Question : A firm made credit Revenue from Operations (Credit Sales) of Rs.5,40,000 during the year. If the trade receivables turnover ratio is 9 times, The value of opening and closing trade Receivables, if the closing trade receivables are more by Rs.8,000 than the opening trade receivable will be
Option 1: Opening trade receivable Rs 56,000 closing trade receivable Rs 64,000
Option 2: Opening trade receivable Rs 64,000 closing trade receivable Rs 56000
Option 3: Opening trade receivable Rs 24000 closing trade receivable Rs 32000
Option 4: None of the above
Correct Answer: Opening trade receivable Rs 56,000 closing trade receivable Rs 64,000
Solution : Answer = Opening trade receivable Rs 56,000 closing trade receivable Rs 64,000
Trade receivable turnover ratio=$\frac{Net credit sales}{Average trades receivable}$
⇒ 9 times= $\frac{5,40,000}{Average trade receivables}$
⇒ Average trade receivables=$\frac{5,40,000}{9}$
⇒ Average trade receivables= 60,000.
Let op. trade receivable=X
Closing trade receivable=X+8000
Average trade receivable=$\frac{X+X+8000}{2}$
⇒ 60,000=$\frac{X+X+8000}{2}$
⇒ 2X+8000=1,20,000
⇒ X=1,20,000/2= 56,000.
Opening trade receivables= Rs 56,000
Closing trade receivables = 56,000+8,000= Rs 64,000.
Hence, the correct option is 1.
Answer laterQuestion : Which aspect of management is highlighted in the below statement?
In whale Ltd, the purchase department purchased 5 tonnes of raw materials for the production department. The production department needs just 2 tonnes. Due to this reason, goods were over produce and were not accepted by the sales department.
Option 1: Lack of planning
Option 2: Lack of organising
Option 3: Lack of manpower
Option 4: Lack of coordination.
Correct Answer: Lack of coordination.
Solution : Lack of coordination among the various department is highlighted in the above statement. It leads to miscommunication.
Hence Option D is correct.
Question : Identify the principle of management in the below case.
The superior has promised his subordinate to share his profit with them once the sales target is achieved.
Option 1: Unity of command
Option 2: Unity of direction
Option 3: Discipline
Option 4: Order
Correct Answer: Discipline
Solution : Principle of discipline is being highlighted here. It involves full filling the promises made by the superior. Discipline is must for all enterprise and for all the levels.
Hence Option C is correct.
Question : Which of the following statements are false with respect of Net profit ratio?
Option 1: Net Profit Ratio establishes the relationship between Net Profit and Revenue from Operations, i.e., Net Sales.
Option 2: Net Profit Ratio is an indicator of overall efficiency of the business. Higher the Net Profit Ratio, better the business.
Option 3: An increase in the ratio over the previous period shows improvement in the operational efficiency and decline means otherwise.
Option 4: None of the above.
Correct Answer: None of the above.
Solution : Answer = None of the above.
Net profit Ratio Establishes the Relationship Between Net profit and Revenue from operation
The net profit Ratio is an indicator of the overall efficiency of the Business.
Higher the Net Profit Ratio Better the Business.
Hence, the correct option is 4.
Question : 12,00,000 in credit sales and 2,40,000 in debts were owed by ABC Ltd. at the conclusion of the year. With a year of 360 days,what will be the average collection period?
Option 1: 180 Days
Option 2: 60 Days
Option 3: 80 Days
Option 4: 72 Days
Correct Answer: 72 Days
Solution : Average Collection Period = Debtors / Credit Sales × 360
= 2,40,000 /1 2,00,000 × 360
= 72 days
Hence option 4 is the correct answer.
Question : Sharma, Verma and Goyal are partners in a firm. On 1st April 2012 the balances in their
Capital Accounts were as follows:
Sharma Rs. 4,00,000; Verma Rs. 4,20,000 and Goyal Rs. 3,70,000. The firm closes its accounts every year on 31st March. Verma died on 30th September 2012. In the event of the death of any partner following are the provisions in the Partnership Deed:
(i) Interest on Capital will be calculated at the rate of 10% p.a.
(ii) The deceased partner; 's legal representative will be paid Rs. 35,000 for his share of goodwill.
(iii) The firm had a Reserve Fund of Rs. 2,10,000. The deceased partner will be paid his share in the Reserve Fund.
(iv) His share of profit till the date of death will be calculated based on sales. It is also specified that the sales during the year 2011-12 were Rs. 15,00,000. The sales from 1st April 2012 to 30th September 2012 were Rs. 3,00,000. The profit of the firm for the year ending 31st March 2012 was Rs. 3,00,000.
Question:
The amount of goodwill distributed amongst the partners are
Option 1: Rs 17,500
Option 2: Rs 35,000
Option 3: Rs 24,000
Option 4: None of the above
Correct Answer: Rs 35,000
Solution : Answer = Rs 35,000
| Verma's capital a/c | |||
| To Verma's executor a/c (b/f) | 5,66,000 | By Bal b/d | 4,20,000 |
| By IOC | 21,000 | ||
| ($4,20,000 \times \frac{10}{100} \times \frac{6}{12}$) | |||
| By Reserve fund | 70,000 | ||
| ($2,10,000 \times \frac{1}{3}$) | |||
| By Sharma & Goyal capitals a/c | 35,000 | ||
| P & L suspense a/c | 20,000 | ||
| 5,66,000 | 5,66,000 | ||
$\frac{3,00,000}{15,00,000}$×3,00,000= 60,000$\times \frac{1}{3}$= 20,000.
Hence, the correct option is 2.
Question : Sharma, Verma and Goyal are partners in a firm. On 1st April 2012 the balances in their Capital Accounts were as follows:
Sharma Rs. 4,00,000; Verma Rs. 4,20,000 and Goyal Rs. 3,70,000. The firm closes its accounts every year on 31st March. Verma died on 30th September 2012. In the event of the death of any partner following are the provisions in the Partnership Deed:
(i) Interest on Capital will be calculated at the rate of 10% p.a.
(ii) The deceased partner; 's legal representative will be paid Rs. 35,000 for his share of goodwill.
(iii) The firm had a Reserve Fund of Rs. 2,10,000. The deceased partner will be paid his share in the Reserve Fund.
(iv) His share of profit till the date of death will be calculated based on sales. It is also specified that the sales during the year 2011-12 were Rs. 15,00,000. The sales from 1st April 2012 to 30th September 2012 were Rs. 3,00,000. The profit of the firm for the year ending 31st March 2012 was Rs. 3,00,000.
Question:
Amount Due to the deceased's partner's capital account will be ......
Option 1: Rs 3,66,000
Option 2: Rs 6,06,000
Option 3: Rs 5,66,000
Option 4: None of the above
Correct Answer: Rs 5,66,000
Solution : Answer = Rs 5,66,000
| Verma's Capital A/c | |||
| By Verma's executor a/c (b/f) | 5,66,000 | By Bal b/d | 4,20,000 |
| By IOC | 21,000 | ||
| ($4,20,000 \times \frac{10}{100} \times \frac{6}{12}$) | |||
| By Reserve fund | 70,000 | ||
| ($2,10,000 \times \frac{1}{3}$) | |||
| By Sharma & Goyal capitals | 35,000 | ||
| By P & L suspense a/c | 20,000 | ||
| 5,66,000 | 5,66,000 | ||
$\frac{3,00,000}{15,00,000}$×3,00,000= 60,000$\times \frac{1}{3}$= 20,000.
Hence, the correct option is 3.
Question : Case Study:
A company believes that aggressive sales and promotion efforts are essential to boost sales. They prioritize short-term sales goals over long-term customer relationships. This philosophy reflects the:
Option 1: Societal Marketing Concept
Option 2: Product Concept
Option 3: Marketing Concept
Option 4: Selling Concept
Correct Answer: Selling Concept
Solution : The correct answer is (d) Selling Concept.
The Selling Concept is a marketing philosophy that emphasizes aggressive sales techniques and promotional efforts to convince customers to buy a company's products or services. It focuses on achieving short-term sales goals and transactions rather than building long-term customer relationships. The primary goal is to sell what the company produces, often with less consideration for long-term customer satisfaction or relationship-building.
Question : Which of the following is an example of a marketing objective?
Option 1: Increasing brand awareness by 20% within six months
Option 2: Reducing production costs by 10% annually
Option 3: Hiring five new sales representatives
Option 4: Expanding into five new markets
Correct Answer: Increasing brand awareness by 20% within six months
Solution : The correct answer is (a) Increasing brand awareness by 20% within six months.
A marketing objective is a specific and measurable goal that a company sets to achieve through its marketing efforts. It provides a clear target or outcome that the company aims to accomplish within a specific time frame.
Among the options provided, increasing brand awareness by 20% within six months is an example of a marketing objective. It sets a specific goal of increasing brand awareness by a specific percentage (20%) within a defined time frame (six months). This objective focuses on a marketing-related outcome and provides a clear metric to measure success.
Question : Case Study:
A company believes that aggressive sales and promotion efforts are essential to boost sales. They prioritize short-term sales goals over long-term customer relationships. This philosophy reflects the:
Option 1: Societal Marketing Concept
Option 2: Product Concept
Option 3: Marketing Concept
Option 4: Selling Concept
Correct Answer: Selling Concept
Solution : The correct answer is (d) Selling Concept.
The Selling Concept is a marketing philosophy that emphasizes aggressive sales techniques and promotional efforts to convince customers to buy a company's products or services. It focuses on achieving short-term sales goals and transactions rather than building long-term customer relationships. The primary goal is to sell what the company produces, often with less consideration for long-term customer satisfaction or relationship-building.
