108/23

. According to this accounting principle, the inventory is valued at “cost price or market
price whichever less”.

A) Materiality principle B) Conservatism principle
C) Consistency principle D) Matching principle

. Accounting standard 25 relates to
A) Cash flow statement B) Depreciation accounting
C) Intangible Assets D) Interim financial reporting

. Pass rectifying journal entry. A credit purchase of Rs. 1,000 from Ram was entered
through the sales book.

A) Sales account Dr. Rs. 1,000 B) Purchase account Dr. Rs. 1,000
To Ram account Rs. 1,000 To Sales account Rs. 1,000

C) Sales account Dr. Rs. 1,000 D) Purchase account Dr. Rs. 1,000
Purchase account Dr. Rs. 1,000 Sales account Dr. Rs. 1,000
To Ram account Rs. 2,000 To Ram account Rs. 1,000

To Suspense account Rs. 1,000

. If closing stock is given inside the trial balance, it will be
A) Credited to trading account
B) Shown as an asset in the balance sheet
C) Credited to trading account and shown as an asset in the balance sheet
D) Credited to profit and loss account
. A business has earned an average profit of Rs.80,000 during the last few years
and the normal rate of return in a similar type of business is 10%. Find out the

value of goodwill by capitalization method, given that assets of the firm amount to
Rs. 7,50,000 and liabilities Rs. 1,00,000.

A) Rs. 1,50,000 B) Rs. 50,000 C) Rs. 6,50,000 D) Rs. 7,00,000
. What is the journal entry in the books of the consignor, when the consignor sends
goods to the consignee ?
A) Debit Consignor account, Credit Consignment account
B) Debit Consignment account, Credit Consignee account
C) Debit goods sent on Consignment account, Credit Consignment account
D) Debit Consignment account, Credit goods sent on consignment account
. In the Tally accounting package, the voucher which is used to record the deposit of
cash into the bank account is
A) Journal voucher B) Payment voucher

C) Receipt voucher D) Contra voucher