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Commerce Practice Paper For Civil Service Examination (UPSC): SOLVED PART - 1

Commerce Practice Paper For Civil Service Examination (UPSC): SOLVED PART - 1

Commerce Practice Paper For Civil Service Examination (UPSC): SOLVED PART - 1

1. In case of any default made in complying with the provisions relating to the postal ballot, the officer on default will be punishable with which one of the following fines ?
(A) Rs. twenty thousand in respect of each such default
(B) Rs. fifty thousand in respect of each such default
(C) Rs. one lakh in respect of each such default
(D) Rs. two lakh in respect of each such default

2. A listed company opting for buyback of shares under the Companies Act, 1956 has to submit return, after completion of such buy-back within which one of the following periods ?
(A) 6 months of such completion to the Registrar of Companies only
(B) 45 days of such completion to the SEBI only
(C) 30 days of such completion to the Registrar of Companies and SEBI
(D) 30 days of such completion to the SEBI only

3. Which one of the following is correct in respect of the doctrine of indoor management and the rule of constructive notice ?
(A) The former operates to protect the outsider against the company and the latter protects the company against the outsider
(B) The former operates to protect the company against the outsider and the latter protects the outsider against the company
(C) Both protect the company against the outsider
(D) Both protect the outsider against the company

4. What is Director Identification Number (DIN) ?
(A) An identification number which the individual company allots to the intending director
(B) A number which the Central Government allots to any individual intending to be appointed as director or to any existing director of a company
(C) A number which the SEBI allots to any individual intending to be appointed as director or to any existing director of a company
(D) A number which the Central Government allots to retired directors so as to build data base

5. Small shareholders' director is to be appointed by which of the following companies ?
(A) Public companies having Rs. 5 crores or more of paid up capital and minimum of 1000 small shareholders
(B) Public companies having Rs. 10 crores or more of paid up capital and a minimum of 1000 small shareholders
(C) Public companies having Rs. 1 crore or more of paid up capital and a minimum of 100 small shareholders
(D) Public companies having Rs. 5 crores or more of paid up capital and a minimum of 100 small shareholders

6. When does a body corporate become capable forthwith of exercising all the functions of a company ?
(A) On finalizing Memorandum of Association
(B) On obtaining certificate of commencement of business
(C) On obtaining certificate of incorporation
(D) On having convened its first Annual General Meeting

7. For how many years the books of accounts of a company have to be preserved in good order ?
(A) For a period of not less than eight years immediately preceding the current year
(B) For a period of not less than five years immediately preceding the current year
(C) For a period of not less than six years immediately preceding the current years
(D) For a period of not less than four years immediately preceding the current year

8. Which one of the following is not one of the elements of the 7S McKinsey Model for analyzing and improving organizational effectiveness ?
(A) Strategy
(B) Structure
(C) Shared Values
(D) Standard

9. Consider the following statements—
1. Aggregate planning implies operational planning concerned with determining a firm's production requirements and manufacturing capacity.
2. Behaviour modification is a concept of motivation totally independent of rewards for the employees.
Which of the statements given above is/are correct ?
(A) 1 only
(B) 2 only
(C) Both 1 and 2
(D) Neither 1 nor 2

10. What is the correct sequence of the following steps in a strategic planning process ?
1. Inputs
2. Evaluation of alternatives
3. Execution
4. SWOT analysis
Select the correct answer using the code given below—
(A) 1 – 4 – 2 – 3
(B) 4 – 1 – 2 – 3
(C) 1 – 2 – 3 – 4
(D) 4 – 1 – 3 – 2

11. Consider the following statements—
1. Managerial grid is an organizational concept that brings together teams of individuals from specialized jobs and departments for achieving specific results in
defined periods of time.

2. The matrix management model is based on a matrix of values between 0 and 9 for two primary variables.
Which of the statements given above is/are correct ?
(A) 1 only
(B) 2 only
(C) Both 1 and 2
(D) Neither 1 nor 2

12. A limited company makes a net profit of Rs. 2,00,000 after writing off preliminary expenses amounting to Rs. 20,000 and providing for depreciation on assets amounting to Rs. 40,000 and gain of Rs. 10,000 on sale of a piece of machinery. What are the funds from operation ?
(A) Rs. 2,00,000
(B) Rs. 2,40,000
(C) Rs. 2,50,000
(D) Rs. 2,60,000

13. Consider the following items that are disclosed in a statement of cash flows—
1. Cash flow from operating activities.
2. Cash flow from financing activities.
3. Closing cash and cash equivalents.
4. Cash from investing activities What is the correct chronological order of their disclosure of the above cash flows ?
(A) 2 – 3 – 1 – 4
(B) 1 – 4 – 2 – 3
(C) 2 – 4 – 1 – 3
(D) 1 – 3 – 2 – 4

14. Consider the following statements—
A cash flow statement is generally prepared for
1. Ascertaining the net cash flows between two accounting periods.
2. Understanding the trends of cash flows between two accounting periods.
3. Short term cash planning of the business.
Which of the statements given above are correct ?
(A) 1 and 2 only
(B) 2 and 3 only
(C) 1 and 3 only
(D) 1, 2 and 3

15. Which of the following represents corporate sustainable reporting ?
(A) Publishing annual financial statement only
(B) Publishing annual financial statements and social accounts
(C) Publishing social and environmental accounts annually
(D) Publishing annual financial statements incorporating economic, social and environmental performances

16. Sometimes an auditor is called upon to review the operations of an enterprise for evaluating their cost-effectiveness. What is this kind of audit generally known as ?
(A) Cost Audit
(B) Operations Audit
(C) Tax Audit
(D) Independent Financial Audit

17. Match List-I with List-II and select the correct answer using the code given below the Lists—
List-I (Assets and Liabilities)
(a) Current assets
(b) Fixed assets
(c) Deferred revenue expenditure
(d) Current liabilities
List II (Accepted Principles of Valuation)
1. To be valued at cost less depreciation
2. To be valued at cost or market price whichever is lower
3. To be valued at the maximum figure which might be incurred
4. To be written off within a reasonable period of time
Codes :
(a) (b) (c) (d)
(A) 2 1 4 3
(B) 3 4 1 2
(C) 2 4 1 3
(D) 3 1 4 2

18. Match List-I with List-II and select the correct answer using the code given below the Lists—
List I (Type of Audit)
(a) Statutory Audit
(b) Management Audit
(c) Cost Audit
(d) Financial Audit
List II (Explanation)
1. Judge the correctness of the financial statements and establish their reliability
2. Appraisal of performance of executives
3. Examination of past records
4. Verification of cost records
Codes :
(a) (b) (c) (d)
(A) 3 4 2 1
(B) 1 2 4 3
(C) 3 2 4 1
(D) 1 4 2 3

19. Match List-I with List-II and select the correct answer using the code given below the Lists—
List-I (Technique of Auditing)
(a) Vouching
(b) Verification
(c) Investigation
(d) Valuation
List-II (Explanation)
1. It is an enquiry into the value, ownership and title of assets
2. It is testing of the exact value of an asset on the basis of its utility
3. It is the verification of authority and authenticity of transactions as recorded in the books of accounts
4. It is an examination of accounts and records of a business concern with some special purpose
Codes :
(a) (b) (c) (d)
(A) 3 2 4 1
(B) 4 1 3 2
(C) 3 1 4 2
(D) 4 2 3 1

20. Consider the following statements—
Internal check relates to
1. arrangement of duties of employees.
2. distribution of work in such a way that work of one employee is checked by other employee.
3. review of operations.
Which of the statements given above is/are correct ?
(A) 1 and 2 only
(B) 2 and 3 only
(C) 3 only
(D) 1, 2 and 3

21. Consider the following categories of documentary evidence from the point of view of the degree of their reliability.
1. Documentary evidence originating from and held by the entity.
2. Documentary evidence originating from third parties and held by the entity.
3. Documentary evidence originating from and held by the third party.
4. Documentary evidence originating from entity and held by the third party.
Which one of the following is the correct order (high to low) of their degree of reliability ?
(A) 4 – 1 – 3 – 2
(B) 3 – 2 – 4 – 1
(C) 4 – 2 – 3 – 1
(D) 3 – 1 – 4 – 2

22. Which one of the following is not included in the internal check as regards purchases ?
(A) Assessment of requirements
(B) Placing orders
(C) Despatch of goods
(D) Recording and making payments

23. Consider the following statements—
1. It is mandatory for all business enterprises to conduct audit of accounts.
2. Audit Note Book is a tool in the conduct of audit.
3. Internal check system is an inbuilt mechanism within an organization to check frauds and errors.
Which of the statements given above is/are correct ?
(A) 1 only
(B) 2 and 3 only
(C) 3 only
(D) 1, 2 and 3

24. Match List-I with List-II and select the correct answer using the code given below the Lists—
List-I (Type of Books)
(a) Minutes Book
(b) Subsidiary Ledger
(c) Stores Ledger
(d) Log Book
List-II (Content)
1. Records of issue of packing materials
2. Records of running hours of machine
3. Records of decisions at a meeting
4. Records entry of receipt from debtors
Codes :
(a) (b) (c) (d)
(A) 3 2 1 4
(B) 1 4 3 2
(C) 3 4 1 2
(D) 1 2 3 4

25. What is the method in which an amount equal to the amount written off as depreciation is invested in outside securities in order to facilitate replacement of an asset at the expiry of its life period, called ?
(A) Annuity Method
(B) Sinking Fund Method
(C) Replacement Method
(D) Depletion Method

26. What is Capital Redemption Reserve Account available for ?
(A) Redemption of redeemable preference shares
(B) Redemption of redeemable debentures
(C) Reorganization of share capital
(D) Issue of fully paid bonus shares

27. Match List-I with List-II and select the correct answer using the code given below the Lists—
List I (Item)
(a) Earnings per share
(b) Cash flow statement
(c) Inventory valuation
(d) Disclosure of accounting policies
List-II (Accounting Standard)
1. AS-3
2. AS-20
3. AS-1
4. AS-2
Codes :
(a) (b) (c) (d)
(A) 3 1 4 2
(B) 2 4 1 3
(C) 3 4 1 2
(D) 2 1 4 3

28. Government grants related to income as per the Accounting Standard (AS)-12 should be—
(A) Presented as a credit in the statement of Profit and Loss
(B) Presented as a deferred income on the asset side of the balance sheet
(C) Presented as a capital grant on the liability side of balance sheet
(D) Presented both in the Profit and Loss statement and in the balance sheet

29. What is the renewal fees paid for a patent right ?
(A) Capital expenditure
(B) Revenue expenditure
(C) Deferred revenue expenditure
(D) Development expenditure

30. According to the Accounting Standard (AS)-2, the inventory is to be valued at which one of the following ?
(A) Actual cost or sales value, whichever is lower
(B) Historical cost
(C) Net realizable value
(D) Historical cost or net realizable value, whichever is lower




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25 Jun, 2019, 17:29:24 PM