CPT Revision Sample Paper - I - Answer Key

CPT REVISION MOCK TEST – 1(Answer Keys)
Dear Student,
Thanks for registering with

EDUEX.
Visit us at Please find attached the Answer

www.eduex.in Key Booklet for CPT Sample
Paper – I for your reference.
At EDUEX we also specialize in Preparing for CPT Exams?

conducting Postal Mock Tests
and Feedback on performance for EDUEX presents CPT Postal Mock Test Series
all levels of CA Exam i.e.
CPT – PCC – IPCC – CA Finals. ‐ Regular Access to Computers no more required
‐ Subject wise covering part syllabus
‐ Full Syllabus Test and evaluation from experts
‐ All India Ranking
Get Regular academic updates
and be a part of continuous ‐ More than 1,500 MCQs with Solutions
faculty interaction by
subscribing to our eNewsletter To KNOW MORE CLICK HERE
For students of PCC – IPCC and
CA Final
To know more about the various services we provide for students of CA (all levels) and
for students of CS – CWA please email us at info@eduex.in or call us at 011-25050428.
All the Best!

Team Eduex
www.eduex.in
TM
EDU EX ….
………CRACK IT IN FIRST ATTEMPT!!!…
THE ALL INDIA TEST SERIES FOR STUDENTS OF CA / CS / ICWA
Visit us at www.eduex.in
Session – I
Answer all questions.
(Each question carries 1 mark for correct answer and a

negative 1/4 mark for incorrect answer)
(Time : 2 Hrs.)
(Full Marks: 100)
© Copyright 2010 EDUEXTM All rights Reserved.

TM
EDU EX ….
Test Paper – I
Answer all questions

(Time : 4Hrs.) (Full Marks: 200)
Section A - Fundamentals of Accounting
1) All of the following are functions of Accounting except:
O Decision making.
O Measurement.
O Forecasting.
Ledger posting.
2) Manufacturing account is prepared to:
O ascertain the profit or loss on the goods produced.

ascertain the cost of the manufactured goods.
O show the sale proceeds from the goods produced during the year.
O both (b) and (c)
3) On March 31, 2009 after sale of goods worth Rs. 2,000, A is left with the closing stock of Rs.
10,000. This is:
An event
O A transaction
O A transaction as well as an event
O Neither a transaction nor an event
4) Financial statements only consider:
O Assets expressed in monetary terms.

O Liabilities expressed in monetary terms
O Assets and liabilities expressed in non- monetary terms
Assets and liabilities expressed in monetary terms
5) A purchased a car for Rs. 5,00,000, making a down payment of Rs.1,00,000 and signing a
Rs.4,00,000 bill payable due in 60 days. As a result of this transaction:
O Total assets increased by Rs.5,00,000

O Total liabilities increased by Rs.4,00,000
O Total assets increased by Rs.4,00,000.
Total assets increased by Rs.4,00,000 with corresponding increase in liabilities by
Rs.4,00,000.

TM
EDU EX ….
6) The debts written off as bad, if recovered subsequently are:
credited to Bad Debts Recovered Account

O credited to Debtors Account.
O debited to Profit and Loss Account
O None of the above
7) A withdrawal of cash from business by the proprietor should be credited to:
O Drawings Account
Capital Account
O Profit & Loss Account
O None of the above.
8) Contra entries are passed only when:
O double column cash book is prepared

three-column cash book is prepared
O single column cash book is prepared
O None of the above
9) Consignment account is:
O Real account O Personal account

Nominal account O None of the above
10) Economic life of an enterprise is split into the periodic interval as per ________.
O Money Measurement Periodicity Concept

O Going concern O Accrual
11) Accounting policies refer to specific accounting ________.
O Principles
O Methods of applying those principles
Both of above
O None of the above
12) Dividends are usually paid as a percentage of :
O Authorized share capital O Net profit

Paid-up capital O Called-up capital
13) ABC Company provides the following information about the month-end bank reconciliation:
TM
EDU EX ….
Ending cash as per bank statement: 1,367

Ending cash as per company records: 7,383
Monthly bank service charge: 25
Deposits in transit at month-end: 8,345
Outstanding cheques at month-end: 2,399
Customer cheques returned NSF: 45
The correct ending cash balance is:
O 4,914 O 7,268
7,313 O 7,383
14) Which of the following inventory methods will always produce the same results under both a
periodic and perpetual system?
FIFO O LIFO
O Average O None of these
15) When reconciling the ending cash balance as per the bank statement to the correct adjusted
cash balance, how would deposits in transit be handled?
Added to the balance as per bank statement

O Subtracted from the balance as per bank statement
O Added to the balance as per company records
O ignored
16) Under the __________ inventory method, the most recent costs incurred are assigned to cost
of goods sold on the income statement.
LIFO O FIFO
O Weighted Average O None of these
17) A businessman purchased goods for Rs. 25,00,000 and sold 80% of such goods. During the
accounting year ended 31st March, 2009. The market value of the remaining goods was Rs.
4,00,000. He valued the closing stock at cost. He violated the concept of:
O Money measurement. Conservatism.

O Cost. O Periodicity.
18) E Ltd., a dealer in second-hand cars has the following five vehicles of different models and
makes in their stock at the end of the financial year 2009-2010:
Car Fiat, Ambassador, Maruti Esteem, Maruti 800, Zen
Cost (Rs.): 90,000, 1,15,000, 2,75,000, 1,00,000 2,10,000
Net realisable value (Rs.): 95,000, 1,55,000, 2,65,000, 1,25,000, 2,00,000.
The value of stock included in the balance sheet of the company as on March 31, 2010 was:
O Rs.7,62,500 Rs.7,70,000
O Rs.7,90,000 O Rs.8,70,000.
19) Original cost = Rs.1,26,000; Salvage value = Nil; Useful life = 6 years. Depreciation for the
first year under sum of years digits method will be:
TM
EDU EX ….
O Rs. 6,000 O Rs. 12,000

O Rs.18,000 Rs. 36,000
20) Find the goodwill of the firm using capitalization method from the following information:
Total Capital Employed in the firm Rs. 8,00,000
Reasonable Rate of Return 15%
Profits for the year Rs. 12,00,000
O Rs. 82,00,000 O Rs. 12,00,000.

Rs. 72,00,000. O Rs. 42,00,000.
21) When a partner draws a fixed sum at the middle of each month, interest on total drawings will
be equal to interest of ____ m/s at an agreed rate.
6 O 6.5
O 7 O 7.5
22) A, B and C are partners sharing profits and losses in the ratio 4:2:1. They admit D for 1/4th
share. For the purpose of admission of D, the goodwill of the firm should be valued on the basis of
2 yrs. purchase of last 3 yrs. average profits. The profits were 2009 - 1,24,000; 2008 - 1,20,000;
2007 - 80,000; 2006-1,30,000. Calculate the value of goodwill.
O Rs. 2,06,000 O Rs. 2,10,000

Rs. 2,16,000 O Rs. 2,20,000
23) If a purchase return of Rs.1,000 has been wrongly posted to the debit of the sales returns
account, but has been correctly entered in the suppliers’ account, the total of the:
O trial balance would show the debit side Rs.1,000 more than the credit.
O trial balance would show the credit side to be Rs.1,000 more than the debit.
the debit side of the trial balance will be Rs.2,000 more than the credit side.
O the credit side of the trial balance will be Rs.2,000 more than the debit side.
24) X and Y are partners sharing profits in the ratio 5:3. They admitted Z for 1/5th share of profits,
for which he paid Rs. 1,20,000 against capital and Rs. 60,000 against goodwill. Find the capital
balances for each partner taking Z’s capital as base capital:
O 3,00,000; 1,20,000 and 1,20,000.

O 3,00,000; 1,20,000 and 1,80,000.
3,00,000; 1,80,000 and 1,20,000
O 3,00,000; 1,80,000 and 1,80,000.
25) After all debentures have been redeemed, balance of Debenture Redemption Fund is
transferred to:

TM
EDU EX ….
O Profit and Loss Account O Capital Reserve

O Loss on issue of debenture General Reserve
26) Errors, whose effect is not reflected in the trial balance is:
O Errors of Principle Compensating errors

O Errors of Posting O Errors of Casting
27) If the partner’s capital account are fixed, withdrawal of capital will be recorded in:
Partner’s capital account O Partner’s current account

O Partner’s drawing account O Partner’s loan account
28) In the absence of any agreement, partners are entitled to get ____ interest p.a. on loan.
6% O 6.25%
O 6.50% O 6.75%
29) A and B are two partners sharing profits and losses in the ratio 4:1. They earned a profit of
Rs. 8,000 during the year. A, in addition, is entitled to a commission at a certain percentage of net
profit (such commission is to be charged in arriving at the net profit). First, Rs. 2,000 of the net
profit to be ignored. Next, Rs. 2,000 of the net profit to carry 10% commission. Next, Rs. 2,000 of
the net profit to carry 15% commission, and balance of net profit to carry 20% commission.
Calculate the commission of A.
O Rs. 500 O Rs. 600

Rs. 700 O Rs. 800
30) A, B and C are partners contributing Rs. 2,00,000, Rs. 3,00,000 and Rs. 4,00,000
respectively. B and C want the profit to be distributed in the ratio of capital contribution but A does
not agree to it. The partnership deed also does not exist. In such a situation, profit can be shared:
equally among all partners O Capital contribution ratio

O equally among working partners only O as per court order
31) Consider the following data pertaining to a company for the month of March 2010:
Particulars Rs.
Opening stock 22,000
Closing stock 25,000
Purchases less returns 1,10,000
Gross profit margin (on sales) 20%
The sales of the company during the month are:
O Rs.1,41,250 O Rs.1,35,600
Rs.1,33,750 O Rs.1,28,400

TM
EDU EX ….
32) The cash book showed an overdraft of Rs.1,500, but the pass book made up to the same date
showed that cheques of Rs.100, Rs.50 and Rs.125 respectively had not been presented for
payments; and the cheque of Rs.400 paid into account had not been cleared. The balance as per
the pass book will be
O Overdraft of Rs. 1,100. O Overdraft of Rs. 2,175.

Overdraft of Rs. 1,625. O Overdraft of Rs. 1,375.
33) A bank reconciliation sometimes points to the need for adjusting entries. In general, the
source of the adjustments is:
O The reconciliation of the ending balance as per the bank statement to the adjusted cash
balance.
The reconciliation of the cash balance as per the company records to the adjusted cash
balance.
O (a) and (b)
O None of the above
34) Excess of purchase consideration over net assets is transferred to:
Goodwill O Capital reserve

O General reserve O Profit and Loss account
35) Omega Ltd., a listed company, acquired assets worth Rs. 7,50,000 from Alpha Ltd and issues
shares of Rs. 100 each at premium of 25%. The number of shares to be issued by Omega Ltd. to
settle the purchase consideration will be:
6,000 O 7,500
O 9,375 O 5,625
36) A truck costing Rs.1,00,000 and standing in the books at Rs.60,000, was sold for Rs.70,000.
The amount of Rs.10,000 is:
ORevenue loss O Capital loss

ORevenue profit Capital profit
37) X sent out certain goods to Y of Delhi. 1/10 of the goods were lost in transit. Invoice value of
goods lost was Rs.12,500. Invoice value of goods sent out on consignment will be:
O Rs.120,000 Rs.125,000
O Rs.140,000 O Rs.100,000

TM
EDU EX ….
38) F Ltd. purchased Machinery from G Company for a book value of Rs.4,00,000. The
consideration was paid by issue of 10% debentures of Rs.100 each at a discount of 20%. The
debenture account was credited with:
O Rs.4,00,000 Rs.5,00,000
O Rs.3,20,000 O Rs.4,80,000
39) P Ltd. issued 5,000, 12% debentures of Rs.100 each at a premium of 10%, which are
redeemable after 10 years at a premium of 20%. The amount of loss on redemption of debentures
to be written off every year is
O Rs. 80,000 O Rs. 40,000

Rs. 10,000 O Rs. 8,000
40) A and B are partners sharing profits in the ratio 2:3. They admit C as a partner for 1/5th share.
The sacrificing ratio of A and B will be:
O 1:5 O 1.6 : 2.4

O 2:5 2: 3
41) T Ltd. has issued 14% Debentures of Rs.20,00,000 at a discount of 10% on April 1, 2007 and
the company pays interest half-yearly on June 30, and December 31 every year. On March 31,
2009, the amount shown as “interest accrued but not due” in the Balance Sheet will be:
Rs. 70,000 shown along with debentures

O Rs. 2,10,000 under current liabilities
O Rs. 1,40,000 shown along with debentures
O Rs. 2,80,000 under current liabilities
42) A and B enter into a joint venture sharing profit and losses in the ratio 2:1. A purchased goods
costing Rs. 2,00,000. B sold the goods for Rs.2,50,000. A is entitled to get 1% commission on
purchase and B is entitled to get 5% commission on sales. The profit on venture will be:
Rs. 35,500 O Rs.36,000

O Rs. 34,000 O Rs.38,000
43) Ram purchased a machine on 01.01.2009 for Rs. 1,20,000. Installation expenses were Rs.
10,000. Residual value after 5 years is Rs. 5,000. On 01.07.2009, expenses for repairs were
incurred to the extent of Rs. 2,000. Depreciation is provided under straight line method. Annual
depreciation is:
O 13,000 O 17,000
O 21,000 25,000
44) X draws a bill on Y for Rs 30,000. X wants to endorse it to W in settlement of Rs 35,000 at 2%

discount with the help of Y’s acceptance and balance in cash. How much cash X will pay to W?
4,300 O 4,000
TM
© Copyright 2010 EDUEX All rights Reserved.
TM
EDU EX ….
O 4,100 O 5,000
45) The excess of closing capital over opening capital represents:
O profit only if there is introduction fresh capital

O loss if there is drawing
profit if there is no introduction fresh capital
O loss if there is no drawing
46) A company sends its cars to dealers ‘on sale or return’ basis. All such transactions are
however treated like actual sales and are passed through the sales day book. Just before the end
of the financial year, two cars which had cost Rs.55,000 each have been sent on ‘sale or return’
and have been debited to customers at Rs.75,000 each, cost of goods lying with the customers
will be:
Rs.1,10,000. O Rs. 55,000.

O Rs. 75,000 O None of the above
47) Goods costing Rs. 2,00,000 sent out to consignee at Cost + 20%. Invoice value of the goods
will be:
O Rs.250,000 Rs.2,40,000
O Rs.300,000 O None of the above
48) R, J and D are partners sharing profits in the ratio 7:5:4. D died on 30th June 2009 and profits
for the accounting year 2008-2009 were Rs. 24,000. How much share in profits for the period 1st
April 2009 to 30th June 2009 will be credited to D’s Account.
O Rs. 6,000 Rs. 1,500

O Nil. O Rs. 2,000
49) X of Kolkata send certain goods at cost + 25%. Invoice value of goods sent was Rs. 2,00,000.
4/5th of the goods were sold by consignee at Rs.1,76,000. Commission 2% upto invoice value and
10% of any surplus above invoice value is payable. The amount of commission will be:
Rs.4,800 O Rs.5,200
O Rs.3,200 O Rs.1,600
50) The sub-field of accounting is:
O Book-keeping O Financial accounting

O Management accounting All of the above
51) When a stock is valued at cost in one accounting period and at a lower of cost or net realizable
value in another accounting period, this conflicts with the principle of:
O Money measurement Consistency

O Conservatism O Historical cost

TM
EDU EX ….
52) As per the Accounting Equation Approach, “outstanding salary account” is classified as:
O Assets account Liabilities account

O Nominal account O Personal account
53) The maturity date of a bill amounting Rs. 1,000 drawn on 7 January 2009 for a period of 4
months is:
O 7 May 2009 O 7 June 2009

10 May 2009 O 10 June 2009
54) The profit/loss on sale of goods sent on consignment belongs to the:
Consignor O Consignee
O Buyer O Agent
55) When debentures are to be redeemed at the end of specific period, ___________ is preferred
for calculating the amount of loss on debentures.
Fixed installment method

O Fluctuating installment method
O Both (a) and (b)
56) A Joint venture account reflects:
O capital contributed by each co-venturers

O expenditure incurred
profit or loss
O cash and bank balances
57) On purchase of old machinery, expenditure of Rs. 1,000 was incurred for its repair. The repair
expenses of Rs. 1,000 will be debited to:
O Repair account Machinery account

O Profit/ loss account O Supplier account
58) Under the Reserve Bank of India regulations, __________ cannot be made payable to the
bearer.
Promissory note O Bill of exchange

O Cheque O None of the above.
59) Depending on the method used for depreciation calculation,
there is a difference in the amount for annual depreciation charged.

O there is difference in the total amount of depreciation charged over the entire life of an
asset.
O both (a) and (b)
TM
EDU EX ….
O None of above
60) The books in which transactions or events are first recorded are called:
O Principal books Subsidiary books

O Ledger O Trial Balance

TM
EDU EX ….
Section B – Mercantile Law
1) An instrument where the last endorsement is in blank is:
O Order instrument O Inland instrument

O Foreign instrument Bearer instrument
2) Which of the following agreements are void?
O Agreements made under a mutual mistake of fact.

O Agreements the consideration of which is unlawful.
O Agreements made without consideration.
All of the above
3) As per section 29 of the Indian Partnership Act, 1932 a partner may transfer his interest in the
firm _______ .
O By sale O By mortgage.
O By charge All of the above
4) A finder of goods is entitled to sell the goods only when the:
O Lawful charges of the finder, in respect of goods found amounts to 2/3rd of its value.
O Owner cannot be found by reasonable diligence.
O Owner refuses to pay the lawful charges of the finder.
All of the above
5) One of the essential elements of partnership is agreement _________ .
O which is enforceable
O which is legal
between two or more persons
O the object of which is not prohibited by law
6) A del-credere agent is:
O A person who undertakes to act as a mediator for a contract.

TM
EDU EX ….
A person who undertakes to be liable to the principal for failure of the third party to
perform a contract.
O A person who undertakes to act as a guarantor to a signatory of a contract.
O A person who is liable to the principal if the third party refuses to carry out the contract.
7) P consigned a quantity of butter through a railway company. Because of a strike, some delay
took place in transit and the railway company sold the butter. This is an agency created by:
Necessity O Holding out

O Estoppel O Ratification
8) In case of breach of warranty:
O The contract is void.

The aggrieved party can claim damages.
O The aggrieved party can treat the contract as repudiated.
O The contract is voidable at the option of the aggrieved party.
9) Relation of partners to one another is governed by the following sections of The Indian
Partnership Act, 1932.
O 1-8 9-17
O 18-27 O 28-36
10) Dissolution by agreement is:
O Dissolution by the adjudication of all the partners or of all the partners but one as
insolvent.
Dissolution as a result of any agreement between all the partners.
O Dissolution by the business of the firm becoming unlawful.
O All of the above.
11) A wager is
I. a contingent contract.
II. void by law.
III. that which includes accidental loss.
IV. payment of money for work
O Only I Only II
O I , II and III O Only IV
12) An offer comes to an end when:
O It is not accepted within the prescribed time.

TM
EDU EX ….
O A counter offer is made.

O It is not accepted according to the prescribed mode.
All of the above
13) The phrase ‘ex nudo pacto non oritur actio’ means :
O The acts of an agent, subject to certain conditions, are acts of the principal.
An agreement made without consideration is void.
O Ignorance of law is no excuse.
O No action arises from a base cause.
14) In case of a sale, the risk of loss resulting from the insolvency of the buyer is borne by______ .
The seller
O The buyer
O Both of the above
O General Insurance Company of India
15) Registration of a partnership firm is_______ .
O Compulsory from the beginning.

O Not compulsory till first five years of beginning of the partnership.
Not compulsory at all.
O Compulsory only if the registrar of firms gives an order in this regard.
16) Compulsory dissolution includes:
O Dissolution by the adjudication of all the partners or of all the partners but one as
insolvent.
O Dissolution by the business of the firm becoming unlawful.
Both of above
O None of the above
17) The right of a minor when admitted to the benefits of the partnership includes:
O Right to share of the property and profits of the firm as may be agreed upon.
O Right to have access to and inspect and copy any of the account of the firm.
O Right to cast his vote on the question of appointment of managing partner.
(a) and (b) but not (c)
18) ‘Buyer’ means a person who__________ .
O Buys goods
O Agrees to buy goods
O Has bought goods

TM
EDU EX ….
Buys or agrees to buy goods
19) Agreement to share profits _________
O Implies an agreement to share losses.

Does not necessarily mean an agreement to share losses.
O Must be coupled with an agreement to share losses.
O Is same as agreement to share losses.
20) Actual sale of future goods is __________ .
O Impossible
Possible through an agreement to sale
O Illegal
O A myth
21) Every __________ forming the consideration for each other is an agreement.
O proposal O offer
promise O acceptance
22) Which of the following is correct?
O The liability of partners of a firm is unlimited.

O Generally the liability of a member of a company is limited but it can be unlimited.
Both (a) and (b).
O The liability of partner of a firm is same as any member of a company.
23) The heir of a deceased partner:
O Has a right to become partner in the firm of the deceased partner.

O Does not have a right to become partner in the firm of the deceased partner.
O Can become a partner in the firm of a deceased partner only if the surviving partners
give their consent in this regard.
Both (b) and (c)
24) In case of agreement to sale, if the seller becomes insolvent while the goods are in his
possession, the buyer’s remedy is:
O to claim the goods from the official receiver or assignee.

is to claim dividend from the estate of the seller for the price paid.
O is not available
O is to file a suit for damages
25) ‘X’ promises to pay ‘Y’ a sum of money if a certain ship does not return within a year. The
contract may be enforced if :

TM
EDU EX ….
O the ship does not return within the year

O the ship is burnt within the year
either of the above
O none of the above.
26) The original contract needs to be performed, if the parties to the contract agree for:
O Novation O Rescission
O Alteration None of the above
27) A sold a piece of land to B. At the time of sale, both the parties believed in good faith that the
area was 200 sq. yards. It, however turned out to be only 175 sq. yards. The contract of sale is:
O Valid Void
O Illegal O Invalid
28) Which of the following is not an essential feature of a wagering agreement?
O Uncertain agreement
Parties should have control over the event
O Promise to pay money or money’s worth
O Each party must stand to win or lose
29) Which of the following is an exception to the rule that an agreement without consideration is
void?
O Promise to pay a time barred debt

O Love & affection
O Agency
All of the above
30) Chandu orally offered to pay Ashok, an auto mechanic, Rs. 100 for testing a used car which
Chandu was about to purchase from Dharam. Ashok agreed and tested the car. Chandu paid
Ashok Rs. 100 in cash for his services. The agreement between Chandu & Ashok is:
O Implied, executed and valid

Express, executed and valid
O Implied, executory and valid
O Express, executed and voidable
31) Which of the following relationships does not raise the presumption of undue influence?
O Doctor & patient O Debtor & creditor

O Landlord and tenant Both (b) and (c)
32) In a contract induced by fraud, the defrauded party

TM
EDU EX ….
O cannot rescind the contract.

O cannot rescind the contract but can sue for damages.
O cannot sue for damages.
can insist that he shall be put in a position in which he would have been if the
representation made had been true.
33) The court may grant rescission where:
the contract is voidable by the plaintiff.

O the plaintiff has expressly or impliedly ratified the contract.
O owing to change in circumstances (not being due to any act of the defendant himself),
the parties cannot restore to their original positions.
O third parties have, during the subsistence of the contract, acquired rights in good faith
and for value.
34) Identify the correct statement from the following:
O A minor may appoint an agent through his guardian.

O An agency without consideration is invalid.
O A minor appointed as an agent is capable of creating a valid contract between the
principal and a third party.
Both (a) and (c)
35) Which of the following is/are true?
O Consideration must be real.

O Consideration can be inadequate.
O Consideration must be adequate
Both (a) and (b)
36) By which of the following cases a contract stands discharged by operation of law?
O By express consent
O By novation of terms of contract
By unauthorized alteration of terms of contract
O By renunciation of obligations
37) The appropriation must be made by _________.
O The seller with the assent of the buyer.

O The buyer with the assent of the seller.
O The buyer or the seller with or without the assent of the other.
Both (a) and (b)
38) When a party repudiates his promise or obligation under the contract before the time for
performance arrives, it is called:

TM
EDU EX ….
O Waiver
O Rescission
O Actual breach of contract
Anticipatory breach of contract
39) A had offered B, a price of Rs.10,00,000/- for B’s flat. But B was not ready to sell the flat at all.
A says to B that “I shall kill you if you don’t agree to sell me your house for Rs.10, 00,000/-”. B
thereafter did all that was the desire of A in order to save his life. What is immediate answer?
O A can enforce the contract.

O B can enforce the contract.
A has applied coercion.
O The contract is unenforceable
40) Partner by holding out is also known as _________.
O Active Partner O Dormant Partner

Partner by estoppel O Partner by stoppage

TM
EDU EX ….
Session – II
Answer all questions.
(Each question carries 1 mark for correct answer and a

negative 1/4 mark for incorrect answer)
(Time : 2 Hrs.)
(Full Marks: 100)

TM
EDU EX ….
Section C – Economics
1) ___________ stands for an economic order in which the four factors of production are privately
owned and managed and in which production takes place for private profit.
Capitalist Economy O Socialist Economy

O Normative Science O None of these
2) The term “inverse demand curve” refers to:
O a demand curve that slopes upward.

expressing the demand curve in terms of price as a function of quantity.
O the demand for “inverses.”
O the difference between quantity demanded and supplied at each price
3) If the demand curve for a good is horizontal and the price is positive, then a leftward shift of
the supply curve results in:
O price of zero. O an increase in price.

O a decrease in price. no change in price
4) What is the reaction of suppliers to an increase in the incomes of consumers?
O Suppliers do not react, since income shifts the demand curve, not the supply curve.
O The supply curve shifts to the right.
O The supply curve shifts to the left.
Quantity supplied increases.
5) Suppose over a certain period of time the technology for producing compact disk players has
improved, and over the same period of time the economy has moved into a recession, causing the
incomes of consumers to decrease. Which of the following will happen to the equilibrium price and
equilibrium quantity for CD players? (Assume CD players are normal goods.)
O Price will increase; quantity cannot be determined.

Price will decrease; quantity cannot be determined.
O Quantity will increase; price cannot be determined.
O Quantity will decrease; price cannot be determined.
6) Which of the following best describes a perfectly inelastic demand function?
The quantity demanded is completely insensitive to changes in price.

O Price is completely insensitive to changes in quantity demanded.
O When price changes by a certain percentage, quantity demanded changes by the same
percentage.
O The demand function is horizontal at the given price.

TM
EDU EX ….
7) In the long run, the price elasticity of demand is __________ than in the short run because
_________.
O less; consumers have more time in which to make adjustments to price changes.
O less; the percentage change is measured over a larger amount of time.
greater; consumers have more time in which to make adjustments to price changes.
O greater; firms have more time to shift the burden of the tax forward to consumers.
8) Tea and Coffee have:
O positive income elasticities of demand with respect to each other.

O negative income elasticities of demand with respect to each other.
a positive cross-price elasticity of demand.
O a negative cross-price elasticity of demand
9) Which of the following is true with respect to the relationship between the marginal cost
function and the average cost functions?
O If MC is greater than ATC, then ATC is falling.

O The ATC curve intersects the MC curve at minimum MC.
The MC curve intersects the ATC curve at minimum ATC.
O If MC is less than ATC, then ATC is increasing
10) The negatively-sloped part of the long-run average total cost curve is due to which of the
following?
O Diseconomies of scale.
Economies of scale.
O The difficulties encountered in coordinating the many activities of a large firm.
O Diminishing returns.
11) The condition for the long run equilibrium of the competitive firm is that:
LMC = LAC = P O LMC = LAC & LMC> P

O P> LAC < LMC O None of the above
12) Price Discrimination is possible only under the following conditions:
Monopoly in some form is necessary.

O The price elasticity should be same in different markets.
O It should be possible for buyers of low priced market to resell the product to the buyers
of high priced market.
13) _________ is the money value of all final goods and services produced in the domestic
territory of a country during an accounting year.
O Gross National Product Gross Domestic Product

TM
EDU EX ….
O National Income O None of the above
14) ________ refers to that portion of total Deposits of a commercial bank, which it has to keep
with the RBI in the form of Cash reserves.
O Statutory Liquidity Ratio Cash Reserve Ratio

O Margin Requirement O None of the above
15) In Macro Economics, we study the economic behaviour of:
O individual O multiple aggregates

large aggregates O national income
16) Difference between the value of goods that a nation exports and the value of goods that it
imports per annum is called the:
O Balance of Payment O Trade Balance

Balance of Trade O Payment Balance
17) IMF commenced its operation in:
O 1946 1947
O 1948 O 1949
18) An International Reserve Asset created by the IMF in 1969 to supplement the existing official
Reserves of the member countries is:
O Special Reserve Asset

Special Drawing Rights
O Special Official Reserve
O Special International Reserve
19) Which of the following measures have been taken to pursue the objective of globalization?
O Convertibility of Rupee
O Import Liberalisation
O Opening the economy to foreign capital
All of the above
20) Export of primary goods or raw materials of agricultural origin and import of manufactured
industrial goods is an indication of:
O developed economy developing economy

O underdeveloped economy O none of the above
21) Which of the following statement is incorrect?

TM
EDU EX ….
O The WTO is a chartered trade organisation.

O The WTO has a legal status and enjoys privileges/immunities on the same footing as the
IMF and the World Bank.
India is not one of the founder members of the WTO.
O The WTO is a successor of GAAT.
22) The _________ is a multilateral development finance institution dedicated to reducing poverty
in Asia and the Pacific.
Asian Development Bank

O Asia Pacific Development Bank
O Asian Industrial Bank
O EXIM Bank
23) Exports and Imports come under the purview of:
O Ministry of Finance Ministry of Commerce

O Ministry of External affairs O Ministry of Home
24) The balance of invisible are included in:
Balance of payment O Balance of trade

O Both of the above O None of the above
25) The opportunity cost is:
O Price in different market for a same product.

O Cost of increase in consumption due to increase in income.
O Cost which cannot be recovered.
Cost of sacrifice of current consumption.
26) Economics is:
O A positive science
O Neither a positive nor normative science
O A science but no art
A science or an art depending on who uses economics and for what purpose.
27) If the supply curve of a product changes so that sellers are now willing to sell 2 additional units
at any given price, the supply curve will:
O shift leftward by 2 units.

shift rightward by 2 units.
O shift vertically up by 2 units.
O shift vertically down by 2 units.

TM
EDU EX ….
28) A was selling his house. The asking price was Rs. 22,00,000, and A decided he would take no
less than Rs. 20,00,000. After some negotiation, B purchased the house for Rs. 20,50,000. B’s
consumer surplus is:
O Rs. 50,000.
O Rs. 1,50,000.
O Rs. 2,00,000.
not able to be calculated from the information given.
29) Assume that both the consumers’ incomes and the number of sellers in the market for good A
decreases. Based upon this information we can conclude, with certainty, that equilibrium
O price will increase. O price will decrease.

O quantity will increase. quantity will decrease.
30) If a firm has a fixed amount of factory or office space, which of the following will happen as
output expands?
Marginal cost increases.

O The opportunity cost of an additional unit of output decreases.
O The firm will be willing to accept a lower price for an additional unit of output.
O Worker productivity usually increases as the firm hires more labor.
31) Which one of the following is not an exception to the law of demand?
O Conspicuous goods O Giffen goods

O Necessities Luxury goods
32) A higher indifference curve represents:
a higher level of satisfaction. O a lower level of satisfaction.

O same level of satisfaction. O marginal level of satisfaction.
33) One of the main kinds of internal economies and diseconomies of scale is:
O Development of skilled labour

Managerial economies and diseconomies
O Growth of ancillary industries
O Cheaper raw materials
34) Point elasticity is useful for which of the following situations?
O The bookstore is considering doubling the price of notebooks.

O A restaurant is considering lowering the price of its most expensive dishes by 50
percent.
An auto producer is interested in determining the response of consumers to the price of
cars being lowered by Rs.1,000.
O An insurance company raises the health insurance premiums it charges by 30 percent

TM
EDU EX ….
35) Assuming that the consumer is at equilibrium, what will be the marginal utility of coffee, if the
marginal utility of coke is 75 and the prices of coffee and coke are Rs. 5 and Rs. 15 respectively?
O 10 25
O 50 O 100
36) Which of the following is not a feature of perfect competition?
O Large number of buyers and sellers

O Free entry and exit of the firms
O Homogeneous product
No close-substitutes available for the product
37) Under which of the cost conditions can a monopolist incur losses?
O TC> TR O MC > MR
ATC> AR O All of the above
38) ________ measures the contribution of each producing enterprise in the domestic territory of
the country.
O Income Method O Expenditure Method

Value added method O None of the above
39) ________ explains the nature of relationship between population and the means of
subsistence and how the latter limits the growth of the former through national checks.
Malthusian Theory
O Theory of Optimum Population
O Theory of Demographic Transition
O None of the above
40) In the __________ method of measuring terms of trade, the change in the price of exports
over the change in the price of imports is taken into account.
O gross barter terms of trade net barter terms of trade

O net index terms of trade O gross index terms of trade
41) Till date Indian Rupee has been devalued:
O two times three times

O four times O five times
42) Special Drawing Rights is a basket of currency and it currently consists of:
Euro, Pound Sterling, Japanese Yen and U.S Dollar

O Euro, Rupee and U.S Dollar
TM
EDU EX ….
O Euro, Japanese Yen , Singapore Dollar and U.S Dollar

O None of the above
43) __________ is issued to a merchant exporter for import of inputs used in the manufacture of
goods without payment of basic custom duty and special additional duty:
Duty Free Replenishment Scheme Certificate

O Export Promotion Capital Goods Scheme Certificate
O Export Registration Certificate
O None of the above
44) Which of the following is not one of the four major functions of money?
O A medium O A standard
O A store General acceptability
45) _________ are those selective instruments which affect the amount of credit in specific areas
or regulate the direction of credit.
O Quantitative Instruments Qualitative Instruments

O Bank Rate Policy O Open Market Operations
46) One of the four parameter of globalisation is:
O Increase of trade barriers to permit free- flow of goods and services across national
frontiers.
O Reduction of trade barriers to permit free-flow of goods across national frontiers.
Reduction of trade barriers to permit free-flow of goods and services across national
frontiers.
O Reduction of trade barriers to permit free-flow of goods and services across local
frontiers
47) __________ which is used for further production of goods is called capital.
O Money O Wealth
O Income All of the above
48) The second devaluation of Indian Rupee took place on:
O June, 1967 O June, 1966

July, 1991 O July, 1995
49) __________ does not give the true picture of the financial position of the country and was
given up in 1997. It is no longer shown in the budgetary statement.
Budgetary deficit O Fiscal deficit

O Revenue deficit O Capital deficit

TM
EDU EX ….
50) In stage _________ of the Demographic transition model, both death rates and birth rates are
high and roughly in balance.
One O Two
O Three O Four

TM
EDU EX ….
Section D – Quantitative Aptitude
1) A total of Rs. 12,000 is invested into two rate is simple interest accounts. The annual simple
interest rate on one account is 9%; on the second account, the annual simple interest rate is 6%.
How much should be invested in each account so that both accounts earn the same amount of
annual interest?
O 4,000 & 8,000 4,800 & 7,200

O 5,600 & 6,400 O 6,400 & 5,600
2) An investor deposited an amount of money into a high-yield mutual fund that returns a 9%
annual simple interest rate. A second deposit of Rs. 2,500 more than the first, was placed in a
certificate of deposit that returns a 5% annual simple interest rate. The total interest earned on
both investments for one year was Rs. 475. How much money was deposited in the mutual fund?
O 5,000 O 1,500
2,500 O 3,500
3) An eccentric person leaves instructions in his will that a certain sum of money is to be divided
between his relatives so that Patrick will receive half and Quentin will receive one fifth. The
remainder is to be divided so that Rufus receives three quarters and the rest goes to Simon. If
Simon eventually received Rs.324 how much did Patrick and Quentin receive?
O 864 and 2160 O 2208 and 816

O 816 and 2208 2160 and 864
4) How many different 6-letter arrangements can be formed using the letters in the word ABSENT,
if each letter is used only once?
O 6 O 36
720 O 1440
5) A standard deck of 52 cards is shuffled. What is the probability of choosing the card 5 of
diamonds?
O 1/5 O 1/15
O 3/52 1/52
6) If P(E) is the probability that an event will occur, which of the following must be false?
O P(E)=1 O P(E)=1/2
O P(E)=1/3 P(E)= - 1
7) Your state issues license plates consisting of letters and numbers. There are 26 letters and the
letters may be repeated. There are 10 digits and the digits may be repeated. How many possible
license plates can be issued with two letters followed by three numbers?

TM
EDU EX ….
O 25,000 O 67,600
O 2,50,000 6,76,000
8) Suppose 60% of a herd of cattle is infected with a particular disease. Let Y = the number of
non-diseased cattle in a sample of size 5. The distribution of Y is:
O binomial with n = 5 and p = 0.6

binomial with n = 5 and p = 0.4
O binomial with n = 5 and p = 0.5
O the same as the distribution of X, the number of infected cattle.
9) A random sample (without replacement) of 2 members has to be taken from a population

consisting of 20 members. The total number of possible samples in such case would be:
O 10 O 20
190 O 380
10) The number of traffic accidents per week in a small city has a Poisson distribution with mean
equal to 1.3. What is the probability of at least two accidents in 2 weeks?
O 0.2510 O 0.3732
O 0.5184 0.7326
11) The best way to recognize whether or not a variable is growing exponentially over time is by:
O plotting the variable against time and looking for a straight-line pattern.
O calculating the least squares regression line of the variable against time and examining
the residuals.
O plotting the logarithm of the variable against time and looking for a straight line pattern.
smoothing the time series by running medians of three or five.
12) The number of bacteria in a drop of water from a lake has a Poisson distribution with an
average of 0.5 bacteria/drop. A small dish containing four drops of water from the lake is placed
under a microscope. The probability of observing at most one bacteria in the sample is
O 0.910 0.406
O 0.271 O 0.135
13) Which of the following is NOT applicable to a Poisson Distribution?
O It is used to compute the probability of rare events.

O Every event is independent of every other event.
It is parameterized by the sample size and the probability that an event will occur.
O The theoretical range for the number of events that could occur is 0,1,2,3, ...
14) Some scientists believe that a new drug would benefit about half of all people with a certain
blood disorder. To estimate the proportion of patients who would benefit from taking the drug, the
scientists will administer it to a random sample of patients who have the blood disorder. What
sample size is needed so that the 95% confidence interval will have a width of 0.06?

TM
EDU EX ….
O 748 1,068
O 1,503 O 2,056
15) The following table represents the relative frequency of accidents per day in a city.
Accidents 0 1 2 3 4or more
Relative Freq. 0.55 0.20 0.10 0.15 0
Which of the following statements are true?

I. The mean and modal number of accidents are equal.
II. The mean and median number of accidents are equal
III. The median and modal number of accidents are equal
O I only O II only
III only O I, II and III
16) Find k so that x-2 is a factor of : p(x) = x3 – 2x2 + kx –3
O 1/2 O -1/2
O 2/3 3/2
17) James scored 66 and 72 marks in two class tests. What is the lowest marks he must score in
his class to qualify for a bonus prize, if an average score of 75 is needed to qualify for the prize.
87 O 78
O 67 O 76
18) Find the value of x in : 5x + 6 = 13 - 9x
O 1 1/2
O 1/3 O 1/4
19) Express the following in index form: Log3 x = 4.
34 = x O 43 = x
O X3 = 4 O X4 = 3
20) An Ogive can be prepared in ______ different ways.
2 O 3
O 4 O 5
21) The value of (8/27)1/3 is:
2/3 O 3/2
O 2/9 O None of these
22) The equation –7x + 1 = 5–3x will be satisfied for x equal to:
O 2 -1
TM
© Copyright 2010 EDUEX All rights Reserved.
TM
EDU EX ….
O 1 O None of these
23) The sum of two numbers is 52 and their difference is 2. The numbers are
O 17 and 15 O 12 and 10
27 and 25 O None of these
24) In what time will Rs.85,000 amount to Rs.1,57,675 at 4.5 % p.a.?
O 18 yrs O 18.5 yrs

19 yrs O 20 yrs
25) The 4 arithmetic means between –2 and 23 are
O 3, 13, 8, 18 O 18, 3, 8, 13
3, 8, 13, 18 O None of these
26) Significant birth defects occur at a rate of about 4 per 1000 births in human populations. After
a nuclear accident, there were 10 defects observed in the next 1500 births. Find the probability of
observing at least 10 defects in this sample if the rate had not changed after the accident.
O 0.008 O 0.003
O 0.041 0.084
27) In a certain communications system, there is an average of 1 transmission error per 10

seconds. Let the distribution of transmission errors be Poisson. What is the probability of more
than 1 error in a communication one-half minute in duration?
O 0.262 O 0.738
O 0.199 0.801
28) _________ is an area diagram which emphasises the widths of rectangles between the class
boundaries.
O Bar Diagram Histogram

O Frequency Polygon O Ogive
29) Statistics is concerned with
O Qualitative information O Quantitative information

O (a) or (b). Both (a) and (b)
30) For any two numbers SD is always:
O Twice the range Half of the range

O Square of the range O None of these
TM
EDU EX ….
31) Bivariate Data are the data collected for:
O One variables.
O More than two variables.
Two variables at the same point of time.
O Two variables at different points of time.
32) Karl Pearson’s coefficient is defined from:
Ungrouped data. O Grouped data

O Both O None
33) What would be the index of the following using method of relatives?
Commodity Base price Current price
Wheat 15 20
Rice 10 12
Pulse 20 25
O 126.66 O 378.33
126.11 O 133.33
34) In _________ sampling method, sample units are selected at equal intervals.
O Random O Purposive
O Stratified Systematic
35) If an investment of Rs.60,000 and Rs.70,000 yields an income of Rs.5,750 Rs.6,500

respectively. An investment of Rs. 90,000 would yield income of Rs.__________.
O 7,500 8,000
O 7,750 O 7,800
36) The sum of all natural numbers between 200 and 400 which are divisible by 7 is ________
O 7730 8729
O 7729 O 8730
37) Mutually inclusive classification is usually meant for______
A discrete variable O A continuous variable

O An attribute O All these
38) _____ is an absolute measure of dispersion.
O Range O Mean Deviation

O Standard Deviation All these measures

TM
EDU EX ….
39) For finding the degree of agreement about beauty between two Judges in a Beauty Contest,
we use______ .
O Scatter diagram
Coefficient of rank correlation
O Coefficient of correlation
O Coefficient of concurrent deviation
40) Probability density function is always_____
O Greater than 0
Greater than equal to 0
O Less than 0
O Less than equal to 0
41) On what sum will the compound interest at 5% per annum for two years compounded annually
be Rs.1,640?
Rs. 16,000 O Rs. 17,000

O Rs. 18,000 O Rs. 19,000
42) Find the future value of an annuity of Rs. 500 made annually for 7 years at interest rate of 14%
compounded annually. Given that (1.14)7 = 2.5023
O Rs.5635.25 Rs.5365.25
O Rs.6535.25 O Rs.6355.25
n
43) Find n if P3 = 60
O 4 5
O 6 O 7
44) A man has 5 friends. In how many ways can he invite one or more of his friends to dinner?
O 29 O 30
31 O 32
45) The second term of a GP is 24 and the fifth term is 81. The series is
O 16, 36, 24, 54,.. O 24, 36, 53,…

16, 24, 36, 54, .. O 12, 24, 48, 96….
46) In a group of 20 children, 8 drink tea but not coffee and 13 like tea. The number of children
drinking coffee but not tea is:
O 6 7
O 12 O None of these.

TM
EDU EX ….
47) Integration of 3 – 2x – x4 will become
O – x2 – x5 / 5 O 3x – x2 – x5 / 5
3x – x2 - x5 / 5 + k O None of these
48) Find the number of observations between 250 and 300 from the following data:
Value : > 200 > 250 > 300 > 350
No. of observations: 56 38 15 0
O 56 23
O 15 O 8
49) If the range of x is 2, what would be the range of –3x +50 ?
O 2 6
O -6 O 44
50) ________ are values which divide the total number of observations into four equal parts.
O Median Quartiles
O Deciles O Percentiles

TM
EDU EX ….
Dear Student,
Thanks for registering with EDUEX.
Hope you liked the Quality of the Sample CPT Mock

Test.
Visit us at WISH U ALL THE VERY BEST FOR

YOUR EXAMS
www.eduex.in
For your suggestions and feedback mail us at
info@eduex.in
At EDUEX we also specialize in

conducting Postal Mock Tests Preparing for CPT Exams?
and Feedback on performance for
all levels of CA Exam i.e. EDUEX presents CPT Postal Mock Test Series
CPT – PCC – IPCC – CA Finals.
‐ Regular Access to Computers no more required
‐ Subject wise covering part syllabus
‐ Full Syllabus Test and evaluation from experts
Get Regular academic updates
‐ All India Ranking
and be a part of continuous
faculty interaction by ‐ More than 1,500 MCQs with Solutions
subscribing to our eNewsletter
For students of PCC – IPCC and To KNOW MORE CLICK HERE
CA Final
To know more about the various services we provide for students of CA (all levels) and
for students of CS – CWA please email us at info@eduex.in or call us at 011-25050428.
All the Best!

Team Eduex
www.eduex.in

CPT Revision Sample Paper - I - Answer Key

Transféré par

Informations du document

Description originale:

Titre original

Copyright

Formats disponibles

Partager ce document

Partager ou intégrer le document

Options de partage

Avez-vous trouvé ce document utile ?

Ce contenu est-il inapproprié ?

Droits d'auteur :

Formats disponibles

CPT Revision Sample Paper - I - Answer Key

Transféré par

Droits d'auteur :

Formats disponibles

CPT REVISION MOCK TEST – 1(Answer Keys)

Thanks for registering with

Visit us at Please find attached the Answer

At EDUEX we also specialize in Preparing for CPT Exams?

All the Best!

Answer all questions.

(Each question carries 1 mark for correct answer and a

(Full Marks: 100)

© Copyright 2010 EDUEXTM All rights Reserved.

Answer all questions

Section A - Fundamentals of Accounting

1) All of the following are functions of Accounting except:

2) Manufacturing account is prepared to:

O ascertain the profit or loss on the goods produced.

4) Financial statements only consider:

O Assets expressed in monetary terms.

O Total assets increased by Rs.5,00,000

© Copyright 2010 EDUEXTM All rights Reserved.

6) The debts written off as bad, if recovered subsequently are:

credited to Bad Debts Recovered Account

7) A withdrawal of cash from business by the proprietor should be credited to:

8) Contra entries are passed only when:

O double column cash book is prepared

9) Consignment account is:

O Real account O Personal account

O Money Measurement Periodicity Concept

11) Accounting policies refer to specific accounting ________.

12) Dividends are usually paid as a percentage of :

O Authorized share capital O Net profit

Ending cash as per bank statement: 1,367

Added to the balance as per bank statement

O Money measurement. Conservatism.

O Rs. 6,000 O Rs. 12,000

O Rs. 82,00,000 O Rs. 12,00,000.

O Rs. 2,06,000 O Rs. 2,10,000

O 3,00,000; 1,20,000 and 1,20,000.

© Copyright 2010 EDUEXTM All rights Reserved.

O Profit and Loss Account O Capital Reserve

O Errors of Principle Compensating errors

Partner’s capital account O Partner’s current account

O Rs. 500 O Rs. 600

equally among all partners O Capital contribution ratio

© Copyright 2010 EDUEXTM All rights Reserved.

O Overdraft of Rs. 1,100. O Overdraft of Rs. 2,175.

34) Excess of purchase consideration over net assets is transferred to:

Goodwill O Capital reserve

ORevenue loss O Capital loss

© Copyright 2010 EDUEXTM All rights Reserved.

O Rs. 80,000 O Rs. 40,000

O 1:5 O 1.6 : 2.4

Rs. 70,000 shown along with debentures

Rs. 35,500 O Rs.36,000

44) X draws a bill on Y for Rs 30,000. X wants to endorse it to W in settlement of Rs 35,000 at 2%

45) The excess of closing capital over opening capital represents:

O profit only if there is introduction fresh capital

Rs.1,10,000. O Rs. 55,000.

O Rs. 6,000 Rs. 1,500

50) The sub-field of accounting is:

O Book-keeping O Financial accounting

O Money measurement Consistency

© Copyright 2010 EDUEXTM All rights Reserved.

O Assets account Liabilities account