Quiz - Rakesh & Akhilesh

1. Due date is calculated by adding days of grace:

• 4 Days

• 3 Days

• It depends on the period of the bill

• 1. It is as mutually decided by the parties

Arun and Anand were friends and in need of funds. On 1-1-2006 Arun drew a bill of for Rs 200,000 for 3 months on Anand. On 4-1-2006 Arun got the bll discounted at 10% pa. and remitted halt of the proceeds to Anand. The cheque sent to Anand is for

• INR 1,00,000

• INR 90,000

• INR 97,500

• INR 95,000

1. Arun accepted Anand's bill for Rs.120,000 on 4-4-2006 for two months. This was discounted by Anand at 12% p.a. The discounted proceeds is:

• INR 1,17,600

• INR 2,400

• INR 14,400

• INR 3,600

1. Bank Account Dr. 3,920 

Discount Account Dr.        80

To Bills Receivable Account 4,000

If the above bill is for 2 months the annual rate of discount is

• 10%

• 12%

• 2%

• 8%

Amortization refers to writing off:

• Amortization refers to writing off

• 1. Wasting assets

• 1. Intangible asset

• 1. Tangible assets 

In the first year depreciation amount by straight line method, as compared to diminishing balance method will be

• Higher

• Lower

• Same

• 1. None of the above

1. M/s R & Co. purchased four machines for Rs. 50.000 each. His accounting year ends on 31st March. Depreciation (@20% on original cost has been charged to profit and loss account. What is the estimated life of the machine:

• 5 year

• 4 Year

• 6 Year

• 3 Year

Original cost of machine = Rs.130,000, Salvage value = Rs.4,000, Useful life = 6 years Depreciation for the 1st year under sum of year's digit method will be:

• INR 6,000

• INR 12,000

• INR 18,000

• INR 36,000

Scrap value of an asset means the amount that it can fetch on sale at the of its useful life:

• Beginning

• End

• Middle

• None

1. Right shares means the share which are:

• Issued to the directors of the company

• First offered to the existing shareholders

• 1. First offered to the existing debenture holders

• 1. Issued by the newly formed company