Subject: Principles of Accounting

Paper: Objective Type

Time Allowed: 20 Min

Max Marks: 15

Note: You have four choices for each objective type question as A, B, C and D. The choice which you
think is correct, fill that circle in front of that question number with marker or pen on the answer
book provided. Cutting or filling two or more circles will result in zero mark in that question.
Attempt as many questions as given in objective type question paper and leave others blank.
1.

Accounting is called ---- of business:

(a)
2.

Heart

Transaction
Liabilities
Cash
Dr. Side
An asset
Trial balance

Trial balance
Journal

Liabilities

(d)

Assets

Introduction

(c)

Meeting

(d)

Business

(b)

Profit

(c)

Loss

(d)

Income

(c)

Cash & Capital

(d)

None of these

(d)

None of these

(b)

Capital

(b)

Cr. Side

(c)

Both of Dr. & Cr.

(b)

A revenue

(c)

A liability

(d)

An expense

(c)

Journal

(d)

Cash book

(c)

Drawings A/C

(d)

Sales A/C

(c)

Final accounts

(b)

Ledger
Charity A/C

(b)

Journal

(d)

Ledger

(b)

Voucher

(c)

Balance sheet

(d)

Trial balance

An expenditure which is not incurred again and again is called:

(b) Revenue exp.

(c) Capitalized exp.

(d) Deferred revenue exp.

Any expenditure which will benefit only the current period is:

(a) Capital exp.

15.

(c)

(b)

Purchases A/C (b)

(a) Capital exp.

14.

Income

Any mistake in ledger can be easily found out (detected) with the help of:

(a)
13.

(b)

It is also called King of all books of account:

(a)
12.

Expenses

Goods given away as charity should be debited to:

(a)
11.

(d) Charity

Transaction is first of all (primarily) recorded in:

(a)
10.

(b) Sale of merchandise (c) Personal expense

Discount allowed is:

(a)
9.

Tongue

Left hand side of an account is called:

(a)
8.

(d)

Expenses paid by a business decrease:

(a)
7.

Ear

Assets Capital =

(a)
6.

(c)

A dealing between two persons or things is called:

(a)
5.

Eye

Debts of business are known as:

(a)
4.

(b)

Withdrawal of goods (merchandises) for personal use is:

(a) Drawings
3.

(151=15)

(b) Revenue exp.

(c) Current exp.

(d) Deferred revenue exp.

(c)

(d)

Which is intangible asset?

(a)

Building

(b)

Subject: Principles of Accounting

Cash

Goodwill

Furniture

Time Allowed: 2:10 Min

Paper: Subjective Type

Paper Code

Max Marks: 60

SECTION-I
Note: Section I is compulsory. Out of questions no. 2, 3 and 4 write any Eighteen (18) short
answers. While writing answer, write question no. carefully.

(18x2=36)

(Q.2)
(i)
(iii)
(v)
(vii)
(ix)

Write short answers to any Six (6) questions:

Define Accounting?
(ii) Define Stock?
Define Creditors?
(iv) What is Cash Sales?
Define Purchases Returns?
(vi) What is Trade Discount?
What are Assets?
(viii) Define Capital?
Define Transaction?

(6x2=12)

(Q.3)
(i)
(iii)
(v)
(vii)
(ix)

Write short answers to any Six (6) questions:

What is Paper Transaction?
(ii) Define External Transaction?
Define Pass book?
(iv) What is Double Entry System?
Define Nominal Accounts?
(vi) Define Personal Accounts?
What Credit Balance?
(viii) What is Simple Entry?
Define Narration?

(6x2=12)

(Q.4)
(i)
(iii)
(v)
(vii)
(ix)

Write short answers to any Six (6) questions:

(6x2=12)
Define Dishonor of cheque ?
(ii) What is Balance?
What is Pay-in-slip?
(iv) Define Saving account?
What are Bank overdraft ?
(vi) Define Deferred Revenue Expenditures?
What is Revenue Loss?
(viii) Define Capital Payment?
Define Capital Profit?

SECTION-II
Note: Attempt any Three (3) questions:

(38=24)

(Q.5) State with reasons whether the following items of expenditures are capital or revenue:
(i)
Expenditure on advertising campaign.
(ii)
Preliminary expenses incurred on the flotation of a company.
(iii) Freight paid on a newly purchased machine.
(iv) An amount spent as legal expenses for abuse of trademark.

P.T.O

(Q.6) Enter the following transaction in double column cash book (with cash & bank column) of
Khurram & Co. and find out the balance on 07-01-2014.

2005
Jan
Jan
Jan
Jan
Jan
Jan
Jan
Jan
Jan
Jan
Jan
Jan

Rs.
1

4
5
6

Cash in Hand
Cash at bank
Paid salaries
Paid rent by cheque
Bought goods by cheque
Sold goods for cash
Bought machinery by cheque
Deposited into bank
Withdrew from bank for business use
Cash sales
Withdrew cash from business for personal use
Received bank interest

(Q.7) Record the following transactions in journal:

May 01, 2013:
Commenced business with cash Rs.250,000.
May 03, 2013:
Goods purchased from Mr. C on credit Rs.10,000.
May 15, 2013:
Cash sale to Mr. D Rs.6,000.
May 20, 2013:
Paid salary to clerk Rs.3,000.
(Q.8) Post the following journal entries in the ledger and prepare a trial balance:
(i)
Bank Account
Dr. 50,000
Cash Account
50,000
(ii)
Furniture Account
Dr. 10,000
Bank Account
10,000
(iii) Cash Account
Dr. 5,000
Commission Received Account 5,000
(Q.9) State which items are chargeable to capital and which to revenue:
(a)
Carriage paid on purchase of goods.
(b)
Profit earned on sale of fixed assets.
(c)
Cost incurred in purchasing a patent.
(d)
Discount on issue of debentures.

50,000
700,000
40,000
30,000
430,000
75,000
125,000
70,000
45,000
90,000
40,000
3,000