False None of the above. 87. A agrees with B to discover treasure by magic. The agreement is Void Valid Voidable Illegal 80. An Unpaid Seller has rights against Goods only The Buyer only Both the Goods and the Buyer Neither nor 89. A applies to a Banker fora loan at a time when there is stringency in the money market. The Banker declines to make the loan except at an unusually high rate of interest. A accepts the loan on these terms. Is the contract induced by undue influence? Yes No Partly Yes None of the above 90. Which of the following statements is not true about Minor’s position in a Firm? He cannot become a Partner in an existing Firm. He can become a Partner in an existing Firm. He can be admitted only to the benefits of any existing Firm. He can become Partner on becoming a major. 91. A finds B’s purse, and gives it back to him. B promises to give A Rs.50. This is a/an Agreement Contract Acceptance Offer. 92. A’s son had forged B’s name to a Promissory Note. B under threat of prosecuting A’s son, obtains a bond from A for the amount of the forged note. B sues on bond. Will he succeed?

Yes No Partly Yes None of the above 93. Can a time–barred debt be adjusted by a Creditor, where the Debtor makes the payment without indicating the debt to be adjusted? Yes, in such a case the Creditor is at liberty to make such adjustment No, as a time–barred debt cannot be recovered Yes, if the Court directs so No, the Court will set aside such adjustment 94. A Partner of an Unregistered Firm cannot sue for his dues from the Firm or from other Partners. True Partly True False None of the above 95. In an Auction Sale, if the Seller makes use of pretended bidding to raise the price, then the sale is valid void voidable illegal 96. In case of breach of contract, which of the following remedy is available to the aggrieved party? Suit for rescission Suit for damages Suit for specific performance All of these 97. Can a person who is usually of unsound, but occasionally of sound mind, make a contract? Yes, he can always make a contract. Yes, but only when he is of sound mind. No, he cannot make a contract. No, the contract is always illegal 98. Which of the following statement is true? A threat to commit suicide does not amount to coercion. Undue Influence involves use of physical pressure. Ignorance of law is no excuse. Silence always amounts to fraud.

Mock Test Paper-VIII 173 99. In case of sale on approval, the ownership is transferred to the Buyer when he accepts the goods adopts the transaction fails to return goods all of the above 100. A and B are solicitors in Partnership. C, a client of the Firm, hands a sum of money to be invested on

security. A never invests it but applies it to his own use. B receives no part of the money and knows nothing of the transaction. Is B liable to make good the loss? Ye s No Partly Yes None of the above

174 Full Syllabus Mock Tests SESSION - II TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section C-Economics (50 marks)

1. Cetris paribus means: Holding demand constant Holding supply constant Price being constant Other things being constant 2. Under which of the following land reforms, common land such as forests, waste land, etc., which belonged to the intermediaries, were passed on to state governments. Abolition of Intermediaries Tenancy Reforms Consolidation of holdings Cooperative farming 3. Given ES = 5, original price = Rs. 60, new price = Rs. 100, change in quantity = 20 units. Find the original quantity and the new quantity supplied. 10, 24 20, 28 6, 26 16, 18 4. Which of the following are measures taken by government to curb inflation? Wage freeze Dividend freeze Population control measures All of above 5. Birth rate shows: number of birth per hundred of population. number of birth per thousand of population. number of birth per lacs of population. proportion of number of birth to number of death. 6. Which assumption implies the consumer aims at utility maximisation? a rationality

ordinality cardinality None of the above 7. Which of the following is part of Capital account of BOP? Merchandise Transfer payments Investment income Gold and foreign exchange 8. Economic cost includes accounting cost plus: normal return on capital invested by an entrepreneur salary not paid to an entrepreneur Both of the above None of the above 9. As per Economic Survey 2007-08 Industrial production is likely to grow by _____ in 2007-08. 7.6% 8.4% 9.4% 9.8% 10. A firm’s total cost schedule is given in the following table: Output (Units)

Total Cost (Rs.)

0

40

1

120

2

170

3

180

4

210

5

260

What is the total fixed cost of this firm? 20

Mock Test Paper-VIII 175 40 60 550 11. Globalisation means: National integration Cultural integration Integration of the economy of a country with the world Self-reliance 12. The rate of interest at which the RBI lends to the commercial banks is called: SLR CRR Bank Rate OMO 13. Under perfect competition, at the shut down point, revenue earned by the firm covers which cost? AC MC AVC AFC 14. Stagflation arises due to: Increase in price of precious metal. Persistent rise in factor cost. Combine phenomena of demand pull and cost-push inflation. Mismatch between demand and supply of commodities. 15. GNP is a poor measure of welfare because it does not show: composition of output price level population level all of the above

capital formation 18. India’s external debts constitute _______ of GDP in 2004-05. 8% 17% 23% 19% 19. GDPMP does not include: capital gains financial transactions income generated through illegal means All of above 20. A ready garment factory pays Rs. 100 for suit length and Rs. 5 for cotton thread purchased and Rs. 50 to the labour for stitching the suit which he sells in the market for Rs. 750. His contribution to GDP is: Rs. 620 Rs. 680 Rs. 730 Rs. 750 21. Under monopolistic competition in the long-run, compare the profit maximising output with the least cost output. profit maximising output is less than least cost output profit maximising output is equal to least cost output profit maximising output is more than least cost output none of the above 22. In the figure given below, Point N shows:

16. Which of the following is not an assumption of the Law of Supply? Price of the commodity remains the same. State of technology remains the same. Cost of production remains the same. Government policy remains the same. 17. When inputs are transformed into output, it is called: consumption intermediate good production

over utilization of resources unemployment of resources full employment of resources best utilisation of resources

176 Full Syllabus Mock Tests 23. The reason behind increasing returns to scale are: Economies of scale Diseconomies of scale Under utilisation of factors Over utilisation of factors 24. Which of the following factor causes Urban Poverty? Unequal distribution of land Presence of educated unemployment Failure to implement land reforms Low education level 25. In diagrammatic method the value of point elasticity of demand on price axis is: ratio of lower segment to upper segments ratio of upper segment to lower segments the price axis cannot be determined 26. Services sector is also called: Primary sector Secondary sector Tertiary sector None of the above 27. Privatisation means: transfer of a function, activity or organisation from the public to the private sector. sale of a part of equity holdings held by the government in any PSUs to private investor. Both of above None of above 28. Sweezy’s model does not explain: output determination price determination price rigidity kinked demand determination 29. Price elasticity of demand between two points on a demand curve is called: Point elasticity Arc elasticity Period elasticity Stretched demand curve 30. If the firm is operating at a level above break even level, it will: earn net profit on the total quantity sold at the rate of contribution margin.

earn net profit on the quantity in excess of break even level quantity at the rate of contribution margin. incur loss on the quantity in excess of break even level quantity at the contribution margin. incur loss on the quantity in short of break even level quantity at the contribution margin. 31. Which of the following functions are performed by an entrepreneur? To Take Advantage of Changes in a Dynamic Economy To Bear Uncertainties To Bring About Innovations All of above 32. A market structure where the monopolist charges different prices from different consumers for the same good or service at the same time is called: Monopoly Discriminating monopoly Monopolistic Competition Perfect Competition 33. With increase in wage rate beyond a point, labour supply decrease due to: Health reasons Fall in demand Preference for leisure Lack of work 34. Which of the following principle states that “Every individual should pay tax according to their ability to pay”. Canon of convenience Canon of equality Canon of economy Canon of productivity 35. EPCG stands for: Export Promotion Council of Government Export Promotion Capital Goods Export Prevention Country Group Export Prevention Capital Goods 36. Average Product (AP) is equal to: Change in Total Product/Change in Labour Input Change in Total Product/Capital Input Total Product/Labour Input Total Product/Change in Capital Input

Mock Test Paper-VIII 177 37. When demand is inelastic, MR is: zero one positive negative 38. Which of the following is a positive statement? What determines the price rise? What determines the fair price rise? Rate of inflation should be less than 5% Ethics 39. Which of the following, according to the expenditure method, is not composition of National income? Private final consumption expenditure Change in Stock Valuable Sales 40. Demand for a commodity has direct relationship with the: price of the commodity. price of substitute goods. price of complementary goods. All of above 41. Explicit cash payments made by an entrepreneur to the suppliers of various factors of production is called: accounting cost total cost economic cost direct cost 42. Which of the following measures have been taken to solve the problem related to energy? In 2002, the power sector was nationalised in Delhi. The government is discouraging the excess use of hydel and wind energy. ‘Rajiv Gandhi Vidhyutikaran’ programme was started in 2005. All of above 43. In short run producer surplus is: Zero Less than economic profit Greater than economic profit Equal to economic profit 44. __________ is defined as surplus of production over consumption in an accounting year which is further used for production.

Savings Surplus Capital formation Profit 45. The objectives of monetary policy of RBI is: To encourage hoarding of commodities which are in short supply. To discourage flow of credit into any one particular sector. To restrain inflationary pressure arising out of increased growth of money supply as a result of deficit financing by the government. All of above 46. When demand of a commodity increases, while supply remains constant, equilibrium price will: increase. decrease. remain constant. become negative. 47. When price of related goods or income or taste changes, it brings about: change in demand increase in demand decrease in demand change in quantity demanded 48. When TU is maximum, i.e., it reaches its saturation point, then: MU is also maximum. MU is minimum. MU is zero. MU is negative. 49. In which of the following type of inflation, inflationary pressure builds up but they remain under control because of government intervention. Galloping inflation Hyper inflation Suppressed inflation Stagflation 50. Which of the following is the objectives of IMF as per Article I of the Articles of Agreement? Facilitating the expansion and balanced growth of international trade. To remove the disequilibrium in the balance of payments. To generate higher employment and income. All of above

178 Full Syllabus Mock Tests Section D-Quantitative Aptitude (50 marks) 51. To find the number of observations less than any given value, we use: grouped frequency distribution. single frequency distribution. cumulative frequency distribution. None of these. 52. A sum of Rs. 53 is divided among A, B, C in such a way that A gets Rs. 7 more than what B gets and B gets Rs. 8 more than what C gets. The ratio of their shares is: 24 : 15 : 10 25 : 18 : 10 25 : 14 : 8 22 : 16 : 9 53. If n numbers are drawn at random without replacement from the set {1, 2, …..., m), then var (x) would be: (m + 1) (m - n)/12n (m - 1) (m + n)/12 (m - 1) (m + n)/12n (m - 1) (m + n)/12m

Factor Reversal Test None of these 57. The weight of 50 students in pounds are given below: 82, 95, 120, 174, 179, 176, 159, 91, 85, 175, 88, 160, 97, 133, 159, 176, 151, 115, 105, 172, 170, 128, 112, 101, 123, 117, 93, 117, 99, 90, 113, 119, 129, 134, 178, 105, 147, 107, 155, 157, 98, 117, 95, 135, 175, 97, 160, 168, 144, 175. If the data are arranged in the form of a frequency distribution with class intervals as 81-100, 101120, 121-140, 141-160 and 161-180, then the frequencies for these 5 class intervals are: 6, 9, 10, 11, 14 12, 8, 7, 11, 12 10, 12, 8, 11, 9 12, 11, 6, 9, 12 58. Graph of the Inequation are as below:

54. With usual notations if r = -1, n = 8, then the value of C is: 1 4 2 0 55. In a sample of 800 students, the mean weight and standard deviation of weight are found to be 50 kg and 20 kg respectively. On the assumption of normality, what is the number of students weighing between 46 kg and 62 kg? Given area of the standard normal curve between (Z = 0 to Z = 0.20) = 0.0793 and area between (Z = 0 to Z = 0.60) = 0.2257. 250 244 240 260

The common region indicated on the graph is expressed by the set of five inequalities given as: L1: x1 >= 0 ; L2: x2 >= 0 ; L3: x1 + x2 >= 1 ; L4: x1 - x2 >= 1 ; L5: -x1 + 2x2 >= 1 L1: x1 >= 0 ; L2: x2 >= 0 ; L3: x1 + x2 = 1 ; L4: x1 - x2 >= 1 ; L5: -x1 + 2x2 = 0 ; L2: x2 >= 0 ; L3: x1 + x2 >= 0 ; L4: x1 - x2 >= 0 ; L5: -x1 + 2x2 S.D M.D. < S.D. M.D. = S.D. 97. The value of the middle-most item when they are arranged in order of magnitude is called: Standard deviation Mean Mode Median

98. If the quartile deviation of a normal curve is 4.05, then its mean deviation is: 5.26 6.24 4.24 4.86 99. If f(x) = x + 3, g(x) = x2, then fog(x) is: x2 + x + 3 x2 + 3 (x + 3) 2 (x + 3)3 100. A machine worth Rs. 490740 is depreciated at 15% of its opening value each year. When its value would reduce by 90%? 11 years 6 months 11 years 7 months 11 years 8 months none of these

Mock Test Paper-VIII 183

COMMON PROFICIENCY TEST Mock Test Paper–VIII [Answer Key] SESSION - I Section A-Fundamentals of Accounting (60 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30.

Question 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60.

184 Full Syllabus Mock Tests Section B-Mercantile Law (40 marks)

Question 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80.

Question 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100.

SESSION - II Section C-Economics (50 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Question 11. 12. 13. 14. 15. 16. 17. 18. 19. 20.

Mock Test Paper-VIII 185 Question 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35.

Question 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.

Section D-Quantitative Aptitude (50 marks)

Question 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70.

Question 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90.

186 Full Syllabus Mock Tests Question 91. 92. 93. 94. 95.

Question 96. 97. 98. 99. 100.

Mock Test Paper-IX 187

COMMON PROFICIENCY TEST Mock Test Paper–IX SESSION - I TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section A-Fundamentals of Accounting (60 marks)

1. X Ltd. decides to redeem 650, 15% Redeemable Preference Shares of Rs.100 each at a premium of 10%. It has a General Reserve of Rs.70,000 and a Securities Premium of Rs.4,000. If it is decided to issue 6,500 Equity Shares of Rs 10 each at a premium of 5% for the purpose of redemption of Preference Shares, the amount required to be transferred to capital Redemption Reserve account is: Rs 65,000 Nil Rs 17,500 Rs 54,000 2. Krishna of Bombay sends 200 boxes of fancy kids wears costing Rs. 40,000 to Deepak of Goa for sale on consignment basis at an invoice price 25% above the cost price. Consignment A/c will be debited for the goods send on consignment by: Rs. 50,000 Rs. 34,000 Rs. 46,000 Rs. 62,000 3. A and B enter into a Joint Venture by opening a joint bank account contributing Rs 20,00,000. The profit sharing ratio between A and B is 3:2. How much amount to be contributed by A? Rs 8,00,000 Rs 11,40,000 Rs 12,00,000 Rs 9,70,000

4. The heir of the deceased partner: Has a right to become a partner in the firm of the deceased partner. Does not have a right to become a partner in the firm of the deceased partner. Can become a partner in the firm of the deceased partner only if the surviving partners give their consent in this regard. Both & . 5. If a reliable estimate of probable outflow of resources to settle a possible obligation cannot be made, it is: to be recognised as a provision. to be recognised as a liability. to be disclosed as a contingent liability. none of these. 6. A bill received from a debtor is called: Bills Receivable Bills Payable Purchase Invoice Sales Invoice 7. Which of these is not an essential requirement of a valid bill of exchange? Acceptance Consideration Writing Specific sum payable 8. Current Assets are those assets: Which can be converted into cash within 12 months.

188 Full Syllabus Mock Tests Which can be converted into cash within a period normally not exceeding 12 months. Which can be converted into cash within an operating cycle which normally does not exceed 12 months. Which are held for their conversion into cash within an operating cycle which normally does not exceed 12 months. 9. Unless otherwise stated, the preference shares are deemed to be: Cumulative, Participating and Non-convertible. Cumulative, Non-participating and Convertible. Non-cumulative, Non-participating and Nonconvertible. None of the above. 10. In the absence of proper agreement, representative of the deceased partner is entitled to the Dead partner’s share in the following items. Profits till date, goodwill, joint life policy, interest on capital, share in revalued assets and liabilities. Capital, profits till date, goodwill, joint life policy, share in revalued assets and liabilities. Capital, profits till date, goodwill, interest on capital, share in revalued assets and liabilities. Capital, goodwill, joint life policy, interest on capital, share in revalued assets and liabilities. 11. Discuss which one of the valuation principle is being followed in the given case. Cost of motor-car as on 1st April, 2009 is Rs. 50 lakhs. Market value as on 31st March, 2010 is Rs. 10 lakhs. While preparing the financial statements the car was valued at Rs. 10 lakhs. Historical cost Present value Realizable cost Current cost 12. How unrecorded assets is treated at the time of retirement of a partner? Debited to Revaluation A/c Credited to Revaluation A/c Credited to partners Capital A/c Credited to capital A/c of retiring partner only 13. Debenture Redemption Premium Account is a: Personal Account

Nominal Account Real Account None of these 14. Which of the following errors will affect the trial balance? A Cash Sale of goods to X Rs. 17 credited to X. A Credit Sale of goods to X Rs. 17 posted as Rs. 71. A Credit sale of furniture to X Rs. 17 posted as Rs. 71. None of the above 15. Mr. X is admitted into a partnership firm for 1/4th share of profit. The total capital of the old partners stood at Rs. 45,000 after carrying adjustment of goodwill, revaluation of assets and liabilities and transfer of reserves and surplus. What amount should be brought in by new partner as his share of capital at the time of admission? Rs. 12,000 Rs. 15,000 Rs. 14,000 Rs. 18,000 16. Financial Position of the business is ascertained on the basis of: Records prepared under book-keeping process Accounting reports Trial balance None of the above 17. A transfer to Capital Redemption Reserve is required u/s 80 when preference shares are redeemed: by converting them into new equity shares. by converting them into new preference shares. out of fresh issue of shares. out of divisible profits. 18. As per AS-I, the fact need not be disclosed in the financial statements if the following concept is followed: Accounting Entity Principle Periodicity Principle Consistency Principle Money Measurement Principle 19. While preparing a Bank Reconciliation Statement taking the balance as per Cash Book as the starting point, Interest allowed by bank are:

Mock Test Paper-IX 189 Added Subtracted not required to be adjusted none of these 20. Mr. Q sent goods worth Rs. 1,00,000 which were invoiced 33.33% above cost on 10th March on March and the remaining were still pending with the customers as on 31st March. How would you deal with the goods lying with the customer as on 31st March? Deduct Rs. 70,000 from sales and debtors and include goods worth Rs. 52,500 in closing stock Deduct Rs. 30,000 from sales and debtors and include goods worth Rs. 70,000 in closing stock Deduct Rs. 60,000 from sales and debtors and include goods worth Rs. 64,000 in closing stock Deduct Rs. 30,000 from sales and debtors and include goods worth Rs. 24,000 in closing stock 21. The directors of ABC Ltd. made the final call of Rs. 30 per share on May 15, 2010 indicating the last date of payment of call money to be May 31, 2010. Mr. X, holding 10,000 shares paid the call money on July 15, 2010. If the company adopts Table A, the amount of interest on calls-in-arrear to be paid by Mr. X is: Rs. 2,345 Rs. 1,875 Rs. 1,450 Rs. 3,270 22. A draws a bill on B for Rs 1,50,000. A endorsed the bill to C. The bill return dishonoured. Noting charges Rs 1,500. B request A to accept the amount at 2% discount by a single cheque. The cheque amount will be: Rs 1,42,520 Rs 1,34,600 Rs 1,48,470 Rs 1,26,780 23. Which Accounting Standard replaced AS 8? AS 24 AS 26 AS 18 AS 44

24. The going concern concept is the underlying basis for: Disclosing the market value of securities Stating fixed assets at their realizable values Disclosing the sales and other operating information in the income statement None of these 25. Under the liquidity approach: the least urgent payments are presented at the top of Balance Sheet. the most liquid assets are presented at the bottom of the Balance Sheet. the most urgent payments are presented at the bottom of the Balance Sheet. the least liquid assets are presented at the bottom of Balance Sheet. 26. Closing stock of work-in-progress Rs. 30,000, Cost of manufactured goods Rs. 1,00,000. Opening stock of Finished Goods Rs. 20,000, Closing Stock of Finished Goods Rs. 25,000. The manufacturing Cost of Finished Goods sold is: Rs. 74,000 Rs. 58,000 Rs. 95,000 Rs. 114,000 27. Jupiter Ltd. purchased a new office equipment on 1-1-2010 for Rs. 50,000 on lease basis. The company intends to provide for renewal of lease at the end of 5 years by setting up depreciation fund which may be invested outside the business which will yield interest @5%. Sinking fund table shows Re. 0.2309 invested every year will provide Re. 1 at the end of 5 years at 5% interest. How much should be transferred to depreciation fund A/c every year in order to provide for renewal of the plant at the end of 5 years. Rs. 11,600 Rs. 10,270 Rs. 12,500 Rs. 11,550 28. A, B and C are partners sharing profits and losses in the ratio 3:2:1. They decide to change their profit sharing ratio to 2:2:1. To give effect to this new profit sharing ratio they decided to value the goodwill at Rs. 60,000. Pass the necessary journal entry if Goodwill not appearing in the old balance sheet and should not appear in the new balance sheet.

190 Full Syllabus Mock Tests Goodwill Account Dr. To A’s Capital Account To B’s Capital Account To C’s Capital Account A’s Capital Account Dr. B’s Capital Account Dr. C’s Capital Account Dr. To Goodwill Account B’s Capital Account Dr. C’s Capital Account Dr. To A’s Capital Account A’s Capital Account Dr. To B’s Capital Account To C’s Capital Account

60,000 30,000 20,000 10,000 24,000 24,000 12,000 60,000 4,000 2,000 6,000 6,000 4,000 2.000

29. When we say that a company has perpetual existence we mean: Its continuity is not affected by the change in its membership. Its life is defined in the Memorandum of Association. Its life is limited to the life of Plant and Machinery. Its life is coterminus with the life of its Chairman. 30. The commission received from consignor will be transferred to which account? Consignment A/c General Trading A/c General Profit & Loss A/c Consigor’s A/c 31. Pluto Ltd. purchased a Plant from Saturn Ltd. for Rs. 10,00,000. The company paid Rs. 200,000 in cash and agreed to allot 15% redeemable preferences shares of Rs. 100 each at a premium of 25% for the balance amount. The vendor will be allotted ________ 15% preference shares of Rs. 100 each. 8,200 6,400 7,600 6,850 32. The cash book showed an overdraft of Rs 3,000 as cash at bank, but the pass book made up on the same date showed that cheques of Rs 200, Rs 100 and Rs 250 respectively had not been presented for payments; and the cheque of Rs. 800 paid into account had not been cleared. The balance as per the cash book will be:

Rs 2,280 Rs 4,640 Rs 3,250 Rs 2,870 33. An amount of Rs. 15,000 spent on a lawyer’s fees to defend a suit for claiming that the factory site belongs to the plaintiff’s land. This is a: Capital Expenditure Revenue Expenditure Deferred Revenue Expenditure None of the above 34. A debit note for Rs 1,000 issued to Mr. X for goods returned by us is to be accounted for in: Purchases Book Bills Receivable Book Purchases Return Book Journal Proper 35. Goods costing Rs 10,000 distributed as free samples were credited to sales account. While passing rectifying entry: Sales Account to be debited & Purchases Account to be credited. Sales Account to be debited & Suspense Account to be credited. Free Samples Account to be debited & purchases account to be credited. Sales Account to be debited & free samples account to be credited. 36. The number of production or similar units expected to be obtained from the use of an asset by an enterprise is called as: Production life Useful life Expected life Unit life 37. ________ Principles requires that revenues which are recognized through the application of the realization principle are then related to relevant and appropriate historical cost. Matching Realization Accounting period Cost concept 38. Gaining ratio is: Old profit sharing ratio New profit sharing ratio

Mock Test Paper-IX 191 Old profit sharing ratio - new profit sharing ratio New profit sharing ratio - old profit sharing ratio 39. A’s Trial Balance contains the following information: Bad debts Rs 4,000, Provision for Doubtful debts Rs 5,000, Sundry debtors Rs 25,000. It is desired to create a provision for bad debts at 10% on sundry debtors at the end of the year. Sundry debtors will appear in the Balance Sheet at a figure of: Rs 24,600 Rs 22,500 Rs 26,800 Rs 18,400 40. Cost of Lease paid Rs. 20,000, Annuity factor @ 5% Interest for 4 years is Re 0.2820. The net charge to Profit & Loss Account is: Rs. 5,280 Rs. 4,640 Rs. 2,720 Rs. 6,750 41. Prepaid Salary Account is: An Asset Account A Liability Account A Revenue Account An Expense Account 42. What would be the cost of goods sold from the following details: Opening stock Rs. 4,000 Purchases Rs. 26,000 Closing stock Rs. 2,000 Rs. 22,000 Rs. 26,000 Rs. 28,000 Rs. 30,000 43. Which of the following is not a book of original entry? the Journal the Ledger the Cash Book the Bill Receivable Book 44. If closing stock is understated: the profit will decrease and current assets will increase. the profit will increase and current assets will decrease.

Both the profit & current assets will increase. Both the profit & current assets will decrease. 45. Journal is a book of: original entry. secondary entry. all cash transactions. all non-cash transactions. 46. A sent some goods costing Rs. 10,500 at a profit of 25% on sale to B on sale or return basis. B returned goods costing Rs. 2,400. At the end of the accountingm period i.e. on 31st December, 2007, the remaining goods were neither returned nor were approved by him. The stock on approval will be shown in the balance sheet at: Rs 7,200 Rs 8,100 Rs 12,400 Rs 9,600 47. Implied authority means the capacity of a partner to bind: third party by his acts firm by his acts Both of above none of these 48. Cheques received but not banked are generally shown in ______ column of Cash Book. Cash Bank Discount None 49. X sent goods to B at 125% of cost which is invoice price. The Rate of Commission is 10% on sales at IP and 25% of any surplus realized above IP. 10% of the goods sent out on consignment, invoice value of which is Rs 12,500 were destroyed. 75% of the total consignment is sold by B at Rs 1,00,000. What will be the amount of commission payable to B? Rs 12,438.00 Rs 10,937.50 Rs 9,568.50 Rs 11,863.00 50. If the sale is Rs. 2,000 and the rate of profit on cost of goods sold is 25% then the cost of goods sold is: Rs. 1,200 Rs. 1,500

192 Full Syllabus Mock Tests Rs. 1,800 Rs. 2,000 51. Cost of Stock as per books is Rs. 2,38,000. Goods purchased for Rs. 10,000 and recorded but are yet to be received. Goods costing Rs. 20,000 sold and recorded but are yet to be delivered. Goods costing Rs. 5,000 were returned by customers but omitted to be recorded. Goods costing Rs. 3,000 were returned to suppliers but omitted to be recorded The value of physical inventory is: Rs. 2,20,000 Rs. 2,50,000 Rs. 2,34,000 Rs. 2,45,000 52. A, B and C are partners sharing profits in the ratio of 3: 2: 1. D is admitted. The new profit sharing ratio among A, B, C and D will be 3:3:2:2. The gain or sacrifice will be: A sacrificed 1/30, B sacrificed 6/30 A sacrificed 6/30th, B sacrificed 1/30th C gained 1/30th and D gained 2/10th & 53. X and Y partners sharing profits in the ratio of 3 : 1. They admit Z as a partner who pays Rs. 8,000 as Goodwill. The new profit sharing ratio being 2: 1 :1 among X, Y and Z respectively. The amount of goodwill be credited to: X and Y as Rs. 6,000 and Rs. 2,000 respectively X only Y only None of the above 54. XYZ Ltd. purchased a plant for Rs.100,000 payable Rs.37,000 in cash and balance by issue of 13% debentures of Rs. 100 each at a discount of 10%. However many debentures would be required to issue to the vendor? 660 debentures of Rs. 100 each 700 debentures of Rs. 100 each 580 debentures of Rs. 100 each 600 debentures of Rs. 100 each 55. The difference between the guaranteed profit and actual share of profit is borne by: All the partners equally. All the partners in their profit sharing ratio. The persons who gave guarantee. Central Government.

56. Income Tax Liability of a Proprietor paid should be debited to: Drawings Account Income Tax Account Income Tax Payable Account Business Expenses Account 57. Trade Discount received is: recorded in the discount column on the debit side of three column Cash Book. recorded in the discount column on the credit side of single column cash book. recorded in the discount column on the credit side of three column Cash book (d none of the above. None of these. 58. Mr. X had two accounts one current account and another saving bank A/c in a nationalized bank. He drew a cheque of Rs. 5,000 on saving bank but credited to Current A/c in his cash book. Similarly a cheque of Rs. 2,000 deposited in current A/c was debited to Saving Bank A/c. What would be effect of these errors in Bank pass books/Bank statement of these two A/cs? Current A/c balance would be more by Rs. 2,000 and saving A/c balance less by Rs. 5,000 Current A/c balance would be less by Rs. 2,000 and saving A/c balance more by Rs. 5,000 Current A/c balance would be less by Rs. 5,000 and saving A/c balance more by Rs. 2,000 Current A/c balance would be more by Rs. 5,000 and saving A/c balance less by Rs. 2,000 59. Measurement discipline deals with: Identification of objects and events. Evaluation of dimension of measurement scale. Selection of scale. All of the above. 60. Goods sold on credit is an example of: Increase in Asset & Owner’s Liability. Decrease in Asset & Owner’s Liability. Increase in Liability & Owner’s Liability. Decrease in Liability & Increase in Owner’s liability.

Mock Test Paper-IX 193 Section B-Mercantile Law (40 marks) 61. When the consent to an agreement is obtained by coercion, the agreement is voidable at the option of ________ either party to the agreement a party who consent was so obtained a party who obtained the consent none of these 62. In case of Illegal Agreements, the collateral agreements are Valid Void Voidable Any of these 63. Z, a Partner of a Firm dealing in readymade garments places an order for liquor worth Rs. 50,000 in the Firm’s name. Can the princ i ple of Z’s implied authority be invoked here? Yes, the act is done by the Partner Yes, the act is done in the Firm’s name No, the act is not related to the Firm’s business No, dealing in liquor is opposed to public policy 64. Where an agreement consists of two parts one legal and the other illegal, and the legal part is separable from the illegal one, such legal part is ______ void valid voidable illegal 65. P agrees to sell apples to Q at price to be fixed by R. R was willing to value the apples but was prevented from evaluating by the wrongful act of P. Could Q file a suit for damages against P? Yes No Partly Yes None of the above 66. To claim reimbursement of money paid on behalf of another person, the payment should be made bonafide, i.e. for protection of own interest of the Payer.

True Partly True False None of the above. 67. A contract dependent on the happening or non-happening of future uncertain event, is a ______ Uncertain Contract Contingent Contract Void Contract Voidable Contract 68. When goodwill of the Firm is sold, the Partners agree with the Buyer, not to carry out similar business a specified period or within the specific local limits. This agreement in restraint of trade is valid provided the restrictions imposed are ______ understandable reasonable implementable feasible 69. Which of the following statements is false? A contract is not voidable if Fraud or Misrepresentation does not induce the other party to enter into a contract. A party cannot complain of fraudulent silence or misrepresentation if he had the means of discovering the truth with ordinary means. In case of Fraud or Misrepresentation, aggrieved party can either rescind or affirm the contract. A party who affirms the contract, can also change his option afterwards if he so decides. 70. For loss caused to the Firm by his fraud in the conduct of the business, every Partner shall ______ Indemnify the Firm Indemnify the other Partners Indemnify all the retiring Partners Indemnify only the working Partners 71. R, an optical surgeon, employs S as the assistant for a term of three years and S agrees not to practice as a surgeon during this period. This contract is ______ Valid

194 Full Syllabus Mock Tests Void Voidable Illegal

Illegal

72. In case of sale of standing trees, the property passes to the Buyer when trees are ______ felled and ascertained UV not felled but earmarked counted and ascertained both and

79. A falsely represents to B that 500 tonnes of Cement are made annually at A’s factory and thereby induces B to buy the factory. The contract is voidable at A’s option at B’s option at the option of either A or B not voidable at all

73. Intimation to Registrar, of any change in names and address of Partners of Registered Firms, should be signed by all the Partners or their agents majority of the Partners or their agents all Working Partners or their agents any one Partner or his agent

80. If the Buyer rejects the whole quantity of goods due to short delivery or excess delivery, the contract is treated as ________ Subsisting Cancelled Void Invalid

74. A agrees to pay Rs.500 to B if it rains, and B promises to pay a like amount to A if it does not rain, this agreement is called Quasi Contract Contingent Contract Wagering Agreement Voidable Contract

81. Where one party is in a position to dominate the will of another and uses hi superior position to obtain the consent of a weaker party, the consent is said to be obtained by ________ Undue Influence Fraud Coercion Misrepresentation

75. In case of Illegal Agreements, the Collateral Agreements are Valid Void Voidable Enforceable

82. An Unregistered Firm cannot claim Set on Set off Compensation None of the above

76. Agreement, the meaning of which is uncertain is ________ Valid Void Voidable Illegal

83. The person who buys or agrees to buy goods is known as Consumer Buyer Both and Neither nor

77. Every Partner has the right ________ To take part in the business of the Firm To share exclusive profits To claim remuneration To pay taxes

84. A Contingent Contract dependent on the happening of future uncertain event can be enforced when the event — happens becomes impossible does not happen any of these

78. When the consent of a party is obtained by misrepresentation, the contract is Void Voidable Valid

85. A new Partner can be admitted in the Firm with the consent of All the Partners Simple majority of Partners

Mock Test Paper-IX 195 Any one Partner New Partner only 86. Which of the following acts does not fall under the categories of fraud? Intentional false statement of facts Active concealment of facts Innocent false statement Promise made without intention to perform 87. In a contract of sale, the agreement may be expressed or implied from the conduct of the parties. True Partly True False None of the above 88. A person, even if he is not a Partner in the Firm, may be held liable as Partner if he knowingly permits himself to be represented as a Partner. True, as the principle of holding out applies in such a case False, as a person can become a Partner only by agreement not otherwise Partly True None of the above 89. A agrees to pay Rs.25,000 to B if a certain ship returns within a year. However, the ship sinks within the year. In this case, the contract becomes valid void voidable illegal 90. The consideration or object of an agreement is considered unlawful, if it is ______ forbidden by law fraudulent immoral all of these 91. All agreements in restraint of trade are void and there are no exceptions to this rule. True, the Indian Contract Act provides so False, the Indian Contract Act, and Partnership Act contains exception Maybe True We cannot decide without further information

92. Which of the following is not an Implied Condition in a contract of sale? Condition as to title Condition as to description Condition as to free from encumbrance Condition as to sample 93. The aggrieved party can rescind the contract on account of fraud. Can he also claim damages from the other party? Yes No Not possible to answer with the available information The Indian Contract Act is silent on this issue 94. X and Y buy 200 bales of cotton, agreeing to share the same between them. There is a valid partnership between X and Y. Yes No Partly Yes None of the above 95. An agreement in restraint of marriage is valid in case of following persons ______ Minors Educated Married Divorced 96. Where the existence of a Retiring Partner was not known, he is not liable for debts incurred by the Firm after his retirement even if public notice of his retirement was not given. True Partly True False None of the above 97. An agreement to pay money or money’s worth on the happening or non-happening of a specified uncertain event, is a Wagering Agreement Contingent Contract Quasi Contract Uncertain Agreement 98. Which one of the following is not true? Document showing title is different from Document of title. Bill of Lading is a Document of title to goods.

196 Full Syllabus Mock Tests Specific Goods can be identified and agreed upon at the time of the contract of Sale. None of the above. 99. Past Consideration is no consideration in India. True Partly True False None of the above

100. Goodwill is the property of the Firm, and like any other property it belongs proportionately to all the Partners. True Partly True False None of the above

Mock Test Paper-IX 197

SESSION - II TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section C-Economics (50 marks)

1. Which of the following factor remains the same in case of shift in supply curve? Price of the goods Price of other commodities State of Technology Cost of production

6. FDI in Airports sector is allowed up to: 24% 49% 72% 100%

2. Which of the following is a danger arising from inflation? Raises capital formation Businessmen and rich classes are gainers High cost economy All of above

7. The actual expenditure incurred by a firm to purchase or hire the inputs it needs in the production process is called: Outlay cost Explicit cost Implicit cost Variable cost

3. Under perfect competition, long-run equilibrium of the industry occurs at: minimum point of short run AC curve minimum point of short run MC curve minimum point of long run AC curve minimum point of long run MC curve

8. How does a Capitalist economy decides what to produce? Market survey Economic models Intensity of consumer demand Cost of production

4. When,

9. What is India’s rank in the list of exporters of services? 1st 2nd 14th 21st

MUn = Marginal utility of n units; TUn = Total utility of n units; and TUn-1 = Total utility of n - 1 units Which of the following equation hold good? MUn =TUn + TUn-1 MUn =TUn - TUn-1 MUn =TUn-1 - TUn MUn =TUn x TUn-1 5. The main objective of MODVAT is: To avoid repetitive payment of duties from raw material to the final product stage. To help simplifying the export procedure. To avoid payment of interest at different stages of excise duties. All of above

10. A linear or straight downward line of PPC implies: increasing marginal cost increasing marginal opportunity cost decreasing marginal opportunity cost constant marginal opportunity cost 11. The difference between least cost output and profit maximizing output is called: normal capacity abnormal capacity excess capacity reserve capacity

198 Full Syllabus Mock Tests 12. Addition made to TP when one more unit of labour is employed is called: average product marginal revenue product labour product marginal product 13. Higher PPC curve indicates: More production of one at the expense of other. More production of both the things with increase in technology or factor inputs supply. More production of one items at the expense of other with increase in technology or factor input supply. Less than full employment situation. 14. Which of the following method is used to measure the National income of India? Value added method Income method Expenditure method Mixed method 15. The absolute value of the coefficient of elasticity of demand ranges from: minus one to one zero to infinity one to infinity minus one to infinity 16. In the short-run, a monopolistic firm can incur losses if: Price is below AC Price is above AC Price is below AR AC is below AR 17. Constraints on which budget line is made are: given income and prices given prices and tastes given income and tastes given prices and government policy 18. If final good attracts an excise duty of Rs. 8,000 and Rs. 1,050 has already been paid on inputs then the firm will pay Rs. 7,000 towards excise duty. It is paying tax according to: VAT CENVAT MODVAT

None of the above 19. In economics Income is a ______ concept. Flow Stock Both depending on situation None 20. When a large firm diversifies output, market, etc. it is called: Technical economies Risk bearing economies Marketing economies Managerial economies 21. Wages rent, supply curve, etc. are studied under which branch of economics? microeconomics macroeconomics monetaryeconomics wealtheconomics 22. Which type of unemployment cannot be openly seen by every one? Casual Unemployment Disguised Unemployment Seasonal Unemployment Cyclical Unemployment 23. A rational producer will always operate on which portion of demand curve? elastic inelastic unitary elastic perfectly inelastic 24. When price of Z rises it causes an increase in demand for good X. Then X and Z are: necessities substitute goods inferior goods complementary goods 25. The objective of the Tenth Plan is: To reduce the decadal rate of population growth between 2001 and 2011 to 16.2%. To reduce Infant Mortality Rate (IMR) to 45 per 1,000 live births by 2007 and 28 per 1,000 live births by 2012, To reduce Maternal Mortality Rate (MMR) to 2 per 1,000 live births by 2007 and 10 per 1,000 live births by 2012. All of above

Mock Test Paper-IX 199 26. Decrease in supply is due to: obsolete technology rise in cost rise in the price of related goods All of above 27. Under the scheme of Consolidation of holdings, ceilings are imposed on land holdings. small scattered bits of land can be grouped together into a single compact block and these can be exchanged for land at one place. all the land owners in the village form cooperative society for cultivation of land in the village. common land such as forests, waste land, etc., which belonged to the intermediaries, were passed on to state governments. 28. The law of variable proportions states that, when total output or production of a commodity is increased by adding units of a variable input, while the quantities of other inputs are held constant, increase in total production becomes larger and larger. increase in total production is smaller and only after some point, becomes larger. increase in total production becomes, after some point, smaller and smaller. increase in total production is at a constant rate. 29. In which of the following situation the law of demand does not hold good? Giffen goods Conspicuous goods Emergency All of above 30. India’s telephone network is _________ in the world. one of the largest second largest third largest seventh largest 31. The nature of product in which of the following market is homogeneous? Perfect competition Monopoly Monopolistic competition Differentiated oligopoly

32. Which agency discharges the responsibilities of dispute settlement body under WTO? Security Council General Council UNO USA 33. Which of the following is not one of the four factors of production? Land Organisation Society Labour 34. What kind of satisfaction is utility which a consumer derives when he is willing to spend money on a stock of commodity which has the capacity to satisfy his want? realised expected both expected and realised none of above 35. Budgetary deficit is equal to: revenue expenditure minus revenue receipts. capital expenditure minus capital receipts. sum total of revenue deficit and capital deficit. difference of revenue deficit and capital deficit. 36. Which of the following is a sunk cost? Payment of arrears of income-tax liability. Retrenchment compensation paid to the staff. The cost of plant and machinery installed five years ago become redundant due to change in production technology. Minimum bonus payment to industrial workers. 37. If supply decreases, while demand remains constant, equilibrium price and output both will fall. equilibrium price and output both will rise. equilibrium price will rise and output will fall. equilibrium price will fall and output will rise. 38. The reason behind the slope of TC and TUC curve is: Producer’s behaviour the objective of minimising cost

200 Full Syllabus Mock Tests return to scale law of variable proportion 39. Policy measures by the RBI to control and regulate money supply is called: debit policy credit policy monetary policy loan policy 40. Savings are done by: Individuals households Government All of above 41. Which of the following strategy is used by government to finance fiscal deficit? Privatisation Disinvestment Globalisation None of above 42. Public debt is required to: to finance economic development to curb inflation to finance war All of above 43. The quantity consumed of product X and utility derived by the consumer Y are given below: Unit consumed

0

1

2

3

Marginal utility derived

0

10

?

8

Total utility

0

10

19

27

45. NNPMP is defined as the market value of output of final goods and services produced by normal residents of an economy in its domestic territory during an accounting year: inclusive of both depreciation and net factor income from abroad. inclusive of depreciation and exclusive of net factor income from abroad. exclusive of depreciation and inclusive of net factor income from abroad. exclusive of both depreciation and net factor income from abroad. 46. What is the term used for interdependence among countries with regard to goods, services, capital, etc.? Liberalization Privatization Deregulation Globalization 47. Commercial paper was introduced as per the recommendations of ________ committee. Mehta Vaghual Chakraborty Tandon 48. RBI devalued its rupee to what percentage in 1991? 20% 17% 24% 9%

What is the marginal utility while consuming 2nd unit of product X? 4 7 9 11

49. In the long run a firm in perfect competition earns: Normal profit only Abnormal profit Average profit of past five years Supernormal profit

44. The Central Government operates through ________ corporation for electricity. NTPC NPCIL NHPC through corporation for electricity All of the above

50. Which of these is the least liquid money supply in India? M1 M2 M3 M4

Mock Test Paper-IX 201 Section D-Quantitative Aptitude (50 marks) 51. In a bivariate data: N=25, X= 125, Y = 100, XY = 520, X2 = 650, Y2 = 436. Then the value of r is given by: 0.67 0.75 0.57 0.9 52. If (2x + 3) : (5x – 38) be in the duplicate ratio of 5: 6 , then the value of x is: 12 14 15 16 53. The regression equation of profit (x) on sale (y) of a certain firm is given by 3y - 5x + 108 = 0. The variance of profit is (9/16)th of the variance of the sale. The coefficient of correlation between sales and profits is: 0.6 0.7 0.8 0.5 54.

(x x(1

1) xe x)

log

log

xe x xe x xe x

1

2log

2log

1

xe x xe x xe x

1

xe x

56. If each observation of a set is divided by 10, the S.D. of the new observations is: 1/10th of S.D. of original observations. 1/100th of S.D. of original observations. does not changed. 10 times of S.D. of original observations. 57. If a / b = c / d, implies (a + /(a – b) = (c + d)/(c – d), the process is called: Componendo Dividendo Componendo and Dividendo None of these 58. Between second and upper quartile, the frequency is equal to: 3N/4 N/4 N/2 None of these 59. If 2x - 2x-1 = 4, then the value of xx is: 4 27 124 267

dx xe x

1

Rs. 7582 Rs. 7520.98 Rs. 7522.93

c

c

c

c

55. A random sample of size 82 was taken to estimate the mean annual income of 5000 families and the mean and S.D. were found to be Rs. 7500 and Rs. 80 respectively, What is upper confidence limit to the average income of all the families when the confidence level is 90 per cent? [Given (2.58) = 0.95] Rs. 7600

60. The mean and S.D. for group of 100 observations are 65 and 7.03 respectively. If 60 of these observations have mean and S.D. as 70 and 3 respectively, what is the S.D. for the group comprising 40 observation? 16.03 25.03 4.03 2.03 61. If log (x/y) = x + y, then x y y x

dx is proved to be: dy

202 Full Syllabus Mock Tests x(1 y(1

y) x)

y(1 x(1

x) y)

62. If X and Y are two independent variables such that Mean X = 5, Mean Y = 10, x2 = 4, y2 = 9 and if u = 3x + 4y, v = 3x - y, then (u, v) is equal to: 0 1 2/3 None of these 63. If r between the lines of regression of x on y and y on x, is ± 1, then the: lines coincide lines are perpendicular lines are not parallel None of these 64. Find the positive value of k for which the equations: x2 + kx + 64 = 0 and x2 - 8x + k = 0 will have real roots. 14 16 18 20 65. Cost of sugar in a month under the heads raw materials, labour, direct production and others were 12, 20, 35 and 23 units respectively. What is the difference between the central angles for the largest and smallest components of the cost of sugar? 72° 48° 56° 92° 66. A set consisting of only one element as its member is known as _________. Void set Singleton set Finite set Universal set 67. If you are interested in how a football coach divides the practice session into drills, weight training, scrimmaging and game plans, it would be best to use: bar graph

line graph pie chart times series graph 68. The cost of living index (C.L.I.) is always: Weighted index Quantity index Price index None of these 69. Throwing two unbiased coins simultaneously, Ramu bets with Shyamu that Ramu will receive Rs. 4 from Shyamu if he gets 2 heads and he will give Rs. 4 to Shyamu otherwise. Find the expectation of Ramu. loss Rs. 2.20 loss Rs. 3.30 loss Rs. 5.60 none 70. The points (1, a), (2, b) and (c2, -3) are the vertices of a triangle. Then its centroid may lie an x-axis if a + b = k, where k = 3 4 5 7 71. A selection procedure of a sample having no involvement of probability is known as: judgement sampling purposive sampling subjective sampling all of these 72. Which sampling provides separate estimates for population means for different segments and also overall estimate? Multistage sampling Stratified sampling Systematic sampling Simple random sampling 73. The equation of the line passing through (-1, 1) and subtending an angle of 45° with the line 6x + 5y - 1 = 0 is: x + 11y - 10 = 0 11x - y + 12 = 0 both of above none of these 74. In a sample of 120 workers in a factory the mean and standard deviation of wages were Rs. 11.35

Mock Test Paper-IX 203 and Rs. 3.03 respectively. Find the percentage of workers getting wages between Rs. 9 and Rs. 17 in the whole factory assuming that the wages are normally distributed. 70.1 75.1 60.1 65.1 75. A scooter company manufactures scooters of two models A and B. Model A requires 15 manhours for assembly, 5 man-hours for painting and finishing and 1 man-hour for checking and testing. Model B requires 6 man-hours for assembly, 4 man-hours for painting and finishing and 2 manhours for checking and testing. There are 300 man-hours available in the assembly shop, 120 man-hours in paining and finishing shop and 50 man-hours are available in checking and testing division. The constraints can be formulated by taking x = number of scooters of model A and y = number of scooters of model B as: 15x + 6y >=300; x + 2y > 50; 5x + 4y >=120; x >=0; y >=0 15x + 6y 0; y > 0 15x + 6y 0; y > 0 76. Out of 10 consonants and 4 vowels how many words can be formed each containing 6 consonant and 3 vowels? 10 C 6 x 4C3 10 C6 x 4C3 x 9! 10 C6 x 9C3 x 4! 10 C6 x 9! 77. A manager receives on an average of 12 telephone calls per 8-hour day. Assuming that the number of telephone calls received by him follow a Poisson variate, what is the probability that he will not be interrupted by a call during a meeting lasting 2 hours? 0.0348 0.0548 0.0498 0.6

78. Effective Rate of Interest is ______ the Nominal Rate of Interest. always greater than always lesser than always equal to None of above 79. In how many ways can a party of 4 men and 4 women be seated at a circular table, so that no two woman are adjacent? 162 144 132 156 80. Which sampling provides separate estimates for population means for different segments and also overall estimate? Multistage sampling Stratified sampling Systematic sampling Simple random sampling 81. If the A.M. and G.M. for 10 observations are both 15, then the value of H.M is: Less than 15 More than 15 15 Can not be determined 82. A and B are two sets containing 3 and 6 elements respectively. The number of elements in A U B is: 3 6 2 18 83. There are two examination rooms A and B. If 10 candidates are sent from A to B, the number of students in each room is the same. If 20 candidates are sent from B to A the number of students in A is double the number of students in B. Find the number of students in each room. (90, 80) (200, 900) (90, 600) (100, 800) 84. A card is drawn from each of two well-shuffled packs of cards. The probability that at least one of them is an ace is:

204 Full Syllabus Mock Tests 0.15 0.5 0.2 None of these 85. lim x (a1/x – 1) = n

1 x logea logae 86. If x2 + px + q = 0 and x2 + qx + p = 0 have a common root, then: p+q=-1 p-q=1 p = 2q q = 2p 87. The characteristic in log (6.7432 x 10-5) is: 6 10 5 -5 88. Paasche’s index is based on: average of current and base year. current year quantities. base year quantities. None of these 89. If C (n, r) + C (n, r + 1) = 1 : 2 and C (n, r + 1) ; C (n, r + 2) = 2 : 3, determine the value of n and r. (12, 4) (14, 8) (14, 4) (12, 6) 90. Which of the following is not a linear equation? (x - 2) (x + 3) = x + 7 3x + 4 = 2x - 3 11x – 4 11 = 7 11 8y + (21/4) = 3y + 7 91. If the mean of n observations 12, 22, 32, …… n2 is 46n/11, then n is equal to: 11 12 23 22

92. An annuity left unpaid for a certain number of years is called: Contingent Annuity Forborne Annuity Variable Annuity Deferred Annuity 93. A sample of 4 balls is drawn from an urn containing 3 red and 5 white balls. If the sample contains two or more red balls, the player receives one rupee; otherwise he loses half a rupee. What is the mathematical expectation of his gain. 8.33 paise 9.33 paise 10.33 paise none 94. If f : R R; f(x) = 3x3 + 5 for all x Into One-One onto (bijections) One-One into None of these

R, then f is:

95. In an intelligence test administered to 1,000 students the average score was 42 and standard deviation 24. Find the number of students securing between 30 and 54. 383 373 363 393 96. Find n such that (an+1 + bn+1) / an + bn may be the geometric mean between a and b. 0 1 1/2 - 1/2 97. The letters A, B, E, L, T are written on cards, such that one on each card. If all the cards are arranged in a row in all possible ways, the probability of the event of forming the word TABLE (correct to 3 decimals) is: 0.008 0.020 0.200 0.009

Mock Test Paper-IX 205 98. Unequal widths of classes in the frequency distribution do not cause any difficulty in the construction of: Ogive Histogram Frequency Polygon None of these 99. If log32, log3 (2x – 5), log3 (2x – 7/2) are in A.P., then x is: a positive fraction

a negative fraction an even positive integer an odd positive integer 100. The third term of the series whose nth term is (2n – 3) / 4 is: 1/4 3/2 3/4 2/5

206 Full Syllabus Mock Tests

COMMON PROFICIENCY TEST Mock Test Paper–IX [Answer Key] SESSION - I Section A-Fundamentals of Accounting (60 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30.

Question 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60.

Mock Test Paper-IX 207 Section B-Mercantile Law (40 marks)

Question 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80.

Question 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100.

SESSION - II Section C-Economics (50 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Question 11. 12. 13. 14. 15. 16. 17. 18. 19. 20.

208 Full Syllabus Mock Tests Question 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35.

Question 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.

Section D-Quantitative Aptitude (50 marks)

Question 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70.

Question 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90.

Mock Test Paper-IX 209 Question 91. 92. 93. 94. 95.

Question 96. 97. 98. 99. 100.

210 Full Syllabus Mock Tests

COMMON PROFICIENCY TEST Mock Test Paper–X SESSION - I TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section A-Fundamentals of Accounting (60 marks)

1. While preparing a Bank Reconciliation Statement taking the balance as per Cash Book as the starting point, an under cast of withdrawal column in Pass Book is: Added Subtracted not required to be adjusted none of these 2. Cost of machinery purchased on 1st April, 2009 Rs. 5,00,000 Market value Rs. 6,00,000

as

on

31st

March,

2010

As on 31st March, 2010, if the company values the machinery at Rs. 6,00,000 Which of the following valuation principle is being followed? Present Value Current cost Historical Cost Realisable Value 3. Which types of account is sale or return day book? Nominal A/c Personal A/c Suspense A/c Memorandum A/c 4. Which of the following is not a sub-field/Branch of Accounting? Book-keeping Cost Accounting

Management Accounting Social Responsibility Accounting 5. In case Revaluation Account is not prepared, the assets & liabilities appear in the books of reconstituted firm at their: Revalued Figures Realizable Values Old Book Values Market Values 6. Revenue from sale of products, is generally, realized in the period in which: Cash is collected Sale is made Products are manufactured None of the above 7. In case the consignee is allowed del credere commission, to which A/c he will account for Bad debts loss? Consignor A/c Consignment received A/c Commission earned A/c Debtors A/c 8. Bad Debts Account is: An Asset Account A Liability Account A Revenue Account An Expense Account 9. A company issued 1000 12% debentures of 100 at par redeemable at 10% premium. 12% stands for:

Mock Test Paper-X 211 Rate of tax Rate of interest Rate of dividend Rate of TDS 10. Interest accrued for the month of March will be recorded in: Purchases Book Sales Book Cash Book Journal Proper 11. Who bears the expenses of noting charges on dishonourment of a bill of exchange? Drawer Drawee Endorsee Banker 12. L.F. (i.e. Ledger Folio Column) in the journal is filled at the time of: Casting Posting Balancing Journalising 13. Tick the wrong statement. Accounting is the language of business. Transactions are recorded in Quantitative terms only. Accounting is the Art of recording, classifying and summarizing. Transactions and events of Financial Character are subject-matter of Accounting. 14. Mr X valued the inventory on FIFO basis and LIFO basis during 2009 and 2010 respectively. He has violated: Materiality Principle Conservatism Principle Cost Principle Consistency Principle 15. To provide funds to pay to the retiring partner or to the representatives of a deceased partner, generally partners: Create Reserve Fund. Create a Sinking Fund. Create a separate Bank Account. Take Join Life Policy.

16. Which of the following is not an error of principle? Rs. 10,000 paid for erection and commissioning of Plant & Machinery debited to Repairs and Maintenance A/c. Rs. 4,000 paid to Shyam, credited to his A/c. Rs. 1,000 paid as cartage for office furniture debited to Cartage A/c. Rs. 5,000 paid to Gopal as his salary, debited to his A/c. 17. Which of the following errors will affect the Trial Balance? The total of purchase journal is Rs. 2,000 short. Repairs to buildings have been debited to buildings. Freight paid on new machinery has been debited to the Freight Account. None of these. 18. If an inflow of economic benefits is probable then a contingent asset is disclosed: in the financial statements. in the cash flow statement. in the report of the approving authority (Board of Directors in the case of a company, and the corresponding approving authority in the case of any other enterprise). None of the above 19. A, B and C are sharing profit and loss in the ratio of 3:2:1, D is admitted into the firm with 1/7 share of profit which he takes equally from existing partners. What would be sacrificing ratio? 1:1:1 3:2:1 2:4:1 1:3:4 20. X was issued 100 shares of Rs. 10 each at a premium of Re. 1. He paid application money and allotment money total amounting to Rs. 5 (including premium) and failed to pay the balance call money of Rs. 5. Find the maximum discount that can be given at the time of reissue of these shares. Rs. 4 per share Rs. 5 per share Rs. 7 per share Rs. 3 per share

212 Full Syllabus Mock Tests 21. P’s Trial balance as at 31 December, 2010, contains the following information: 12% Bank loan Rs. 40,000, Interest paid Rs. 3,800. Interest debited to the Profit & Loss Account is: Rs 4,500 Rs 3,800 Rs 5,400 Rs 4,800 22. Opening Stock of Raw-Materials Rs. 1,00,000. Closing stock of Materials Rs. 2,00,000. Purchases Rs. 3,00,000, Carriage Inward Rs. 10,000, Freight outward Rs. 5,000. Purchase Returns Rs. 20,000, the cost of raw-materials consumed is: Rs. 1,64,000 Rs. 1,90,000 Rs. 2,10,000 Rs. 1,85,000 23. In a Three-column Cash Book: Cash Discount received is recorded on the credit side of Cash Book. Trade Discount allowed is recorded on the debit side of Cash Book. Discount Columns are balanced. None of above. 24. Purchase Book is a part of the: Cash Book Ledger Journal None of these 25. X, Y and Z are sharing profits & losses in the ratio of 5:3:2. They decide to share future profits & losses in the ratio of 2:3:5 with effect from 1st April, 2010. They also decide to record the effect of the following accumulated profits, losses & reserves without affecting their book figures, by passing a single adjusting entry. Book Figure General Reserve

Rs. 24,000

Profit & Loss A/c

Rs. 6,000

Advertisement Suspense A/c (Dr.)

Rs. 12,000

The necessary single adjusting entry will involve: Debit X and Credit Z with Rs 5,400. Debit Z and Credit X with Rs 5,400. Debit X and Credit Y wit Rs. 5,400. Debit Y and Credit X wit Rs. 5,400.

26. Sales include goods worth Rs. 36,000 sent on sales on approval basis @ 20% profit on cost. At the close of the financial year the goods were still pending with the customer pending approval from the customer. The Accounting adjustment would be: Debit sales A/c by Rs. 36,000, credit Debtors A/c by Rs. 36,000, Credit trading A/c by Rs. 30,000, Debit stock A/c by Rs. 30,000 Debit sales A/c by Rs. 30,000, credit Debtors A/c by Rs. 30,000, Credit trading A/c by Rs. 30,000, Debit stock A/c by Rs. 30,000 Credit sales A/c by Rs. 36,000, debit Debtors A/c by Rs. 36,000, Debit trading A/c by Rs. 30,000, Credit stock A/c by Rs. 30,000 Debit sales A/c by Rs. 6,000, credit Debtors A/c by Rs. 36,000, Credit trading A/c by Rs. 30,000, Debit stock A/c by Rs. 36,000 27. As per Table A, the amount of call on a share must not exceed: 5% of the nominal amount of share. 25% of the nominal amount of share. 5% of the called amount of share. 25% of the called amount of share. 28. Financial accounting information is characterized by all of the following except: It is historical in nature It is factual, so it does not require judgment to prepare. It is enhanced by management’s explanation. It results from inexact and appropriate measures. 29. Goods costing Rs 10,000 taken by the proprietor for personal use were not recorded. The errors will result in: Increase in Gross Profit. Decrease in Gross Profit. No Effect on Gross Profit. Either or 30. Which of the following expenses is not considered as part of cost of stock? Inward consignment freight paid by consignee. Packing, loading, & insurance paid by consignor. Insurance charges paid by consignee. Transport charges upto godown paid by consignee.

Mock Test Paper-X 213 31. P, Q and R are three partners in a partnership firm. P retires from the firm on 31st March 2010. On the date of his retirement stock, Sundry debtors and provisions for bad debts stand in the books of accounts at Rs. 50,000, Rs. 45,000 and Rs. 4,500 respectively. The partners decided to revalue assets. Stock in trade to be reduced to 90%, provisions for bad debts to be brought to 15% of Sundry debtors. The entry for revaluation of stock in trade will be: Profit and loss A/c Dr. Rs. 5000, Stock in trade credit by Rs. 5000 Partners Capital A/c Rs. 5000 to Revaluation A/c Rs. 5000 Revaluation A/c Rs. 45000, Stock in trade Cr. Rs. 45000 Revaluation A/c Dr. Rs. 5000, Stock in trade credit by Rs. 5000 32. Debit balance in Bank pass book means: Bank Balance Bank overdraft Balance as per Cash book Total of bank A/c 33. The gain from sale of capital assets is added to revenue to ascertain the: Operating Profit of a business. Gross Profit of a business. Overall Profit of a an enterprise. None of these 34. Making Provision for Doubtful Debts is an example of: Increase in Asset & Owner’s Liability Decrease in Asset & Owner’s Liability Increase in Liability & Owner’s Liability Decrease in Liability & Increase in Owner’s liability 35. Wages outstanding is classified as: Assets Fixed Liability Current Liability Revenues 36. X sent out 1000 boxes to Ram of Delhi costing Rs 100 each at a profit of 1/6th on Invoice Price. Goods sent out on consignment to be credited in general trading will be: Rs. 92,400 Rs. 86,000

Rs. 1,00,000 Rs. 1,12,000 37. Purchase Day book records: Only cash purchase of trading goods. Only credit purchase of trading goods. Both and All types of purchases including purchase of capital goods. 38. In the case of downward revaluation of an asset which is for the first time revalued, the account to be debited is: Profit & Loss Account. General Reserve. Revaluation Reserve. Fixed Asset. 39. From the following details calculate the number of equity shares of Rs. 10 each to be issued in order to redeem the preference shares. The company intends to raise the balance fund through issue of sufficient number of preference shares at 10% discount. 12% Redeemable preference shares of Rs. 10 each Rs. 1,50,000 Security premium A/c Rs. 15,000 General Reserve A/c Rs. 10,000 Profit and loss A/c Rs. 14,000 Redeemable preference shares redeemed @ 10% premium. 12,000 11,000 14,000 16,000

are

to

be

40. A and B are partners sharing profits in the ratio of 3 : 2. C is admitted paying a premium with 1/4th share of profit of which he acquires 1/6th from A and 1/12th from B. The goodwill of the firm is valued at Rs 20,160. One half of goodwill is with drawn by the partners. A and B withdrew: Rs. 1,280, Rs 1,140 Rs. 1,680, Rs 840 Rs. 980, Rs 1,440 Rs. 1,450, Rs 960 41. ________ assumes that users needs are known and sufficiently well specified so that the accounting theory can deductively arrive at and produce optimal input values for users and useful decision models.

214 Full Syllabus Mock Tests Event approach Value approach Predictive approach Pragmatic approach 42. Sale of office furniture has been credited to Sales Account. It is: A clerical error Compensating error An error of principle An error of omission 43. If a fixed amount is withdrawn on the first day of every month of a calender year, the interest on total amount of drawings will be calculated for: 4.5 months 5 months 6.5 months 5.5 months 44. X and Y are two partners in a partnership firm. As per the terms of partnership deed partners are charged 6% interest on the drawing made by them during the year. During the year ending 31st Dec. 10 X draws money from the firm as per the details given below. 31st March Rs. 4000 31st May Rs. 2000 31st August Rs. 3000 30th November Rs. 2000 Calculate the interest on drawing to be charged from X. Rs. 240 Rs. 385 Rs. 320 Rs. 275 45. Under Sales on Return or approval basis when the transactions are moderate and the seller sends the goods on approval or return basis, the accounting treatment will: No Journal Entry Entry in Sales or Return Day Book Entry in Sales or Return Journal Sales account 46. If the goods purchased are in transit, then the journal entry at the end of the period will be: Good-in-transit A/c Dr. To Trading A/c

Goods-in-transit A/c Dr. To Purchases A/c Goods-in-transit A/c Dr. To Supplier’s A/c or 47. Which of the following does not appear under the head ‘share capital’ of a balance sheet? Equity share capital Preference share capital Capital Reserve account Calls in arrears 48. The cost of inventory as per physical verification as on 24th March, 2010 was Rs. 4,00,000. Goods are sold at a profit of 25% on cost. On 21st March, goods on the sale value of Rs. 1,00,000 were sent on sale on return basis to a customer, the period of approval being two weeks. He returned 20% of the goods on 31st March. The cost of inventory as per books is: Rs. 4,48,000 Rs. 4,26,000 Rs. 4,80,000 Rs. 4,94,000 49. When we say that inventory is to be valued at cost of market price whichever is less. The “Term” market means: Historical cost Current replacement cost Net realizable value Discounted price 50. A and B enter into a joint venture sharing profit and losses in the ratio 3:2. A purchased goods costing Rs 2,00,000. B sold 95% goods for Rs 2,50,000. A is entitled to get 1% commission on purchase and B is entitled to get 5% commission on sales. Remaining goods are stolen. A’s share of profit on venture will be: Rs 24,700 Rs 20,200 Rs 21,300 Rs 22,700 51. A cheque which is payable across the bank counter is: a bearer cheque a crossed cheque Either of above None of the above

Mock Test Paper-X 215 52. On 1.1.2010, X drew a bill on Y for 3 months for 1,50,000. On 4.3.2010, Y pay the bill to X at 12% p.a. discount, the amount of discount will be: Rs 1,200 Rs 900 Rs 1,500 Rs 2,400 53. The portion of the acquisition cost of the asset, yet to be allocated is known as: Realisable value Accumulated value Written down value Salvage value 54. Which does not from part of Divisible Profits? Workmen Accident Fund Workmen compensation fund Capital Reserve arising from revaluation of assets All of above 55. Goods costing Rs 1,000 (Sale Price Rs 1,200) distributed as free samples should be credited to: Purchases Account with Rs 1,000 Sales Account with Rs 1,000 Sales Account with Rs 1,200 Loss by Theft A/c 56. X Ltd. issued Rs 1,00,000 12% debentures at a discount of 6% on 1st January, 20X1, repayable by five equal annual drawings of Rs 20,000 each on 31st Dec. every year. The amount of discount to be written of each year assuming that the company closes its accounts on calendar year basis is: Rs 1,500 each year. Rs 2,000, Rs 1600, Rs 1,200, Rs 800, Rs 400. Rs 400, Rs 800, Rs 1,200, Rs 1,600, Rs 2,000. Rs 1,200 each year.

57. _____________ is created to provide for the loss by way of fluctuation in the value of investment. Investment fluctuation reserve Sinking fund Dividend equalization reserve Debenture redemption reserve 58. A cheque of Rs 2,345 issued by Miss Seeta was recorded in deposit column as Rs 2,435. To ascertain the balance as per Cash Book of Miss Seeta: Rs 2,345 should be added to the balance as per Pas Book. Rs 2,435 should be subtracted from the balanced as per pass Book. Rs 10 should be added to the balance as per Pas Book. Rs 4,780 should be subtracted from the balance as per Pass Book. 59. A and B are partners sharing profits in the ratio of 7:3. A surrenders 1/7th of his share and B surrenders 1/3rd of his share in favour of C, a new partner. The new profit sharing ratio and sacrificing ratio will be: NR 3: 2 : 1, SR 1 : 1 NR 3: 1 : 1, SR 1 : 2 NR 1: 2 : 1, SR 2 : 1 NR 3: 1 : 1, SR 1 : 1 60. Which of the following statements is false? Capital Profit realized in cash can be used for payment of dividend. Capital Redemption Reserve cannot be used for writing off miscellaneous expenses and losses. Dividend is payable on the calls paid in advance by shareholders. Reserve created by revaluation of fixed assets are not permitted to be capitalized.

216 Full Syllabus Mock Tests Section B-Mercantile Law (40 marks) 61. X offers Y his buffalo for Rs.10,000, the buffalo to be delivered to Y on a stipulated day and price to be paid on another stated day. Y accepts the offer. When does the property in the buffalo pass to Y? Immediately On the stipulated day of delivery On payment of price on the other stated day Earlier of or 62. Where the consent of a party is obtained by misrepresentation, the contract is ______ Void Voidable Valid Illegal 63. Where dissolution of Firm is sought for on the ground that a Partner has allowed his share to be sold in the recovery of arrears of land revenue, the suit shall be brought by ______ all the other Partners any other Partner the Partner whose share is to be sold a majority of the Partners. 64. A being indebted to B, the money-lender of his village, contracts, a fresh loan on terms which appear to be unconscionable. Will it be presumed that the contract was induced by undue influence? Yes No Partly Yes None of the above 65. Under which circumstances can the unpaid Seller exercise his right of re-sale? When the goods are of perishable nature When he does not give notice to the Buyer When he gives notice to the Buyer of his intention to re-sale and the Buyer does not within a reasonable time pay the price Both and 66. In case of sale of unascertained goods, the ownership is transferred to the Buyer when the goods are ______ ascertained appropriated to the contract

weighed and measured both and 67. Where a Partner in a Firm is adjudicated as insolvent, he ceases to be a Partner from the ______ Day on which the order of adjudication is made First day of the financial year in which the order of adjudication is made Day on which the Firm comes to know of his insolvency Day as decided by the Registrar of Firms. 68. In case the delivery of goods is delayed due to the fault of a party, the goods shall be at the risk of defaulting party even though the ownership is with the other party. True, as there is a provision to this effect False, as it is against the general rule Partly True None of the above 69. The rule of estoppel implies that a person who holds himself out to be a Partner ______ can claim innocence and claim that he was misrepresented as a Partner can claim that he is a real Partner in the Firm is estopped from denying that he was represented as a Partner is estopped from admitting liability to third parties 70. An agreement which is enforceable by law at the option of one or more of the parties thereon but not at the option of the other or others is a: Valid Contract Voidable Agreement Void Agreement Contingent Agreement 71. Where a Partnership Contract is rescinded on grounds of fraud or misrepresentation, the party entitled to rescind, is entitled to: a lien on/right of retention of the surplus or assets of the Firm remaining after settlement of Firm’s debts, for any sum paid by him for purchase of share or for contribution of capital

Mock Test Paper-X 217 rank as a Creditor of the Firm in respect of any payment made by him for the Firm’s debts be indemnified by the Partner(s) guilty of such fraud or misrepresentation against all debts of the Firm. All of the above.

being no collusion between A and the Trader. Is the Firm liable to the Trader? Yes No Partly Yes None of the above

72. A stipulation which is collateral to the main purpose of the contract, and if proves false, gives the Buyer only a right to claim damages, is known as Guarantee Warranty Condition Term

78. An agreement, which prevents a person from carrying a lawful business, is ______ Void Valid Voidable Contingent

73. The Offer of Promisor to perform must be made to: the Promisee any one of the Joint Promisees Authorised Agent(s) of or Any one of the above

79. Under which of the circumstances does the Unpaid Seller lose his right of lien? By Estoppel Where Seller waived the right of lien Where the Buyer or his agent lawfully obtains possession of the goods Any of the above

74. A mistake as to a law not in force in India has the same effect as: Mistake of fact Mistake of Indian law Fraud Misrepresentation

80. Every Partner cannot participate in the conduct of the business. True Partly True False None of the above

75. Unless agreed otherwise, a Firm is dissolved by the death of a Partner. True Partly True False None of the above

81. Agreement with a view to defraud others is — legal void voidable valid

76. A agrees to sell a horse to B on a condition that B will keep it for 6 days on trial basis and have the option to return on the expiry of 6 days, if he does not find it suitable. Three days after the making over of the horse to B, it dies without the fault of either party. The contract is thereby avoided. Yes No Partly Yes None of the above 77. A and B are Partners. A with the intention of cheating B goes to a shop and purchases such articles on behalf of the Firm as might be used in the ordinary course of the Partnership business, but converts them to his own separate use, there

82. As per Section 20, the contract is void on account of bilateral mistake of fact. but as per Section 22, if there is mistake of only one party, then the contract is: Void Voidable Valid Illegal 83. A Partner can retire on: Reaching the age of superannuation On the balance in the Capital Account reaching a certain amount Giving a notice of his intention to retire On the condition of his nominee becoming a Partner

218 Full Syllabus Mock Tests 84. Acceptance of delivery of goods is deemed to take place when the Buyer: intimates to the Seller that he had accepted the goods does any act to the goods, which is inconsistent with the ownership of the Seller rejects and retains the goods after the lapse of a reasonable time, without intimating the Seller any of the above 85. A threatens to kill B if he does not agree to sell his scooter to him for Rs.1000 only. Here B’s consent is obtained by: Undue Influence Fraud Coercion Misrepresentation 86. In case of special conditions or terms in a contract, the Offeree is not bound or deemed to have accepted if such conditions — are communicated to him are not communicated to him are legal and enforceable are restrictive in nature. 87. A Partner who receives certain remuneration from the Firm as per the express agreement, becomes an employee of the Firm. True Partly True False None of the above 88. An agreement with a Minor can be ratified after he attains majority. True Partly True False None of the above 89. Generally, the following recoverable? Ordinary Damages Special Damages Remote Damages Nominal Damages

damages

are

90. The Sale of Goods Act, 1930 deals with the — Movable Goods only. Immovable Goods only.

not

Both Movable and Immovable Goods. All Goods except ornaments. 91. Which of the following is not a disability of an Unregistered Firm? It cannot file a suit against third parties its Partners cannot file a suit against a Firm It cannot be sued by a third party Any of the above 92. There can be a stranger to a consideration but not a stranger to a contract. True Partly True False None of the above 93. Where a contract has to be inferred from the conduct of parties, it is called: Express Contract Implied Contract Tacit Contract Unlawful Contract. 94. Conditions and Warranties may be: Express Implied Either or . Neither nor 95. A, B and C jointly promised to pay Rs.30,000 to D. For recovery of this amount, D filed a suit against A only. Is he justified? Yes, as the liability of Joint Promisors is joint and several. No, as the liability of Joint Promisors is joint only. No, D has to sue all of A, B and C jointly. None of the above. 96. Which of the following statements, about the registration of Firm, is not true? It must be done at the time of its formation. It may be done at the time of formation. It may be done at any time after its formation. It may be done in the presence of a Notary Public. 97. Where the performance of a promise by one party depends on the prior performance of promise by the other party, such Reciprocal Promises fall under the category of:

Mock Test Paper-X 219 Mutual and Concurrent Conditional and Dependent Mutual and Independent Both and 98. Which of the following elements does not affect the free consent of the parties? Coercion Fraud Incompetency Undue Influence 99. Is it compulsory for a Minor who has attained majority to give public notice that he has elected

either to become or not to become a Partner in the Firm? Yes No Partly Yes None of the above 100. The term “Goods” under Sale of Goods Act, 1930 does not include: Goodwill Actionable Claims Stocks and Shares Harvested Crops

220 Full Syllabus Mock Tests SESSION - II TIME: 2 Hours

Maximum marks: 100

Each Question have only one correct answer and carry + 1 mark for each correct answer and – 0.25 mark for each wrong answer. Section C-Economics (50 marks)

1. Structural unemployment is caused: by a decline in demand for production in a particular industry, and consequent disinvestment and reduction in its manpower requirement. due to the introduction of better machinery and improvement in methods of production. due to trade cycles especially recessionary and depressionary phases. None of above. 2. According to 2001 census, which state recorded the highest literacy rate? Mizoram Tamilnadu Kerela Assam 3. When increase in output is less than proportional to an increase in inputs, it is called: Increasing Returns to Scale Constant Returns to Scale Decreasing Returns to Scale Negative Returns to Scale 4. In which of the following method of disinvestment, the government retains stake upto 26% in the PSU to protect its interest? Cross-holding Golden share Strategic sale Warehousing 5. Under perfect competition losses incurred by the firm at the shut down point are equal to which cost? AC MC TFC

AVC 6. Capital intensive techniques will be the choice of: labour surplus economy capital surplus economy both labour and capital surplus economy underdeveloped economy 7. CSO stands for: Central Statistical Organisation Central Statutory Organisation Centre-State Organisation Central Social Organisation 8. The output and cost pattern of a product are given below: Output (q)

0

Total in Rs. cost (Tc)

30 42 53 63 75 88

1

2

3

4

5

From the above details what is the marginal cost of producing 2nd unit? Rs. 12.5 Rs. 9 Rs. 11 Rs. 14 9. Behavioural assumption of Sweezy’s kinked demand curve model is: oligopolists recognise mutual dependents oligopolists match price cuts but not price increases oligopolists do not match price cuts and price increases oligopolists match price increases but not price cuts 10. Higher the consumer surplus implies state of economy is: advanced developing

Mock Test Paper-X 221 under developed none of above 11. In economics, a state of balance is called: break-even point equilibrium point stability point saturation point 12. The concept of demand-pull inflation works when: supply is umlimited. all factors of production are variable. there is full employment in an economy. All of above 13. An engel curve is: Flat demand curve Upward sloping demand curve A type of demand curve which is angular A type of demand curve named after Prof Engel 14. Personal cultivation refers to: personal labour on the part of the owner. personal labour on the part of the cultivator. personal supervision only and not the personal labour on the part of the owner. both personal supervision as well as personal labour on the part of the owner. 15. When we go from general assumption to particular production which method is used for constructing an economic theory? Inductive method Deductive method General method Partial method 16. The kink occurs at: prevailing price any quantity any price to be determined price 17. Example of substitutes can be: rice and wheat ball pen and ink pen tea and coffee all of the above 18. The shape of demand curve in Oligoploy is: Perfectly elastic

Inelastic Elastic Undefined 19. Treasury bills are: Long term liability of State Government Long term liability of Central Government Short term liability of Central Government Joint liability of State and Central Government 20. Main cause of slow progress of land reforms is: Inadequate ceiling laws Lack of political will Problem of voluntary surrender None of the above 21. Capitalist system is characterized by ________ of means of production. Private ownership Social ownership State ownership All the three 22. Which of these method of measuring National income is used in the Trade, Hotels and Restaurants sector? Income method Value added method Expenditure method None 23. When labour and capital are increased by 10% and also increases by 10%, then we have: Increasing returns to scale Decreasing returns to scale Constant returns to scale Negative returns to scale 24. Cheap money policy means: Making money available to trade and industry at cheaper interest rate. Demanding more money for the same goods than earlier. Giving money at discounted price. Printing money by cost efficient printing technology. 25. One of the main recommendations of Chelliah Committee on tax reform is: Limitation of MODVAT to products such as textile and petroleum.

222 Full Syllabus Mock Tests Increase in import duties on almost all commodities. Introduction of a simplified tax scheme for large manufacturers. Removal of various concessions and exemptions.

32. When there is no consumption, what value TU and MU takes? TU is zero and MU is positive TU is zero and MU is falling TU is zero and MU is maximum TU is zero and MU is minimum

26. _______ provides the forum for negotiations among its members concerning their multilateral trade relations. IMF IBRD WTO IFC

33. Equilibrium price will increase sharply if: the demand for a commodity and its supply both decreases in the same proportion. the demand for a commodity and its supply both increases in the same proportion. the demand for a commodity decreases and its supply increases in the same proportion. the demand for a commodity increases and its supply decreases in the same proportion.

27. How does the Central Bank regulate credit flow by moral suasion? Enhancing CRR Enhancing bank rate Refusing further credit to commercial banks Issuing directions to commercial banks to cooperate with the general monetary policy of the Central Bank 28. Globalisation will result in allocative efficiency by: raising labour productivity raising capital funds modernising technologies all of the above 29. When AP is maximum, MP is equal to: Zero One AP TP 30. Full convertibility on Current Account means freedom to buy and sell foreign currency for transaction relating to: Interest obligation Moderate family living expenses Payment due in respect of foreign trade All the three 31. Which of the following is empowered to regulate credit creation and money supply in an economy? Central Bank of India (CBI) Reserve Bank of India (RBI) State Bank of India (SBI) Regional Rural Banks (RRB)

34. If production possibility frontier is linear it implies: Economy is stagnant. Underemployment of factor of production. Constant opportunity cost. With the increase in production, opportunity cost also increases. 35. Which of the following statement is incorrect? Capital Formation determines the growth rate of an economy. Capital Formation increases production. Capital Formation reduces the productive capacity of an economy. Capital Formation raises employment opportunities. 36. Commercial Banks were nationalised in: 1991 1969 1947 1984 37. Which of the following fact about an Indian economy is revealed by an analysis of National income statistics? There is low standard of living of the people. There is unequal distribution of income. There exists a large regional disparity. All of above. 38. India has largest merchant and shipping fleet in: the world Asia developing countries south east countries

Mock Test Paper-X 223 39. The terms Micro economic and Macro economics were coined by: Giffen Professor A Samulson Prof. Ragner Frisch Fedrick Taylor 40. Which of the following stage of the law of variable proportion covers the entire range over which MP curve is negative? Stage of Increasing Returns Stage of Diminishing Returns Stage of Negative Returns None of above 41. The aggregate of the utility that a consumer derives from the consumption of a certain amount of a commodity is called: Incremental Utility Additional Utility Marginal Utility Total Utility 42. MC curve passes through the minimum point of both AC and: AFC AVC TC TVC 43. If price of rice rises from Rs. 20 to Rs. 40 per kg. and supply increases from 10 kg. to 15 kg. in a month, then the arc elasticity of supply is: 0.2 0.4 0.6 0.8 44. A budget is said to be balanced if: receipts are greater than expenditure. receipts are equal to expenditure. capital receipts are equal to capital expenditure.

revenue receipts are equal to revenue expenditure. 45. A rightward shift of the demand curve indicates: an increase in demand a decrease in demand an expansion of demand a contraction of demand 46. ____________ is the sum total of income actually received by person from all sources in the form of current transfer payments and factor incomes. Personal income Disposable Income National Income Domestic Factor Income 47. When the price of a good falls and, as a result, if the total outlay of consumers on the commodity rises then: Ed < 1 Ed > 1 Ed = 1 Ed = 0 48. The reward or price of ________ is not certain and cannot be decided in advance. A land An entrepreneur A labourer All of above 49. The year which is known as the year of great divide: 1901 1987 1921 1951 50. When there is infinite change in quantity supplied at a price, the shape of supply curve is: Vertical Horizontal Upward sloping originating from x axis Upward sloping originating from y axis

224 Full Syllabus Mock Tests Section D-Quantitative Aptitude (50 marks) 51. For a student, the probability of getting a pass in one paper is 75% and the probability of getting a pass in another paper is 60%. The probability for the student to pass in one paper (of the two papers) only is: 3/10 13/20 11/20 9/20 52. Eight people are planning to share equally the cost of a rental car. If one person withdraws from the arrangement and the others share equally the entire cost of the car, then the share of each of the remaining persons increased by: 1/4 1/6 1/7 1/9 53. Which of the following laws states that if A, B and C are three sets then, A (B U C) = ( A B) U (A C). Associative Laws Distributive Laws Complement Laws Identity Laws 54. The next term of the series 5, 20, 45, 80 is: 110 115 120 125 55. Ten competitor in a beauty contest are ranked by two judges in the following orders: 1st Judge:

1 6 5 10 3

2nd Judge: 3 5 8

4

2

4 9 7 8

7 10 2 1 6 9

Then the value of R is: 0.21 0.31 0.41 0.28 56. The value of x satisfying log32x = 0.8 is: 8 16

48 236 57. A pharmaceutical company wants to estimate the mean life of a particular drug under typical weather conditions. A simple random sample of 81 bottles yields the following information: Sample mean = 23 months, population variance = 6.25 (months)2 The interval estimate with a confidence level of 90% is: [22.54, 23.46] [22.54, 23.16] [22.54, 21.46] none of these. 58. Rs. 5000 is invested in a Term Deposit Scheme that fetches interest 6% per annum compounded quarterly. What is effective rate of interest? 6.03% 6.13% 5.16% 6.18% 59. The lines 2x - y - 3 = 0 3x - 2y - I = 0 and x - 3y + 2 = 0 are: concurrent not concurrent perpendicular to each other parallel to each other 60. The geometric mean of the first n terms of the G.P. a + ar + ar2 +……….. is: arn/2 arn ar(n-1)/2 arn-1 61. Given x = 2t + 5 ; y = t2 - 2, then

dx is calculated dy

as: t -t 1/t -1/t 62. The following data relate to the marks of a group of students:

Mock Test Paper-X 225 Marks

No. of students

Below 10

15

Below 20

38

Below 30

65

Below 40

84

Below 50

100

How many students get marks more than 30? 65 50 35 43 63. In n is a natural number such that n = p1a1 . p2a2 . …………. . pkak and p1, p2, ……. pk are distinct primes, then logen >= log 2 k log 2 log 4 k log 3 64. Given: Unexplained variation = 19.22, explained variation = 19.70, then the coefficient of correlation is: ± 0.71 ± 0.75 ± 0.61 ± 0.65 65. A dietitian wishes to mix together two kinds of food so that the vitamin contents of the mixture is at least 9 units of vitamin A, 7 units of vitamin B, 10 units of vitamin C and 12 units of vitamin D. The vitamin content per kg. of each food is shown below A

B

C

D

Food I:

2

1

1

2

Food II:

1

1

2

3

Assuming x units of food I is to be mixed with y units of food II the situation can be expressed as: 2x + y >= 7 ; x + y >= 10 ; x + 2y >= 9 ; 2x + 3y >= 12 ; x >= 0; y >= 0 2x + y = 12 ; x >= 0; y >= 0 2x + y >= 9 ; x + y >= 7 ; x + 2y >= 10 ; 2x + 3y 0; y > 0 2x + y >= 9 ; x + y >= 7 ; x + 2y >= 10 ; 2x + 3y >= 12 ; x >= 0; y >= 0

66. The value of [(10)150 + (10)146] is: 1000 10000 100000 1000000 67. When an investigator wants a sample containing m units which possess a rare attribute, the appropriate sampling procedure is: stratified sampling purposive sampling inverse sampling all of these 68. The equation of the straight line through the point of intersection of the lines 2x + y – 5 = 0 and x + 3y + 8 = 0 and cutting off equal intercepts from the axes is: 5x - 5y – 2 = 0 5x - 5y + 2 = 0 5x + 3y + 2 = 0 5x + 5y – 2 = 0 69. For grouped frequency distribution __________ is equal to the value corresponding to cumulative frequency kN/10. median kth percentile kth decile none of these 70. Length of a class is: the difference between the U.C.B. and L.C.B. of the class the difference between the U.C.L. and L.C.L. of that class Either or Both and 71. The roots of the system of equations: x + y - z = 3, 2x + 3y + z = 10, 3x – y – 7z = 1 is: 3, 1, 1 3, -1, 1 3, 1, -1 -3, 1, 1 72. The M.D. of the variates 10, 15, 20, 25…………85 over A.M. is nearly: 40 42 40.7 38.7

226 Full Syllabus Mock Tests 73. Following is an incomplete distribution having modal mark as 44: Marks No. of Students:

0-20 20-40 40-60 60-80 80-100 5

18

?

12

5

What would be the mean marks? 45 46 47 48 74. Random sampling implies: Probability sampling Haphazard sampling Systematic sampling Sampling with the same probabililty for each unit. 75. The roots of the cubic equation: x3 + 7z2 - 21x - 27 = 0 are: (3, 9, 1) (3, - 9, - 1) (- 3, 9, 1) (- 3, - 9, - 1) 76. There are six slips in a box and numbers 1, 1, 2, 2, 3, 3 are written on these slips. Two slips are taken at random from the box. The expected values of the sum of numbers on the two slips is: 4 5 7 6 77. How many words can be formed with the letters of the word ‘ORIENTAL’ so that A and E always occupy odd places. 8640 8460 8240 8420 78. The least integer which when subtracted from both the terms of 6/7 will give a ratio equal to 16/21 is: 2.3 2.8 3.5 4.2 79. A candidate is required to answer 6 out of 12 questions which are divided into two groups

containing 6 questions in each group. He is not permitted to attempt not more than four from any group. The number of choices are: 780 820 850 860 80. Given the regression equations as: 3x + y = 13 and 2x + 5y = 20, which one is the regression equation of y on x? 1st equation 2nd equation both and none of these 81. The gradient of the curve y = 3x2 - 5x + 4 at the point (1, 2) is: 0 1 -1 2 82. Chain index is equal to: (link relative of previous year x chain index of the current year)/100 (link relative of current year x chain index of the current year)/100 (link relative of current year x chain index of the previous year)/100 (link relative of previous year x chain index of the previous year)/100 83. In a class of 64 students, the number of girls is (1/7) times the number of boys. The number of boys and girls in the class are: 56, 8 46, 18 36, 28 26, 18 84. If each value of a series is multiplied by 10, the coefficient of variation will be increased by: 25% 15% 10% 10% 85. The ratio of the sums of m and n terms of an A.P. is m2 : n2. The ratio of mth and nth terms is: m:n (m + 1) : (n + 1)

Mock Test Paper-X 227 (2m + 1) : (2n + 1) (2m - 1) : (2n - 1) 86. From the following data x:

2

3

5

4

7

y:

4

6

7

8

10

The coefficient of correlation was found to be 0.93. What is the correlation between u and v as given below? u: –3

–2

0

–1

2

v: –4

–2

–1

0

2

- 0.93 0.93 0.57 - 0.57 87. Index number for the base period is always taken as: 100 50 1 200 88. Common form of rectilinear co-ordinate graph is: surface chart band chart stratum chart All the above 89. For any natural number a, we define aN = {ax : x N}. If b, c, d N such that bN cN = dN, then d is equal to: b c bc ac 90. Two dice are thrown at a time. The probability that the numbers shown are equal is: 5/6 2/6 1/6 none of these 91. A function f is defined as follows f(x) = 4x, when x 5 2x, when x 5 Test the existence of lim f(x). x

5

limit does not exist limit exist but not finite infinite limit none of these 92. There are two consecutive numbers such that the difference of their reciprocals is 1/240. The numbers are: (12, 15) (15, 16) (15, 18) (12, 13) 93. If each of the n observations of a discrete data with mean X be divided by a non-zero constant , then the new mean is: X X X/ None of these 94. The range of the relation R, where R = {(x, x3); x is a prime number less than 10} is: (8, 27, 125, 343) (8, 29, 115, 243) (8, 27, 125, 243) (2, 3, 5, 7) 95. X is a normal variable with mean = 5 and S.D. 10. Find the value of b such that the probability of the interval [25, b] is 0.4772. 45 35 55 65 96. If X and, Y are 2 independent normal variables with mean as 10 and 12 and S.D. as 3 and 4, then (X + Y) is normally distributed with: mean = 22 and S.D. = 7 mean = 22 and S.D. = 25 mean = 22 and S.D. = 5 mean = 22 and S.D. = 49 97. In how many ways can 18 different books be divided equally among 3 students? 18!/(6!)3 18!/3(6!)3 18!/ 6! 18!/(3 x 6!)

228 Full Syllabus Mock Tests 98. If E[X - E(X)] = 0, then E(X) equals: 0 μ E(11X) μ2 99. A equipment is purchased on an instalment basis such that Rs. 5000 is to be paid on the signing of the contract and four yearly instalments of Rs. 3000 each payable at the end of the first, second, third and fourth year. If the interest is charged at 5% per annum, what would be the cash down price? Rs. 14654.65

Rs. 15637.85 Rs. 12854.82 Rs. 17436.24 100. The integral of (3x + 7) (2x2 + 3x - 2) w.r.t x is: (2/3) log (x2 + 3x - 2) + (19/20) log [(2x - 1) / {2(x + 2)}] + k (3/4) log (3x2 + 2x - 2) + (19/20) log [(2x - 1) / {(x + 2)}] + k (3/4) log (2x2 + 6x - 2) + (19/20) log [(x - 1) / {(x + 2)}] + k (3/4) log (2x2 + 3x - 2) + (19/20) log [(2x - 1) / {2(x + 2)}] + k

Mock Test Paper-X 229

COMMON PROFICIENCY TEST Mock Test Paper–X [Answer Key] SESSION - I Section A-Fundamentals of Accounting (60 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30.

Question 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60.

230 Full Syllabus Mock Tests Section B-Mercantile Law (40 marks)

Question 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80.

Question 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100.

SESSION - II Section C-Economics (50 marks)

Question 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Question 11. 12. 13. 14. 15. 16. 17. 18. 19. 20.

Mock Test Paper-X 231 Question 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35.

Question 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.

Section D-Quantitative Aptitude (50 marks)

Question 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70.

Question 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90.

232 Full Syllabus Mock Tests Question 91. 92. 93. 94. 95.

Question 96. 97. 98. 99. 100.

All India Mock Test-I

PART C All India Mock Tests

233

Test ID: 123

AIMCPT ME All India Mock Test–I SESSION - I TIME: 2 Hours

Maximum marks: 100 Answer all questions

(Each question carries 1 mark for correct answer and a negative 1/4 mark for incorrect answer).

Section A-Fundamentals of Accounting (60 marks)

1. At the end of the financial year after sale of goods worth Rs. 2,00,000, there was a closing stock of Rs. 10,000. This is: An event A transaction Both an event as well as transaction None of these 2. The Provision for discount on debtors is calculated: before deducting additional Bad Debts. before deducting additional discount. before deducting provision for doubtful debts from debtors. after deducting provision for doubtful debts from debtors. 3. Purchase of RBI bonds for cash would lead to: Total assets to decrease Total assets to increase No change in total assets Total liabilities to increase 4. Purchase Price of Machine Rs. 80,000, Installation Charges Rs. 20,000, Residual Value Rs. 40,960, Useful life 4 years, the rate of depreciation under WDV Method is: 15% 20% 14.76% 25%

5. Which of the following is an Accounting Concept? Consistency Conservatism Money measurement None 6. A, B and C are the partners sharing profits in the ratio of 7 : 5 : 4. C died on 30th June 2009 and profits for the accounting year 2008-2009 were Rs 48,000. How much share in profits for the period 1st April 2009 to 30th June 2009 will be credited to C Account. Rs 3,000 Rs 8,000 Rs 4,000 Rs 12,000 7. An old furniture was sold for Rs. 450, but the amount has been entered in the Sales Day book as Rs. 540. On rectification of this error suspense Ac will be: Debited by Rs. 450 Credited by Rs. 90 Debited by Rs. 90 Credited by Rs. 450 8. Consider the following data pertaining to X Ltd. Particulars Cost of Machinery purchased on 1st April, 09 Installation charges Market value as on 31st March, 09

Rs. 1,00,000 10,000 1,20,000

236 All India Mock Tests While finalizing the annual accounts, if the company values the machinery at Rs 1,20,000. Which of the following concepts is violated by the X Ltd. Cost Matching Realisation Periodicity 9. Which of the following is correct? Profit/Loss = Closing Capital + Additional Capital - Drawings made - Opening Capital Profit/Loss = Closing Capital - Drawings made - Additional Capital - Opening Capital Profit/Loss = Opening Capital + Drawings made - Additional Capital - Closing Capital Profit/Loss = Closing Capital + Drawings made - Additional Capital - Opening Capital 10. Which of the following is not a fictitious Asset? Deferred revenue expenditure Accumulated losses Pre-paid Rent Discount on issue of shares and debentures 11. Direct payment received from third party on behalf of account holder is entered in: the Cash Book when the amount is received by the Bank the Pass Book when the amount is received by the Bank the Cash Book when entry is posted in the Pass Book None of these 12. The periodic total of sales return day book is posted to: Debit side of Sales Ac Credit side of trading Ac Credit side of Sales Ac Credit side of Purchase return Ac 13. F Ltd. forfeited 50 shares of Rs 100 each issued at 10% premium (to be paid at the time of allotment) on which first call of Rs 30 per share was not received, the second & final call of Rs 20 per share was not yet called. If 20 of these shares were reissued as Rs 80 paid-up for Rs 90 per share, the Profit on re-issue is: Rs 1,400 Rs 2,400 Rs 700

Rs 1,000 14. From the following details calculate Closing stock. Opening stock = 15,000 Purchases = Rs. 180,000 Direct expenses = Rs. 35,000 Selling and distribution expenses = Rs. 20,000 Administrative expenses = Rs. 10,000 Financial expenses = Rs. 5,000 Sales = Rs. 240,000 Gross profit on sales 25% Rs. 54,000 Rs. 46,000 Rs. 50,000 Rs. 60,000 15. The manufacturing account is prepared; to ascertain the profit or loss on the goods produced to ascertain the cost of the goods manufactured to show the sale proceeds from the goods produced during the year both and 16. When prices are continuously increasing which of the following method of inventory valuation report higher profit? FIFO LIFO Weighted average Specific identification method 17. Insurance claim for machinery damaged by fire is: Capital Receipt Revenue Receipt Advance Receipt None of these 18. To redeem 15% Pref. Shares of Rs 1,00,000 at 5% premium, Rs. 10,000 12%. Debentures of Rs 100 each are issued at a discount of 10%. The amount to be transferred to Capital Redemption Reserve is: Nil Rs 90,000 Rs 91,000 Rs 1,00,000

All India Mock Test-I

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19. Under sinking fund method of depreciation any surplus in sinking fund Ac is transferred to: Profit and loss Ac Reserve Capital Ac Capital Reserve Ac General Reserve Ac

25. The assets are classified as current assets and fixed assets in accordance with: Accounting period Assumption Matching Principle Consistency Principle Going concern principle

20. When the Interest on capital is allowed to partners, Interest on Capital Account is debited and Partners’s Capital Account is credited. It is called: an opening entry a closing entry an adjusting entry an transfer entry

26. Which of these parties would debit noting Charges Ac? Bank Drawee Drawer Endorsee

21. Opening Capital Rs 30,000, Closing Capital Rs 15,000, Loss during the year Rs 8,000, Drawings Rs 7,000, Additional Capital introduced will be: Nil 8,000 16,000 23,000 22. The following is entered in the Journal Proper: Purchase of an machinery for cash Purchase of an machinery on credit Purchase of goods for Cash Purchase of goods on credit 23. Goods sent on consignment Ac is a: Personal account Nominal account Memorandum Account Suspense account 24. XY formed a joint venture to construct railway line for Metro railway in Delhi and agreed to share profit and loss in the ratio of 2:3. X purchased goods worth Rs. 2,00,000 and send the same to Y on payment of freight and insurance of Rs. 10,000. Y also purchased material worth Rs. 45,000 and incurred Rs. 5000 as incidental expenses. Y sold the construction material to Railway for Rs. 320,000. the profit will be shared by X and Y as 32,000, 28000 24,000, 36,000 20,000, 30,000 36,000, 24,000

27. If a reliable estimate of probable outflow of resources to settle a present obligation cannot be made, it is: to be recognised as a liability to be recognised as a provision to be disclosed as a contingent liability none of these 28. Loss on issue of debentures is treated as: Intangible asset Current asset Current liability Miscellaneous expenditure 29. Cost of stock as per books is Rs. 2,38,000. Goods purchases for Rs. 10,000 received but omitted to be recorded. Goods costing Rs. 20,000 were sold & delivered but omitted to be recorded. Goods costing Rs. 5,000 were returned by customers but omitted to be recorded. Goods costing Rs. 3,000 were returned to suppliers but omitted to be recorded. The value of physical inventory is: Rs. 2,42,000 Rs. 2,34,000 Rs. 2,30,000 Rs. 2,24,000 30. Provision for Doubtful Debts Account is: An Asset Account A Liability Account A Revenue Account An Expense Account 31. A, B and C are partners in the ratio of 3: 2: 1. D is admitted with 16th share in profits. C would retain his original share. The new profit sharing ratio will be:

238 All India Mock Tests 8:10:2:5 12:9:4:4 12 : 8: 5 : 5 9 :5:3:3 32. Mr. Y sent goods costing Rs. 1,00,000 which were invoiced at a profit of 25% on invoice price on 10th March on reject or approval basis. Out of which goods costing Rs. 30,000 were accepted by the customers till 31st March and the remaining were still pending with the customers as on 31st March. How would you deal with the goods lying with the customer as on 31st March? Deduct Rs. 100,000 from sales and debtors and include goods worth Rs. 70,000 in closing stock. Deduct Rs. 30,000 from sales and debtors and include goods worth Rs. 70,000 in closing stock. Deduct Rs. 50,000 from sales and debtors and include goods worth Rs. 66,000 in closing stock. Deduct Rs. 70,000 from sales and debtors and include goods worth Rs. 52,500 in closing stock. 33. If the consignee is not authorized to get delcredere commission, then he is liable for all losses on account of nonrecovery of debts due to insolvency of customers he is not liable for all losses on account of non-recovery of debts due to dispute. he is not liable for all losses on account of non-recovery of debts due to insolvency of customers none of these 34. Accounting policy for inventories of X Ltd. states that inventories are valued at the lower of cost determined on weighted average basis or net realizable value. Which accounting principle is followed in adopting the above policy? Materiality Prudence Substance over form All of the above 35. In Memorandum Joint Venture Account Method, each Co-venturer records all the joint venture transactions common joint venture transactions

only those which are effected by him only None of these. 36. XY are two partners in a partnership firm. As per the terms of partnership deed partners are charged 6% interest on the fresh capital added by them. During the year ending 31st Dec. 09, Y added fresh capital in the firm as per details given below. 31st March Rs. 3000 31st May Rs. 2000 31st August Rs. 2000 30th November Rs. 1000. What will be the interest on fresh capital added by Y? Rs. 245 Rs. 260 Rs. 185 Rs. 310 37. Which of the following is not foreign bill? A bill drawn in India, on a person resident outside India and made payable outside India A bill drawn outside India, on a person resident outside India A bill drawn outside India, made payable in India A bill drawn on a person resident in India made payable in India 38. To which account is accumulated balances of profit and loss account and general reserve account are transferred at the time of admission of a partner? Partners current capital Ac Partners fixed capital Ac Revaluation Ac Profit and loss adjustment Ac 39. Current Liabilities are those liabilities which: fall due for payment within a period of not more than 6 months. fall due for payment within a period of more than 12 months. fall due for payment within a period of not more than 12 months. none of these 40. A, B and C are three partners sharing profit and loss in the ratio of 3:2:1. B retires from the firm. What is the new profit sharing ratio of the remaining partners?

All India Mock Test-I 1:3 3:1 2:3 3:2 41. When a firm maintains a Three-column Cash Book, it need not maintain: Cash Account in the ledger Bank Account in the ledger Discount Account in the ledger Both Cash Account and Bank Account in the ledger. 42. There must be a gap of ____ month between two calls. 2 1 6 3 43. Which of the following item is not to be adjusted in the Amended Cash Book? Bank Charges and Interest charged by Bank Interest allowed and Direct Payments by Bank Direct Payment by our Debtors into the bank A wrong entry in the Pass Book 44. Redeemable preference shares redeemed out of: Profit prior to incorporation Contingency fund General reserve Dividend Equalization Fund Ac

cannot

be

45. X Ltd. purchased a plant for Rs. 20,000 payable Rs. 6,500 in cash and balance by issue of 13% debentures of Rs. 100 each at a discount of 10%. However many debentures would be required to issue to the vendor? 180 debentures of Rs. 100 each 120 debentures of Rs. 100 each 150 debentures of Rs. 100 each 225 debentures of Rs. 100 each 46. The process of recording a transaction in the journal is called: Posting Journalising Casting Balancing

239

47. Which of the following errors is an error of principle? Rs 600 received from Ganpat has been debited to his account Purchase of Rs 2,000 has been entered in the sales journal Repairs to building have been debited to Building Account None of these. 48. X Ltd. issued 10,000, 12% debentures of Rs 100 each at a premium of 10%, which are redeemable after 10 years at a premium of 20%. The amount of loss on redemption of debentures to be written off every year is: Rs 12,000 Rs 25,000 Rs 20,000 Rs 30,000 49. The term of a Bill after date commences: from the date of acceptance of the bill. from the date of drawing a bill. from the date of receipt of the accepted bill. from the date of receipt of drawn bill. 50. Under average profit basis goodwill is calculated by: No. of years purchased multiplied with average profits. No. of years purchased multiplied with super profits. Summation of the discounted value of expected future benefits. Super profit divided with expected rate of return. 51. H Ltd. purchased a machinery on April 01, 2005 for Rs. 3, 10,000. It is estimated that machinery will have a useful life of 5 years after which it will have salvage value of Rs. 10,000. If the company follows Sum-of-the-Years-Digits method of depreciation, the amount of depreciation charged during the year 2009-2010 was: Rs. 1,20,000 Rs. 90,000 Rs. 40,000 Rs. 60,000 52. The concept of conservatism when applied to the balance sheet results in:

240 All India Mock Tests Understatement of assets Overstatement of assets Overstatement of capital Understatement of capital 53. Outgoing Partner is compensated for parting with firm’s future profits in favour of remaining partners. In what ratio do the remaining partners contribute to such compensation amount? Gaining Ratio Capital Ratio Sacrificing Ratio Profit Sharing Ratio 54. Insurance claim for loss-in-transit received by consignee is: Debited to Insurance Co. Debited to Bank Account Credited to Consignee’s Account Credited to Abnormal Loss Account 55. A and B are partners with the capital Rs 1,00,000 and Rs 80,000 respectively. They share profits and losses equally. C is admitted on bringing Rs. 50,000 as capital only and nothing was bought against goodwill. Goodwill in Balance sheet of Rs. 40,000 is revalued as Rs 70,000. What will be value of goodwill in the books after the admission of C? Rs. 95,000 50,000 Rs. 1,25,000 70,000 56. Which of the following errors will not be revealed by the trial balance? Wrong totalling in the books of original entry. Wrong balancing in the Cash Book. Wrong carrying forward in the books of original entry.

Posting a correct amount in the wrong account but on the correct side. 57. Journal proper is used to record: all cash purchases of assets other than goods all cash sales of assets other than goods returns of fixed assets purchased on credit recovery of an amount already written-off as bad debts. 58. A and B entered into a joint venture. They opened a joint bank account by contributing Rs 4,00,000 each. The expenses incurred on venture is exactly equal to Rs. 4,00,000. Once the work is completed, contract money received by cheque Rs. 4,00,000 and in shares Rs. 1,00,000. The shares are sold for Rs 80,000. What will be the profit on venture? Rs 7,40,000 Rs. 6,80,000 Rs 80,000 Rs 90,000 59. Under Permanence approach: the most liquid assets are presented at the top of the Balance Sheet. the least urgent payments are presented at the bottom of Balance Sheet. the most urgent payments are presented at the top of the Balance Sheet. the least liquid assets are presented at the top of Balance Sheet. 60. If forfeited shares (which were originally issued at a discount) are reissued at a premium, the amount of such premium will be credited to: Share Forfeiture Account Securities Premium Account Capital Reserve Account Discount on issue of shares account

All India Mock Test-I

241

Section B-Mercantile Law (40 marks) 61. Claim for Quantum Meruit cannot arise in case of: Void Agreements Void Contracts Non-Gratuitous Act Gratuitous Act

seller has to compulsorily deliver the balance instalments seller has no obligation to deliver the balance of goods seller cannot claim payment for the instalments already paid

62. A fraudulently informs B that A’s estate is free from incumbrance. B thereupon buys the estate. The estate is subject to mortgage. Now, B may avoid the contract. B may insist upon its performance. B may get the mortgage debt redeemed. All of the above.

67. Losses including deficiencies of capital are to be paid first out of. Capital Profits partner’s contribution in profit sharing ratios none of these

63. ‘A’ acquired certain goods from ‘C’ by falsely representing that he was acting on behalf of ‘B’ and was authorized to collect the goods. ‘A’ later sold the goods to ‘D’. Is the sale valid? The sale is valid as ‘D’ is not supposed to inquire the status of ‘A’ as a seller The sale is valid because ‘D’ has purchased. the goods in good faith The sale is valid as ‘A’ has acquired the goods by way of fraud The sale is not valid because it a sale by nonowner and therefore, `D’, the buyer, will not acquire any good title of the goods. 64. A contract in which both the parties have to perform the promises is called: Executed Contract Bilateral Contract Tacit Contract Voidable Contract 65. Which of the following does not require public notice in case of registered firms: admission of a partner retirement of a partner expulsion of a partner dissolution of the firm 66. In case of contract for delivery of goods in instalments which are to be separately paid for and the buyer refuses to take delivery or pay in respect of one or more installments: seller has to request buyer to accept the delivery

68. The test of good faith as required under Section 33(1) includes the following: That the expulsion must be in the interest of the partnership. That the partner to be expelled is served with a notice. That the partner to be expelled is given an opportunity of being heard. All of the above. 69. The damages which can be awarded even if the aggrieved party has not suffered any loss, are called: Ordinary Damages Special Damages Exemplary Damages Nominal Damages 70. Which of these arrangements indicates partnership: X and Y are joint owners of a ship; A, a contractor for loading and unloading railway wagons, appointed a servant to manage it. The servant was to receive 75 percent of the profits and was to bear all the losses, if any; P, a publisher, agrees to publish at his own expense a book written by Q and to pay Q half the net profit; X and Y purchase 100 bags of wheat which they agree to sell for their joint profit. 71. A delivers bags of sugar to B on ‘Sale on approval basis’ for 15 days. The cement became stone due to heavy rainfall (without any fault of B) on the

242 All India Mock Tests 10th day itself. If B retains the goods and gives notice of rejection on the fourth day, the loss is to be borne by: A, because the ownership has not passed to B B, because the bags were in custody of B, at the time of damage B, because B has retained the bags for more than three days B, because the ownership has passed to B 72. Where the promisee has to apply to the promisor for performance, such application should be made at a proper time and place. What should be the proper time and place is a: question of fact question of law question of general usage mixed question of law and fact 73. Where the performance of a promise by one party depends on the prior performance of promise by the other party, such reciprocal promises fall under the category of: Mutual and concurrent Conditional and dependent Mutual and independent Both and 74. A document of title to goods: must be used in the ordinary course of business must be used only while the goods are in transit and then they of no use must be used when the original invoice is lost must be used along with original invoice otherwise the property in goods would not be transferred 75. “Risk prima facie passes with ownership.” It signifies: that the risk and ownership go together provided the goods have been delivered to the buyer that the risk and ownership go together provided the price have been paid by the buyer that the risk and ownership go together provided the goods have been delivered to and price have been paid by the buyer

that the risk and ownership go together irrespective of delivery being made to or price being made by the buyer 76. An unregistered firm has sold some goods to a customer. A suit against the customer for the recover of price of goods is: maintainable if the firm is registered after filing the suit. maintainable if the firm is registered before filing the suit. not maintainable at all irrespective of the registration before or after filing the suit. none of these. 77. X agrees with Y who is goldsmith to buy and furnish gold to Y, to be worked up by him and sold, and that they shall share in the resulting profit or loss. The contract between X and Y is that of: Partnership Association of goldsmith Contract of labour work Contract of Sale 78. Where goods were delivered in excess of the quantity ordered for: the buyer can not accept the whole quantity the buyer can not reject the whole quantity the buyer can accept the quantity ordered and reject the rest the seller can sue the buyer for not accepting the ordered quantity 79. Sharing of profits is __________ evidence of existence of partnership: affirmative confirmative not a conclusive conclusive 80. Goods must be the same as wanted by the seller. This is: Condition as to description Condition as to sample Condition as to wholesomeness Condition as to title 81. Doctrine of implied authority of a partner applies to the: Act of settling accounts with the person dealing with the firm. Act of acquiring immovable property on behalf of the firm.

All India Mock Test-I Act of admitting a liability in suit against the firm. Act of entering into partnership on behalf. 82. The right of lien is available to the unpaid seller only when: he is not in possession of the goods he is in possession of the goods he has delivered the goods to the carrier he has delivered the goods to the buyer 83. Which of the following is not a feature of a Wagering Agreement: mutual chance of gain or loss uncertainty of future event neither party has control over the event one of the party have interest in the event 84. The principle of restitution does not apply to contracts which are: valid voidable void ab-initio (except where the minor has entered into an agreement by misrepresenting his age) none of these 85. Business of the firm must be carried on by: majority of the partner only all the partners senior partners only none of these 86. X, by a letter dated 4th Jan 2010 offers to sell his house to Y for Rs. 20 lakhs. The letter reaches Y on 6th Jan, 2010, who posts his acceptance on 7th Jan, 2010 which reaches A on 9th Jan 2010. Here, the communication of offer is complete on: 4th Jan 2010 6th Jan 2010 7th Jan 2010 9th Jan 2010 87. Anticipatory breach may take place: when a party refuses to perform his promise under a contract when a party deliberately disables himself from performing the promise before the due date of performance either or neither nor

243

88. Acceptance of delivery of goods is deemed to take place when the buyer: intimates to the seller that he had accepted the goods. does any act to the goods, which is inconsistent with the ownership of the seller. rejects and retains the goods after the lapse of a reasonable time, without intimating the seller. any of the above 89. Where the price is not determined in any manner, the buyer: need not pay anything must pay the market price of the goods must pay the reasonable price of the goods must pay the price demanded by the seller 90. An agreement not supported by consideration is called: nudum pactum consensus ad idem quid pro quo Ignorantia juris non excusat 91. The liabilities of a minor when admitted to the benefits of the partnership: Is confined to his share of the profits and property in the firm. Is same as that of any other partner in the firm. Is similar as that of any other partner in the firm. Is unlimited. 92. Which of the following statement is correct: Newspaper advertisements are offers Display of goods at shop is an offer Declaration of intention is not an offer A school announced a scholarship examination is an offer 93. Contracts made before war with an alien enemy which are against public policy are: dissolved void ab initio suspended and are revived after the war is over. not affected at all

244 All India Mock Tests 94. Substitution of a new contract in place of an existing contract is called: Alteration Novation Rescission Remission 95. The act constituting consideration must be something which the: the promisor is not already bound to do. the promisee is not already bound to do. the promisor is already bound to do. the promisee is already bound to do. 96. ‘A’ told his wife within the hearing of their daughter that the bridegrool,proposed for her was a young man. The bridegroom, however, was over years. The daughter gave her consent to marry him believing the statement by her father. The statement made by the father amounts to: coercion undue influence misrepresentation mistake 97. The person who makes the offer and the person who accepts the offer respectively known as: contractor and contractee offeror and contractee

promisor and promisee contractor and offeree 98. Agreement in restraint of legal proceeding is: altogether void to that extend void illegal none of these 99. ‘Price’ under Section 2(10) of The Sale of Goods Act, 1930 means: Money or money’s worth. Monetary consideration for the sale of goods. Any consideration that can be expressed in terms of money. None of the above. 100. Which of the following involves a valid consideration? A saves B’s goods from fire without being asked to do so. A demands payment for his services A receives some money from B to be paid over to C. A admits this receipt to C. C wish to recover the amount from A ‘A’ promises to put life into B’s dead wife on a payment of Rs. 50,000 by B A engages B for doing a certain work and promise to pay “reasonable” sum

All India Mock Test-I

245

SESSION - II TIME: 2 Hours

Maximum marks: 100

(Each question carries 1 mark for correct answer and a negative 1/4 mark for incorrect answer).

Section C-Economics (50 marks)

1. The demand function of a product x is as dx =12- 2Px, where Px stand for price. The quantity demanded corresponding to price of Rs. 2 will be: 8 9 10 4 2. A firm should produce where MR = MC and: slope of MC > slope of MR slope of MC = slope of MR slope of MC < slope of MR none of the above 3. Which of the following is not a cause of unemployment in India? Growing population Lack of employment opportunity Inappropriate education system Liberalization 4. ________ Curve never touch X axis. AFC TFC TVC MC 5. What is elasticity of demand in case of necessities and luxuries? Necessities have elastic and luxuries have inelastic. Necessities have inelastic and luxuries have elastic. Necessities have zero and luxuries have one. Necessities have one and luxuries have zero. 6. Which of the following equation is correct? NDP = GDP - Depreciation NDP = GDP + Depreciation

NDP = GDP - Depreciation-subsidy NDP = GDP - Depreciation+subsidy 7. Sampoorna Grameen Rojgar Yojana was launched in 2002 2000 2004 2001 8. Gilt edged market is the market in: Government securities Treasury bills Precious metals Bullion 9. Non-Tax revenue includes: currency and coinage dividends and profit grants-in-aid all of the above 10. Balance of payment on current account excludes: Borrowing and lending Borrowing only Lending only None 11. A decrease in price will result in an increase in total revenue if: Percentage change in quantity demanded is greater than the percentage change in price. Percentage change in quantity demanded is less than the percentage change in price. Percentage change in quantity demanded is equal to the percentage change in price. None

246 All India Mock Tests 12. If the disposal income of a household increases by 10% and the demand for X commodity increased by 10% the income elasticity of X is: 1.5 0.5 1.5 1.0 13. India has second largest roadways in: The world Developing countries Asia South east countries 14. Which of the following is Direct tax? Income tax Custom duty CENVAT Sales tax 15. For consumers’ equilibrium to be stable, the requirement is: constant MRS increasing MRS diminishing MRS none of above 16. Agricultural sector contribution in export earning is: 30% 20% 40% 50% 17. To get fiscal deficit we add _____ to Budget deficit. Subsidy and interest payments Borrowing and other liabilities Foreign aid Capital consumption 18. Which of the following statement is true about average cost function? ATC = AFC – AVC AVC = AFC + ATC AFC = ATC + AVC ATC = AFC + AVC 19. The table below show the Marginal utility derived at different level by a consumer.

Quantity Marginal Purchased utility(Utls)

Price in Rs. per unit

1

18

8

2

15

8

3

13

8

4

10

8

5

8

8

The Consumer surplus when he buys 3 units is: 20 28 22 15 20. Gini coefficient was formulated by G.Gini R.Gini C.Gini D.Gini 21. Quantitative restrictions mean: A restriction by Government on quantity of export or imports of goods from or to a country. A restriction by Government on quantity of production of goods by a country. A restriction by Government on quantity of sale of goods by a manufacturer. A restriction by Government on quantity of raw material consumed. 22. Which central problem is not solved by PPF? what to produce how much to produce for whom to produce economic growth 23. Entry-exist is free under which market structure? Oligopoly and monopolistic competition Perfect competition and monopolistic competition Perfect competition and monopoly Perfect competition and oligopoly 24. Corporate savings depend upon: profit level income level production level loans level

All India Mock Test-I 25. In economic theory the term “means” refers to Resources Arithmetic mean A characteristic None 26. Slope of Budget line is equal to: Marginal rate of substitution between the factor inputs. Ratio of price of factor inputs. Demand of each factor input. Supply of each factor input. 27. In a closed economy: GDP=GNP GDP>GNP GDP or

All India Mock Test-I

95. If events A and B are independent, the probability of occurrence of A as well as B is given by: P(AB) = P(A/B) P(B) P(AB) = P(AB) P(AB) = P(A) P(B) None of these 96. lim x

10 x

0

2x x2

5x

1

equals to:

(log 5) (log 2) (log 10) (log 2) log 5 + log 2 log 10 + log 5 + log 2 97. The makes index numbers timereversible. A.M. G.M. H.M. None of these

98. For the following data; r = 0.6, error of estimate of y on x is: 0.84 0.74 0.64 0.54

y

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= 4 the standard

99. 4 coins are tossed simultaneously. The expected number of heads obtained is: 4 3 2 1 100. A Maruti Zen costs Rs. 3,60,000. Its price depreciates at the rate of 10% a year during first 2 years and at the rate of 20% in third year. What will be the price of the car after 3 years? 2,33,280 1,67,900 3,24,980 254,750

254 All India Mock Tests

Test ID: 456

AIMCPT ME All India Mock Test–II SESSION - I TIME: 2 Hours

Maximum marks: 100 Answer all questions

(Each question carries 1 mark for correct answer and a negative 1/4 mark for incorrect answer).

Section A-Fundamentals of Accounting (60 marks)

1. One outgoing Cheque of Rs 112 recorded in the Cash Book but omitted to be sent to creditor. When the balance as per Cash Book is the starting point Rs 112 to be added Rs 112 to be subtracted No adjustment is required None of these 2. An Accounting information is said to be ____ , if its inclusion or exclusion effect the decision of the users of the accounting information. reliable verifiable objective material 3. Accounting Standard on ‘the Effect of Changes in foreign exchange rates’ is: AS-11 AS-13 AS- 18 AS - 23 4. When preference shares are redeemed out of divisible profits, which amount is transferred to Capital Redemption Reserve u/s 80: Premium payable of redemption of preference shares. Nominal value of preference shares redeemed out of divisible profits. Nominal value of preference shares redeemed out of fresh issue of shares.

Nominal value of preference shares redeemed out of divisible profits + premium payable on redemption. 5. Balance sheet prepared after the new partnership agreement, assets and liabilities are recorded at: Original Value Revalued Figure At reaisable value At Current Cost 6. Bharat Ltd. which depreciates its machinery at 10% p.a. straight line basis, had on 1st 20X4 Rs. 14,000 to the debit of Machinery Account, On 31st March 20X5, the company decided to change the method of depreciation to diminishing balance method with effect from 1st April, the rate of depreciation remaining the same. Prepare the Machinery Accuse for the year 20X4-20X5. On account of changed method of depreciation: Short Depreciation to be provided Rs. 580 Excess Depreciation to be provided Rs. 580 Excess Depreciation to be provided Rs. 290 Short Depreciation to be provided Rs. 1160 7. Income is measured and financial position is assessed on the basis of: Money measurement concept Cost concept Accounting period concept Matching concept

All India Mock Test-II 8. The gain from sale of capital assets need not be added to revenue to ascertain the: gross profit of a business Net profit of a business Operating profit of a business all of above 9. X, Y and Z are sharing profits & losses in the ratio of 5:3:2. They decide to share future profits & losses in the ratio of 2:3:5 with effect from 1st April 20X2. They also decide to record the effect of following revaluations without affecting the book values of the assets & liabilities, by passing a single adjusting entry: Book Figure Revalued Figure Land & Building Rs 60,000 Rs 90,000 Plant & Machinery Rs 90,000 Rs 84,000 Trade Creditors Rs 30,000 Rs 27,000 Outstanding Expenses Rs 27,000 Rs 36,000 The necessary single adjusting entry will involve: Debit Z and Credit X with Rs 5,400 Debit X and Credit Z with Rs 5,400 Debit Y and Credit X wit Rs. 5,400 Debit X and Credit Y wit Rs. 5,400 10. Uncalled capital refers to: That portion of subscribed capital which has not yet been called up by the company. That portion of unissued capital which has not yet been called up by the company. That portion of authorized capital which has not yet been issued. None of the above 11. Which of the following column does not exist in a three column cash book? Cash Column Petty Cash Column Bank Column Discount Column 12. Goods sold for cash were returned by a customer but cash was not given immediately. These are recorded in: Sales Book Sales Return Book Cash Book Journal Proper 13. A tallied trial balance will not reveal: errors on account of wrong balancing

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errors on account of wrong carrying forward errors on account of wrong casting errors of complete omission 14. X purchased 2000 boxes costing Rs 100 each. 400 boxes were sent out to Y at cost + 25%. 1200 boxes were sold at 120 each. The amount of gross profit to be recorded in general trading will be: Rs 28,000 Rs 24,000 (Rs 6,000) None 15. Goods worth Rs. 2,000 distributed as free sample will be debited to: Charity Ac Trading Ac Purchase Ac Sales promotion expenses Ac 16. Which of the following is not a Capital Expenditure? Rs. 15,000 spent on construction of temporary structure for storing building material. Rs. 10,000 spent on overhauling of a second hand Car purchased. Rs. 10,000 paid for removal of old waste and scrap. Rs. 10,000 paid as Excise duty on New Capital equipment. 17. Sales include goods worth Rs. 50,000 sent on sales on approval basis @ 25% profit on cost. At the close of the financial year the goods worth Rs. 30,000 was still lying with the customer pending approval from the customer. The Accounting adjustment would be: Debit sales Ac by Rs. 30,000, credit Debtors Ac by Rs. 30,000, Credit trading Ac by Rs. 24,000, Debit stock Ac by Rs. 24,000 Credit sales Ac by Rs. 36,000; debit Debtors Ac by Rs. 36,000; Debit trading Ac by Rs. 30,000, Credit Ac by Rs. 30,000 Credit sales Ac by Rs. 36,000; credit Debtors Ac by Rs. 36,000; Debit trading Ac by Rs. 30,000, Credit Ac by Rs. 24,000 Credit sales Ac by Rs. 36,000; debit Debtors Ac by Rs. 36,000; credit trading Ac by Rs. 30,000, Credit Ac by Rs. 240,000 18. If the change in accounting policy has a material effect in current period and the effect of change is ascertainable in part

256 All India Mock Tests the amount of change should be disclosed the fact of change should be disclosed the fact of change should not be disclosed none of these 19. C, D and E are partners sharing profits and losses in the proportion of 12 , 13 and 16. D retired and the new profit sharing ratio between C and E is 3’: 2 and the Reserves of Rs. 24,000 is divided amount the partners in the ratio: 4000:8000:12000 10000:10000:4000 8000:12000:4000 12000:8000:4000 20. Prepaid Insurance is an example of: Increase in asset & decrease in owner’s liability Increase in liability & decrease in owner’s liability Decrease in liability & owner’s liability Increase in asset & owner’s liability 21. An amount of Rs. 2,500 is debited twice in the bank column of cash book. When credit balance as per pass book is the starting point which one of these adjustments would be done at the time of reconciliation? Add Rs. 2,500 to balance as per pass book. Deduct Rs. 2,500 to balance as per pass book. Add Rs. 5,000 to balance as per pass book. Deduct Rs. 5,000 to balance as per pass book. 22. Accrual means: recognition of revenue as it is earned and of costs as they are paid. recognition of revenue as it is received and of costs as they are incurred. recognition of revenue and costs on payment basis. recognition of revenue as it is earned and of costs as they are incurred. 23. When inventory is valued at the lower of cost or market price, we are under the influence of: Cost concept Materiality concept Conservatism concept Consistency concept

24. Sale of Goods by Mohan to Sohan for Rs 1,000 will be recorded in the: Cash Book Sales Book Journal Purchase book 25. In the Balance Sheet of a company debenture Redemption Premium Account appears under the head: Share Capital Reserves & Surplus Secured Loans Miscellaneous Expenditure 26. ABC Ltd. purchased a new Plant and Machinery on 1-1-2005 for Rs. 600,000 on lease basis. The company intends to provide for renewal of lease at the end of 4 years by setting up depreciation fund which may be invested outside the business which will yield interest @ 4%. Sinking fund table shows Re. 0.23549 invested every year will provide Re. 1 at the end of 5 years at 4% interest. How much should be transferred to depreciation fund Ac every year in order to provide for renewal of the plant at the end of 5 years. Rs. 145,640 Rs. 141,294 Rs. 119,780 Rs. 137,547 27. If a concern proposes to discontinue its business from March 2009 and decides to dispose off all its assets within a period of 6 months, the Balance Sheet as on March 31, 2010 should indicate the assets at their: Historical cost Net realizable value Cost less depreciation Cost price or market value, whichever is lower 28. Which of the following term is true about consignment? Sale of goods Mortgage of goods Hypothecation of goods Shipment of goods 29. Where cost of by-products can not be separately determined, inventory of by products should be valued at:

All India Mock Test-II Cost or market price whichever is lower Cost or market price whichever is higher Cost or Net Realizable Value whichever is lower. at net realizable value 30. Interest on a term loan for the purchase of machinery where the commercial production has not begun till the last day of the accounting year is: Capital Expenditure Revenue Expenditure Deferred Revenue Expenditure Prepaid Expenses 31. In the absence of an agreement, partners are entitled to: Salary Commission Interest on Loan and Advances Profit share in capital ratio 32. Accounting Standards in India are issued by: The Central Govt. The State Govt. The Institute of Chartered Accountants of India. The Institute of Cost Accountants of India. 33. Advance to an Employee Account is Personal A/c Real A/c Nominal A/c None of these 34. When each co-venturer open their own account, material sent or expenses incurred on Joint venture by a co-venturer will be: Credited to memorandum A/c Debited to joint venture with other A/c Credited to Joint venture with other A/c Credited to general profit and loss A/c 35. Change in accounting estimate means Differences arising between certain parameters estimated earlier and re-estimated during the current period. Differences arising between certain parameters estimated earlier and actual results achieved during the current period. Differences arising between certain parameters re-estimated during the current

257

period and actual results achieved during the current period. Both and 36. A draws a bill of exchange of Rs. 30,000 on B for 4 months on 150210. If a public holiday is declared suddenly on 180610, the due date of bill will be: 15610 18610 17610 19610 37. In which of the following cases capital A/c of a partner will not be debited? Revaluation loss. Writing off goodwill. Profit on revaluation of assets and liability. Distribution of profit and loss A/c debit balance. 38. Wages paid for installing a second hand machinery should be debited to: Installation charges A/c Business Expenses A/c Machinery A/c Wages A/c 39. Book-keeping covers only the following activities: Recording and Classifying Recording, Classifying, Summarising and Analysing Summarising, Analysing and Interpreting Identifying, Measuring and Communication 40. On 1.6.09 X drew a bill on Y for Rs 25,000. At maturity Y request X to accept Rs 5,000 in cash and noting charges incurred Rs 100 and for the balance X draw a bill on Y for 2 months at 12% p. a. Interest amount will be: Rs 420 Rs 450 Rs 380 Rs 400 41. ABC are three partners in a firm sharing profit and loss in the ratio of 3:2:1. They agree to admit C into the firm. A, B and C are prepared to give 13rd, 16th and 19th share of their profit to C. The share of profit of C will be: 4 15 1156 1354

258 All India Mock Tests 949 42. ABC Oil is a bulk distributor of petrol. A periodic inventory of petrol on hand is taken when the books are closed at the end of each month. The following summary of information is available for the month: Sales Rs. 9,45,000 General administration cost Rs. 25,000 Opening Stock: Rs. 3,00,000 (1,00,000 litres @ Rs. 3 per litre Purchases (including freight inward): June 1 2,00,000 litres @ Rs. 2.85 per litre June 30 1,00,000 litres @ Rs. 3.03 per litre June 30 Closing stock 1,30,000 litres The value of inventory on June 30 using FIFO method of inventory costing is: Rs. 4,24,200 Rs. 3,88,500 Rs. 3,38,000 Rs. 2,86,500 43. Increase in liability at the time of retirement of a partner is: Debited to goodwill A/c Debited to profit and loss A/c Debited to revaluation A/c Credited to revaluation A/c 44. Discount on issue of shares is a: Trading loss Capital loss Revenue loss Speculative loss 45. From the following details calculate the number of equity shares of Rs. 10 each to be issued in order to redeem the preference shares. The company intends to raise fund through equity shares @ 10% discount. 13% (50000) Redeemable preference shares of Rs. 10 each = Rs. 500,000 Security premium Ac = Rs. 55,000 General Reserve Ac = Rs. 25,000 Profit and loss Ac = Rs. 20,000 Redeemable preference shares are to be redeemed @10% premium. 47,000 57,000

50,000 49,000 46. The share of Profit of the co-venturer maintaining only his own transaction is: debited to other co-venturer’s Personal Account debited to Joint Venture Account debited to Profit & Loss Account None of these. 47. The maximum discount at which debenture can be issued is: 20% 40% 50% no such limit exist 48. Under Sales on Return or approval basis when the transaction are large and the seller sends the goods on approval or return basis, the accounting treatment will be: No Journal Entry Entry in Sales or Return Journal Entry in Sales or Return Day Book Entry in Sundry debtors account 49. Which of the following types of information are found in subsidiary ledgers, but not in the general ledger? Total cost of goods sold for the period. The quantity of a particular product sold during the period. The amount owed to a particular creditor. The portion of total current assets that consist of cash. 50. In the absence of any agreement, partners are liable to receive interest on their Loans at the rate of: 12% Simple Interest 12% Compounded Annually 6% Simple Interest 6% p.a. Simple Interest 51. Interest is paid to the person who produces the interest coupon attached to debenture in case of: Bearer Debentures Registered Debentures All types of Debentures None of these

All India Mock Test-II 52. Under sales on return or approval basis, when transactions are few and the seller at the end of the accounting year reverse the sale entry, then what will be the accounting treatment for the goods returned by the customers on a subsequent date? No entry will be passed for such return of goods Entry for return of goods is passed by the seller Only the stock account will be adjusted None of these 53. Outstanding expenses refer to those expenses which have been: Paid but not incurred during the current accounting period. Incurred but not paid during the current accounting period. Incurred but not paid during the previous accounting period. Paid but not incurred during the previous accounting period. 54. Damaged inventory is valued at: Cost or market price whichever is lower Cost or Net Realizable Value whichever is lower Cost or Current Replacement price whichever is lower at net realizable value 55. Which of the following is not a condition for issue of shares at a discount? The Memorandum of Association must authorize the company for issue of shares at a discount. The issue must be authorized by passing an ordinary resolution in General Meeting and must be confirmed by the Central Government. The shares must be of a class of shares already issued. At least one year must have elapsed since the company was entitled to commence business.

259

56. X got Y’s acceptance for Rs 1,50,000 discounted at 2 months at 12% p.a. The amount of discount will be: Rs 3,000 Rs 1,500 Rs 4,500 Rs. 2,000 57. X Ltd. decides to redeem 650, 15% Red. Pref. Shares of Rs 100 each at a premium of 10%. It has a General Reserve of Rs 70,000 and a securities premium of Rs 4,000. If it is decided to issue 2,500 Equity shares of Rs 10 each at a pare for the purpose of redemption of Pref. Shares, the amount required to be transferred to Capital Redemption Reserve Account is: Rs 65,500 Rs 45,000 Rs 40,000 Rs 71,500 58. In the books of consignor, the profit of consignment will be transferred to: General Trading A/c General PL A/c Drawings A/c Consignee A/c 59. For charging depreciation, on which of the following assets, the depletion method is adopted? Plant & machinery Land & building Goodwill Wasting assets like mines and quarries 60. A and B are partners with capitals of Rs. 20,000 and 40,000 respectively and sharing profits equally. They admitted C as their third partner with one-fourth profits of the firm on the payment of Rs. 24,000. The amount of hidden goodwill is: Rs 12,000 Rs 21,000 Rs 14,000 Rs 34,000

260 All India Mock Tests Section B-Mercantile Law (40 marks) 61. On approval of tender to supply specific quantity of certain goods during a specific period, it becomes: an agreement a contract a standing offer None of these 62. The general rights of continuing partners include: Right to get remuneration Right to get interest on capital Right to prevent the introduction of a new partner Right to carry on competing business 63. Where the consent is caused by coercion, undue influence, fraud or misrepresentation, the contract is: void valid voidable illegal 64. Goods that are defined only by description and not identified and agreed upon at the time of contract of sale are known as: Specific Goods Existing Goods Future Goods Unascertained Goods 65. When two or more persons have made a joint promise, then, unless contrary intention appears from the contract, the promise must be fulfilled by: all such persons jointly all such persons jointly and severally all such persons severally all such persons jointly or severally 66. Mr. A is an agent of landed proprietor. He agrees for money without the knowledge of his principal, to obtain for Mr. B a lease of land belonging to his principal. This agreement between Mr. A and Mr. B is: valid because it involves consideration valid because it involves two competent parties

invalid because the agreement is not in writing invalid because it constitutes fraud by Mr. A on his principal 67. An offer can be revoked by: communication of notice of revocation by the offeror failure of acceptor to fulfill a precedent condition insanity or death of offeror to the knowledge of the acceptor all of the above 68. The maximum number of partners allowed in a firm carrying on general business is: 10 20 50 100 69. The doctrine of Caveat Emptor does not apply, when: the goods are bought by sample the goods are bought by sample as well as description the goods are purchased under its brand name all of the above 70. Where the amount in case of breach is fixed in advance whether by way of liquidated damages or penalty, the aggrieved party may claim: a reasonable compensation for the breach the amount so fixed in the contract lower of or higher of or 71. Under which of the circumstances unpaid seller loses his right of lien by estoppel where seller waived the right of lien where the buyer or his agent lawfully obtains possession of the goods any of the above 72. The obligations which are created by law in situations where a person has not entered into or broken any contract, are called:

All India Mock Test-II quasi contracts contingent contracts deemed contracts unforeseen contracts 73. Which of the following elements does not affect the free consent of the parties? coercion fraud incompetency undue influence 74. X fraudulently induced Y to enter into partnership with him and Y pays a premium of Rs.5,000/- to X. Within three months the firm incurs liabilities to the extent of Rs. 10,000/-. On discovering the fraud, Y files a suit for the rescission of the contract creating partnership and contract is rescinded. The creditors of the firm also levy attachment on Y who pays Rs.3,000/- to them as well. Which of the following is correct? Y can obtain a decree for Rs.8000/- against X. Y can obtain a decree for Rs.5000/- against X. Y can obtain a decree for Rs.3000/- against X Y cannot obtain a decree for either Rs. 5,000/or Rs. 3,000/- or Rs. 8000/- against. 75. For a valid novation, substitution must be made: before making the original contract during the continuance of the original contract after the conclusion of the original contract any of the above 76. In case of change in the constitution of the firm, the continuing guarantee given to the firm or the third party in respect to the transactions of the firm: is not affected at all is revoked as to future transactions is revoked with retrospective effect ceases to be continuing guarantee 77. A registered firm cannot claim a set off exceeding __________ in a proceeding instituted against the firm or any partner thereof. Rupess 1000/Rupess 100/Rupees 500/Rupees 10,000V

261

78. A convict when undergoing imprisonment is: capable of entering into a contract incapable of entering into a contract capable of entering into a contract, if he is permitted by the Court capable of passing on consideration 79. In a sale, there is an implied condition on the part of the seller that he: has a right to sell the goods is in possession of the goods will have the right to sell will acquire the goods 80. A person, to whom the interest in partnership firm is transferred by a partner, can, during the continuance of the firm: receive the share of profit of the transferring partner interfere in the conduct of the business of the firm require the accounts of the firm inspect the books of the firm 81. Mr. X is to pay Rs. l0 lakhs to Mr. Y if he (Mr. Y) procures an employment for Mr. X in VAT Department. This agreement is void valid voidable contingent 82. A contract of sale of goods includes: Sale only Agreement to sell only Both sale and agreement to sell only Barter 83. A delivered some jewellery to B on ‘sale or return’ basis. B pledged the same with C. Thus, A can recover the price of jewellery from B A can recover the jewellery from C B can not pledge the jewellery to C A can not recover the price from 13 nor the jewellery from C 84. Delivery of the key of a warehouse where goods are lying amounts to: Actual Delivery Symbolic Delivery Constructive Delivery None of these

262 All India Mock Tests 85. Mr. X boards a bus running on a route to carry passengers. It is an example of: Express Contract Implied Contract Void Contract None of these 86. In a sale under hire purchase agreement: the property in goods is passed to the purchaser immediately the property in goods is passed only on the payment of last instalment by the purchaser the property in goods is passed only when the purchaser terminates the contract the property in goods is passed only at the desire of seller irrespective of the terms of hire purchase agreement 87. In an auction sale, if the seller makes use of pretended bidding to raise the price, then the sale is: valid void voidable illegal 88. Abandonment or intentional relinquishment of a right under a contract is called: waiver breach rescission alteration 89. A minor can be admitted to the benefits of partnership with the consent of: majority of the partners all the partners all working partners none of these 90. A collateral event is an event: The performance for which is neither directly promised nor it is the entire consideration for the promise. The performance for which is directly promised. It is the entire consideration for the promise. The performance which is agreed upon by the parties in a Court of Law. 91. Where a partner is found guilty of misconduct which is likely to adversely affect the carrying on

of the business, the court may allow dissolution of the firm: on a suit by the partner found guilty of misconduct on a suit by any other partner if the misconduct relates to the firm’s business none of these 92. The Doctrine of Privity of Contract states that: A contract cannot confer any right on one who is not a party to the contract, even though the very object of the contract may have been to benefit him A contract can confer right on one who is not a party to the contract, if the contract benefits him A contract always confers right on one who is not a party to the contract A contract can confer rights on strangers 93. In case of an anticipatory breach of the contract, the aggrieved party: must rescind the contract and claim damages for breach of contract without waiting until the due date for performance must treat the contract as operative and wait till the due date for performance and claim damages if the promise still remains unperformed both and none of these 94. A sold 1000 tins of oil to B without appropriating any particular oil to the contract. B sold 600 tins out of it to C and gave delivery order addressed to A. C lodged the delivery order with A requesting him to “await” his orders. Meanwhile, B became insolvent and thus A became the unpaid seller. A can exercise his right of lien and refuse to make delivery to C. A cannot exercise his right of lien and refuse to make delivery to C. C has claim over the goods in possession of A. None of the above. 95. In case of insolvency of a partner: He ceaser to be a partner on the date on which an application for insolvency is made. His estate is liable for firm’s acts done after the date of the order if no public notice is given.

All India Mock Test-II the firm is dissolved unless otherwise agreed. none of these. 96. A minor enters into a contract for the purchase of certain necessaries. In such a case: he is personally liable to pay his guardian is liable to pay his estate is liable to pay none of these 97. A finder of goods has the same responsibility as a: bailee real owner next best owner bailor 98. In which case the promisor must apply for the performance: where no time for performance is specified and the promise is to be performed without demand by the promisee

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where no place for performance is specified and the promise is to be performed without demand by the promisee where time for performance is specified and the promise is to be performed without demand by the promisee none of these 99. Where more than one separate adventure or undertaking is carried on by the firm, and one of the adventures becomes unlawful: firm becomes an illegal association firm is automatically dissolved firm is not automatically dissolved; firm is declared insolvent. 100. Satyabrata Ghose v. Mugneeram Bangur & Co., (1954) case deals with: agreements opposed to public policy supervening impossibility contracts of guarantee agency

264 All India Mock Tests SESSION - II TIME: 2 Hours

Maximum marks: 100

(Each question carries 1 mark for correct answer and a negative 1/4 mark for incorrect answer).

Section C-Economics (50 marks)

1. The slope of the total production curve measures: Average production Minimum production Marginal production Maximum production 2. Demand curve is elastic under which market form? monopoly perfect competition monopolistic competition oligopoly 3. For the purpose of calculating National Income Indian Economy is divided into: 12 sectors 14 sectors 10 sectors 15 sectors 4. When a large firm takes up advertising and grants margin to distribution, it is called: Technical economics Managerial economics Marketing economics Financial economics 5. Which of the following is free from location restriction as per new industrial policy? Small scale sector unit Public sector units Polluting units Extraction industries 6. In a mixed type of Economy which type of price mechanism is found? Dual price system Market driven price system Administrative price control

None 7. Which of these is a secondary sector? Manufacturing sector Transport Forestry Animal husbandry 8. A decline in the price of X by Rs. 2 causes an increase of 10 units in demand which goes up to 60 units. The new price is Rs. 18. Calculate elasticity of demand. 1.2 2 4 8 9. Repo transaction means: Sale of securities by the holder to the investor with the agreement to purchase them at a predetermined rate and date. Sale of securities by the holder to the investor with the agreement to resell them at a predetermined rate and date. Sale and purchase of securities by the holder to the investor with the agreement to purchase them at the prevailing rate and date. Sale of securities by the holder to the investor with the agreement to purchase them at market driven rate. 10. Given the budget line a consumer will try to opt for _______ level of indifference curve. Higher Lower Same None 11. The shape of TVC curve is: inverse S-shaped

All India Mock Test-II downward sloping rectangular hyperbola U-shaped 12. Under monopolistic competition in the long run, what will the firm earn? supernormal profits normal profits break even any one of the above 13. Two Commodities X and Y can be inferred as complementary to each other if Increase in price of one leads to increase in demand of other and vice versa Increase in price of one leads to decrease in demand of other and vice versa Fall in price of one lead to fall in demand of other one Increase in price of one leads to increase in demand of other one

265

Increase in real rate of interest Increase in wealth 19. Voting power of each member under WTO is: One According to population According to size According to per capita income 20. Reason for rise in both AP and MP curves is: under utilisation of fixed factor under utilisation of variable factor over utilisation of variable factor over utilisation of fixed factor 21. Who alleged that economic should not be normative in character? Jacob Viner AC Pigou Robbins Samuelson

14. The second stage of capital formation is: creation of savings mobilisation of savings investment of savings distribution of savings

22. An isoquant joins all factor inputs which: Yield same level of output Give same marginal utility Have same marginal cost Have same Average cost

15. Generally GDP is always at: current prices constant prices real prices nominal prices

23. Real GDP is a crude measure of national welfare because it excludes: Depreciation Voluntary services not paid for Export earnings Intermediate production

16. Which of these is a fixed cost? Piece rate worker Raw material Depreciation of plant and machinery Power and fuel 17. _______ states that rapid growth of per capita income will be associated with a reduction in poverty. The trickle down theory Multiplier theory Malthus population theory None 18. Which of these would lead to fall in demand for money? Inflation Increase in real income

24. In Budget 2008-09, the threshold level of service tax exemption for small service providers has been enhanced to: Rs. 500,000 Rs. 600,000 Rs. 700,000 Rs. 1,000,000 25. The concept of relative poverty is relevant for: developed countries developing countries socialist countries mixed economies 26. CIF stands for: Cost insurance freights Cost inclusive of freights

266 All India Mock Tests Cost in freights Cost interest freights 27. The type of unemployment that includes those persons who are unemployed for an intervening period of change over in job for better job is known as: Seasonal unemployment Voluntary unemployment Frictional unemployment Technical unemployment 28. GATT was set up in: 1949 1947 1995 1987 29. Decreases in price of a product results in increased consumption of the product as the product becomes cheaper compared to other products. This effect is known as: Substitution effect Income effect Diminishing marginal utility concept Law of diminishing returns 30. When the price is less than the average variable cost, the firm should: Continue to operate till the market recover Shut down its operation for the time being Retrench workers and pay them compensation Clear the existing stock at a price less than the prevailing price to beat the competitors 31. Consumer surplus means: Difference between a sum consumer had in his Bank ac and what he spend from it. Difference between what a consumer is willing to spend for a product and what he actually pays for it. Difference between what a producer is willing to sell and what he actually sold. Difference between what a firm is willing to pay for a factor production and what it pays for it. 32. India revalued Rupee first time in 1949 1959 1950

1969 33. When a monopolist charges different prices for different units of the same commodity, it is called price discrimination of: First order Second order Third order Fourth order 34. The cross elasticity of substitute goods is generally >1 0, if y

10 log10 2

x

x

0

and x = ya, then a =

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70. A die was thrown 400 times and ‘six’ resulted 80 times then observed value of porportion is: 0.4 0.2 5 none of these 71. If f: R R, f(x) = x2 – 3x + 2, then f(f(x)) = x4 + 3x3 + 10x2 – 3x x4 + 3x3 + 8x2 – 5 x4 + 6x3 + 10x2 – 3x x4 + 3x3 + 10x2 + 3x – 2 72. For the calculation of ________, the data must be arranged in the form of a frequency distribution. median mode mean none 73. The following frequency distribution

0 1 –1 2 66. Coefficient of Quartile Deviation is equal to: (Quartile deviation x 100) median (Quartile of Standard x 100) mean (Quartile deviation x 100) mode none of these 3

67. Using integration by parts, integrate x log x and the integral is: x4/16 + k x4/16 (4 log x - 1) + k 4 log x - 1 + k None of these 68. Three numbers in G.P. with their sum 13/3 and sum of their squares 9/19 are: 1/3, 1, 3 3, 1, 13 both and none of these. 69. A population consisting of all the items which are physically present is called: hypothetical population real population infinite population none of these

0-10

10-20

20-30

5

8

3

is known as: discrete distribution inclusive distribution exclusive distribution None of these 74. Effective rate corresponding to 9% compounded quarterly is: 9.1% 9.31% 8.97% 8.65% 75. If xyz = 1, then the value of 1 1 1 1 x

y

1

1 y

z

1

1 z

x

1

is:

1 0 2 -1 76. For a (p x q) bivariate frequency table, the maximum number of marginal distributions is: p+q p q 2

270 All India Mock Tests 77. A random sample of size 5 without replacement is taken from a population containing 100 units. If the sample observations are 10, 12, 13, 7, and 18. Then the estimate of the standard error of mean is: 1.82 1.78 1.92 1.89 78. The value index is equal to: the total sum of the values of a given year multiply by the sum of the values of the base year. the total sum of the values of a given year divided by the sum the values of the base year. the total sum of the values of a given year pulse by the sum of the values of the base year. None of these. 79. If r = 0.6, then the coefficient of non-determination is: 0.4 – 0.6 0.36 0.64 80. When a coin is tossed 10 times, then it is a case of: Normal Distribution Poisson Distribution Binomial Distribution None of these

groups were: Food 45, Rent 15, Clothing 12, Fuel and Light 8, Miscellaneous 20. The group index numbers for the current year as compared with a fixed base period were respectively 410, 150, 343, 248 and 285. Calculate the Cost of Living Index Number of the current year. Mr. X was getting Rs. 240 in the base period and Rs. 430 in the current year. State how much he ought to have received as extra- allowance to maintain his former standard of living. Rs. 250 Rs. 350 Rs. 450 Rs. 150 84. The least number of times a fair coin must be tossed, so that the probability of getting at least one head is at least 0.8 is: 7 6 5 3 85. For a set of 100 observations, taking assumed mean as 4, the sum of the deviations is -11 cm, and the sum of the squares of these deviations is 257 cm2. The coefficient of variation is: 41.13% 40.13% 42.13% None of these 86. Graph of the inequations are drawn below:

81. Which of the following relation is true? P(A) P(Ac) = 1 P(A) + P(Ac) = 1 P(A)-P(Ac) =1 None of these 82. The system of equations: 4x + 7y = 10; 10x + (35/2) y = 25 have: Infinite number of solution unique solution no solution none of these 83. An enquiry into the budgets of the middle class families of a certain city revealed that on an average the percentage expenses on the different

LI : 3x+3y=36; L2=5x+2y=50; L3:2x+6y=60; x y 0

0;

The shaded region M 0 D E F shown in the figure above refers to the inequalities:

All India Mock Test-II 3x + 3y y 0. 3x + 3y y 0. 3x + 3y y 0. 3x + 3y y 0.

36; 2x + 6y

60; 5x + 2y

50; x

0;

36; 2x + 6y

60; 5x + 2y

50; x

0;

36; 2x + 6y

60; 5x + 2y

50; x

0;

36; 2x + 6y

60; 5x + 2y

50; x

0;

87. When for some countries, the magnitudes are small and for other, the magnitudes are very large, to portray the data, it is preferred to construct: deviation bar diagram duo-directional bar diagram broken bar diagram Any of the above 88. A player tosses 3 fair coins. He wins Rs. 5 if 3 heads appear, Rs. 3 if 2 heads appear, Re 1 if 1 head appears. On the other hand he losses Rs. 15 if 3 tails appear. His expected gain (in rupees) is: 0.15 0.25 –0.25 –0.15 89. Two numbers are in the ratio 5 : 6. If 5 is subtracted from each number, the ratio becomes 4 : 5. The numbers are: 15, 20 25, 30 5, 10 10, 15 90. Rs. 250 are divided equally among a certain number of children. If there were 25 children more, each would have received 50 paise less. The number of children is: 75 100 80 90 91. The statistical method, which helps us to estimate or predict the unknown value of one variable from the known value of the related variables, is called: Correlation Scatter diagram Regression Dispersion

271

92. The number of 2-digit numbers that can be formed from the digits 0, 1, 3, 4, 5, 6 assuming repetition of digits is not allowed is: 30 360 120 24 93. When we are not concerned with the magnitude of the two variables under discussion, we consider: Product moment correlation coefficient. Rank correlation coefficient. Coefficient of concurrent deviation. Either or but not . 94. If a : b = c : d then (a +b) : b = (c +d) : d. The given relation holds true by which of the following theorem? Componendo Dividendo Intervendo Alternendo 95. Out of 13 applicands for a job, there are 5 women and 8 men. It is desired to select 2 persons for the job. The probability that at least one of the selected persons will be woman is 25/39 14/39 5/13 10/13. 96. Given is the following information: X Y Arithmetic mean 6 8 Standard deviation 5 403 Coefficient of correlation between X and Y = 815. The regression coefficient of Y on X is: 1.422 1.322 2.422 2.322 97. If a2 + b2 = 0 and a + b 0, then the value of log (a+b) is: log a + log b + log 2 1 [log a + log b + log 2] 2 log a + log b 2 [log a + log b + log 2]

272 All India Mock Tests 98. In an exclusive type distribution, the limits excluded are: upper limits lower limits either of the lower or upper limit lower limit and upper limits both 99. The solution of the equations: x + y + z = 2; 2x – y = 3; -x + 2y + 3 = 0 is: x = 1, y = – 1, z = 0

x = 1, y = 2 , z = 3 x = 0, y = – 1, z = 1 x = 1, y = – 1, z = 2 100. Pictograms are shown by: dots lines circles pictures