Institute of Chartered Financial Analysts of India (ICFAI) University 2007 Certification Finance Financial Accounting (CFA510): - Question Paper

(1 mark)
(a) Benefits in the current accounting period only
(b) Will benefit only in the next accounting period
(c) outcomes in the acquisition of a permanent asset
(d) outcomes in the acquisition of a current asset
(e) outcomes in the acquisition of a current asset and a permanent asset.
< ans >
23. Manila who is yet to prepare the final accounts obtained that a cash sale of Rs.1,234 to Mr. Nadir correctly
entered in the cash book, was posted to the debit of Mr. Nadir’s personal account in the ledger. The
aggregate amount of sales is correctly posted. The entry needed to rectify the above fault is
(2 marks)
Rs. Rs.
(a) Sales account Dr. 1,234
To Nadir’s account 1,234
(b) Nadir’s account Dr. 1,234
To Sales account 1,234
(c) Suspense account Dr. 1,234
To Nadir’s account 1,234
(d) Sales account Dr. 1,234
To Suspense account 1,234
(e) Suspense account Dr. 2,468
To Sales account 1,234
To Nadir’s Account 1,234.
< ans >
24. Accounting does not record non-financial transactions due to
(a) Business entity concept
(b) Going concern concept
(c) Accounting period concept
(d) Money measurement concept
< ans >
(1 mark)
(e) Cost concept.
25. Which of the subsequent is generally not used as a evaluation base in accounting?
(1 mark)
(a) Historical cost
(b) Opportunity cost
(c) Current cost
(d) Realizable value
(e) current value.
< ans >
26. The annual financial statements should be approved by the _______ before being signed by the auditors.
(1 mark)
(a) Board of directors
(b) Registrar of companies
(c) Shareholders
(d) Audit Committee
(e) Nominee directors.
< ans >
27. Current liabilities are such obligations which are to be satisfied
(1 mark)
(a) Within 3 months
(b) Within 6 months
(c) Within 1 year
(d) Within 2 years
(e) Within 3 years.
< ans >
28. The balances of prepaid expenses of a company as on March 31, 2006 and March 31, 2007 were
Rs.40,320 and Rs.32,720 respectively. If the expenditure paid by the company during the year 2006-

Earning:   Approval pending.