Institute of Chartered Financial Analysts of India (ICFAI) University 2007 Certification Finance Financial Accounting (CFA510):2009 - Question Paper
Monday, 17 June 2013 10:55Web
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The provision needed to be created for doubtful debts is
(a) Rs.28,500
(b) Rs.33,750
(c) Rs.36,000
(d) Rs.35,250
(e) Rs.34,875. (2marks)
39.Under the direct write off method of recognizing a bad debt expense, which of the subsequent statements
is/are true?
I. The bad debt expense is not matched with the related sales.
II. Accounts receivables are overstated in the year of sales.
III. Revenue is overstated in the year of sales.
IV. It violates the matching principle of accounting.
(a) Only (I) above
(b) Both (I) and (II) above
(c) Both (II) and (III) above
(d) (I), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above. (1 mark)
40.Under delivery method the revenue is recognized when the
(a) Percentage of the total work performed during the accounting period is determined
(b) Income can be reliably measured at the completion of production itself
(c) Goods are delivered or services are truly given
(d) Installment payments have recouped out of the total cost of sales
(e) Installment payments are received. (1 mark)
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41.Which of the subsequent statements is false with respect to dividends?
(a) Dividend can be paid out of capital
(b) Interim dividend can be declared by the directors without obtaining approval of the shareholders
(c) Dividend is not payable on the calls paid in advance
(d) Declared dividend is regarded as a current liability
(e) Dividend is payable only on paid-up capital. (1 mark)
42.Consider the subsequent info of Tadpole Ltd., for the year 2007-08:
Opening balance of provision for debtors account Rs. 60,000
Bad debts during the year Rs. 54,000
Closing balance of Sundry debtors Rs.7,95,000
Estimated provision for doubtful debts 4%
The amount to be debited to Profit and Loss account to make the estimated provision is
(a) Rs.25,800
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