COMPANY ACCOUNTS

Q.1

Which of the following is not a feature of "Bearer Debentures"? 1. Name & address of the bearer not recorded in the Company's records 2. Debentures are transferable by mere delivery 3. Need to be registered with the Company Law Board 4. Coupons are attached to the Debentures Correct Answer: 3

Q.2

B Ltd. issued shares of Rs.10 each at a discount of 10%. Mr. C purchased 30 shares and paid Rs.2 on application but did not pay the allotment money of Rs.3. If the company forfeited his entire shares, the forfeiture account will be credited by 1. Rs.90 2. Rs.81 3. Rs.60 4. Rs.54 Correct Answer: 3

Q.3

A company forfeited 2,000 shares of Rs.10 each (which were issued at par) held by Mr. John for non-payment of allotment money of Rs.4 per share. The called-up value per shares was Rs.9. On forfeiture, the amount debited to share capital will be 1. Rs.10,000 2. Rs.8,000 3. Rs.2,000 4. Rs.18,000 Correct Answer: 4

Q.4

Brave Ltd. issued 60,000 shares of Rs.10 each at a discount of Re. 1 per share. The application money was Rs.2, allotment money was Rs.4,and first call was of Re.1. The amount of final call will be 1. Rs.3 2. Rs.2 3. Re.1 4. Rs.4 Correct Answer: 2

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.5

Asha Ltd. issued shares of Rs.100 each at a premium of 25%. Mamta, who has 2,000 shares of Asha Ltd., failed to pay first and final call totaling Rs.5. Premium was taken by Asha Ltd. at the time of allotment. On forfeiture of Mamta's shares, the amount to be debited to Share premium account will be 1. Rs.5,000 2. Rs.10,000 3. Rs.15,000 4. Nil Correct Answer: 4

Q.6

Jadu Ltd. reissued 2,000 shares of Rs.10 each, which were forfeited by debiting Share forfeiture account by Rs.3,000. These shares were reissued Rs.9 per share. The amount to the transferred to Capital Reserve account will be. 1. Rs.3,000 2. Rs.2,000 3. Rs.1,000 4. Nil Correct Answer: 3

Q.7

Bajaj Ltd. issued 25,000 equity shares of Rs.10 each payable as Rs.2 on application, Rs.3 on allotment, Rs.2 on first call & the balance in the final call. Archit, who has 1,000 shares paid full value of shares with allotment money. The amount to be debited to bank account at the time of receipt of first call money will be. 1. Rs.50,000 2. Rs.47,000 3. Rs.49,000 4. Rs.48,000 Correct Answer: 4

It is assumed that Archit has paid the Final Call money in advance & hence only Call money will be recd on 24,000 Equity Shares. 24,000*2 =48000

Q.8

Light Ltd. has 10,000 5% preference shares of Rs.10 each to be redeemed after 5 years. The company forfeited 500 preference shares on which final call of Rs.2 has not received after due notice & cancelled these shares on account of redemption. Remaining shares were redeemed out of reserves of the company. The amount to be credited to capital redemption reserve will be. 1. Rs.1,00,000 2. Rs.95,000 3. Rs.99,000 4. Rs.99,500 Correct Answer: 2

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.9

G Ltd. acquired assets worth Rs.75,000 from H Ltd. by issue of shares of Rs.10 at a premium of Rs.5. The number of shares to be issued by G Ltd. to settle the purchase consideration will be 1. 6,000 shares 2. 7,500 shares 3. 9,375 shares 4. 5,000 shares Correct Answer: 4

Q.10

Gama Ltd. issued 10,000, 10% debentures of Rs.100 each at a discount of 10%. The entire amount is payable on application. Application were received for 12,000 debentures. The allotment of debentures was made on 10 th October, 2006. The amount which should be credited to the debentures account on 10 th October, 2006 will be 1. Rs.12,00,000 2. Rs.10,80,000 3. Rs.9,00,000 4. Rs.10,00,000 Correct Answer: 4

Q.11

Alfa Ltd. issued 20,000, 8% debentures of Rs.10 each at par. The debentures are redeemable at a premium of 20% after 5 years. The amount of loss on redemption of debentures should be: 1. Rs.50,000 2. Rs.40,000 3. Rs.30,000 4. None of the above Correct Answer: 2

Q.12

Indigo Ltd. had 9000, 10% redeemable preference shares of Rs.10 each, fully paid up. The company decided to redeem these preference shares at par by the issue of sufficient number of equity shares of Rs.10 each fully paid up at a discount of 10%. The number of equity shares issued should be: 1. 9,000 2. 11,000 3. 10,000 4. None of the above Correct Answer: 3

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.13

Preference shares amounting to Rs.1,00,000 are redeemed at a premium of 5% by issue of shares amounting to Rs.50,000 at a premium of 10%. The amount to be transferred to capital redemption reserve account will be 1. Rs.55,000 2. Rs.50,000 3. Rs.45,000 4. Rs.57,500 Correct Answer: 2

Q.14

Brokerage on the issue of shares and debentures is a _____________ expenditure: 1. Revenue 2. Capital 3. Deferred Revenue 4. Partly capital partly revenue Correct Answer: 3

Q.15

Security premium is shown under which head in the Balance Sheet. 1. Current Liabilities 2. Miscellaneous Expenditure 3. Reserves and Surplus 4. None of these Correct Answer: 3

Q.16

The minimum subscription as prescribed by SEBI against the entire issue is: 1. 95% 2. 90% 3. 5% 4. None Correct Answer: 2

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.17

Dividends are usually paid upon: 1. Paid up capital 2. Called up capital 3. Issued capital 4. Reserve capital Correct Answer: 1

Q.18

X was issued 100 shares of Rs. 10 each at a premium of Re. 1, he paid application money and allotment money which in total amounted to Rs. 5 (excluding premium) and failed to pay the balance call money of Rs. 5. Find the maximum discount that can be given at the time reissue of shares: 1. Rs. 4 per share 2. Rs. 5 per share 3. Rs. 2 per share 4. Rs. 6 per share Correct Answer: 2

Q.19

Redeemable preference shares must be redeemed within: 1. 5 years 2. 10 years 3. 15 years 4. 20 years Correct Answer: 4

Q.20

When debentures are issued as collateral security, interest is paid on: 1. Nominal value of debentures 2. Face value of debentures 3. Discounted value of debentures 4. No interest is paid Correct Answer: 4

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.21

Discount on issue of debentures is a ___________ 1. Revenue loss to be charged in the year of issue 2. Capital loss to be written off from capital reserve 3. Capital loss to be written off over the tenure of the debentures 4. Capital loss to be shown as goodwill Correct Answer: 3

Q.22

B Ltd. issued shares of Rs.10 each at a discount of 10%. Mr. C purchased 30 shares and paid Rs.2 on application and the allotment money of Rs.3. He failed to pay the call money. If the company forfeited his entire shares, the capital account will be debited by 1. Rs.120 2. Rs.300 3. Rs.180 4. Rs.150 Correct Answer: 2

Q.23

S Ltd. issued 2,000, 10% Preference shares of Rs.100 each at par, which are redeemable at a premium of 10%. For the purpose of redemption, the company issued sufficient Equity shares of Rs.100 each at a discount of 10% per share. At the time of redemption of Preference Shares, the amount to be transferred by the company to the Capital Redemption Reserve Account will be 1. Rs.50,000 2. Rs.65,000 3. Rs.2,00,000 4. NIL Correct Answer: 4

Q.24

G Ltd. acquired assets worth Rs.8,10,000 from H Ltd. by issue of shares of Rs.100 at a discount of 10%. The number of shares to be issued by G Ltd. to settle the purchase consideration will be 1. 6,000 shares 2. 7,500 shares 3. 9,000 shares 4. 5,625 shares Correct Answer: 3

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.25

The following information pertains to X Ltd. Equity share capital called up Rs.5,00,000 Calls in arrear Rs. 40,000 Calls in advance Rs. 25,000 Proposed dividend 12% The amount of dividend payable will be 1. Rs.50,000 2. Rs.55,200 3. Rs.46,000 4. 43,500 Correct Answer: 2

Q.26

Dividends are usually paid as a percentage of __________ 1. Authorized share capital 2. Net profit 3. Paid - up Capital 4. Called - up capita Correct Answer: 3

Q.27

A company forfeited 2,000 shares of Rs.10 each (which were issued at 10% discount) for non - payment of call money of Rs.4 per share. On forfeiture, the amount credited to share forfeiture will be 1. Rs.10,000 2. Rs.8,000 3. Rs.12,000 4. Rs.18,000 Correct Answer: 1

Q.28

That portion of Share Capital which can be called up only on the winding up of the Company is 1. Authorised Capital 2. Issued Capital 3. Subscribed Capital 4. Reserve Capital Correct Answer: 4

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.29

When shares are forfeited, the Called Up Amount on shares is debited to 1. Shares Forfeited Account 2. Capital Reserve Account 3. General Reserve Account 4. Capital Account Correct Answer: 4

Q.30

A Company issues 10,000 shares of Rs.100 each at a premium of 10% payable as - application Rs.25; Allotment Rs.50 and First and Final Call Rs.35. A holder of 100 shares did not pay the final call and his shares were forfeited. In this case, Share forfeiture Account will be credited by 1. Rs.7,500 2. Rs.6,500 3. Rs.10,000 4. Rs.9,000 Correct Answer: 2

Q.31

T Ltd. has issued 14% 20,000 Debentures of Rs.100 each at a discount of 10% on April 01, 2004 and the company pays interest half - yearly on June 30, and December 31 every year. On March 31, 2006, the amount shown as ''interest accrued but not due'' in the Balance Sheet will be 1. Rs.70,000 shown along with Debentures 2. Rs.2,10,000 under current liabilities 3. Rs.1,40,000 shown along with Debentures 4. Rs.70,000 under current liabilities Correct Answer: 4

Q.32

P Ltd. issued 5,000, 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 1. Rs.80,000 2. Rs.40,000 3. Rs.10,000 4. Rs.8,000 Correct Answer: 3

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.33

F Ltd. purchased Machinery from G Company for a book value of Rs.4,00,000. The consideration was paid by issue of 10% debentures of Rs.100 each at a discount of 20%. The debenture account was credited with 1. Rs.4,00,000 2. Rs.5,00,000 3. Rs.3,20,000 4. Rs.4,80,000 Correct Answer: 2

Q.34

"Proposed dividends" is shown in the Balance Sheet of a company under the head: 1. Provisions 2. Reserves and Surplus 3. Current Liabilities 4. Other Liabilities Correct Answer: 1

Q.35

A company forfeited 100 equity shares of Rs. 100 each issued at premium of 50% (to be paid at the time of allotment) on which the first call money of Rs. 30 per share was not received, final call of Rs. 20 is yet to be made. These shares were subsequently reissued @ Rs. 70 per share at Rs. 80 paid up. The amount credited to capital reserve is: 1. 4,000 2. 2,000 3. 3,000 4. None Correct Answer: 1

Q.36

Share Allotment Account is a: 1. Real Account 2. Nominal Account 3. Personal Account 4. Company Account Correct Answer: 3

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.37

10,000 equity shares of Rs. 10 each were issued to public at a premium of Rs. 2 per share. Applications were received for 12,000 shares. Amount of Securities Premium Account will be: 1. Rs. 20,000 2. Rs. 24,000 3. Rs. 4,000 4. Rs. 1,600 Correct Answer: 1

Q.38

Asha Ltd. issued shares of Rs. 100 each at a premium of 25%. Mamta who has Rs. 2,000 shares of Asha Ltd., failed to pay first and final call totaling Rs. 5. Premium was taken at the time of allotment by the company. On forfeiture of Mamta's shares, the amount to be debited to Share Premium Account will be: 1. Rs. 5,000 2. Rs. 10,000 3. Rs. 15,000 4. Nil Correct Answer: 4

Q.39

If a company is not able to the excess amount of share within the reasonable time. The company will give them interest @: 1. 15% p.a. 2. 5% p.a. 3. 7% p.a. 4. 10% p.a. Correct Answer: 1

Q.40

When debentures are issued as Collateral Security, which entry has to be passed: 1. Debenture Suspense A/c Dr. To Debenture A/c 2. No Entry has to be made 3. Either (1) or (2) 4. None Correct Answer: 3

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.41

Premium on redemption of debentures account is --------------1. A real account 2. A nominal account-Income 3. A personal account 4. A nominal account-expenditure. Correct Answer: 3

Q.42

Capital Redemption Reserve is utilised to 1.To redeem Preference Shares. 2.To redeem Debentures. 3. For issue of Bonus Shares 4. None of these Correct Answer: 3

Q.43

Debenture premium cannot be used to ------1.Write off discount on issue of Shares or Debentures 2.Write off premium on redemption of Shares or Debentures 3. Pay Dividends 4. Write off capital loss Correct Answer: 3

Q.44

As per Companies Act, "Interest accured and due on debentures" should be shown 1.Under Debentures 2.As Current Liabilities 3. As Provision 4. As a reduction of Bank balance Correct Answer: 1

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.45

Which of the following is False with respect to debentures ? 1.They can be issued for Cash 2.They can be issued for consideration other than Cash 3.They can be issued as Collateral security 4.They can be issued in lieu of dividends Correct Answer: 4

Q.46

which of the following cannot be used for the purpose of creation of Capital Redemption Reserve Account ? 1.Profit & Loss account (Credit balance) 2.General Reserve account 3.Dividends equalization reserve account 4.Unclaimed dividends account Correct Answer: 4

Q.47

As per Schedule VI of the Companies Act, 1956, Forfeited shares account will be 1.Added to the Paid-Up Capital 2.Deducted from the Paid-Up Capital 3.Shown as a Capital Reserve 4.Shown as a Revenue Reserve Correct Answer: 1

Q.48

The document inviting offers from Public to subscribe for Shares or Debentures or Deposits of a body Corporate is a 1.Share Certificate 2.Stock invest 3.Fixed deposit receipt 4.Prospectus Correct Answer: 4

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.49 Declared dividend should be classified in the Balance as a 1. Provision 2. Current Liability 3. Reserve 4. Current Asset
Correct Answer: 2

Q.50 On the issue of Shares, the application money should not be less than 1) 2.5% of the nominal value of shares 2) 2.5% of the issue price of the shares 3) 5% of the nominal value of shares 4) 5% of the issue price of the shares
Correct Answer: 3

Q.51 When shares are issued to promoters for the services offered by them, the account that will be debited with the nominal value of shares is 1. Preliminary expenses 2. Goodwill 3. Asset account 4. Share Capital
Correct Answer: 2

Q.52 Maximum Interest rate applicable for calls in arrears 1) 5% 2) 6% 3) 7% 4) 8%

Correct Answer: 1

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.53 Maximum Interest rate applicable for calls in advance 1) 5% 2) 6% 3) 7% 4) 8%

Correct Answer: 2

Q.54 The minimum paid-up capital for Public limited Company 1) Rs. 1 lakh 2) Rs. 2 lakh 3) Rs. 5 lakh 4) Rs. 10 lakh
Correct Answer: 3

Q.55 The minimum paid-up capital for Private limited Company 1) Rs. 1 lakh 2) Rs. 2 lakh 3) Rs. 5 lakh 4) Rs. 10 lakh
Correct Answer: 1

Q.56 Which of these items are shown in the Profit & Loss appropriation account 1. Provision for Bad debts 2. Provision for depreciation 3. Provision for bonus 4. Provision for dividend
Correct Answer: 4

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS Q.56 Schedule VI Part II of the Companies Act, deals with 1. Format of Balance Sheet 2. Format of Profit & Loss Account 3. Format of Cash Flow Statement 4. Format of trading account
Correct Answer: 2

Q.57 Schedule VI Part I of the Companies Act, deals with 1. Format of Balance Sheet 2. Format of Profit & Loss Account 3. Format of Cash Flow Statement 4. Format of trading account
Correct Answer: 1

Q.58 In the event of liquidation of the company, the debenture holders have prior right over 1. Principal amount 2. Interest 3. Both "a" & "b" 4. Either "a" & "b"
Correct Answer: 3

Q.59 Preference Shareholders get 1. Fixed dividend 2. Fixed bonus 3. Fixed Interest 4. Fixed discount every year
Correct Answer: 1

Q.60 Which of the following accounts have only credit balances ? 1. Reserve Fund Account 2. Capital Account 3. Accounts Payable 4. All of these
Correct Answer: 4

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.61 A Company intending to issue shares at discount must issue the shares within------from the date of approval of Company Law Board 1. 30 days 2. 2 months 3. 6 months 4. 1 year
Correct Answer: 2

Q.62 In case a Public limited Company is required to refund the application money due to non subscription to the minimum limit, the application money is to be refunded within ------days of Closure of issue 1. 45 days 2. 60 days 3. 42 days 4. 21 days
Correct Answer: 2

Q.63 Maximum rate od discount shall not be more than 1) 5 % 2) 10% 3) 12% 4) 15%
Correct Answer: 2

Q.64 The act of voluntary return of shares by shareholders for cancellation is called 1. Cancellation of shares 2. Return of shares 3. Surrender of shares 4. Refusal of shares
Correct Answer: 3

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com

COMPANY ACCOUNTS

Q.65 Rights issue of shares is for whom 1. General public 2. Promoters only 3. Employees only 4. Existing shareholders only
Correct Answer: 4

Q.66 Balance Sheet of a company is prepared in the format prescribed in/by 1. Income Tax Act 2. Schedule VI of the Companies Act,1956 3. By CAG 4. By ICAI
Correct Answer: 2

VX PLAIN 2 score more----post your doubts to us vx plain @gmail.com