JAIIB Accounting and Finance for Bankers Mock Tests Set 14

Payback period is a applicable


Options are :

  • In evaluating a single project
  • In evaluating mutually exclusive projects
  • In evaluating term loan proposals
  • In evaluating single project or mutually exclusive projects
  • None of the above.

Answer :In evaluating single project or mutually exclusive projects

JAIIB Accounting and Finance for Bankers Mock Tests Set 15

While evaluating capital investment proposals, the time value of money is Considered in case of


Options are :

  • Payback period method
  • Discounted cash flow method
  • Accounting rate of return method
  • All of the above
  • None of the above

Answer :Discounted cash flow method

Posting of correct amount has been made but on the wrong side. This is an error of __.


Options are :

  • Omission
  • Commission
  • Principle
  • Compensating error

Answer :Commission

The return after the pay-off period is not considered in case of -


Options are :

  • Payback method
  • Internal rate of return method
  • Present value index method
  • All of the above
  • None of the above

Answer :Payback method

JAIIB Accounting and Finance for Bankers Mock Tests Set 2

The cash inflows on account o operations are presumed to have been re-invested at the cut-off rate in case of


Options are :

  • Payback method
  • Accounting rate of return method
  • Discounted cash flow method
  • All of the above.
  • None of the above.

Answer :Discounted cash flow method

Name which of the following errors are not error of commission


Options are :

  • Wrong amount has been posted
  • Correct amount has been posted on the wrong side of the account
  • A mistake has been made while balancing the ledger account
  • A sale of goods has been made for ?500, but not entered in sale journal

Answer :A sale of goods has been made for ?500, but not entered in sale journal

Which one of the following statement is true?


Options are :

  • The working capital released on the termination of a project is not cash
  • Depreciation on asset is included in cost in computing discounted cash
  • Increase in working capital due to investment proposal is included in
  • Cost of investment in the new plant is the cost of new plant plus the
  • Between two mutually exclusive projects, that one should be preferred

Answer :Increase in working capital due to investment proposal is included in

JAIIB Accounting and Finance for Bankers Mock Tests Set 3

A firm finds that during the last month of the year an amount of ?3500 received as cash from XYZ has been posted as ?5300 to their account. The entry will be rectified:


Options are :

  • No journal entry if the correction is to be made before trial balance
  • Debit XYZ account and credit suspense account if trial balance has been made
  • Debit XYZ account and credit suspense account if trial balance has been made
  • All the above

Answer :All the above

Which one of the following statement is true?


Options are :

  • The internal rate of return and net present value are synonymous terms.
  • Cash flows from a project can be estimated accurately.
  • The inflation and deflation factors need not be taken into account while estimating future cash inflows since it is difficult to predict future price changes.
  • Cash flows from a project can be worked out only on the basics of certain probabilities
  • No additional working capital is required in case of an expansion of an existing project.

Answer :Cash flows from a project can be worked out only on the basics of certain probabilities

At the end of each financial year all accounts of _____and_____ are transferred to trading and profit & loss account, called closing entries:


Options are :

  • Assets, liabilities
  • Income, liabilities
  • Expenses, assets
  • Income, expenses

Answer :Income, expenses

JAIIB Accounting and Finance for Bankers Mock Tests Set 4

Total of Balance Sheet will be


Options are :

  • ? 5,14,000
  • ? 6,00,000
  • ? 6,80,000
  • None of the three

Answer :? 5,14,000

JAIIB Accounting and Finance for Bankers Mock Tests Set 5

CC Corporation reported the following inventory transactions (in chronological order) for the year:

Assuming inventory at the beginning of the year was zero, calculate the year-end inventory using FIFO and LIFO.



Options are :

  • ?5,220; ?1,040
  • ?2,100; ?1,280
  • ?2,100; ?1,040

Answer :?2,100; ?1,280

As a project manager, Abdul Wahid has to choose between three mutually exclusive projects: A, B and C. He uses the information given below to evaluate the three projects:

Based on the information given, the most appropriate project for Wahid's department is:


Options are :

  • Project A
  • Project B
  • Project C
  • None.

Answer :Project B

Bashir Corporation is considering two mutually exclusive projects. Both require an initial outlay of ?1,50,000 and will operate for five years. The cash flows associated with these projects are as follows.


Bashir's required rate of return is 10 percent. Using the net present value method, which one of the following actions would you recommend to Bashir?



Options are :

  • Accept Project X, and reject Project Y.
  • Accept Project Y, and reject Project X.
  • Accept Projects X and Y.
  • Reject Projects X and Y.

Answer :Accept Project X, and reject Project Y.

JAIIB Accounting and Finance for Bankers Mock Tests Set 6

Total of corrected trial balance will be ____________________________ .



Options are :

  • ? 3,20,000
  • ? 3,60,000
  • ? 3,60,000
  • ? 4,00,000

Answer :? 3,20,000

Debit balance as per Cash Book of ABC Enterprises as on 31.3.2012 is ? 10,000. Cheques deposited but not cleared amounts to ? 1,000 and Cheques issued but not presented is ? 2,000. Balance as per pass book should be



Options are :

  • ? 11,000.
  • ? 9,000.
  • ? 10,000.
  • None of the three

Answer :? 11,000.

Calculate the tangible net worth from the following balance Sheet



Options are :

  • ? 50,000/-
  • ? 50,000/-
  • ? 40,000/-
  • ? 20,000/

Answer :? 40,000/-

JAIIB Accounting and Finance for Bankers Mock Tests Set 7

An investor examines the following rate quotes for the Thailand Bhat and the Indian Rupee.

If the investor shorts INR500, 000 he will achieve a risk-free arbitrage profit (in INR) closest to:

(Please note- Rates used are for example purposes only and should not be compared with current

prevailing rates)


Options are :

  • 856.
  • 924.
  • 1035.
  • 2038

Answer :924.

H Ltd. purchased a machinery on April 01, 2005 for ?3,00,000. It is estimated that the machinery

will have a useful life of 5 years after which it will have no salvage value. If the company follows sum-ofthe-years' digits method of depreciation, the amount of depreciation charged during the year 2009-2010

was


Options are :

  • ?1,00,000
  • ?1,00,000
  • ?60,000
  • ?20,000

Answer :?20,000

Calculate the profit for the year ended 31.03.2018 from the following data.


Options are :

  • Profit of ? 27,000
  • Loss of ? 27,000
  • Profit of ? 8,000
  • Profit of ? 21,000

Answer :Loss of ? 27,000

JAIIB Accounting and Finance for Bankers Mock Tests Set 1

The net present value, internal rate of return, and payback period for four proposed capital budgeting projects are shown below.

If the projects are mutually exclusive, which one of the following is the best project for the company to select?


Options are :

  • Project I.
  • Project II.
  • Project III.
  • Project IV

Answer :Project I.

ABC Builders is considering an investment in mutually exclusive kitchen upgrade projects with the following cash flows:

Assuming ABC Builders has a 12.5% cost of capital, which of the following investment decisions is most appropriate?


Options are :

  • Accept Project A because its internal rate of return is higher than that of Project B
  • Accept both projects because they both have positive net present values.
  • Accept Project B because its net present value is higher than that of Project A.

Answer :Accept Project B because its net present value is higher than that of Project A.

Given below are the ledger balances of a management consultancy firm: Capital ? 4,00,000, Computer ? 25,000, Air conditioner and furniture ? 1,00,000, Fixed Deposits ? 2,00,000, Salaries ? 8,00,000, Fee received ? 12,00,000, Travelling expenses ? 1,50,000, Rent and office expenses ? 2,40,000, Cash balances ? 1,80,000. Bank overdraft ? 95,000. The total of trial balance will be:



Options are :

  • ? 16,00,000.
  • ? 16,95,000.
  • ? 14,50,000.
  • ? 15,00,000.

Answer :? 16,95,000.

JAIIB Accounting and Finance for Bankers Mock Tests Set 10

The financial manager at IBFM, a farm implement distributor, is contemplating the following three mutually exclusive projects.IBFM's required rate of return is 9.5%. Based on the information provided, which should the financial manager select and why?


Options are :

  • All of the projects, because they all earn more than 9.5%.
  • Project A with the lowest initial investment.
  • Project C with the highest net present value.

Answer :Project C with the highest net present value.

The following are the details regarding purchases of a certain item during the month of January.

A physical inventory of the items taken on January 31 shows that there are 700 units in hand. The valuation of inventory as per FIFO method is:


Options are :

  • ? 5,400.
  • ? 6,700.
  • ? 8,600
  • ? 5,000

Answer :? 6,700.

The exhibit below provides relevant data and financial statement information about Acme's inventory purchases and sales of inventory for the last year.

The cost of goods sold using the first in, first out (FIFO) method is:


Options are :

  • ?4,351.
  • ?5,248.
  • ?4,133.

Answer :?4,351.

JAIIB Accounting and Finance for Bankers Mock Tests Set 11

ABC Ltd is considering undertaking a project, which will involve an initial outlay of ?3,00,000. The project has the following cash flows associated with it:

If a discount rate of 10% is used to calculate the NPV of the project, which of the following statements is correct? (Assume the cash flows arise at the end of each year.)


Options are :

  • The project will yield a positive NPV of ? 65.5k and have a payback period of 2 years and 3 months
  • The project will yield a positive NPV of ? 65.5k and have a payback period of 2 years and 9 months
  • The project will yield a positive NPV of ? 365.5k and have a payback period of 2 years and 3 months
  • The project will yield a positive NPV of ? 365.5k and have a payback period of 2 years and 9 months

Answer :The project will yield a positive NPV of ? 65.5k and have a payback period of 2 years and 3 months

During 2017-18, R and Co. purchased ?9,60,000 of inventory. The cost of goods sold for 2017 was ?9,00,000, and the ending inventory at March 31, 2018, was ?1,80,000. What was the inventory turnover for 2017-18?



Options are :

  • 6.4
  • 6.0
  • 5.3
  • 5.0

Answer :6.0

Kappa Ltd is about to undertake a project and has computed the NPV of the project using a variety of discount rates:

What is the approximate IRR of this project?


Options are :

  • 20%
  • 17.5%
  • 15%
  • 22.5%

Answer :17.5%

JAIIB Accounting and Finance for Bankers Mock Tests Set 12

Record of Purchase of T.V. parts is as follows-:

As per LIFO the closing inventory as on March 15 will be?


Options are :

  • ?1,500
  • ?1,650
  • ?1,575
  • None of the three

Answer :?1,500

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