MTP_ Intermediate _Syllabus 2012_Dec2016_Set 2
Paper 5- Financial Accounting
Academics Department, The Institute of Cost Accountants of India (Statutory Body under an Act of Parliament) Page 1
, MTP_ Intermediate _Syllabus 2012_Dec2016_Set 2
Paper 5- Financial Accounting
Full Marks: 100 Time Allowed: 3 hours
Section A
1. Answer the following questions
(a) Multiple choice questions: [5x1=5]
(i) Which of the following purpose is served from the preparation of trial balance:
(a) To check the arithmetical accuracy of the recorded transactions;
(b) To ascertain the balance of any ledger account;
(c) To facilitate the preparation of final account promptly;
(d) All of the above.
(ii) Survey expenses for marine insurance claim must be
(a) Added to claim;
(b) Added to legal charges;
(c) Added to administrative charges;
(d) None of the above.
(iii) A profit on sale of furniture of a club will be taken to
(a) Cash Account;
(b) Receipts and Payment Account;
(c) Income and Expenditure Account;
(d) Profit and Loss Account.
(iv) Realisation Account is a:
(a) Representative Personal Account;
(b) Artificial Personal Account;
(c) Real Account;
(d) Nominal Account.
(v) Bank shows the provision for income tax under the head
(a) Contingency Accounts;
(b) Other liabilities and provisions;
(c) Contingent liabilities;
(d) Borrowings.
Solution:
(i) —D
(ii) —A
(iii) —C
(iv) —D
(v) —B
(b) Match the following: [5x1=5]
Column ‘A’ Column ‘B’
1. Cash Flow Statement A AS-13
2. Unexpired risk revenue B Consignment
Academics Department, The Institute of Cost Accountants of India (Statutory Body under an Act of Parliament) Page 2
, MTP_ Intermediate _Syllabus 2012_Dec2016_Set 2
3. Accounting for investment C AS-7
4. Delcredere commission D Insurance Companies
5. Construction contracts E AS-3
Solution:
1. —E
2. —D
3. —A
4. —B
5. —C
(c) State whether the following statements are true or false: [5x1=5]
(i) Original cost minus scrap value is the depreciated value of an asset.
(ii) The average clause is applicable when the actual loss is less than the sum assured.
(iii) Life membership fee may be capitalized and shown in balance sheet in liabilities
side.
(iv) Bad debts are apportioned among departments in the proportion of value of sales
of each department.
(v) A banking company cannot grant any loans or advances on the security of its own
shares.
Solution:
(i) — True
(ii) — False
(iii) — True
(iv) — True
(v) — False
(d) Answer the following: [5×2=10]
(i) Calculate the amount of Insurance claim to be lodged based on the following
information:
Valuation of stock destroyed by fire ` 90,000
Insurance Policy amount (subject to average clause) ` 65,000
Value of stock salvaged from fire ` 40,000
Solution:
Total value of Stock before fix = 90,000 + 40,000 = 1,30,000
Stock destroyed by fix
Amount of Insurance claim = × Amount insured
Total Stock before fixe
90,000
= × 65,000 = `45,000
13,000
(ii) New Bank Ltd. Informs you the following:
Bill discount commission (unadjusted) ` 21,00,000
Rebate on bills discounted as on 1-4-2012 ` 2,43,000
Rebate on bills discounted as on 31-3-2013 ` 2,18,000
Compute the discount to be credited to the profit and loss account of the Bank
for the year ended 31-3-2013.
Academics Department, The Institute of Cost Accountants of India (Statutory Body under an Act of Parliament) Page 3
Paper 5- Financial Accounting
Academics Department, The Institute of Cost Accountants of India (Statutory Body under an Act of Parliament) Page 1
, MTP_ Intermediate _Syllabus 2012_Dec2016_Set 2
Paper 5- Financial Accounting
Full Marks: 100 Time Allowed: 3 hours
Section A
1. Answer the following questions
(a) Multiple choice questions: [5x1=5]
(i) Which of the following purpose is served from the preparation of trial balance:
(a) To check the arithmetical accuracy of the recorded transactions;
(b) To ascertain the balance of any ledger account;
(c) To facilitate the preparation of final account promptly;
(d) All of the above.
(ii) Survey expenses for marine insurance claim must be
(a) Added to claim;
(b) Added to legal charges;
(c) Added to administrative charges;
(d) None of the above.
(iii) A profit on sale of furniture of a club will be taken to
(a) Cash Account;
(b) Receipts and Payment Account;
(c) Income and Expenditure Account;
(d) Profit and Loss Account.
(iv) Realisation Account is a:
(a) Representative Personal Account;
(b) Artificial Personal Account;
(c) Real Account;
(d) Nominal Account.
(v) Bank shows the provision for income tax under the head
(a) Contingency Accounts;
(b) Other liabilities and provisions;
(c) Contingent liabilities;
(d) Borrowings.
Solution:
(i) —D
(ii) —A
(iii) —C
(iv) —D
(v) —B
(b) Match the following: [5x1=5]
Column ‘A’ Column ‘B’
1. Cash Flow Statement A AS-13
2. Unexpired risk revenue B Consignment
Academics Department, The Institute of Cost Accountants of India (Statutory Body under an Act of Parliament) Page 2
, MTP_ Intermediate _Syllabus 2012_Dec2016_Set 2
3. Accounting for investment C AS-7
4. Delcredere commission D Insurance Companies
5. Construction contracts E AS-3
Solution:
1. —E
2. —D
3. —A
4. —B
5. —C
(c) State whether the following statements are true or false: [5x1=5]
(i) Original cost minus scrap value is the depreciated value of an asset.
(ii) The average clause is applicable when the actual loss is less than the sum assured.
(iii) Life membership fee may be capitalized and shown in balance sheet in liabilities
side.
(iv) Bad debts are apportioned among departments in the proportion of value of sales
of each department.
(v) A banking company cannot grant any loans or advances on the security of its own
shares.
Solution:
(i) — True
(ii) — False
(iii) — True
(iv) — True
(v) — False
(d) Answer the following: [5×2=10]
(i) Calculate the amount of Insurance claim to be lodged based on the following
information:
Valuation of stock destroyed by fire ` 90,000
Insurance Policy amount (subject to average clause) ` 65,000
Value of stock salvaged from fire ` 40,000
Solution:
Total value of Stock before fix = 90,000 + 40,000 = 1,30,000
Stock destroyed by fix
Amount of Insurance claim = × Amount insured
Total Stock before fixe
90,000
= × 65,000 = `45,000
13,000
(ii) New Bank Ltd. Informs you the following:
Bill discount commission (unadjusted) ` 21,00,000
Rebate on bills discounted as on 1-4-2012 ` 2,43,000
Rebate on bills discounted as on 31-3-2013 ` 2,18,000
Compute the discount to be credited to the profit and loss account of the Bank
for the year ended 31-3-2013.
Academics Department, The Institute of Cost Accountants of India (Statutory Body under an Act of Parliament) Page 3
