1st Session
Date: - 04.12.2015
CPT Mock Test
Test Booklet No. – 110011
(1)
(2)
Duration : 2 Hours
Total Marks : 100
Ans. b
Explanation: Management is internal user.
Ans. c
Explanation: Matching concept matches the
profit.
revenue with expenses, to compute
(3)
Ans. d
Explanation: Conservatism says that extra income should not be recorded, hence
inventory is valued at lower of cost or NRV.
(4)
Ans. a
Explanation: Consistency says that policy once adopted, cannot be changed and is
followed year after year.
(5)
Ans. a
Explanation:
Cost concept says that fixed assets are to be recorded at cost inclusive of all the
expenses incurred on that asset, before that asset is put to use.
(6)
Ans. c
Explanation: Accounting standards issued by ICAI are 32.
(7)
Ans. c
Explanation: Inventory & Materials are current assets and all other are fixed assets.
(8)
Ans. a
Explanation:
Assets
= Liability + Capital
= 25000 + 75000
= Rs. 100000
(9)
Ans. c
Explanation:
Cash A/c
Dr.
To Sales A/c
25000
25000
(10)
Ans. a
Explanation: Trial Balance is prepared After Ledger.
(11)
Ans. b
Explanation: Outstanding salary represents representative personal account.
(12)
Ans. a
Explanation:
Particulars
Cash A/c
Capital A/c
MITTAL COMMERCE CLASSES
Trial Balance
Dr.
3180
----
Cr.
---10000
1|Page
Bank A/c
Purchases A/c
Sales A/c
Salary
Rent
Total
6900
725
------150
10955
------950
5
---10955
(13)
Ans. c
Explanation: Purchase book record only credit purchases of goods.
(14)
Ans. c
Explanation:
Cash book contain debit & credit side, hence it is the form of ledger.
(15)
Ans. a
Explanation:
Expenses incurred on fixed assets, before the assets are put to use, are added to the
cost of asset and hence are capital expenditure.
(16)
Ans. a
Explanation: Car is newly purchased and all the other expenses, incurred after the
car is put to use are not to be added to cost.
(17)
Ans. b
Explanation: Financial statement include trading A/c, P&L A/c and Balance sheet.
Contingent Liability is not recorded in above statements.
(18)
Ans. b
Explanation: Compensation, may or may not be payable, hence contingent liability.
(19)
Ans. c
Explanation:
Hari Ram
To Bank A/c
To Discount A/c
(20)
720
700
20
Ans. d
Explanation:
A's Dr.
600
To Sales A/c
600
Both the accounts are affected.
(21) Ans. a
Explanation:
Cash Book
Less:
Add:
Pass Book
(22)
Dr.
Ans. d
Explanation:
Pass Book
MITTAL COMMERCE CLASSES
(6340)
(2360)
2368
6332
10585
2|Page
Add: (35x12)
Less: (25+42+39+57)
Cash Book
(23)
Ans. b
Explanation :
Date
Particulars
Jan. 1
To Balance
b/d
Jan. 8
Purchases
Jan. 25 Purchases
Jan. 30 Sales
420
(163)
10842
Quantity
200
Cost Pur.
7
Amt.
1400
Balance Qty.
200
Balance Amt.
1400
900
300
400
8
9
200  7
7200
2700
3000
1100
1400
8600
11300
8300
200  8
700  8
300  9
So valuation of closing inventory under FIFO is 8300.
(24)
(25)
Ans. c
Explanation :
Cost of Physical stock
(+) Cost of goods sold
(–) Net Purchases (10000–1000)
Stock on 31.3.2012
=
=
=
Rs. 1,20,000
Rs. 10,000
Rs. (9,000)
Rs. 1,21,000
Ans. c
Explanation :
Cost of Goods = Rs. 5,000
(+) Profit = Rs. 2,500 (5,000 50% )
(-) Trade Discount = Rs. (1,125) [ 7500 15% ]
Purchase price before cash discount = Rs. 6,375
(26)
Ans. a
Explanation :
Cost of Boiler: Purchase Cost
Add: Shipping and forwarding
charges
Import Duty
Installation exp.
Total Cost
Rs.
10000
2000
Cost
(-) Dep. 1st Year @10% p.a.
WDV
20000
2000
18000
7000
1000
20000
(-) Dep 2nd year @ 10% p.a.
WDV
(-) Dep 3rd year @ 10% p.a.
WDV . or closing balance
1800
16200
1620
14580
(27) Ans. a
Explanation :
Depreciable value = Cost – scrap value.
Depreciation 
(28)
5000 units
 (63000  3000 )  Rs.5000
60,000 units
Ans. b
Explanation :
Depreciation on machinery = 10,000
MITTAL COMMERCE CLASSES
10% 
3
 250
12
3|Page
Depreciation on furniture = 20,000  5% x 3/12= 250
Total Depreciation  250 + 250 = Rs. 500
(29)
Ans. b
Explanation:
The amount to be paid without any discount will be Rs. 7,000
(-) paid on 30/06/2006
Discount = 200
10 

1,800  
90 

Total amount =
1800  200   2,000 
(-) paid on 30/09/2006
Discount = 150
(2850 x 5/95 )
Total amt = 2850 + 150 = 3,000
Amount to be paid in final settlement = 7000 – 2000 – 3000 = Rs. 2,000
(30)
Ans. c
Explanation :
Profit before charging managerial remuneration = Rs. 44,000
Managerial remuneration on profit after charging commission
= 44000 x 10 / 110 = Rs.4000
(31)
Ans. a
Explanation :
Profit = (Sales – Sales return) – (purchase - purchase return)
= (40000 – 5000) – (30000 – 5000) = Rs. 10000
(32)
Ans. b
Explanation :
Amt. of accrual interest
 10, 000 12% 
(33)
(34)
2
 200
12
Ans. d
Explanation :
Purchase cost
(+) Shipping and forecasting charges
(+) Import duty
(+)Carriage Inwards
(+) Repair Charges
(+) Installation Charges
(+) Brokerage
(+) Iron Paid
Ans. d
Explanation :
Provision for discount on creditors
To Balance b/d
To P&L (b/f)
MITTAL COMMERCE CLASSES
= Rs. 50,000
=
2,000
=
1,000
=
1,000
=
500
=
200
=
400
=
100
55,200
1600
500
By Discount received
By Balance c/d
1000
1100
4|Page
Total
(35)
2100
Total
Ans. a
Explanation :
TRADING ACCOUNT
To Opening stock
20,000 By Sales
To Purchases
1,00,000 By Closing Stock
To Carriages
2,000
To Gross Profit (B/F)
53,000
Total
1,75,000 Total
Selling expenses are indirect expenses and it will be included in P&L A/c.
(36)
2100
1,50,000
25,000
175000
Ans. b
Explanation :
Suppose Invoice Price Rs. 100,
Profit @ 20% i.e. Rs. 20,
Cost = Rs. 80,
Profit on cost =
20
 100  25%
80
Cost = Rs. 1,20,000,
Profit @ 25% i.e. 1,20,000 x
(37)
Ans. b
Explanation :
Suppose Net Profit Rs. 100
Commission @ 5% i.e. Rs. 5
Profit before commission Rs. 105
In question profit before comm. [58000-16000] = Rs. 42000
Commission =
(38)
25
 Rs.30,000
100
42000
105
x 5 = Rs. 2000
Ans. d
Explanation :
Consignment A/c At cost
Goods on Consignment
100,000 By Deepak [Sale]
Cash [consignor exp.] (6,000 +2,000)
8000 By value of stock
Deepak [consignee exp.]
16000 With Deepak
Deepak [Comm[ 2% on 100,000
2000
P & L Acc. (profit)
3500
129500
Value of Stock
Purchase cost 100,000  ¼ =
Consignor Exp. 8000  ¼ =
Consignee non selling exp. 10,000  ¼ =
To
To
To
To
To
(39)
Ans. b
Explanation :
Sale value of land
Less: Cost on land
MITTAL COMMERCE CLASSES
100,000
29,500
129500
25000
2000
2500
29500
80,000
60,000
5|Page
Profit on Venture
(40)
Ans. b
Explanation :
Value of 10 kg as under :
Purchase price 10 kg  20 = Rs. 200
Add: Expenses
Total
(41)
(42)
20,000
500
100
𝑥 10
= Rs. 50
= Rs. 250
Ans. a
Explanation :
Cost of Boxes = 2000 x 100 =
Add : Profit (200000 x 45%)
Sales Value
Amount of Bill = 290000 x 60% = Rs. 174000.
Ans. a
Explanation :
Entry in the Books of Rohit
Raj. a/c
Dr.
5200
To B/R a/c
5000
To Discount a/c
200
Dr.
Discount A/c
Particular
Amount
Particular
By Raj.
200000
90000
290000
Cr.
Amount
200
(43)
Ans. c
Explanation :
In case of after sign bill due date is calculated from date of acceptance, so due date
will be :
2 April, 2006 + 1 Month + 3 Days of Grace = 5 May, 2006.
(44)
Ans. c
Explanation :
Amount Received = 2000  (2000 
Amount send to Sohan = 1970 
3
6

)  1970
12 100
1
 985
2
(45)
Ans. b
Explanation:
Stock shown in the balance sheet at cost price.
Stock on Approval = 3500 – 800 = Rs. 2700
(46)
Ans. b
Explanation :
If fixed amount is withdrawn at the end of each month then interest on drawings is
charged for 5.5 months.
200 x 12 = 2400 x 5/100 x 5.5/12 = Rs. 55.
MITTAL COMMERCE CLASSES
6|Page
(47)
Ans. b
Explanation :
If goodwill account is raised in the books of accounts then following entry passed
Goodwill A/c Dr.
To Partners Capital A/c
(48)
Ans. a
Explanation :
Capital Rs. 50000 + Reserve (15000 x
𝑥𝑥. 12000) + Profit share (7050 x
(49)
2
5
2
5
= 𝑥𝑥. 6000) + Goodwill (30000 x
2
5
=
= 𝑥𝑥. 2820)  B’s Loan a/c = Rs. 70820.
Ans. b
Explanation :
Average profit 
15000  20000  25000
 20000
3
Normal profit = 100000 x
15
100
= 𝑥𝑥. 15000
Super profit = 20000 - 15000 = Rs. 5000
Goodwill = 5000 × 2 = Rs. 10000
(50)
Ans. a
Explanation :
Sacrifice Ratio = Old Ratio – New Ratio
5
7
10−7 3
𝑥 = 8 − 16 = 16 = 16
𝑥=
3
5
6−5 1
−
=
=
8 16
16 16
= 3:1
(51)
Ans. b
Explanation :
Calculation of amount payable to Z by making Z’s loan account
Date
Particular
Amount Date
Particular
31.3.2010 To Cash
40,000
1.10.2009 By Z capital
31.3.2010 To Balance c/d
44,000
31.3.2010 By Interest
(80,000 
30.9.2010
To
Cash
Payment)
(Final
84,000
46,200
10 6
 )
100 12
1.4.2010
By Balance B/d
84,000
44,000
30.9.2010
By interest
22,00
_____
46,200
(52)
Amount
80,000
4000
10 6
( 44,000 
 )
100 12
46,200
Ans. d
Explanation :
At the time of forfeiture following entry is passed
Share capital A/c Dr. ( No of Share forfieted × Called up capital ) i.e 2000 × 9 = Rs. 18,000
MITTAL COMMERCE CLASSES
7|Page
So Rs. 18000 shall be debited at the time of forfeiture.
(53)
Ans. a
Explanation :
Total amount of purchase Consideration = 7, 50,000
Issued price per share ( 100 + 25 ) = 125
So , No. of Share issued =
(54)
7,50, 000
 6000 Shares.
125
Ans. d
Explanation :
Applicants of 14000 Share were allotted 10,000 shares.
So applicant of 420 shares allotted =
10, 000
 420 = 300 Shares.
14, 000
And excess money received on Application = (420 – 300 ) × 2 = Rs. 240
(55)
Ans. d
Explanation :
Securities premium has been paid with the allotment so, at the time of forfeiture of
shares no amount shall be debited to Sec. Premium A/c.
(56)
Ans. c
Explanation :
Amount Forfeited by the Company = 3,000
(–) Discount on re-issue of share = 2000 (2000 × 1)
Amount to be transferred to capital reserve = Rs. 1000.
(57)
Ans. c
Explanation :
When call in arrear account is opened than calls in arrear A/c shall be credited at the
time of forfeiture of shares.
(58)
Ans. d
Explanation :
Any amount withdrawn from free Reserve for the Redemption of preference share is
transferred to capital Redemption Reserve A/c. Amount Withdrawn from free Reserve
(3,00,000 – 120,000) = Rs. 1,80,000.
(59)
Ans. d
Explanation :
Interest of Debenture = 40,000 × 100 ×
7 11

 256667
100 12
1 May 2003 to 31 March 2004.
(60)
Ans. c
Explanation :
Loss per debenture = 100 × (6% + 5%) = Rs. 11
Total loss = 1,40,00,000 × 11 = Rs. 15,40,00,000
(61)
Ans. c
Explanation:
MITTAL COMMERCE CLASSES
8|Page
When an offer is made by offeror and offeree provides acceptance thereto, than it is
termed as agreement.
(62)
Ans. c
Explanation:
Section 2(j) defines void contract as a contract which ceases to be enforceable by
law.
(63)
Ans. b
Explanation:
Here, the offer is by A and its acceptance is by B, and offer + acceptance =
agreement.
(64)
Ans. b
Explanation:
Under executory contract the reciprocal promises or obligations which serves as
consideration is to be formed in future.
(65)
Ans. d
Explanation:
Where the obligation or promise in a contract is outstanding on the part of both the
parties, it is known as the bilateral contract.
(66)
Ans. a
Explanation:
General offer is an offer made to the public in general and hence any one can accept
and do the desired act.
(67)
Ans. b
Explanation:
As per Sec- 4, the communication of an offer is complete when it comes to the
knowledge of the person to whom it is made.
(68)
Ans. d
Explanation:
Auction sale is invitation to offer but bids made by bidder under auction sale is
termed as offer.
(69)
Ans. c
Explanation:
Communication is must both at the time of making, or, revocation of offer and
acceptance.
(70)
Ans. c
Explanation:
General offer is an offer made to the public in general and hence any one can accept
and do the desires act. Further section – 8 points out that performance of the
conditions of a proposal is an acceptance of the proposal. (Carbolic smoke ball
company v/s Mrs. Carlill).
(71)
Ans. d
Explanation:
MITTAL COMMERCE CLASSES
9|Page
As per section -4 acceptance should be communicated to the offeror before the offer
lapses, the offer terminates and the offer is revoked by the offeror.
(72)
Ans. c
Explanation:
The acceptance is valid. Acceptance should be unconditional and unqualified but
condition regarding verification of the subject- matter to the contract does not
termed as conditional acceptance.
(73)
Ans. d
Explanation:
Rule regarding acceptance is that it must be unconditional and unqualified. If it is
conditional or qualified then it leads to counter offer.
(74)
Ans. b
Explanation:
Acceptance should be made in the prescribed manner and mode of the offer.
(75)
Ans. a
Explanation:
As per Sec. 15 "Coercion" is the committing, or threatening to commit any act
forbidden by Indian penal code, or the unlawful detaining or threatening to detain
any property, to the prejudice of any person whatever with the intention of coursing
any person to enter into an agreement. And suicide comes under "Coercion".
(76)
Ans. a
Explanation:
The burden of proof that the consent was obtained by Coercion lies on the person
who wants to relieve himself of the consequences of coercion (Sec. 19)
(77)
Ans. b
Explanation:
As per sec. 16, A contract is said to be induced by "Undue influence". Where the
relations subsisting between parties are such that one of the parties is in a position
to dominate the will of the other and uses that position to obtain an unfair advantage
of the other. A person is deemed to be in a position to dominate the will of the other,
when he holds authority real or apparent over the other, or when he stands in a
fiduciary relation to the other.
(78)
Ans. b
Explanation:
Mistake as to foreign law is treated in the same manner as mistake of fact. (Section
– 20)
(79)
Ans. c
Explanation:
The agreement is not enforceable because it is forbidden by law due to unlawful of
consideration as well as object in the agreement.
(80)
Ans. b
Explanation:
Agreement based on personal skill cannot be enforceable after the death of the
party. Hence, it lapses for both the parties.
MITTAL COMMERCE CLASSES
10 | P a g e
(81)
Ans. a
Explanation:
Contract which involve the exercise of personal skill or diligence, or which are
founded on personal confidence between the parties must be performed by the
promisor himself.
(82)
Ans. b
Explanation:
The Partnership Act, 1932 came into force on 1st day of October 1932.
(83)
Ans. d
Explanation:
According to the Partnership Act, the term "Business" includes trade, occupation and
profession.
(84)
Ans. b
Explanation:
The maximum number of persons permissible for a valid partnership for doing
banking business is hundred (100).
(85)
Ans. a
Explanation:
The ratio in which partners share profits and losses are based on agreement. And in
absence of any information in the agreement, such are shared equally.
(86)
Ans. d
Explanation:
To form a partnership, the partners should share profits and losses. But some
partners may get a share only in the profits subject to the provision inserted in the
partnership deed.
(87)
Ans. c
Explanation:
Partners are bound to render true accounts and full information of all the things
affecting the firm or any of the partner on demand and in case of death of any
partner then to his legal representative also, upto the settlement of the accounts of
the deceased partner.
(88)
Ans. a
Explanation:
While forming partnership, partners may mutually decides the terms and conditions
of it in the partnership deed and if the provisions of such deed is lawful, then such
are valid and enforceable. So, if there is a contract that the partner shall not carry on
the business other than that of the firm while he is a partner, such contract is valid.
(89)
Ans. c
Explanation:
As per section 19(1) and 22, the implied authority of any partner is subject to either
contract between the partners, or usages/customs of the trade.
(90)
Ans. c
Explanation:
MITTAL COMMERCE CLASSES
11 | P a g e
As per section – 34, ordinarily but not invariably, the insolvency of a partner results
in dissolution of a firm, but the partners are competent to agree among themselves
that the adjudication of a partner as an insolvent will not give rise to dissolution of
the firm. Secondly, on insolvency of a partner, his estate ceases to be liable for any
act of the firm done after the date of the order, and the firm also is not liable for any
act of such a partner after such date.
(91)
Ans. a
Explanation:
As per section -2(2) of the Sale of Goods Act, delivery means voluntary transfer of
possession by one person to another.
(92)
Ans. b
Explanation:
Symbolic Delivery - When there is a delivery of a thing in taken of a transfer of
something else, i.e., delivery of goods in case of transit may be made by handing
over documents of title to goods, like bill of lading or railway receipt or delivery
orders or the key of a warehouse containing the goods is handed over to buyer.
(93)
Ans. c
Explanation:
Promissory Note is not a document of title of goods, because it is a indebt certificate
of particular amount/debt.
(94)
Ans. (b)
As per section -2(6) of the Sale of Goods Act, future goods means goods to be
manufactured or produced or acquired by the seller after making the contract of sale.
(95)
Ans. d
Explanation:
Contingent goods are such goods availability of which depends upon future
contingency of event. Here in the given question the goods are not future but
depends upon contingent event i.e., cyclonic storm.
(96)
Ans. b
Explanation:
As per section – 4 (3) of the Sale of Goods Act, where under a contract of sale the
transfer of the property in the goods is to take place at a future time or subject to
some condition thereafter to be fulfilled, the contract is called an agreement to sell.
(97)
Ans. b
Explanation:
A condition is stipulation essential to the main purpose of the contract, the breach of
which gives right to repudiate the contract and to claim damages.
(98)
Ans. b
Explanation:
Section – 16 of the Sale of Goods Act states about the implied condition as to quality
or fitness. Here in the given case it is the breach of implied condition as to quality
and chemist is liable for it.
(99)
Ans. c
Explanation:
MITTAL COMMERCE CLASSES
12 | P a g e
Caveat Emptor means "Let the buyer beware". This is applicable Where seller
provides reasonable opportunity to the buyer to examine the goods.
(100) Ans. b
Explanation:
Sale by one of the joint owners: If one of the several joint owners of goods has the
sole possession of them with the permission of the others, the property in the goods
may be transferred to any person who buys them from such a joint owner in good
faith and does not ay the time of the contact of sale have notice that the seller has
no authority to sell (Section – 28)
***
MITTAL COMMERCE CLASSES
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