Lecturer in Commercial Practice 235/2017 Answer Key

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Post: Lecturer in Commercial Practice
Department: Kerala Technical Education (Polytechnics)
Category Code: 235/17
Qualification: Master's Degree in Commerce
Date of Test: 05-09-2018


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  1. "The proprietor of a business is treated as a creditor." Which accounting concept is based on this assumption?
    • Cost concept
    • Accounting period concept
    • Business entity concept
    • Going concern concept

  2. Among the following which one is not a fictitious asset?
    • P and L account debit balance
    • Patents
    • Organization expenses
    • Discount on issue of shares

  3. How do you treat the item of depreciation while preparing final accounts if it appears in Trial Balance?
    • Debited to P and L account only
    • Deducted from the asset concerned in the Balance Sheet
    • Both "Debited to P and L account only" and "Deducted from the asset concerned in the Balance Sheet"
    • None of these

  4. Heavy advertisement expenses incurred to launch a new product is treated as
    • Capital expenditure
    • Revenue expenditure
    • Deferred revenue expenditure
    • All of these

  5. Which of the following statements is a false one?
    • Single entry method is an incomplete record of transactions
    • A trial balance cannot be prepared under single entry system
    • Books maintained under single entry are not reliable with that of double entry system
    • All accounts are maintained under single entry system

  6. A B C share profits and losses in the ratio of 1/2 ,1/3 and 1/6 respectively. D, a new partner is admitted with 1/8 share. Then, what will be new profit sharing ratio?
    • 7/16, 7/24, 7/48, 1/8
    • 7/24, 7/48, 7/24, 1/8
    • 2/8, 7/16, 7/24, 1/8
    • 2/8, 7/48, 7/24, 1/8

  7. At the time of admission of a new partner, when goodwill is raised at full value in which ration the same is credited to capital accounts of partners?
    • Sacrificing ratio
    • Old profit sharing ratio
    • New profit sharing ratio
    • None of these

  8. When an existing company takes over the business of one or more existing companies, it is the case of
    • Amalgamation
    • Internal reconstruction
    • External reconstruction
    • Absorption

  9. A company may utilize the premium received on issue of shares/debentures for
    • Payment of dividends
    • Writing off discount on issue of debentures
    • Writing off any capital loss
    • Writing off any revenue loss

  10. The aggregate of the cost of indirect material, indirect labour and indirect expenses is called
    • Overheads
    • Cost
    • Prime cost
    • Works cost

  11. Among the following, which one is not an expense excluded from cost accounts?
    • Capital losses
    • Income tax
    • Dividend
    • Distribution expenses

  12. The time lag between indenting and receiving of materials is know as
    • Re order level
    • Danger level
    • Lead time
    • EOQ

  13. Re apportionment of service department costs to production department is called
    • Secondary distribution
    • Allotment
    • Primary distribution
    • Absorption

  14. Following are the information available in respect of A Ltd.
    Fixed expenses Rs. 50,000
    Sales (value) Rs. 2,00,000
    Profits Rs. 50,000
    Then, the P/V ratio will be
    • 30%
    • 50%
    • 40%
    • None of these

  15. Which of the following is not a method of absorbing factory overheads?
    • Machine hour rate
    • Dual hour rate
    • Direct labour hour rate
    • Marginal cost rate

  16. Policy formulation and objective determination are the main focus of
    • Management
    • Administration
    • Middle level management
    • None of these

  17. Which one of the following roles does not constitute management roles as proposed by Henry Mintzberg?
    • Training role
    • Interpersonal role
    • Decision role
    • Informational role

  18. ___________ refers to those social interactions which do not have consciously coordinated joint purpose.
    • Communication
    • Supervision
    • Informal communication
    • Formal communication

  19. Which of the following is a quantitative technique of decision making in management?
    • Consensus mapping
    • Brainstorming
    • Delphi technique
    • Game theory

  20. The approach of Scientific Management was developed by
    • Henry Fayol
    • Elton Mayo
    • F. W. Taylor
    • George R. Terry

  21. Which of the following is not a source of short term finance for business?
    • Commercial banks
    • Retained earnings
    • Public deposits
    • Trade credits

  22. Which of the following statement is not applicable to financial planning?
    • Determining the duties of finance manager
    • Determining the amount of capital required
    • Determination of capital structure
    • Laying down of policies regarding cash control, borrowing and lending

  23. The type of layout suitable for mass production of products in continuous industries is
    • Process layout
    • Fixed position layout
    • Product layout
    • None of these

  24. The policy of the enterprise to fix a very high price for a new product at the very outset to recover the amount of capital invested quickly is called
    • Penetration pricing
    • Skimming pricing
    • Bait pricing
    • Full pricing

  25. 360 degree method in HRM is related to
    • Employee motivation
    • Employee morale
    • Employee selection
    • Employee performance appraisal

  26. The first stock exchange in India was set up in
    • New Delhi
    • Chennai
    • Mumbai
    • Kolkatha

  27. __________ is the regulatory authority in the field of capital market.
    • Banking Regulation Act
    • SEBI
    • RBI
    • None of these

  28. FDI stands for
    • Foreign Derivatives Investment
    • Foreign Disposable Investment
    • Foreign Derived Investment
    • Foreign Direct Investment

  29. Which one of the following is not a type of derivatives?
    • Mutual funds
    • Futures
    • Options
    • Forwards

  30. The market where securities that have already been issued are traded is called __________
    • Primary market
    • Secondary market
    • Tertiary market
    • All of these

  31. The branch of business dealing with production of goods is known as _________
    • Commerce
    • Trade
    • Industry
    • Marketing

  32. Which one of the following is not a form of business organization?
    • Company
    • Sole trader
    • Partnership
    • Government Department

  33. The minimum number of directors in the case of a Public Ltd. Company is
    • 4
    • 3
    • 2
    • 5

  34. Debentures Payable to a holder of certificate is called __________
    • Bearer debentures
    • Secured debentures
    • Unregistered debentures
    • Convertible debentures

  35. Rights issue refers to the shared issued to
    • Existing directors
    • Employees
    • Public
    • Existing shareholders

  36. Auditors of a company have to report to the
    • Institutional investors
    • Board of directors
    • Shareholders at the annual general meeting
    • Managing director

  37. EXIM Bank is a _________
    • Non-banking non-financial company
    • Non-banking financial company
    • Scheduled bank
    • Commercial bank

  38. In life insurance, the insured can recover the loss only if the loss is due to the nearest cause. This principle is called
    • Subrogation
    • Indemnity
    • Insurable interest
    • Causa proxima

  39. The method of transferring the rights of the insured in respect of life insurance policy to another party is known as
    • Surrender
    • Assignment
    • Nomination
    • None of these

  40. Which of the following is an essential component of intranet?
    • PAD
    • LAN with a minimum 5 PCs
    • Computer with server software
    • CRM

  41. Digital products are best suited for B2C e-commerce. Because __________
    • They can be mass-customized and personalised
    • They are commodity like products
    • They can be delivered at the time of purchase
    • All of these

  42. Which type of communication is based on social relationship among the members?
    • Upward communication
    • Downward communication
    • Formal communication
    • Informal communication

  43. Which one of the following documents attests the fact that goods of specified quantity, value and description are entering the boundary of the country?
    • Documentary bill
    • Bill of entry
    • Bill of lading
    • Consular invoice

  44. Under which principle, all the rights of an insured are transferred to insurance company after making payment of claim?
    • Contribution
    • Average clause
    • Subrogation
    • Indemnity

  45. Which of the following is an example of company incorporated by a Special Act of Parliament?
    • Indian Oil Corporation Ltd.
    • LIC of India
    • State Trading Corporation of India
    • Bharath Heavy Electricals Ltd.

  46. Which one of the following is not an instrument of credit control under banking system?
    • Tax rates
    • Cash reserve ratio
    • Bank rate
    • Moral suasion

  47. The Act which is applicable for the registration of NBFCs is
    • SBI Act
    • RBI Act
    • Companies Act
    • None of these

  48. _________ is known as "the soft loan window" of the World Bank.
    • IFC
    • IMF
    • IBA
    • IDA

  49. In India, the custodian of monetary reserves of the country is
    • NABARD
    • RBI
    • SBI
    • IDBI

  50. The "scheme of lead bank" was introduced in India in the year
    • 1969
    • 1971
    • 1980
    • 1991

  51. The system of Unit Banking is originated in
    • U. K.
    • HongKong
    • USA
    • India

  52. "No man must grow rich out of another person's loss". Which type of contract is based on this principle?
    • Express contract
    • Implied contract
    • Executed contract
    • Quasi contract

  53. A contract which is dependent on the happening or non-happening of some event is called _____________
    • Absolute contract
    • Contingent contract
    • Wagering contract
    • None of these

  54. In India, the Factories Act was passed in the year __________
    • 1939
    • 1947
    • 1948
    • 1951

  55. Which one of the following is not a negotiable instrument?
    • Bill of exchange
    • Promissory note
    • Cheque
    • Hundi

  56. Which one of the following is not a form of e-banking?
    • Cheque book
    • ATM
    • Smart card
    • Tele Banking

  57. RTGS stands for
    • Rigid Time Gross Settlement
    • Real Time Gross Settlement
    • Real Tune Gross Settlement
    • Reserve Time Gross Settlement

  58. The Act contains the provisions for health and safety measures of employees is
    • Employee Compensation Act, 1923
    • Industrial Dispute Act, 1947
    • Trade Union Act, 1926
    • None of these

  59. Which one of the following is not a right of an unpaid seller against the goods sold as per sale of Goods Act?
    • Right for interest
    • Right of lien
    • Right of stopping the goods in transit
    • Right of re sale

  60. Which of the following statement is incorrect?
    • E-banking is virtual banking
    • E-banking services include phone banking and home banking
    • Debit-cards are known as check cards
    • ATM is one of the major channels used for electronic banking

  61. Which of the following is related with the question "Do higher interest rates slow the economy and lower inflation?"
    • Deductive Method
    • Inductive Method
    • Normative Economics
    • Positive Economics

  62. How the demand curve for cigarettes changes when there is a positive impact of public service announcements and governments' mandatory health warnings on cigarette packages?
    • There will be a movement along the demand curve
    • No change in demand curve
    • Shift the demand curve for cigarettes to the left
    • Shift the demand curve for cigarettes to the right

  63. Which among the following is a factor affecting supply curve of a commodity?
    • Internet shopping and auctions allow consumers to compare the prices of different dealers more easily and drives high cost sellers out of business
    • Increase in tariff on imported automobiles increases total automobile supply
    • If truck prices goes up, the supply of cars rises
    • Computerised manufacturing lowers production costs and decreases supply

  64. Which of the following is the effect of imperfect competition?
    • Too low price and too high output
    • It leads to price that rise above cost and to consumer purchases that are reduced below efficient levels
    • Increase in economic efficiency
    • None of these

  65. When the oligopolists find it profitable to sell in each other's territory markets, then this act is known as
    • Phantom freight
    • Pittsburgh-plus pricing system
    • Cross-hauling
    • Both "Phantom freight" and "Pittsburgh-plus pricing system"

  66. Spending money in socially unproductive efforts to acquire, maintain or exercise monopoly is called
    • Price regulation
    • Rent seeking
    • Deadweight loss
    • Marginal expenditure

  67. Why economic profit is smaller than accounting profit?
    • Economic profit is total revenue minus total cost including both explicit and implicit costs
    • Accounting profit is the total revenue minus total explicit cost
    • Economic cost include all opportunity cost when analysing a firm, whereas accounting cost measure only explicit cost
    • All these

  68. Real GDP is calculated by using the formula
    • Nominal GDP -: Real GDP
    • Nominal GDP − Real GDP
    • Nominal GDP -: GDP Deflator
    • GDP Deflator ÷ GNP

  69. The price support policy in India aims at
    • Maximum production of essential commodities
    • Increasing the prices of rice, wheat, jute, cotton, sugarcane etc. so that producers' of those goods can receive higher incomes
    • Market regulation
    • None of these

  70. The statistical method which connects an old index number series with a revised series in order to make the series continuous is called
    • Splicing
    • Deflating
    • Fixed base method
    • Chain base method

  71. If the data set contains even number of items, then median is
    • Average of two middle items
    • Middle item of the array
    • Most often repeated value in the data set
    • Sum of values of all observations

  72. Which among the following is the property of regression coefficient?
    • Arithmetic mean of regression coefficients is lower than the coefficients of correlation
    • Correlation coefficient is the geometric mean of the two regression coefficients
    • If one regression coefficient is greater than one, then other regression coefficient would also be greater than one
    • All these

  73. Which among the following is a type of non-random sampling design?
    • Shopping-Mall intercept sampling
    • Snowball sampling
    • Both "Shopping-Mall intercept sampling" and "Snowball sampling"
    • Cluster sampling

  74. Which among the following is a feature of correlation coefficients?
    • A high numerical value of 'r' that is value close to +1 or –1 represents a strong linear relation
    • A value of 'r' close to zero means that the linear association is very weak
    • The magnitude of 'r' indicates the strength of linear relation, whereas its sign indicates the direction
    • All these

  75. If the Lorenz curve is nearer to the line of equal distribution, the dispersion is
    • Zero
    • Greater
    • Smaller
    • Equal to one

  76. Name the person associated with 'Kuttamkulam Struggle' in Thrissur as a protest against untouchability.
    • P. K. Kumaran Master
    • C. Kesavan
    • K. Kelappan
    • A. K. Gopalan

  77. Who organised Cheramar Mahajan Sabha in 1921?
    • Ayyankali
    • Dr. Ayyathan Gopalan
    • Pampady John Joseph
    • M. C. Joseph

  78. Who translated Rabindranath Tagor's Gitanjali into Malayalam?
    • Kumaran Asan
    • G. Sankara Kurup
    • Ponkunnam Varky
    • Kesava Dev

  79. The President of Vakkom Moulavi Foundation Trust (VMFT).
    • Dr. N. A. Karim
    • Vakkom Majeed
    • A. Suhair
    • Dr. Muhammad Iqbal

  80. The new Vice Chancellor of Malayalam University
    • Dr. E. Radhakrishnan
    • K. Jayakumar
    • Dr. Anil Vallathol
    • Gopinath Revindran

  81. In the Indian Constitution, the term 'Cabinet' appears only in
    • Article 358
    • Article 352
    • Article 71
    • Article 28

  82. Name the India-Nepal joint military exercise which was conducted recently
    • Hand-in-Hand
    • Lamitye
    • Surya Kiran XI
    • Al-Nagah

  83. The Social Justice Department was established in Kerala in
    • September 1978
    • October 1980
    • October 1985
    • September 1975

  84. The present Chairperson of Kerala State Women's Commission is
    • K. C. Rosakutty
    • M. C. Josephine
    • Chinta Jerome
    • M. Kamalam

  85. In which district of Kerala is The Indian Institute of Space Science and Technology located?
    • Ernakulam
    • Kozhikode
    • Thiruvananthapuram
    • Malappuram

  86. Nair Service Society (NSS) was formed in
    • October 1924
    • September 1916
    • November 1927
    • October 1914

  87. By which among the following Amendments of the Constitution of India was Delhi designated as the National capital territory?
    • 69th Amendment Act
    • 63rd Amendment Act
    • 75th Amendment Act
    • 16th Amendment Act

  88. Who among the following started Lokamanayan news paper?
    • T. R. Krishnaswamy Iyer
    • K. Kelappan
    • Kurur Neelakandan Namboodiripad
    • C. V. Kunjiraman

  89. The headquarters of Kerala Sangeetha Nataka Academy in
    • Thiruvananthapuram
    • Thrissur
    • Malappuram
    • Ernakulam

  90. Who wrote the book "Old History, New Geography, Bifurcating Andra Pradesh "?
    • Jayaram Ramesh
    • M. C. Joseph
    • Subramanya Swami
    • Manohar Parikkar

  91. The National Disaster Management Authority of India is chaired by
    • The President of India
    • Prime Minister of India
    • Home Minister of India
    • None of these

  92. Which one of the following was a re-curving cyclone that affected the Arabian sea coast of the Indian Peninsula in 2017?
    • Phailin
    • Mora
    • Ockhi
    • Irma

  93. Identify the wrong statement about ozone gas.
    • The ozone layer of the atmosphere protects us from harmful UV radiation from the sun
    • Release of Chloro Fluoro Carbons (CFCs) were responsible for the thinning and damage to ozone layer
    • Inhalation of Ozone is harmful to human beings
    • Ozone in the atmosphere is found at ground level only

  94. Minamata disease is associated with poisoning due to
    • Bacteria
    • Mercury
    • Sulphur
    • Argon

  95. The Monazite sands of Kerala are a potential reserve of
    • Coal
    • Plutonium
    • Uranium
    • Thorium

  96. "The amount of carbon dioxide released into the atmosphere as a result of the activities of a particular individual, organization or community" is called
    • Carbon footprint
    • Ecological footprint
    • Per capita emission
    • Carbon balance

  97. Oil spills in water bodies are a man-made hazard, Which of the following is a possible effect of an oil spill in a water body?
    • Increase in dissolved oxygen levels
    • Decrease in dissolved oxygen levels
    • No effect on dissolved oxygen levels
    • None of these

  98. Which is the only Genetically Modified (GM) crop that is being cultivated in India on a commercial scale?
    • Bt Cotton
    • Bt Brinjal
    • GM Mustard
    • GM Tomato

  99. In 2016, India's first Liquefied Natural Gas (LNG) powered bus was launched in
    • Maharashtra
    • New Delhi
    • Gujarat
    • Kerala

  100. The two primary scales used to measure intensity of earthquakes are
    • Doppler and Richter
    • Beaufort and Richter
    • Richter and Mercalli
    • Doppler and Mercalli

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