FC-505: Financial Accounting | Final Exam |

Fall 2020
* Required

Answer all the questions

Read the questions carefully then answer. You are asked not to take any help from others. Be honest & take
decision based on your own capacity.

A trader purchases goods for tk. 2500000, of these 70% of goods were sold during the
year. At the end of 31st December 2009, the market value of such goods were tk.
500000. But the trader recorded in his books for tk. 750000. Which of the following
concept is violated. *
2 points

Consistency
Money measurement
None of these
Conservatism √
Sales – Gross Profit = ________ *
2 points

Net sales
Gross Sales
Cost of goods sold √
Liabilities

Probable liabilities is tk. 36000 then it would be appear on final account as? *
2 points

none
Balance sheet: Liabilities side - probable liabilities tk.36000 √
Balance sheet: s side - probable liabilities tk.36000
Balance sheet: Foot notes- Probable liabilities tk. 36000

An asset was purchased for Rs.1000000 with the down payment of Rs.200000and
bills accepted for Rs.800000/-. What would be the effect on the total asset and total
liabilities in the balance sheet? *
2 points
Assets increased by Rs.800000 and liabilities decreased by Rs.800000
Assets increased by Rs.1000000 and liabilities increased by Rs.800000
Assets decreased by Rs.800000 and liabilities increased by Rs.800000
Assets increased by Rs.800000 and liabilities increased by Rs.800000 √
]If nothing is given in the financial statements about the three accounting assumptions
then it is to be treated as it *
2 points

Is assumed to be followed to some extent

Is assumed to be followed √
None of the above
Is assumed that it is not followed

The market price & current price of closing stock is tk. 37000 & 40000 respectively
then you would record closing stock as? *
2 points

Trading a/c: Cr- closing stock - tk. 77000 & Balance sheet: Asset side - Closing stock tk. 77000
Trading a/c: Cr- closing stock - tk. 40000 & Balance sheet: Asset side - Closing stock tk. 40000
none
Trading a/c: Cr- closing stock - tk. 37000 & Balance sheet: Asset side - Closing stock tk. 37000 √
Profit and loss is calculated at the stage of *
2 points

Classifying
Posting
Recording
Summarising √
bad debts tk. 2500 should be recorded in the balance sheet as? *
2 points

none
add to capital
deduct from sundry debtors √
add to sundry debtors

Provision for discount on debtors is calculated on the amount of debtors. *

2 points

After deducting provision for doubtful debts.√

Before deducting provision for doubtful debts.
After adding actual bad and doubtful debts.
Before deducting actual debts and provision for doubtful debts.

Profit before commission is tk. 70,000 & you have to calculate 10% commission on net
profit after charging such commission then commission would be? *
2 points

7000 √
6364
6363
6300

Profit after commission is tk. 50,000 & you have to calculate 7% commission on net
profit before charging such commission then profit before commission would be? *
2 points

53700
53763
46237 √
50000

Fixed assets are held by business for _____ *

2 points

None of the above

Resale
Converting into cash
Generating revenue √
Interest on drawings are recorded as? *
2 points

Profit & loss a/c: Dr. Interest on drawings & Balance sheet: deduct from capital a/c
Profit & loss a/c: Cr. Interest on drawings & Balance sheet: deduct from capital a/c √
Profit & loss a/c: Cr. Interest on drawings & Balance sheet: add from capital a/c
none

In income measurement & recognition of assets & liabilities which of the following
concepts goes together ? *
2 points

Going concern, Periodicity, Reliability

Cost, Accural, matching
Periodicity, Accural, Matching √
Going concern, cost, Realization
Profit after commission is tk. 50,000 & you have to calculate 5% commission on net
profit before charging such commission then commission would be?
2 points

2631
2500
2381 √
none

Clear selection

Depreciate machinery @ 10%. Machinery value is tk. 33000 then how would you
record this item at final account? *
2 points

Profit & Loss Account: Dr. depreciation tk. 33000 & Balance sheet: deduct tk. 33000 from
machinery
Profit & Loss Account: Cr. depreciation tk. 3300 & Balance sheet: deduct tk. 3300 from machinery
Profit & Loss Account: Dr. depreciation tk. 3300 & Balance sheet: add tk. 3300 from machinery
Profit & Loss Account: Dr. depreciation tk. 3300 & Balance sheet: deduct tk. 3300 from
machinery √
Profit after commission is tk. 50,000 & you have to calculate 5% commission on net
profit after charging such commission then commission would be? *
2 points

none
2381 √
2500
2300

Historical cost concept requires the valuation of an asset at *

2 points

Net realizable value

Market value
Original cost √
Replacement value

Consistency with reference to application of accounting procedures means *

2 points

Any accounting method can be followed as per convenience

Accounting methods & procedures shall be followed uniform basis year after year √
Income & assets have not been overstated
All companies in the same Industry should use identical accounting procedures

Rent outstanding is tk.500 then it would be recorded as in the final account? *

2 points

Profit & loss a/c: Dr. Rent tk. 500 & Balance sheet: Assets side: outstanding rent tk.500
Profit & loss a/c: Cr. Rent tk. 500 & Balance sheet: Liabilities side: outstanding rent tk.500
none
Profit & loss a/c: Dr. Rent tk. 500 & Balance sheet: Liabilities side: outstanding rent tk.500 √
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