Both sales and X Ltd. accounts are understated by Rs. 900. Entries are required to increase the amount due from X Ltd. and increase sales by crediting the sales account.

Motor vehicle entry needs to be reduced by making credit entry and debit the vehicle maintenance account.

The Banking Regulation Act of 1949 came into force on 16^th March, 1949.

In case of last day of drawings, interest is calculated for 5.5 months. If drawings are made on first day of month, interest is charged for 6.5 months and for the mid of every month, time period is 6 months.

Sacrifice made by A and gain to C is 3/10. Thus, gaining partner i.e. C will be debited and sacrificing partner i.e. A will be credited with 30000 x 3/10

As C is to be given a minimum of Rs.1,00,000, the profit being insufficient, so he will get Rs. 1,00,000 and the rest of Rs. 3,00,000 will be divided among A and B in 5 : 3. Thus, A's share = Rs.1,87,500 B's share = Rs. 1,12,500

Since cash is received, we would debit cash. Punjab National Bank is credited because it is our creditor. 

Bad debts is a loss and loss is always debited. Since debtors is an asset, and it has decreased, which means it has gone out, so we would credit debtors.

Interest on drawings is an income for business, so it will be credited. And it will be charged from the capital account of partners, so Capital account will be credited.

Cash is received, so it would be debited (3600 - 54 = 3546). Discount is a loss, since the payment is received after deducting it. Hence, it would also be debited. Discount = 3,600 X 6/100 X 3/12 = Rs. 54. B/R has gone out, so it would be credited.

Cash has been debited, since it has come in. Bad Debts recovered a/c is credited.

Closing stock is always valued at cost price + direct expenses or market price, whichever is less. Since there is no indication of reduction in the market price of goods in the given question, so option 4 is correct.

A general ledger is a complete record of financial transactions over the life of a company.

For banks, printing and stationery expenses include the cost of stationery items which are used daily in offices and the printed material for correspondence purposes. For example: business letter heads, business cards, envelopes etc.

Performing assets provide a positive return annually.  

A bank is a financial institution that accepts deposits from the public and creates credit. Lending activities can be performed either directly or indirectly through capital markets.

Interest = 50,000 * 5.5*2 /100 = Rs. 5500 Interest = 5500 Amount = 50000 + 5500 = Rs. 55,500

A sinking fund is a part of a bond indenture or preferred stock charter that requires the issuer to regularly set money aside in a separate custodial account for the exclusive purpose of redeeming the bonds or shares.

The present value at 8% p.a. for 15 years from the standard table is 8.5525 which multiplied by 15,000 amounts to Rs. 1,28,288 approx.

The American Accounting Association defines accounting as “the process of identifying, measuring and communicating economic information to permit informed judgments and decisions by users of the information.”

Accounting Standards are written policy documents issued by expert accounting body or by government or regulatory body covering the aspects of recognition, treatment, measurement, presentation and disclosure of accounting transaction and events in the financial statements.

Accounting Standards Board was constituted in India by the Institute of Chartered Accountants in the year 1977.

Accounting standards set the trend towards rigidity and eliminate flexibility which can prove a disadvantage sometimes. 

Accounting Standards provide an essential supporting structure and standard accounting policies. So, both the options are correct. 

AS 4 deals with the treatment and disclosure requirements in the financial statements of events occurring after the balance sheet. 

Correct Answer: All of the above

AS 28 should be applied in accounting for impairment of all assets except options 1 and 2 because they are not considered under assets. They are considered under inventories.

AS 7 deals with accounting for construction contracts in the financial statements of enterprises undertaking such contracts (hereafter referred to as 'contractors'). The statement also applies to enterprises undertaking construction activities of the type dealt with in this statement not as contractors but on their own account as a venture of a commercial nature where the enterprise has entered into agreements for sale.

Foreign Exchange Market is also known as over the counter (OTC) and inter bank. 

The spot market or cash market is a public financial market in which financial instruments or commodities are traded for immediate delivery. It is opposite to the futures market in which delivery is due at a later date.

The rate quoted through the third currency is called cross rate.

Correct Answer: Leading

The cash is overstated and expenses are understated.

A cash book is a financial journal that contains all cash receipts and payments, including bank deposits and withdrawals.

A cash book is a financial journal that contains all cash receipts and payments, including bank deposits and withdrawals. In the given case, no cash is received. Hence, there will be no entry in cash book.

A ledger holds account information that is needed to prepare financial statements, and includes accounts for assets, liabilities, owners' equity, revenues and expenses.

A journal (daybook, book of original entry) is a place for recording transactions as they occur. Journal entries are the first step in the accounting cycle.

Purchases and Sales can be treated as either nominal accounts or real accounts. GOLDEN RULE: "Debit all expenses and losses; Credit all incomes and gains."

The three columns in the cash book represent Cash column, Bank column and Discount column. 

Nominal accounts in accounting are the temporary accounts, such as the income statement accounts. In other words, nominal accounts are the accounts that report revenues, expenses, gains and losses.

The separate entity concept is the basic accounting concept which states that we should always separately record the transactions of a business and its owners.

Financial statements are prepared assuming that a business entity will continue to operate in the foreseeable future without the need or intention on the part of management to liquidate the entity or to significantly curtail its operational activities. If the Going Concern concept is no longer valid, all the assets would be recorded at realisable value, not at cost.

Matching Concept states that the revenue and the expenses incurred to earn the revenue must belong to the same accounting period.

Going concern concept assumes that business will be carried on for an INDEFINITE period. Capital losses need to be deducted to ascertain net income. The provision for bad debts is made in accordance with the concept of conservatism. Materiality concept states that transactions of insignificant value need not be recorded.

As per the prudence concept, do not overestimate the amount of revenues recognized or underestimate the amount of expenses.

Net Profit is the actual profit after working expenses not included in the calculation of gross profit have been paid.

50,000 + 6,000 + 3,000 = 59,000 

Rs. 2,22,000

After three months, the date will be 1^st July, 2012. Adding 3 grace days, the final date will be 4^th July, 2012.

Drawer, Drawee and Payee

Bills payable discounted in the cash by the creditor need not be recorded.

Maturity date is the date when the bill gets matured or the day when payment becomes due.

After 1 month, the date will be 30^th February, but 3 grace days are given to make the payment. So, the date will be 3^rd March.

Endorsement is the direct transfer of right on the bill from the drawer to the creditors.

When the bill is dishonoured, the full amount of bill is credited to the bank account in the books of the drawer.

The amount of the bill would be 10,000 + 200 (for bank charges) = Rs. 10,200.

Mutual accommodation means both the persons will receive half the amount, i.e. 10,000. Charges for discounting = 12% per annum We need to find for 2 months, which will come out to be Rs. 200. Rs. 200 will also be divided equally as charges. Therefore, B's receivables will be 5,000 - 100 = 4,900.

Capital expenditure is money invested by a company to acquire or upgrade fixed, physical, non-consumable assets, such as buildings and equipment or a new business.

It is a capital expenditure as capital expenditure is money invested by a company to acquire or upgrade fixed assets.

Any capital expenditure will be debited under capital account, and all the day to day expenditures will be debited as revenue expenditure.

It means that the purchases have been reduced to the extent of stock amount at the end of the period.

Trial balance is a statement of all debits and credits in a double-entry accounts book, with any disagreement indicating an error.

A trial balance contains balances of all the accounts. 

Suspense account is an account in the books of an organization in which items are entered temporarily before allocation to the correct or final account.

The errors which are committed while recording or posting a transaction are called errors of commission. Such errors include posting wrong amounts, posting on wrong side of accounts or posting in wrong accounts, wrong totaling or carrying forward, and wrong balancing. 

Errors of principle may occur due to wrong allocation between capital and revenue expenditure, or wrong valuation of assets.

A Public Company is a company whose shares are traded freely on a stock exchange and the minimum number of directors is 3.

Premium = 10% = Rupee - 1 Share Price = 11 Rs.  Number of shares issued = 165,000 / 11 = 15,000 

Statutory corporations are public enterprises brought into existence by a Special Act of the Parliament. The Act defines its powers and functions, rules and regulations governing its employees and its relationship with government departments. 

7,25,000/125 = 6,000 shares

Balance Sheet is prepared as per Part I Schedule Ill. 

60,000 / 12 = 5,000

Under the head Issued Capital should be stated if the shares are issued, then all the classes of shares. If it's preference share, then all the sub-classes of preference share should be stated. 

Share application money is the money received by a company during an IPO.

Minimum tradable lot is decided according to the existing provision which is contained in the SEBI.

A rights issue is a dividend of subscription rights to buy additional securities in a company made to the company's existing security holders.

6,00,000 / 12 = 50,000

The provision for doubtful debts is an account receivable contra account, so it should always have a credit balance. Hence, entry for provision for bad debts is:

Profit and Loss a/c Dr       To Provision for bad and doubtful debt

Window dressing means the actions taken to improve the appearance of a company's financial statements. Window dressing is particularly common when a business has a large number of shareholders, so that management can give the appearance of a well-run company to investors who probably do not have much day-to-day contact with the business.

Ratios act as indicators of good position of the company because it shows the financial position of the company. If a company is sound, it will ultimately result in good position and strength.

Long term solvency is judged by the ratios like debt equity ratio, proprietary ratio, total assets to debt ratio.

A measure of profitability is the overall measure of efficiency.

Capital Employed = Total Assets - Current Liabilities                            = Fixed Assets + Current Assets - Current Liabilities                           = Fixed Assets + Working Capital

The operating ratio is a financial term defined as a company's operating expenses as a percentage of revenue. Operating Ratio = Operating Expense / Net Sales

Debtor collection period is different in different types of industries. It also differs according to the terms and conditions of the policy and the nature of the product.

Proprietary Ratio = Shareholder's Fund/Total Assets 

The payout ratio is the percentage of net income that a company pays out as dividends to common shareholders. The ratio is calculated as the percentage of earnings paid out as dividends.

Debt/equity ratio is a debt ratio used to measure a company's financial leverage. It is calculated by dividing a company's total liabilities by its stockholders' equity. Therefore, it is considered good when it is 2 : 1.

Amount deducted when cheques presented = Rs. 35,000 Rs. 15,000 cheques were not presented before the closing of the month, so Rs. 15,000 will be added back.   

Bank reconciliation book is to find if there is any mismatch in the cash book and bank pass book. If there is so, then it is useful in finding the reason of mismatch and correcting it. 

20,000 - 2,300 + 2,000 + 800 = Rs. 20,500

The first two entries create a difference between the entries made in cash book and the entries made by the bank. The third entry where the cheques have been deposited by the customer is added in the cash book and credited by bank, i.e. added in the pass book. So, this entry will not show any difference. 

The bank credits the account when the bank credits amount in the account. On the other hand, when the bank deducts any amount from your account, it debits the account. 

Pass book a book issued by a bank or building society to an account holder, recording sums deposited and withdrawn.

The entry will be passed in the cash book after it is posted in the pass book.

The bank balance which is shown in the balance sheet of an organisation is the balance after matching it with the cash book.

Credit transfer is a direct payment of money from one bank account to another. The other options are to be debited, not credited.

Correct entry would have been subtracting the amount from the pass book, but as the amount has been recorded twice, it means the amount has been subtracted twice, so the amount will be added once to nullify the difference. 

RTGS helps in the transfer of money and securities from one bank to another.

Suppose Rs. 100 is invested. The rate per annum is 10%, i.e. 5% per half year. The amount after first half year will be 100 + 5%, i.e. Rs. 105 and amount after second half year, i.e. one year will be 105 + 5%, i.e. Rs. 110.25. Thus, effective rate of interest per annum is 110.25 - 100 = 10.25%.

Diversification is a risk management technique that mixes a wide variety of investments within a portfolio. 

Accounting rate of return, also known as the average rate of return, or ARR is a financial ratio used in capital budgeting. ARR calculates the return generated from net income of the proposed capital investment.

IRR method wil not be applicable here as internal rate of return (IRR) is a metric used in capital budgeting measuring the profitability of potential investments. When comparing two projects where their cash flows are not the same in terms of volumes and signs, IRR method is not applicable at all.

Mutually exclusive projects are projects in which acceptance of one project excludes the others from consideration. In such a scenario, the best project is accepted. NPV and IRR conflict, which can sometimes arise in case of mutually exclusive projects, becomes critical. The conflict either arises due to the relative size of the project or due to the different cash flow distribution of the projects. Since NPV is an absolute measure, it will rank a project adding more dollar value higher regardless of the original investment required. IRR is a relative measure, and it will rank projects offering best investment return higher regardless of the total value added.

Accounts payable (creditors) carries a credit balance. Hence, a reserve created on creditors will be debited and P & L a/c would be credited against it.

Reserve for Discount on Accounts Payable A/c To Profit & Loss A/c

2,00,000 - 60,000 = 1,40,000 2% discount on the balance = 140,000 * 2% = 2,800 Final balance payable = 1,40,000 - 2,800 = 1,37,200

The given statement is true.

84,000 - 4,000 + 1,500 (Not recorded as profit) + 1500 (because it was rated as an expense). Therefore, the amount of 1,500 discount will be added two times = Rs. 83,000

Loss = 20,000 + 2,000 - 12,750 = 6,250

Provision for bad debts a/c:   ||||| |---|---|---|---| |Particulars|Debit|Particulars|Credit| |To Bad debts|2,000|Balance b/d|800| | | |By P & l (b/f)|3100| |To balance c/d|1900| | |

Competition, costs and competitors all are the factors that are hard to manage these days.

CRM stands for Customer Relationship Management.

Under online processing, majority of transactions are processed online.

Correct Answer: Both (1) and (2)

Correct Answer: All of the above

Computer programming is a process that leads from an original formulation of a computing problem to executable computer programs.

Software programes and computer peripherals both come under computerized accounting.

The process of online banking follows this process. Transactions are entered through the terminal and then they are recorded, verified, authenticated and corresponding updations are reflected instantly.

E-commerce means availing all the business over net.