Common Proficiency Test Model Paper 4

BOARD OF STUDIES THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA COMMON PROFICIENCY TEST Model Test Paper – BOS/CPT – 17 Time : 4 hours Maximum Marks : 200 The test is divided into four sections. SECTION – A : FUNDAMENTALS OF ACCOUNTING (60 MARKS) 1. All the following are functions of accounting except (a) Decision making (b) Measurement (c) Forecasting (d) Ledger posting 2. Rs. 25,000 incurred on structural alterations to existing asset whereby its revenue earning capacity is increased is _______ (a) Capital expenditure (b) Deferred revenue expenditure (c) Revenue expenditure (d) None of the above 3. Debts written off as bad if recovered subsequently are (a) Credited to Bad Debt recovered A/c (b) Debited to Profit and Loss A/c (c) Credited to Debtors A/c (d) None of the above 4. The total of the sales return book is posted periodically to the debit of _____ (a) Sales Return Account (b) Cash Book (c) Journal proper (d) None of the above 5. Bills payable is ______ (a) Real A/c (b) Nominal A/c (c) Personal A/c (d) Both (a) and (b) 6. Human assets have no place in accounting records is based on _____ (a) Money measurement concept (b) Accrual concept (c) Consistency (d) Conservatism Common Proficiency Test (CPT) Volume - I 453 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 7. Sales return book records _______ (a) Credit sales return (b) Cash sales return (c) Both (a) and (b) (d) Purchase return 8. Contra entries are passed only when ______ (a) Double column cash book with discount is prepared (b) Three column cash book is prepared (c) Simple cash book is prepared (d) None of the above. 9. Consignment Account is: (a) Real A/c (b) Personal A/c (c) Nominal A/c (d) None of the above 10. Parties to Bill of Exchange are: (a) Drawer (b) Drawee (c) Payee (d) All of the above 11. Preliminary expenses are treated as ___________ (a) Miscellaneous expenditure (b) Intangible asset (c) Current assets (d) Current liability 12. Proposed dividends are debited to (a) Trading A/c (b) Profit & Loss A/c (c) Profit & Loss Appropriation A/c (d) None of the above 13. Discount on issue of debentures is a _____________ (a) Capital loss to be shown as goodwill (b) Capital loss to be written off over the tenure of the debentures (c) Capital loss to be written off from capital reserve (d) Revenue loss to be charged in the year of issue 14. Profit and loss on revaluation is shared among the partners in ________ ratio. (a) Old profit sharing ratio (b) new profit sharing ratio (c) Capital ratio (d) Equal ratio 15. Accounts payable normally has ___________ balance (a) Debit (b) Unfavourable (c) Credit (d) none of the above 16. Bank pass book is also known as _______ (a) Bank book (b) Bank account (c) Bank column (d) Bank statement 454 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 17. Depreciation on machinery in trial balance is recorded in ____________ (a) Trading A/c (b) Profit & Loss A/c (c) Balance Sheet (d) None of the three 18. The balance of the petty cash is: (a) An expense (b) An income (c) An asset (d) A liability 19. Fixed capital A/c is credited with _______ (a) Interest on capital (b) Profit of the year (c) Salary of the partner (d) None of the above. 20. Interest on drawing is ______ for the business (a) Capital (b) Expense (c) Gain (d) None of the three 21. Ramesh, the acceptor of the bill has to honour a bill on 31st March 2010. Due to financial crisis, he is unable to pay the amount of bill of Rs. 20,000. Therefore, he approaches Ram on 20th March 2010 for extension of the bill for further 3 months. Ram agrees to extend the credit period by drawing a new bill for Rs. 20,500 together with interest of Rs. 1000 in cash. In this case old bill of Rs. 20,000 will be considered as: (a) Discounted (b) Dishonoured (c) Cancelled (d) Retired 22. M/s Kapoor Bros, which was registered in the year 2000, has been following straight line method (SLM) of depreciation. In the current year it changed its method from SLM to written down value (WDV) method, since such change would result in the additional depreciation of Rs. 200 lakhs as a result of which the firm would qualify to be declared as a sick industrial unit. The auditor raised objection to this change in the method of depreciation. Auditors objection is justified because - (a) Change in the method of depreciation should be done only with the consent of the auditor. (b) Depreciation method can be changed only from WDV to SLM and not Vice Versa. (c) Change in the method of depreciation should be done only if it is required by some statute and change would result in appropriate presentation of financial statement. (d) Method of depreciation cannot be changed under any circumstances. 23. A company purchased a plant for Rs. 5,000 useful life of the plant is 10 years and residual value is Rs. 500. Rate of depreciation will be ____ (a) 9% (b) 10% (c) 15% (d) 12½% Common Proficiency Test (CPT) Volume - I 455 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 Rs. 24. Gross Profit 51,000 Carriage Outwards 5,800 Rent paid 6,400 Bad Debts 2,600 Apprentice premium (Cr.) 1,500 Printing & Stationery 1,000 Net profit of the firm will be (a) Rs. 38,900 (b) Rs. 36,700 (c) Rs. 35,000 (d) Rs. 40,000 25. A started business with Rs. 10,000 cash and Rs. 2,000 furniture. Sales amounted to Rs. 50,000 including Rs. 5,000 cash sale. Rs. 10,000 sales were outstanding at the end of the year. Purchases amounted to Rs. 30,000 including Rs. 10,000 cash purchase. Rs. 15,000 has been paid to creditors. Expenses paid during the year are Rs. 19,300. Cash balance at the end will be _________ (a) Rs. 6,000 (b) Rs. 7,000 (c) Rs. 5,700 (d) Rs. 5,000 26. On Jan 1, 2010 Ram Gopal invested Capital of Rs. 50,000. He withdrew Rs. 2,000 on the first day of each month interest on drawings is provided @ 10%. The amount of interest on drawings deducted from Capital will be _________ (a) Rs. 1,300 (b) Rs. 1,400 (c) Rs. 1,500 (d) Rs. 1,000 27. Received one bill from A Rs. 500 passed through B/P book. The rectifying entry will be ___________ Rs. Rs. (a) A Dr. 500 To B/P 500 (b) B/R A/c Dr. 500 To A 500 (c) B/P A/c Dr. 500 B/R A/c Dr. 500 To A 1000 (d) None of the above. 28. Goods costing Rs. 7,500 were sold at 25% profit on selling price. The sales will be of : (a) Rs. 10,000 (b) Rs. 9,000 (c) Rs. 8,000 (d) None of the three 456 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 29. Following figures have been taken from the books of a trader Purchases 3,00,000 Purchase Returns 6,000 Sales 4,10,000 Sales Returns 10,000 Opening Stock 80,000 Carriage & Freight 12,000 Duty & Clearing Charges 4,000 Wages 8,000 Closing Stock 60,000 Gross profit will be ________ (a) Rs. 60,000 (b) Rs. 61,000 (c) Rs. 62,000 (d) Rs. 65,000 30. Trial Balance containing obvious errors is given below: Dr. (Rs.) Cr. (Rs.) Purchases 60,000 Reserve Fund 20,000 Sales 1,00,000 Purchase return 1,000 Sales Return 2,000 Opening Stock 30,000 Closing Stock 40,000 Sundry Expenses 20,000 Outstanding Expenses 2,000 Cash at Bank 5,000 Fixed Assets 50,000 Debtors 80,000 Creditors 30,000 Capital 94,000 Suspense A/c 10,000 2,72,000 2,72,000 Total of corrected trial balance will be ________ (a) Rs. 2,40,000 (b) Rs. 2,47,000 (c) Rs. 2,50,000 (d) Rs. 2,38,000 Common Proficiency Test (CPT) Volume - I 457 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 31. Bank overdraft as per Cash book is Rs. 2500 Cheque deposited but not cleared Rs.1000 Cheque issued but not cashed Rs.1400 Bank overdraft as per Bank statement will be ________ (a) Rs. 2,000 (b) Rs. 2,100 (c) Rs. 2,500 (d) Rs. 2,200 32. Preliminary expenses in connection with floatation of a new company is: (a) Fixed asset (b) Current asset (c) Fictitious asset (d) None of the three 33. Following are the details of position statement Rs. Rs. Closing Stock 40,000 Cash 3,000 Drawings 12,000 Bills receivable 5,000 Net Profit 18,000 Bills payable 3,000 Capital 70,000 Machinery 20,000 Debtors 40,000 Depreciation provision 4,000 Cash at Bank 8,000 Liabilities for expenses 3,000 Creditors 30,000 Balance sheet total will be: (a) Rs. 1,16,000 (b) Rs. 1,15,000 (c) Rs. 1,20,000 (d) Rs. 1,25,000 34. Panna Lal sends 100 sewing machines on consignment to Ram Ji Lal. The cost of each machine is Rs. 150. Panna Lal spends Rs. 500 on packing and dispatch. Ram Ji Lal receives the consignment and informed that 90 machines have been sold at Rs. 180 each. Expenses paid by Ram Ji Lal are freight Rs. 500, carriage and octroi Rs. 200, Godown rent Rs. 100 and insurance Rs. 150. Ram Ji Lal is entitled to a commission of 7½% on sales. Profit on consignment will be: (a) Rs. 150 (b) Rs. 155 (c) Rs. 200 (d) Rs. 160 35. Bharti consigned to Bhawna 1,500 Kg of flour costing Rs. 4500. She spent Rs. 307 as forwarding charges. 5% of the consignment was lost in weighing and handling. Bhawna sold 1,350 Kg of flour at Rs. 4 per kg. Her selling expenses being Rs. 550 and commission at 12½% on sales. Valuation of closing stock will be ________ (a) Rs. 253 (b) Rs. 250 (c) Rs. 350 (d) Rs. 275 36. Which of the following is not a current asset? (a) Bills Receivable (b) Stock (c) Debtors (d) Furniture and Fittings 458 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 37. Deepak Ltd. forfeited 40 shares of 100 each (Rs. 60 called up) issued at par to Mukesh on which he had paid Rs. 20 per share. Out of these 30 shares were reissued to Sujoy as Rs. 60 paid up for Rs. 45 per share. Amount transferred to capital reserve will be ________ (a) Rs. 150 (b) Rs. 100 (c) Rs. 200 (d) Rs. 120 38. The following information pertains to Quick Ltd. Rs. (i) Equity share capital called up 10,00,000 (ii) Calls in arrear 40,000 (iii) Calls in advance 25,000 (iv) Proposed dividend 5% The amount of dividend payable is ________ (a) Rs. 48,000 (b) Rs. 50,000 (c) Rs. 60,000 (d) Rs. 49,250 39. Which of the following is fixed asset? (a) Plant and machinery (b) Stock (c) Debtors (d) Cash 40. General Reserve at the time of admission of a new partner is transferred to: (a) P/L adjustment A/c (b) Balance Sheet (c) Capital Accounts of partners (d) None of the three 41. A company purchased machinery for Rs. 20,000 on 1st January 2006 and followed the diminishing balance method @ 15%. At the end of 2009 it was decided to follow fixed Instalment method of depreciating the machine at Rs. 3000 per year from the very beginning and the necessary amount of unabsorbed depreciation of 2006 to 2008 to be adjusted in 2009. Adjusted amount will be: _________ (a) Rs. 1,282 (b) Rs. 1,300 (c) Rs. 1,400 (d) Rs. 1,500 42. On 1st April, 2009 M/s Omega Bros. had a provision for bad debts of Rs. 6,500. During 2009- 2010 Rs. 4,200 proved irrecoverable and it was desired to maintain the provision for bad debts @ 4% on debtors which stood at Rs. 1,95,000 before writing off bad debts. Amount of net provision debited to profit and loss A/c will be: _________ (a) Rs. 7,800 (b) Rs. 7,500 (c) Rs. 5,332 (d) Rs. 5,000 Common Proficiency Test (CPT) Volume - I 459 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 43. Following figures have been taken from the books of a trader Rs. Purchases 60,000 Purchase returns 10,000 Sales 80,000 Sales Return 10,000 Carriage outwards 1,000 Office Rent 1,000 Amount of Gross Profit will be _________ (a) Rs. 20,000 (b) Rs.10,000 (c) Rs.15,000 (d) None of the three 44. The profits for the last four years are given as follows: Year Rs. 2006 40,000 2007 50,000 2008 60,000 2009 50,000 The value of goodwill on the basis of three years purchase of average profits based on last four years will be _________ (a) Rs. 1,00,000 (b) Rs. 1,50,000 (c) Rs. 2,00,000 (d) None of three 45. Goods destroyed by fire Rs. 50,000 and Insurance company admitted 60% claim. This adjustment will be entered in: (a) Trading Account (b) Profit & Loss Account (c) Balance Sheet (d) All the three 46. Following balances are given in trial balance Dr. Rs. Cr. Rs. 6% Loan on (1.1.2009) 10,000 Interest on Loan 300 Interest payable and outstanding will be: _________ (a) Rs. 600 (b) Rs. 300 (c) Rs. 500 (d) Rs. 700 47. Machinery bought on 1st July 2006 for Rs. 20,000 was sold on Dec. 31, 2009 for Rs. 15,000. Depreciation is charged @ 10% p.a. on original cost. Accounting year closes on 31st December each year. Profit on sale will be _________ (a) Rs. 3,000 (b) Rs. 2,000 (c) Rs. 2,500 (d) Rs. 4,000 460 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 48. A boiler was purchased from abroad for Rs. 10,000, shipping and forwarding charges amounted to Rs. 2,000, Import duty Rs. 7,000 and expenses of installation amounted to Rs. 1,000. It was depreciated for three years @ 10% on diminishing balance method, Balance of machinery A/c at the end of third year will be _____ (a) Rs. 14,580 (b) Rs. 15,000 (c) Rs. 14,000 (d) Rs. 15,500 49. Syam prepared a trial balance for his factory on 31st March, 2010. The debit total of trial balance was short by Rs. 500. He transferred the deficiency to suspense A/c. After a close examination be found that the purchase day book for Sept. 2009 was under cast by Rs. 500. Necessary Journal entry to rectify the error will be: Rs. Rs. (a) Purchases A/c Dr. 500 To Cash A/c 500 (b) Suspense A/c Dr. 500 To Purchases A/c 500 (c) Purchases A/c Dr. 500 To Suspense 500 (d) None of the above 50. Which of the following errors will effect the trial balance. (a) Repairs to building wrongly debited to Building A/c (b) Total of purchase Journal is short by Rs. 1,000 (c) Freight paid on purchase of new machinery debited to freight account. (d) None of the above. 51. A’s acceptance to B for Rs. 8,000 renewed for 3 months on the condition that Rs. 4,000 be paid in cash immediately and the remaining amount will carry interest @ 12% p.a. The amount of interest will be (a) Rs. 120 (b) Rs. 100 (c) Rs. 80 (d) Rs. 160 52. A Limited Company purchased machine worth Rs. 1,15,000 from Indian Traders. Payment was made as to Rs. 10,000 by cross cheque and the remaining amount by issue of Equity Shares of the face value of Rs. 10 each fully paid at an issue price of Rs. 10.50 each. Amount of share premium will be (a) Rs. 6,000 (b) Rs. 7,000 (c) Rs. 5,000 (d) Rs. 4,000 53. B sold 50 televisions at Rs. 15,000 per television. He was entitled to commission of Rs. 500 per television sold plus one fourth of the amount by which the gross sale proceeds less total commission there on exceeded a sum calculated at the rate of Rs. 12,500 per television sold. Amount of commission will be (a) Rs. 45,000 (b) Rs. 50,000 (c) Rs. 40,000 (d) Rs. 35,000 Common Proficiency Test (CPT) Volume - I 461 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 54. On 16.06.2010 X draws a bill on Y for Rs. 25,000 for 30 days. July 19th is a public holiday. The Maturity date of the bill will be _________ (a) 19th July, 2010 (b) 18th July, 2010 (c) 20th July, 2010 (d) 16th July, 2010 55. A and B entered into a joint venture and agreed to share profits and losses in the ratio of 3:2. A Joint Bank A/c was opened where in A contributed Rs. 50,000 and B contributed Rs. 20,000. Their transactions were as follows: Rs. Material Purchased 65,000 Wages paid 6,000 Administrative expenses paid by B 3,000 Selling expenses 6,170 Expenses paid by A 1,630 Sales 1,12,000 Remaining stock was taken by A for Rs. 6,200. Joint venture profit will be (a) Rs. 36,000 (b) Rs. 36,400 (c) Rs. 35,000 (d) Rs. 36,500 56. The expired portion of capital expenditure is (a) Expense (b) Income (c) Asset (d) Liability 57. Rs. Capital on January 1, 2009 15,200 Capital on January 1, 2010 16,900 Drawings made during the year 4,800 Additional Capital introduced during the year 2,000 Profit of the firm will be (a) Rs. 4,500 (b) Rs. 4,000 (c) Rs. 4,800 (d) Rs. 5,000 58. In the bank reconciliation statement, when balance as per cash book is taken as the starting point, then interest collected by bank Rs. 500 and direct deposit by a customer into his bank Rs. 2,500 will be: (a) Added (b) Subtracted (c) Ignored (d) None of the above 59. Recovery of bad debts is a (a) Revenue receipt (b) Capital receipt (c) Capital expenditure (d) Revenue expenditure 462 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 60. A draws a bill on B for Rs. 50,000 for mutual accommodation. A discounted the bill for Rs. 48,000 from bank and remitted Rs. 24,000 to B. On Maturity date A will send to B. (a) Rs. 25,000 (b) Rs. 24,000 (c) Rs. 23,000 (d) Rs. 26,000 SECTION – B : MERCANTILE LAWS (40 MARKS) 61. An agreement to do an impossible act is: (a) Void (b) Voidable (c) Illegal (d) None of these 62. A, B, and C jointly promised to pay Rs. 50,000 to D on the performance of the contract. C dies. Here the contract (a) Becomes void on C’s death (b) Should be performed by A and B along with C’s legal representatives (c) Should be performed by A and B alone (d) Should be renewed between A, B, and D 63. In case of breach of contract, which of the following remedy is available to the aggrieved party? (a) Suit for rescission (b) Suit for damages (c) Suit for specific performance (d) All of these 64. Which is true statement in voidable contract, the injured party (a) Is entitled to recover compensation (b) Has a right to sue for damages (c) Has a right to rescinded the contract (d) All of these 65. A contract can be discharged by operation of law by (a) Death of promisor (b) By insolvency of promiser (c) By Lunacy of promiser (d) By death or insolvency of promiser 66. Which does not relate with seller’s suits? (a) Suit for price (b) Suit for damages for non acceptance (c) Suit for repudiation of contract by the buyer before due date (d) Suit for taking back the goods Common Proficiency Test (CPT) Volume - I 463 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 67. Future goods means goods to be manufactured or acquired by the seller. (a) Before making the contract of sale (b) At the time of contract of sale (c) After making the contract by sale (d) All of these 68. Where seller refuses to deliver the goods the buyer (a) The buyer many sue the seller for damages for non-delivery (b) The buyer may not sue the seller (c) The buyer may compel the seller to deliver the goods (d) The buyer may not compel the seller to deliver the goods 69. Which of seller’s right against the buyer in case of breach of contract is: (a) Suit for price and damages for non-acceptance (b) Suit for damages for non-acceptance (c) Suit for price only (d) Cannot sue for price and damages 70. Which of the statement is true in case of an auction sale (a) The sale is complete when the auctioneer announces its completion by the fall of hammer (b) The sale is complete after certain period (c) The sale is complete after five hours (d) The sale is complete after eight hours 71. Who cannot become a partner in partnership firm (a) A competent person (b) An unmarried woman (c) Non-resident Indian (d) Alien enemy 72. A Joint Hindu family arises (a) From status decided by court (b) As a result of an agreement (c) By operation of law (d) All of these 73. In partnership the liability of the partner is: (a) Limited to share in partner ship firm (b) Unlimited (c) Decided by court (d) Decided by other partners 74. The Sale of Goods Act, 1930 gives the remedies to a seller for breach of contract of sale. Which is correct. (a) Suit for price (b) Suit for damages for non-acceptance (c) Suit for damages for reputation of contract by the buyer before due date (d) All of these 464 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 75. The term goods includes (a) Stocks and shares (b) Money (c) Actionable claim (d) All of these 76. The partnership agreement may be: _________ (a) Express or implied (b) Only written (c) Oral only (d) Implied only 77. The term business includes _________ (a) Every trade (b) Every occupation (c) Profession only (d) All of these 78. Which is the true statement regarding the inclusion of minor in partnership firm (a) A minor may be admitted to the benefits of partnership with the consent of all other partners. (b) A minor may be admitted to the benefits of partnership with no consent of other partners (c) A minor may be admitted to the benefits of partnership with the consent of his parents (d) A minor may be admitted to the benefits of partnership with the guarantee of his parents 79. In case of partnership, registration of firm is: (a) Compulsory (b) Not necessary (c) Compulsory if the court orders to do so (d) Compulsory if the government thinks fit to do so 80. There may be ____________ condition (a) Implied (b) Express (c) Implied and Express both (d) None of these 81. Under the doctrine of Caveat Emptor the seller is _____________ (a) Responsible for bad selection of goods by the buyer (b) Not responsible for the bad selection of goods by the buyer (c) Both of these (d) None of these 82. The unpaid seller loses the right of lien (a) Where seller waived the right of lien (b) By estoppel (c) Where the buyer obtains possession of goods (d) Any of the above Common Proficiency Test (CPT) Volume - I 465 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 83. If the seller hands over the key to the buyer of warehouse containing the goods, the delivery is known as (a) Constructive delivery (b) Actual delivery (c) Symbolic delivery (d) No delivery 84. In a hire purchase agreement the hirer ___________ (a) Has an option to buy the goods (b) Must buy the goods (c) Must return the goods (d) Is not given the possession of goods 85. In case of goods sold by sample, the goods should correspond with the sample otherwise ______ (a) Buyer can reject the goods (b) Buyer cannot reject the goods (c) Contract is terminated (d) Seller is liable to punishment 86. Voluntary transfer of possession by one person to another is known as _________ (a) Transfer (b) Possession (c) Delivery (d) None of these 87. In a joint family business there should be _____________ members (a) Maximum 20 (b) Unlimited (c) No. of persons decided by the government (d) Maximum 10 88. An unregistered firm _____________ (a) Cannot sue a third party (b) The third party can sue the firm (c) The partners cannot sue the firm (d) A partner cannot sue to any other partner 89. Every partner has ____________ (a) A right to inspect the books of the firm (b) No right to inspect the books of the firm (c) A right with the consent of other partners to inspect the books (d) A right to inspect the books with the consent of the Registrar 90. If claim on interest on capital is called, it is payable only out of (a) Profit (b) Turnover (c) Capital (d) Assets 466 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 91. In absence of specific agreement partner is entitled to interest at the rate of ____________ an advances made for the purpose of business of the firm (a) 6% (b) 10% (c) 8% (d) 12% 92. The partners cannot be expelled from the firm by ______________ (a) Majority of partners (b) Court (c) Government (d) Two partners 93. A partner is (a) Not entitled to receive any remuneration (b) Entitled to receive remunerate with the consent of other partners (c) Entitled to receive remuneration by order of the court (d) Entitled to receive remuneration 94. Goodwill is ______________ (a) Tangible asset (b) Liquid Asset (c) Fixed Asset (d) Intangible Asset 95. When a partner agrees to share his profits derived from the firm with a third person, that third person is known as ____________ (a) Sleeping partner (b) Nominal Partner (c) Sub-Partner (d) No partner 96. On attaining majority the minor partner has to decide within ______ whether he shall continue in the firm or learn it. (a) 6 months (b) 12 months (c) 3 months (d) 1 month 97. A partner may retire from a firm ___________ (a) With the consent of all other partners (b) With the consent by sleeping partner (c) With the consent of main partner (d) No consent of any partner 98. Where a partner in a firm is adjudicated insolvent (a) He ceases to be a partner (b) He does not cease to be a partner (c) He ceases to be a partner with the consent of all other partner (d) He ceases to be a partner by order of the court Common Proficiency Test (CPT) Volume - I 467 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 99. ‘A’, a man enfeebled by disease is induced by B’s influence over him as his medical attendant, to agree to pay ‘B’ an unreasonable sum for his services. It is the case of : (a) Undue Influence (b) Coercion (c) Fraud (d) Mistake 100. ‘A’ contracts to sing for ‘B’ at a concert for Rs. 5,000, which is paid in advance, ‘A’ is too ill to sing. Decide best (a) A must refund the advance of Rs. 5,000 to B (b) A is not liable to refund the many (c) ‘B’ should force ‘A’ to sing (d) ‘A’ is liable to refund only 50% of advance money to B SECTION – C : GENERAL ECONOMICS (50 MARKS) 101. Who is the main exponent of Marginal utility analysis ? (a) Paul Samuelson (b) Hicks (c) Keynes (d) Marshall 102. Cardinal measure of utility is required in: (a) Marginal Utility theory (b) Indifference curve (c) Revealed preference (d) None 103. In case of inferior goods, income elasticity is : (a) zero (b) positive (c) negative (d) none 104. In case of Giffen goods, demand curve will slope : (a) upward (b) downward (c) horizontal (d) vertical 105. Cross elasticity of demand between tea and coffee is: (a) positive (b) negative (c) zero (d) infinity 106. If all inputs are trebled and the resultant output is doubled, this is a case of: (a) constant returns to scale (b) increasing returns to scale (c) diminishing returns to scale (d) negative returns to scale 107. Indifference curve is downward slopping _______ (a) always (b) sometimes (c) never (d) none of these 468 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 108. Demand curve can be derived from: (a) MU curve (b) PCC (c) Both (a) & (b) (d) None 109. The exception to law of demand are: (a) Veblen goods (b) Giffen goods (c) Both (a) & (b) (d) none 110. Under perfect competition price of the product : (a) Can be controlled by individual firm (b) Cannot be controlled by individual firm (c) Can be controlled within certain limit by individual firm (d) None of the above 111. In the case of monopoly: (a) MR curve cannot be defined (b) AR curve cannot be defined (c) the short run supply curve cannot be defined (d) none of the above 112. In case of monopoly a firm in the short run can have - (a) Supernormal profits (b) Normal profits (c) Losses (d) Any of the above 113. The upper portion of the kinked demand curve is relatively - (a) More inelastic (b) More elastic (c) Less elastic (d) Inelastic 114. Price leadership is a form of - (a) Monopolistic competition (b) Monopoly (c) Non-collusive Oligopoly (d) Perfect competition 115. Period in which supply cannot be increased is called - (a) Market period (b) Short run (c) Long run (d) None of these 116. Price discrimination is not possible in the case of (a) Perfect competition (b) Monopoly (c) Monopolistic competition (d) Nothing can be said 117. If the income elasticity is greater than one the commodity is - (a) Necessity (b) Luxury (c) Inferior goods (d) None of these Common Proficiency Test (CPT) Volume - I 469 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 118. Full capacity is utilized only when there is - (a) Monopoly (b) Perfect competition (c) Price discrimination (d) Oligopoly 119. The ‘Diamond Water’ controversy is explained by - (a) Total utility (b) Marginal utility (c) Price offered (d) Quantity supplied 120. Which among the following is the drawback of consumer surplus (as explained in marginal utility analysis)? (a) it is highly hypothetical and imaginary (b) it ignores the interdependence between the goods (c) it cannot be measured in terms of money because marginal utility of money changes (d) all of the above 121. Which of the following is a function of money? (a) Medium of exchange (b) Store of value (c) Transfer of value (d) All the above 122. Increase in money supply will lead to: (a) Cost push inflation (b) Demand pull inflation (c) Structural inflation (d) None of the above 123. Which of the following is a commercial bank in India? (a) UTI (b) IFCI (c) IBRD (d) SEBI 124. Banks are regulated by: (a) Securities Exchange Board of India (b) Reserve Bank of India (c) Company Law Board (d) Registrar of Companies 125. Monetary policy is formulated by : (a) RBI (b) SEBI (c) CLB (d) Finance Ministry 126. In case RBI wants to increase rate of interest then it should: (a) sell securities (b) buy securities (c) hold securities (d) none of the above 470 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 127. Major commercial banks of India were nationalized in (a) 1969 (b) 1970 (c) 1971 (d) 1972 128. Commercial banks provide: (a) loans (b) agency services (c) both (a) & (b) (d) none of the above 129. Rationing of Credit takes place when: (a) Demand for Credit is Zero (b) Demand for Credit is higher than supply (c) Demand for Credit is low (d) None of the above 130. Statutory liquidity Ratio in India is: (a) 15% (b) 20% (c) 25% (d) 30% 131. The cash reserve ratio is determined by : (a) Free play of market forces (b) Commercial banks (c) Monetary authority (d) None of the above 132. In India fiscal year starts from (a) 31st March (b) 31st April (c) 1st April (d) 1st March 133. Which budget in India is passed separately? (a) Defence (b) Airlines (c) Atomic energy (d) Railways 134. Revenue deficit in India is - (a) negative (b) positive (c) zero (d) none of the above 135. VAT is levied by: (a) Central government (b) State governments (c) Local government (d) None of the above 136. Which of the following are sources of growth? (a) Natural resources (b) Human capital (c) Physical capital (d) All the above Common Proficiency Test (CPT) Volume - I 471 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 137. Percentage of population living in rural areas is: (a) 25% (b) 50% (c) 72% (d) 90% 138. The highest user of commercial energy is ________ (a) agriculture (b) industry (c) transport (d) household 139. Consumer surplus means ________ (a) the area inside the budget line (b) the area between the average revenue and marginal revenue curves (c) the difference between the maximum amount a person is willing to pay for a good and its market price (d) none of the above 140. A horizontal supply curve parallel to the quantity axis implies that the elasticity of the supply is: (a) zero (b) infinite (c) equal to one (d) greater than zero but less than one 141. Increase in population can be caused by - (a) High birth rate (b) Low death rate (c) Immigration (d) All the above 142. Which of the following pairs of goods in an example of substitutes ? (a) tea and sugar (b) tea and coffee (c) tea and ball pen (d) tea and shirt 143. A firm encounters its shut down point when: (a) Average cost equals price at the profit maximising level of output (b) Average variable cost equals price at the profit maximising level of output (c) Average fixed cost equals price at the profit maximising level of output (d) None of the above 144. Manufacturing industries are a part of : (a) primary sector (b) secondary sector (c) tertiary sector (d) none of the above 145. Mark the correct statement - (a) India is a purely capitalist economy (b) India is a stagnant economy (c) India is a developing economy (d) India is a resources poor economy 472 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 146. Public sector in India suffers from: (a) over staffing (b) political interference (c) uncompetitiveness (d) all of the above 147. The Reserve Bank of India was set up in : (a) 1949 (b) 1956 (c) 1935 (d) 1901 148. Disinvestment programme started in India after - (a) 1986-87 (b) 1988-89 (c) 1991-92 (d) 1995-96 149. Liberalisation process in India was initiated by - (a) Yashwant Singh (b) Manmohan Singh (c) Jaswant Singh (d) Both (a) & (b) 150. First plan was initiated in: (a) 1950 (b) 1951 c) 1956 (d) 1962 SECTION – D : QUANTITATIVE APTITUDE (50 MARKS) 151. A good estimator posses the following property (a) Unbiasedness (b) Consistency (c) Efficiency (d) All these 152. Frequency density is used in the construction of (a) Histogram (b) Ogive (c) Frequency polygon (d) None of these 153. Mean may lead to fallacious conditions in the absence of original observations (a) True (b) False (c) Both (d) None of these 154. Quartile deviation can be affected by: (a) Poisson distribution (b) Binomial distribution (c) Sampling fluctuations (d) None of these 155. The chart that was logarithm of the variable is known as (a) Line chart (b) Ratio chart (c) Multiple line chart (d) Component line chart Common Proficiency Test (CPT) Volume - I 473 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 156. Which measure of dispersion has some desirable mathematical properties? (a) Standard deviation (b) Mean deviation (c) Quartile deviation (d) All these measure 157. The coefficient of correlation between two variables (a) Can have any unit (b) Is expressed as the product of units of two variable. (c) Is a unit free measure (d) None of these 158. If A and B are two mutually exclusive events, then P(AUB) = P (A) + P (B) (a) True (b) False (c) P(AUB) = P (A/B) (d) None of these 159. A function f(x) is an even function, if (a) –f(x) = f(x) (b) f(–x) = f(x) (c) f(–x) = –f(x) (d) None of these 160. In a circular test the _____________condition must be satisfied? (a) P x P x P = 1 (b) P x P x P = 1 01 12 20 02 10 20 (c) P x P x P = 1 (d) None of these 10 20 21 161. If the same quantity is multiplied to all the values the mean shall ______ by the same amount. (a) Add (b) Subtract (c) Multiply (d) Divide 162. Probability of occurrence of A as well as B is denoted by _________ (a) P(AB) (b) P(A+B) (c) P (A/B) (d) None of these 163. log 512 is equal to 64 (a) 3 (b) 2 (c) 1 (d) 3/2 164. The fourth proportional to (a2– ab + b2), (a3 + b3) and (a-b) is equal to _________ (a) a2 + b2 (b) a2 – b2 (c) 1 (d) None of these 165. The sum of series 4 , 0,– 4 ,–8……… ….100th terms is _____ (a) –19400 (b) –292 (c) –150 (d) –100 474 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 166. Number of arrangement that can be made by word ‘APPLE’ is _______ (a) 50 (b) 40 (c) 60 (d) 120 167. A person lend _______ at simple interest in order of getting Rs. 645 at the end of 1½ years @ 5% p.a. (a) Rs. 600 (b) Rs. 625 (c) Rs. 550 (d) Rs. 575 lim log(1+x)1x 168. is equal to x→0 (a) 1 (b) 0 (c) e (d) Does not exist 1 1 ∫ log( -1)dx 169. is equal to _______ x 0 (a) 1 (b) 0 (c) 2 (d) –1 170. A _______ estimate is a single number (a) Point (b) Interval (c) Both (d) None of these 171. Find the value of m, if one of root is –3/2 of the equation x2+x–m=0 (a) 1 (b) 0 (c) –3/4 (d) –2 172. Find two numbers such that mean proportional between them is 18 and third proportional to them is 144. (a) 9, 36 (b) 29, 56 (c) 18, 72 (d) None of these 173. A man has only 20 paise coins and 25 paise coins in his purse. If he has 50 coins in all totalling Rs. 11.25, how many coins of each does he have (a) 15, 35 (b) 25, 25 (c) 40, 10 (d) 30, 20 x 174. If a function in x is defined by f(x)= ,X∈R then f(1/x) = ________ x2+1 (a) f(x) (b) f(–x) (c) –f(x) (d) 0 Common Proficiency Test (CPT) Volume - I 475 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 175. A line intersects x-axis at (–-2, 0) and cuts off an intercept of 3 from the positive side of y- axis, the equation of line is (a) 2x – 3y + 3 = 0 (b) 2x – 2y-3 = 0 (c) 3x – 2y + 6 = 0 (d) None of these X2-4x+3 lim 176. is equal to x→1 X2-6x+5 (a) 1/5 (b) 3/5 (c) 1/2 (d) 0 177. Three horses A, B and C are in a race, A is twice as likely to win as B and B is twice as likely to win as C. What is the possibility of C winning the race? (a) 1/7 (b) 3/7 (c) 2/5 (d) 2/7 178. The mean annual salary of all employees in a company is Rs. 25,000. The mean salary of male and female employees is Rs. 27,000 and Rs. 17,000 respectively. Find the percentage of males and females employed by the company. (a) 60% and 40% (b) 75% and 25% (c) 70% and 30% (d) 80% and 20% 179. For the series 13, 14, 7, 12, 9, 17, 8, 10, 6, 15, 18, 20, 21 calculate third decile (a) 9.2 (b) 9.5 (c) 9.7 (d) None of these 180. After settlement the average weekly wage in a factory has increased from Rs. 8 to Rs. 12 and standard deviation has increased from 2 to 2.5. Find the coefficient of variation after the settlement. (a) 25% (b) 20.83% (c) 24.0% (d) 26.30% 181. If r = 0.8, then coefficient of correlation shall be _________ (a) 0.64 (b) 0.40 (c) 0.60 (d) 0.80 182. A class consists of 10 boys and 20 girls of which half the boys and half the girls have blue eyes. Find the probability that a student chosen random is a boy and has blue eyes. (a) 1/6 (b) 3/5 (c) 1/2 (d) None of these 183. If x is a Poisson variate such that P(x=2) = 9P(x=4) + 90P(x=6), find mean of x. (a) m = 2 (b) m = 1 (c) m = ± 1 (d) m = –4 476 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 184. If sample mean is 20, population standard deviation is 3 and sample size is 64, find the interval estimate of the mean at confidence integral of 95%. (a) [19.265, 20.735] (b) [19.801, 17.735] (c) [20.735, 25.834] (d) None of these 185. A person invested money in bank paying 6% p.a. compounded semi annually. If the person expects to receive Rs. 8000 in 6 years, what is the present value of investment. (a) Rs. 5,000 (b) Rs. 4,611.03 (c) Rs. 5,611.03 (d) None of these 186. Out of 6 teachers and four boys, a committee of eight is to be formed. In how many ways can this be done when there should not be less than four teachers in the committee. (a) 45 (b) 55 (c) 30 (d) 50 3 ∫ (3x2+5x+2)dx 187. Evaluate the value of 0 (a) 55 (b) 57 (c) 55.5 (d) 56 ( 1 1 ) lim - 188. Evaluate x→2 x-2 x2-3x+2 (a) 1 (b) 3 (c) 2 (d) None of these 189. Find the second differential coefficient of y = x2 log x (a) x + 2x log x (b) 3 + 2 log x (c) 3 log x (d) 2x log x ( x2 +3x+2 ) lim 190. Compute the value of x→2 x3+2x-x+1 (a) 5 (b) 9 (c) 7 (d) 2 191. If 3x = 2, 5y =3 and 2z =5, find the value of multiply of x.y.z (a) 0 (b) 1 (c) 2 (d) None of these 192. If f(x) = |x + 1| and g(x) = 3x2 – 2 – 5, find the value of g of = ? (a) 3x2 + 6x –2 (b) 2x2 – 6x + 3 (c) | 3x2-5 | (d) x – 5 Common Proficiency Test (CPT) Volume - I 477 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 17 4 (x+1) (x+4) ∫ dx 193. x 0 1 48 (a) 51 (b) 5 5 7 (c) 48 (d) 55 15 194. The mean of numbers 1, 7, 5, 3, 4, 4 is m. The numbers 3, 2, 4, 2, 3, 3, P have mean m-1. Then mean of P and 1 is equal to _______ (a) 4.0 (b) 2.5 (c) 4.5 (d) 3.5 195. For a 10 year deposit, what interest rate payable annually is equivalent to 5% interest payable quarterly ? (a) 5.1% (b) 4.9% (c) 6.0% (d) None of these 196. The sum of first m terms of an A.P. is same as the sum of first n terms. Find the sum of first (m+n) terms: (a) 100 (b) m+n (c) 0 (d) m–n 197. The distance from the origin to the point of intersection of two straight lines having equation 3x – 2y = 6 and 3x+2y = 18 is (a) 3 units (b) 5 units (c) 4 units (d) 2 units. 198. The relation “is father of” Over the set of family members is the relation (a) Reflexive (b) Symmetric (c) Transitive (d) None of these 199. If P= {1, 2, 3, 4} and Q= {2, 4, 6} then P∪Q (a) {1,2,3,4,6} (b) {1,4,6} (c) {1,2,3,6} (d) None of these 200. There are four hotels in a certain city. If 3 men check into hotels in a day, what is the probability that they each are into a different hotels. (a) 0.050 (b) 0.375 (c) 0.675 (d) 0.525 (cid:2)(cid:2)(cid:2) 478 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India BOARD OF STUDIES THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA COMMON PROFICIENCY TEST Model Test Paper – BOS/CPT – 18 Time : 4 hours Maximum Marks : 200 The test is divided into four sections. SECTION – A : FUNDAMENTALS OF ACCOUNTING (60 MARKS) 1. Loss leads to reduction in: (a) Liability (b) Capital (c) Income (d) None of the three 2. Financial position of the business is ascertained on the basis of : (a) Profit and Loss account (b) Trial balance (c) Balance Sheet (d) None of the above 3. The determination of expenses for an accounting period is based on the principle of: (a) Objectivity (b) Materiality (c) Matching (d) Periodicity 4. Rent payable to the landlord Rs. 5,000.00 is credited to (a) Cash account (b) Landlord account (c) Outstanding rent account (d) None of the above 5. Bad debts entry is passed in (a) Sales book (b) Cash book (c) Journal book (d) None of the these 6. Goods were sold on credit basis to XY Bros. for Rs. 1,000. This will be recorded in (a) Cash book (b) Journal proper (c) Bills receivable book (d) Sales book Common Proficiency Test (CPT) Volume - I 479 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 7. Compensation paid to retrenched employee is: (a) Capital expenditure (b) Revenue expenditure (c) Deferred revenue expenditure (d) Capital loss 8. Petty expenses paid in cash are recorded in: (a) Purchase book (b) Sales book (c) Petty cash book (d) Purchase return book 9. On April 1, 2010, a bill was drawn for two months. The maturity date of payment will fall on: (a) June 1, 2010 (b) June 4, 2010 (c) June 5, 2010 (d) None of the above 10. Current assets does not include: (a) Cash (b) Stock (c) Debtors (d) Furniture & Fittings 11. Rs. 5,000.00 spent on maintenance of plant and machinery is: (a) Revenue expenditure (b) Capital expenditure (c) Deferred capital expenditure (d) None of the three above 12. Closing stock in trial balance is recorded in (a) Trading account (b) Profit & Loss account (c) Balance Sheet (d) None of the three 13. Interest on capital will be paid to partners if provided for in the agreement but only from (a) Current profit (b) Reserves (c) Accumulated profit (d) Goodwill 14. At the time of death of a partner, firm gets _______ from the insurance company against the joint life policy taken jointly for all the partners (a) Policy amount (b) Surrender value (c) Policy amount or surrender value whichever is higher (d) Policy amount or surrender value whichever is lower 15. Revaluation account is prepared at the time of _________ (a) Admission of a partner (b) Retirement of a partner (c) Both (a) and (b) (d) None of the three 16. While preparing a Bank Reconciliation Statement, if you start with overdraft as per Cash Book, then interest debited in pass book but not yet in cash book with in the period is (a) Added (b) Deducted (c) Not required to be adjusted (d) None of the above 480 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 17. Stock is ______ (a) Fixed assets (b) Current assets (c) Investments (d) Intangible fixed assets 18. As per Section 37 of the Indian Partnership Act, 1932 the executors would be entitled at their choice to the interest calculated from date of death till the date of payment on the final amount due to the dead partner at _______ percent per annum. (a) 7 (b) 4 (c) 6 (d) 12 19. Fluctuating capital account is credited with (a) Interest on capital (b) Profit of the year (c) Remuneration to the partners (d) All of the above 20. If the incoming partner brings any additional amount in cash other than his capital contribution then it is termed as ________ (a) Capital (b) Reserves (c) Profit (d) Premium for goodwill 21. A businessman purchased goods Rs. 25,00,000 and sold 70% of such goods during the accounting year ended 31st March, 2010 the market value of the remaining goods was Rs. 5,00,000.00. He valued the closing stock at Rs. 5,00,000.00 and not Rs. 7,50,000.00 due to (a) Money measurement (b) Cost (c) Conservatism (d) Periodicity 22. A machine was purchased for Rs. 1,00,000.00 on 01.01.2009 and on 31.12.2009 its net realizable value was Rs. 1,50,000.00. Do you prefer to count this profit? If you count which of the following concepts will be violated? (a) Realisation (b) Conservatism (c) Accrual (d) Matching 23. The plant and machinery account of a firm had a debit balance of Rs. 1,45,800.00 on January 1, 2010. It was purchased on January 1, 2007. Firm has been following the practice of charging full years depreciation every year @ 10% on diminishing balance. The cost of machinery in 2007 will be: (a) Rs. 2,00,000.00 (b) Rs. 2,25,000.00 (c) Rs. 1,90,000.00 (d) Rs. 2,50,000.00 Common Proficiency Test (CPT) Volume - I 481 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 24. Rs. Rs. Opening Stock 80,000.00 Purchase returns 6,000.00 Cash purchases 1,00,000.00 Sales returns 10,000.00 Credit purchases 2,00,000.00 Carriage inwards 12,000.00 Cash sales 1,60,000.00 Wages 12,000.00 Credit sales 2,50,000.00 Closing stock 60,000.00 Gross profit of the firm will be (a) Rs. 62,000.00 (b) Rs. 75,000.00 (c) Rs. 80,000.00 (d) Rs. 60,000.00 25. Mohan started business with Rs. 10,000.00 cash and Rs. 2,000.00 furniture. Sales amounted to Rs. 50,000.00 including Rs. 5,000.00 cash sales. Rs. 10,000.00 sales were outstanding at the end of the year. Purchase amounted to Rs. 30,000.00 including Rs. 10,000.00 cash purchases Rs. 15,000.00 has been paid to creditors. Expenses paid during the year 19,300. Trial Balance total will be - (a) Rs. 67,000.00 (b) Rs. 70,000.00 (c) Rs. 75,000.00 (d) Rs. 80,000.00 26. A new machine was purchased for Rs. 1,00,000 but the amount was wrongly posted to furniture account as Rs. 10,000 and cash received from debtors Rs. 11,200 was omitted to be posted in the ledger. The difference in trial balance due to such errors will be (a) Rs. 90,000 (b) Rs. 78,800 (d) Rs. 1,01,200 (d) Rs. 1,11,200 27. A purchased a computer costing Rs. 10,000.00 repairing expenses Rs. 1,000.00 and miscellaneous expenses Rs. 500.00. He sold the computer at 20% margin on selling price. The sale value will be: (a) Rs. 12,500.00 (b) Rs. 11,000.00 (c) Rs. 15,000.00 (d) Rs. 14,375.00 28. According to Table A of the Companies Act, Interest on calls in arrears is charged at the rate of (a) 4% (b) 5% (c) 6% (d) None of these 29. A company can issue redeemable preference shares (a) At par (b) At premium (c) At discount (d) All of the three 482 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 30. A second hand car is purchased for Rs. 10,000.00 the amount of Rs. 1,000.00 is spent on its repairs, Rs. 500.00 is incurred to get the car registered in owner’s name and Rs. 1200.00 is paid as dealer’s commission. The amount debited to car amount will be: (a) Rs. 10,000.00 (b) Rs. 10,500.00 (c) Rs. 11,500.00 (d) Rs. 12,700.00 31. Mr. Ram is a partner in a firm. He made drawings as follows: July 1 200.00 August 1 200.00 September 300.00 November 1 50.00 February 1 100.00 If the rate of interest on drawings is 6% and accounts are closed on March, 31, the interest on drawings is: (a) Rs. 29.75 (b) Rs. 35.00 (c) Rs. 30.00 (d) Rs. 40.00 32. A started business on Jan 1 with a capital of Rs. 40,000. On 31st Dec, his position was Creditors Rs. 4,700, machinery Rs. 40,000, furniture Rs. 2,000, Debtors Rs. 1,300, Cash Rs. 15,000. He made drawings @ Rs. 200 per month and Rs. 1,000 which he brought on 1st Oct. in the business as further capital. Business profit will be (a) Rs. 15,000 (b) Rs. 16,000 (c) Rs. 14,000 (d) Rs. 17,000 33. In a joint venture between A and B, A spent Rs. 3,000 on freight and also raised a loan from Bank of Rs. 50,000 at 18% p.a. repayable after one month B spent Rs. 5,000 as selling expenses and he also raised a loan from Bank of Rs. 1,50,000 at 18% repayable after two months. The total expenses of Joint Venture will be: (a) Rs. 8,000 (b) Rs. 8,500 (c) Rs. 9,500 (d) Rs. 13,250 34. A boiler was purchased from abroad for Rs. 10,000. Shipping and forwarding charges amounted to Rs. 2,000. Import duty paid Rs. 7,000 and expenses of installation amounted to Rs. 1,000. Amount debited to boiler A/c will be (a) Rs. 10,000 (b) Rs. 12,000 (c) Rs. 19,000 (d) Rs. 20,000 Common Proficiency Test (CPT) Volume - I 483 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 35. A of Kanpur consigned 300 calculators costing Rs. 250 each to B of Faridabad. He paid carriage and freight Rs. 1,500 and transit insurance Rs. 900.00 B incurred following expenses: Unloading charges Rs. 400 Octroi Rs. 600 Carriage Rs. 800 Godown rent Rs. 500 Selling expenses Rs. 320 200 calculators were sold @ Rs. 420 each. Value of closing stock will be - (a) Rs. 26,400 (b) Rs. 26,000 (c) Rs. 25,000 (d) Rs. 27,000 36. The original cost of furniture amounted to Rs. 80,000. It is decided to write off 10% on the diminishing balance of the asset each year. Balance of furniture account at the end of the fourth year will be: (a) Rs. 52,488 (b) Rs. 52,000 (c) Rs. 50,000 (d) Rs. 55,000 37. Mohan consigned 50 cases at Rs. 350 each to B of Varanasi to sell it on consignment basis. Consignor paid Rs. 1,800 for freight and insurance. All the cases were sold for Rs. 28,000. Selling expenses paid by agent Rs. 900 and their commission to Rs. 1,000. Consignment profit will be (a) Rs. 7,000 (b) Rs. 6,800 (c) Rs. 8,000 (d) None of the above 38. In the bank reconciliation statement when balance as per cash book is taken as the starting point then Bank charges debited by Bank Rs. 10, cheques paid in but dishonoured Rs. 200 and cheques paid in but not credited by bank in Rs. 950 will be – (a) Added (b) Substracted (c) Ignored (d) None of the three 39. Goods costing Rs. 7,500 were sold at 25% profit on selling price. The amount of sales will be (a) Rs. 8,000 (b) Rs. 10,000 (c) Rs. 9,000 (d) Rs. 11,000 40. A bill is drawn on 28 March, 2010 for one month after sight. Date of acceptance is 2nd April, 2010. The maturity date of the bill will be (a) 1st March 2010 (b) 28th April 2010 (c) 5th May 2010 (d) 2nd May 2010 484 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 41. Which of the following is false? (a) Equity is owner’s stake and the debenture is a debt. (b) Rate of interest on debentures is fixed. (c) Debenture holders get preferential treatment over the equity holders at the time of liquidation. (d) Interest on debentures is an appropriation of profits. 42. A and B are partners sharing profits in the ratio of 3:2. C is admitted as a new partner the new profit sharing ratio among A, B, and C is 5:3:2. Sacrificing ratio will be (a) 1:1 (b) 2:1 (c) 1:3 (d) None of the three 43. A, B and C were in partnership sharing profits in the ratio of 4:2:1 respectively. A guaranteed that in no case C’s share in profit should be less than Rs. 7,500. Profits for the year 2009 amounted to Rs. 31,500. A will get (a) Rs. 15,000 (b) Rs. 18,000 (c) Rs. 16,000 (d) None of the three 44. A and B are partners sharing in the ratio of 3:2. C is admitted for 1/5th share and brings Rs. 15,000 as capital and necessary amount for his share of goodwill. The goodwill of the entire firm is valued at Rs. 60,000. Goodwill brought by C will be (a) Rs. 12,000 (b) Rs. 10,000 (c) Rs. 15,000 (d) None of the three 45. The firm earns a profit of Rs. 20,000 and has invested capital amounting to Rs. 1,50,000. In the same class of business normal rate of earning is 10%. Goodwill according to capitalization method will be (a) Rs. 40,000 (b) Rs. 50,000 (c) Rs. 60,000 (d) None of the three 46. Credit purchase of stationery worth Rs. 10,000 by a stationery dealer will be recorded in (a) Purchases book (b) Sales book (c) Cash book (d) None of the three 47. Debentures issued as collateral security is (a) Added in the total of liabilities (b) Added in the total of assets (c) Both (a) and (b) (d) None of the three 48. Premium on issue of debentures is recorded on the liability side under the heading. (a) Secured loan (b) Unsecured loan (c) Current liabilities and provisions (d) None of the three Common Proficiency Test (CPT) Volume - I 485 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 49. A company issues 100 debentures of Rs. 1,000 each at 97 per cent. These are repayable out of profits by equal annual drawings over 5 years. Discount on issue of debentures will be written off in the ratio (a) 5:4:3:2:1 (b) 4:3:2:1:1 (c) 3:3:4:2:1:1 (d) None of the three 50. Returns of cash sales is recorded in (a) Sales return book (b) Cash book (c) Journal proper (d) None of the three 51. Securities premium is recorded in (a) Profit & Loss Account (b) Profit & Loss Appropriation Account (c) Balance Sheet (d) None of the above 52. V.K. Ltd. forfeited 20 shares of Rs. 100 each (Rs. 60 called up) issued at par to Mohan on which he had paid Rs. 20 per share. Out of these 15 shares were reissued to Sohan as Rs. 60 paid up for Rs. 45 per share. Amount transferred to capital reserve will be (a) Rs. 100 (b) Rs. 75 (c) Rs. 200 (d) Rs. 80 53. Z Ltd. Purchased plant and machinery for Rs. 2,00,000 payable as to Rs. 65,000.00 in cash and the balance by an issue of 6% debentures of Rs. 1,000 each at a discount of 10%. Discount amount will be (a) Rs. 10,000 (b) Rs. 15,000 (c) Rs. 12,000 (d) None of the three 54. A company issued Rs. 1,00,000 15%, debentures at a discount of 5%, redeemable after 10 years at a premium of 10%. Loss on issue of debentures will be (a) 10,000 (b) 15,000 (c) 12,000 (d) None of the three 55. Rs. Opening debtors 20,000 Total sales 90,000 Cash sales 20,000 Cash received from debtors 20,000 Bad debts 3,000 Return inward 1,000 Bills received from customers 10,000 Debtors at end will be (a) Rs. 56,000 (b) Rs. 70,000 (c) Rs. 60,000 (d) Rs. 65,000 486 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 56. Goods costing Rs. 10,00,000 sent out to consignee at cost + 25%. Invoice value of goods will be (a) Rs. 10,00,000 (b) Rs. 12,50,000 (c) Rs. 12,00,000 (d) Rs. 12,25,000 57. 2,000 shares of Rs. 100 each were issued to promoters of the company for their legal services, rendered in the formation of the company. For this, company credited share capital A/c and debited. (a) Goodwill A/c by Rs. 2,00,000 (b) Legal Services A/c by Rs. 2,00,000 (c) Formation expenses A/c Rs. 2,00,000 (d) Promoters expenses A/c Rs. 2,00,000 58. X Y Z and Company employs a team of ten workers who were paid Rs. 1,000 each in the year ending Dec. 31, 2009. At the start of the year 2010 company raised salaries by 20%. The amount of salaries for the year ended 31st Dec. 2010, will be (a) Rs. 11,000 (b) Rs. 10,000 (c) Rs. 12,000 (d) Rs. 13,000 59. Machinery costing Rs. 10,00,000 was purchased on 01.04.2009. The installation charges amounting Rs. 100,000 were incurred. The depreciation at 20% p.a. on straight line method for the year ended 31st March 2010 will be (a) Rs. 2,20,000 (b) Rs. 2,00,000 (c) Rs. 2,10,000 (d) None of the above 60. Original cost Rs. 1,26,000, Salvage value – nil, Useful life - 6 years. Depreciation for the fourth year under sum of digits method will be (a) Rs. 18,000 (b) Rs. 6,000 (c) Rs. 12,000 (d) Nil SECTION – B : MERCANTILE LAWS (40 MARKS) 61. The Indian Contract Act came into force on (a) First Sept., 1872 (b) 23rd Nov., 1872 (c) 26th Sept., 1872 (d) 3rd Nov., 1872 62. The contract is defined in - (a) The Sale of Goods Act, 1930 (b) The Indian Contract Act, 1872 (c) The Partnership Act, 1932 (d) None of the above 63. An agreement enforceable by law is a (a) Contract (b) Obligation (c) Offer (d) Promise Common Proficiency Test (CPT) Volume - I 487 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 64. Proposal when accepted becomes - (a) Acceptance (b) Agreement (c) Promise (d) Lawful Promise 65. Agreement is a - (a) Set of reciprocal promises (b) Acceptance of a proposal (c) Contract (d) Promise 66. Which of the following is true (a) All agreements are contract (b) All contracts are agreement (c) All promises are agreement (d) Set of promises are contracts 67. Existing goods are such goods as are in existence - (a) At the time of contract of sale (b) Before the time of contract of sale (c) After the time of contract of sale (d) All of these 68. Future goods means goods to be manufactured or acquired by the seller (a) Before making the contract of sale (b) At the time of contract of sale (c) After making the contract of sale (d) All of these 69. Which of the following is true, delivery means - (a) Compulsory transfer of possession by one person to another person (b) Voluntary transfer of possession by one person to another (c) Mere person to of possession by one person to another person (d) All of these 70. Which one is the example of document of title to goods - (a) Bill of lading (b) Dock-warrant (c) Railway – Receipt (d) All of these 71. The merchantile agents include (a) Auctioneers (b) Factors (c) Brokers (d) All of these 72. Insolvent means (a) A person when he ceases to pay his debts in ordinary ease of business (b) A person when he accepts to pay his debts before due date (c) A person when he accepts to pay his debts as they become due (d) All of these 73. Partnership is the relation (a) Between persons (b) Between firms (c) Between companies (d) Among numberless persons 488 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 74. The term business includes - (a) Every trade (b) Every occupation (c) Every profession (d) All of these 75. Which is true statement regarding the including of the minor in partnership firm? (a) A minor may be admitted to the benefits of partnership with the consent of all other partners (b) A minor may be admitted to the benefits of partnership with no consent of other partners (c) A minor may be admitted to the benefits of the consent of his partners (d) A minor may be admitted to the benefits of partnership with the guarantee of his parents 76. Which is correct ? (a) All the essential elements of a valid contract must be present in partnership agreement (b) No need of essential elements of a valid contract in a partnership contract (c) Only consideration should be present in partnership agreement (d) All of these 77. Which is odd in case of who may be partners? (a) Married woman (b) A competent person (c) An old man of 60 years (d) A registered company 78. Who can enter into a contract of partnership ? (a) Alien enemy (b) Person of unsound mind (c) A business firm (d) A member of registered company 79. A Joint Hindu Family arises (a) From status decided by court (b) As a result of an agreement (c) By operation of law (d) All of these 80. A voidable agreement is - (a) Valid but not enforceable (b) enforceable at the option of one party (c) Enforceable at the option of both the parties (d) Not enforceable in court 81. A void agreement is - (a) Illegal contract (b) Not enforceable by law (c) Enforceable at the option by both the parties (d) Enforceable at the option of one party 82. An offer to be valid must (a) Be communicated to the person to whom it is made (b) Be communicated to the third party Common Proficiency Test (CPT) Volume - I 489 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 (c) Be communicated to the promisor (d) Be communicated to the promisee 83. A valid offer must be _________ (a) Capable of creating legal relation (b) Capable of creating social relation (c) Capable of creating business relation (d) Capable of creating social and business relation 84. An acceptance must be __________ (a) Absolute and unqualified (b) Conditional (c) Unconditional (d) Liable to be accepted by law 85. An offer may lapse by ___________. (a) Counter offer (b) Revocation (c) Rejection of offer by offeree (d) All of these 86. An agreement entered into by a minor’s ________ (a) Altogether void (b) Voidable (c) Illegal (d) None of these 87. Consequences of coercion, fraud, misrepresentation makes the contract (a) Void (b) Voidable (c) Illegal (d) None of these 88. The term consideration is defined in - (a) The Transfer of Property Act, 1882 (b) The Indian Partnership Act, 1932 (c) The Sales of Goods Act, 1930 (d) The Indian Contract Act, 1872 89. Caveat Emptor means ______ (a) Let the buyer beware (b) Let the seller beware (c) Let the buyer and seller both beware (d) None of these 90. Express contract means ________ (a) Which is made by words either spoken or written (b) Which is made by deeds (c) Which is made by both words and deeds (d) Which is made by promises 91. A valid offer must be _________ (a) Capable by creating legal relation (b) Capable of creating social relation (c) Capable of creating business relation (d) Capable of creating social and business relation 490 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 92. Consideration must move at the desire of ________ (a) promisor (b) promisee (c) any other person (d) any of these 93. Quantum meriut literally means (a) As much as is earned (b) According to the value of work done (c) As much as no work done (d) None of these 94. Existing goods are such goods as are in existence ______ (a) At the time of contract of sale (b) Before the time of contract of sale (c) After the time of contract of sale (d) All of these 95. Contract for the sale of “future goods” is (a) Sale (b) Agreement to sale (c) Void (d) Auction sale 96. The property in goods means (a) Passing of goods (b) Custody of goods (c) Ownership of goods (d) Both (a) and (b) 97. The right of stoppage can be exercised by unpaid seller if _____ (a) The buyer has became insolvent (b) The goods are in transit (c) The seller must be unpaid (d) All of these 98. A partner may be expelled from partnership subject to ______ (a) The power of expulsion of a partner should be conferred by the contract between two partners (b) The power should be exercised by majority of partners (c) The power should be exercised in good faith (d) All of these 99. A agrees to pay a sum of money B if a certain ship does not return. The ship is sunk. A refuses to pay, what will be the advice to B. (a) B cannot enforce the contract (b) B can enforce the contract when the ship sinks (c) B can sue for damage (d) B can sue for not fulfilling the promise Common Proficiency Test (CPT) Volume - I 491 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 100. A, B, and C enter into a partnership agreement under which ‘C’ is not liable for the losses. A filed a suit against A, B, and C. Examine the position of C (a) C is liable to D only (b) C is liable to D jointly with A and B also (c) C is not liable to D (d) C is not liable to D jointly with A and B SECTION – C : GENERAL ECONOMICS (50 MARKS) 101. Which one of the following is not a function of commercial banks? (a) Advancing loans (b) Accepting deposits (c) Issuing notes (d) Discounting bills of exchange 102. The initial membership of IMF was: (a) 184 (b) 160 (c) 10 (d) 31 103. Population explosion occurs in ________ stage of the theory of demographic transition. (a) first (b) second (c) third (d) fourth 104. GRT stands for (a) Great Route Tarry (b) Green Revaolution Technology (c) Gross Registered Tonnage (d) None of the above 105. The government aims to reduce poverty ratio ______% by 2012. (a) 12.3 (b) 11 (c) 14.3 (d) 18.3 106. Population growth rate in India was negative in (a) 1901-11 (b) 1911-21 (c) 1921-31 (d) 1931-41 107. Which one of the following resources is the most crucial input in India’s new agricultural technology, responsible for the Green Revolution? (a) Fertilizers (b) HYV seeds (c) Agricultural Machinery (d) Irrigation 108. Which one of the following states has made the least progress in respect of consolidation of holdings ? (a) Bihar (b) Uttar Pradesh (c) West Bengal (d) Orissa 492 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 109. Location of sugar industry in India is influenced by : (a) the market (b) raw material (c) labour and entrepreneurial factors (d) none of the above 110. Employment in small industry sector has been : (a) nearly 60% of total industrial employment (b) half of the number of employment offered by modern industries (c) about 10% of the total industrial employment (d) only 20% of the total industrial employment 111. In July 1991, India devalued the rupee by about (a) 10-12% (b) 15-16% (c) 18-20% (d) 30-35% 112. The Foreign Trade Policy 2004-09 has : (a) identified certain thrust areas for growth (b) started “served from India” brand (c) revamped Duty Free Export-Credit (d) all of the above 113. Which one of the following offers the least liquidity? (a) Treasury Bills (b) Immovable property (c) Bill of exchange (d) Bearer cheques 114. India ranks ______ in the world in shipping tonnage. (a) 10th (b) 20th (c) 27th (d) 37th 115. Net National Income at market prices is equal to (a) Gross National Income at market prices minus depreciation (b) Net Domestic Product at factor price plus or minus earnings from abroad (c) Gross Domestic Product minus indirect taxes and subsidies (d) Gross National Product at factor price plus or minus depreciation 116. Which one of the following assumptions is not necessary for the cardinal utility theory ? (a) Rationality of the consumer (b) Constant marginal utility of money (c) Perfectly competitive market (d) Additivity of utility 117. Dumping involves (a) selling at a price in another market which is lower than the price or cost in your home market (b) price discrimination between the two markets (c) surplus production at lower cost (d) none of the above Common Proficiency Test (CPT) Volume - I 493 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 118. The IC curve approach assumes : (a) rationality (b) consistency (c) transitivity (d) all of the above 119. A higher indifference curve shows : (a) a higher level of satisfaction (b) a higher level of production (c) a higher level of income (d) none of the above 120. Demand deposits with banks are considered as money because they are: (a) generally acceptable as a means of payment (b) more liquid than cash (c) held by the government (d) managed efficiently by bank managers 121. Which one of the following measures has been accorded the highest priority by the government for checking the inflationary pressure on the economy since 1990? (a) Revamping the public distribution system. (b) Correcting the fiscal imbalance by reducing the fiscal deficit as a percentage of GDP (c) Increasing imports (d) Devaluation of the rupee 122. The basic aim of the lead bank scheme is that - (a) big banks should try to open offices in each district (b) there should be stiff competition among the various nationalized banks (c) individual bank should adopt particular districts for intensive development (d) all the banks should make intensive efforts to mobilize deposits 123. Which one of the following taxes belongs exclusive to the state government of India? (a) Income tax (b) Agricultural tax (c) Excise tax (d) Wealth tax 124. Which one of the following sources of Central revenue belongs to the category of indirect taxes? (a) Corporation tax (b) Customs (c) Wealth tax (d) Interest Receipts 125. The rapid increase of public debt of the Central Government since 1950-51 has been due to (a) uncontrolled inflation (b) mounting shares of state government from revenues raised by the central government (c) mounting costs of financing public expenditure (d) rising population 494 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 126. In the case of two perfect substitutes, the indifference curve will be : (a) straight line (b) L-shaped (c) U-shaped (d) C-shaped 127. Which one of the following is the major characteristic of foreign direct investment (FDI)? (a) It is non-debt creating capital flow (b) It is portfolio investment in stock market (c) It is that investment which involves debt servicing (d) It is the investment made by foreign institutional investors in government securities 128. The objective of selective credit controls is mainly to : (a) selectively allocate credit to commercial banks (b) selectively allocate credit among borrowers (c) regulate the quantity of demand deposits created by commercial banks (d) regulate the quantity of credit created by commercial banks 129. A consumer is at equilibrium when : (a) slope of the price line is equal to indifference curve (b) he saves 10% of his income (c) borrows an amount equal to his income from the bank (d) none of the above 130. Since 1990, savings of the household sector in India have been (a) greater than the savings of the private corporate sector but less than the savings of the public sector (b) less than the savings of the private corporate sector but more than savings of the public sector (c) greater than the savings of the private corporate sector as well as the savings of the public sector (d) less than the savings of the private corporate sector as well as the savings of the public sector 131. The ‘Hindu rate of growth’ (a) refers to growth of Hindu population (b) is the term used by Raj Krishna to represent the nature of the growth of the Indian economy at around 3.5% per year (c) is the term coined by Amartya Sen to represent the nature of the growth of the Indian economy at around 3.5% per year (d) is the term coined by V.K.R.V. Rao to decide the nature of the growth of the Indian economy at around 4% 132. Disguised unemployment in India is maximum in : (a) agricultural sector (b) secondary sector (c) tertiary sector (d) none of the above Common Proficiency Test (CPT) Volume - I 495 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 133. Unemployment rate in India is defined as the ratio of number of persons unemployed to total (a) Population (b) Population excluding children (c) Labour force (d) Population excluding the aged 134. The population of India living below the poverty line (a) is rising in relative and absolute terms (b) is falling in relative terms but rising in absolute terms (c) is falling in both relative and absolute terms (d) has not changed at all over the years 135. If the Indian economy aimed at an annual growth rate of 8 per cent in national income, assuming as incremental capital – output ratio of 3.5:1 what would be the required rate of investment as percent of national income? (a) 28.0 (b) 24.5 (c) 10.5 (d) 3.5 136. In order to provide acess to electricity to all areas including villages and hamlets _________ programmed was started. (a) Rajiv Gandhi Grameen Vidhutikaran (b) Indira Gandhi Grameen Vidhutikaran (c) Sonia Gandhi Grameen Vidhutikaran (d) Mahatma Gandhi Grameen Vidhutikaran 137. Which one of the following has NOT been a part of the land reforms programme in India? (a) Ceiling on holding (b) Consolidation of holdings (c) Agricultural holding tax (d) Zamindari abolition 138. In India, which one of the following is NOT a cooperative organization? (a) Primary land development banks (b) Central land development banks (c) Regional rural banks (d) State cooperative banks 139. As a part of development of National Grid, the total inter-regional transmission capacity is planed to increase to about ______MW by 2012. (a) 9,450 (b) 37,700 (c) 10,150 (d) 47,150 140. Which among the following is NOT a cause of sickness of industrial units in India? (a) Obsolescent technology (b) Labour problems (c) Faulty location (d) Lack of capital account convertibility 496 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 141. The actual disinvestment in the year 2007-08 is ______ (a) Rs. 1,400 crore (b) Rs. 2,367 crore (c) Rs. 5,000 crore (d) Rs. 902 crore 142. The majority of Central Government enterprises belongs to the : (a) Public corporations (b) Public limited companies (c) Private Limited companies (d) Departmental organizations 143. In 1991, foreign exchange reserves were sufficient to finance imports of ___ weeks. (a) 36 (b) 16 (c) 24 (d) 3 144. Which one of the following agencies in India is responsible for computation of national income? (a) NCAER (b) CSO (c) NSS (d) RBI 145. What is the approximate share of the agricultural sector in the total employment in India? (2008-09) (a) 52 per cent (b) 60 per cent (c) 45 per cent (d) 40 per cent 146. According to the World Development Report-2006, the GINI index for India in 1999-00 was: (a) 0.33 (b) 0.29 (c) 0.53 (d) 0.18 147. Over the plan era, the relative share of areas under food grains in gross cropped area in India has: (a) decreased (b) increased (c) remained the same (d) decreased initially and then increased 148. Which one of the following is NOT an important import item of India at present? (a) Petroleum oil (b) Edible oil (c) Fertilizers (d) News print 149. The total area under the demand curve of a good measures: (a) marginal utility (b) total utility (c) consumers surplus (d) producers’ surplus 150. The incremental capital output ratio (ICOR) during the X plan of India was (a) 5.02 (b) 3.04 (c) 4.0 (d) 6.37 Common Proficiency Test (CPT) Volume - I 497 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 SECTION – D : QUANTITATIVE APTITUDE (50 MARKS) 151. The inverse ratio of 13:17 is (a) 17:13 (b) 13: 17 (c) 169:172 (d) None of these 152. The duplicate ratio of 5:7 is (a) 7:5 (b) 15:21 (c) 52:72 (d) None of these 153. The value of 3 × (32)1/5 is (a) 3 (b) 15 (c) 6 (d) None of these 154. The value of 2 × (128)–1/7 is (a) 1 (b) 2 (c) 14 (d) None of these 155. log (3 × 5 × 7) is equal to (a) log 3 × log 5 × log 7 (b) log 3 + log 5 + log 7 (c) log 3 – log 5 – log 7 (d) 0 156. log (5/7) is equal to log5 (a) (b) log 5 + log 7 log7 (c) log 5 – log 7 (d) None of these 157. The equation of the line passing through (5, 0) and (0, 5) is (a) x – y = 5 (b) x + y = 5 (c) 5x + 5y = 1 (d) None of these 158. The equation of the line parallel to the line joining (7,5) and (2,9) and passing through the point (3, –4) is (a) 4x + 5y + 8 = 0 (b) 4x – 5y + 8 = 0 (c) 4x – 5y – 8 = 0 (d) None of these 498 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India 159. The equation 5x + 7(x – 3) – 4(x + 10) = 0 is (a) Quadratic equation (b) Linear equation (c) Cubic equation (d) None of these 160. The equation (x – a) (x – b) = 0 is satisfied by (a) x = 0 (b) x = a, b (d) x = –a, –b (d) None of these 161. The inequalities x≥ 0, y ≥ 0 indicates (a) First quadrant (b) Second quadrant (c) Third quadrant (d) Fourth quadrant 162. Rs. 10,000 is invested at annual rate of interest of 10% p.a. The amount after two years at annual compounding is (a) Rs. 21,100 (b) Rs. 12,100 (c) Rs. 12,110 (d) None of these 163. P(n,r) is equal to n n − r (a) r n−r (b) r n (c) n−r (d) None of these 164. 0! × 6! is equal to (a) 720 (b) 0 (c) 6 (d) –120 165. In how many ways can 8 persons sit at a round table for a meeting? (a) 40320 (b) 64 (c) 5040 (d) 720 166. There are 7 routes from station X to station Y. In how many ways one may go from X to Y and return, if for returning one can make a choice of any of the routes? (a) 49 (b) 17 (c) 42 (d) 35 Common Proficiency Test (CPT) Volume - I 499 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 1 1 1 167. The sum of the series 1, , , to ∞ is 3 32 33 4 3 (a) (b) 3 2 1 (c) (d) None of these 3 168. The number of subsets of the set {2, 4, 6, 8} is (a) 8 (b) 15 (c) 16 (d) 4 169. If A = {1, 3, 5, 7, 9}, B = {2, 4, 6, 8, 10} then A∩B is (a) {0} (b) φ (c) {1, 2, 3, 4, 5, 6, 7, 8, 9, 10} (d) None of these 170. If A = {3, 5, 7} and B = {0, 2, 4, 6}, then A∪Bis (a) φ (b) {0, 2, 3, 4, 5, 6, 7} (c) {0} (d) None of these 171. The series 1 + 2 + 3 + 4 + ….. + 100 is 100(101) ⎡100(101)⎤2 (a) (b) ⎢ ⎥ 2 ⎣ 2 ⎦ (c) 100 × 101 (d) None of these 172. If A = {1, 2, 3, 4} and B = {5, 6, 7}, then cardinal number of A X B is (a) 4 (b) 7 (c) 12 (d) None of these 1 173. lim x→0 x (a) does not exist (b) + ∞ (c) – ∞ (d) None of these x2 -9 lim 174. x→3 x-3 (a) Does not exist (b) 6 (c) 1 (d) None of these 500 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India x2 -25 175. If f(x) = , then the value of f(x) at x = 5, i.e. f(5) is equal to x-5 (a) 10 (b) Undefined (c) 1 (d) None of these dy 176. If y = ax3 + bx2 + cx + d, then is equal to dx ax4 bx3 cx4 (a) 3ax2 + 2bx + c (b) + + +dx 4 3 2 (c) 0 (d) None of these dy 177. If f(x) = 5xa+10ax, then is equal to dx (a) 3axa-1 + 10xax-1 + 3a.aa-1 (b) 5axa-1 + 10ax loga (c) 5xa + logx + 10xax-1 (d) None of these 1 178. ∫ 10x5dxis equal to 0 5 3 (a) x6 (b) 3 5 5 (c) (d) None of these 3 logx ∫ 179. dxis equal to x 1 1 (a) log x+k (b) (log x)2+k 2 2 1 (c) x2 + k (d) None of these 2 ⎛ ex+e-x ⎞ ∫ 10⎜ ⎟dx 180. is equal to ⎝ ex-e-x ⎠ (a) 10 log ex - | e-x + k | (b) 10 log | ex + e-x + k | (c) log (ex - e-x) (d) None of these Common Proficiency Test (CPT) Volume - I 501 © The Institute of Chartered Accountants of India MODEL TEST PAPER - 18 216×310× 54 181. The value of is equal to 212×36× 53 (a) 2160 (b) 6480 (c) 648 (d) 3240 182. The value of ya - m × ym - n × yn - a is equal to (a) 1 (b) 0 (c) –1 (d) y 183. The value of log (1 + 2 + 3 + ............. +n) is equal to (a) log 1+ log 2 + …. + log n (b) log n + log (n+1) – log 2 (c) 0 (d) 1 184. The roots of the equation are (a) 1, 2 (b) 0, 1 (c) 0, 1, 2 (d) 1, 2, 3 185. The roots of the equation x2 - x + 1 = 0 are (a) Imaginary and unequal (b) Real and unequal (c) Real and equal (d) Imaginary and equal 186. Interest earned on Rs. 3,000 at 5% p.a. simple interset for three years is ______ (a) Rs. 540 (b) Rs. 450 (c) Rs. 45 (d) Rs. 54 187. The inequalities x < 0, y > 0 indicates ______ (a) Third quadrant (b) First quadrant (c) Second quadrant (d) Fourth quadrant o 5 188. is equal to 2 (a) 60 (b) 0 (c) 120 (d) None of these 189. nC is equal to r n n (a) n−r (b) r n−r n r n n−r (c) n−r (d) r 502 Common Proficiency Test (CPT) Volume - I © The Institute of Chartered Accountants of India