Question Bank on Accountancy

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Question Bank on Accountancy

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Accountancy Question Bank for Preparation

1. The combined Finance and Revenue Accounts of the Union and State Governments are prepared by –
(a) Indian Audit and Accounts Department
(b) Central Accounting Organisations of the Union Government
(c) Indian Accounts Department
(d) Comptroller and Auditor General of India.

2. The person whose duty it was to check such accounts became known as the auditor, the word being derived from the word ‘Audire’ which is a –
(a) French word
(b) Greek word
(c) Japanese word
(d) Latin word

3. From January 26, 1950 (the date of commencement of the Constitution), as per Structure of Administration, India has been constituted into a Union of States comprising –
(a) 25 States and 7 Union Territories
(b) 27 States and 6 Union Territories
(c) 29 States and 7 Union Territories
(d) 32 States and 7 Union Territories

4. The executive power of the Union vests in the –
(a) Lok Sabha
(b) Rajya Sabha
(c) President
(d) Prime Minister

5. The executive power of the State vests in the –
(a) Legislature
(b) Chief Minister
(c) Governor
(d) Chief Secretary

6. As per Article ___________ of the Constitution of India, each State has a separate Consolidated Fund entitled the ‘Consolidated Fund of the State’ into which the revenues received by the Government of the State, loans raised by that Government by the issue of Treasury Bills, loans or ways and means advances and moneys received by that Government in repayment of loans are credited and from which the expenditure of the State, when authorized by the appropriate Legislature, is met –
(a) Article 265
(b) Article 266
(c) Article 267
(d) Article 268

7. A statement of its estimated annual receipts and expenditure is prepared by each Government and presented to its Legislature. The Union Territory |Governments present the Statement to its Legislature with the previous approval of the President. This ‘Annual Financial Statement’ is commonly known as the –
(a) Statement of Accounts
(b) Statement of Receipt and Expenditure
(c) Statement of Receipt and Payment
(d) Budget

8. In order to have a meaningful reflection of the national development effort and also as a means for evaluating the progress of projects against set targets as well as to serve as a tool for securing the efficient management of operations entrusted to the Administration, a system of __________ has been introduced both at the Centre and in the States.
(a) Action Plan
(b) Rapid Action Target
(c) Performance Budgeting
(d) Zero Base Budgeting.

9. The Finance Bill containing the annual taxation proposals is considered and passed by the Legislatures only after the Demands for Grants have been Voted and the total expenditure is known. Then it enters the Statute as the _______.
(a) Finance Act
(b) Appropriation Act
(c) Public Debt Act
(d) Contingency Fund of India Act

10. The term ‘Ways and Means’ refers to methods of maintaining the Government’s daily cash balance at a level sufficient to meet its day-to-day requirements. All moneys received by or on behalf of Government either as dues of Government or by way of deposits, remittance or otherwise enter into the cash balance. The __________ acts as the Banker to the Central and State Government (except Jammu and Kashmir and Sikkim).
(a) State Bank of India
(b) United Bank of India
(c) Central Bank
(d) Reserve Bank

11. Generally, the current receipts of Governments fall short of the current expenditure during the earlier part of the financial year and sometime exceptionally heavy payments in excess of cash balance have also to be made. In such cases, the Central Government borrows from the Reserve Bank against issue of ____________, whenever necessary, for replenishing its cash balance.
(a) Fully-Vouched Contingent Bill
(b) Scale-Regulated Contingent Bill
(c) Countersigned Contingent Bill
(d) Treasury Bills

12. All the States are divided into a number of ‘districts’ and at the headquarters of each district there is a government treasury called the __________ with one or more sub-treasuries.
(a) State Treasury
(b) Directorate of Treasury
(c) District Treasury
(d) Government Treasury

13. The Treasury Rules of each State Government provide that moneys may be received and payments made on behalf of the State Government, as well as Union Government, including Union Territory Governments and other State Governments. After the departmentalization of accounts of the Union Government, however, only certain limited category of transactions relating to the Union Government are permitted to be routed through the ________ and such transactions are initially taken under ‘Suspense’ pending settlement by cheque / demand draft with the Pay and Accounts Officer of the Ministry / Department concerned, by the Accountant General.
(a) Sub-Treasury
(b) District Treasury
(c) State Treasury
(d) Government Treasury

14. At present, only the Loans / Grants from the Central Government to the States and the repayments of the loans and the interest by the State Governments to the Centre are settled through the medium of the __________ and in other cases, the system is of settlement by cheque /draft.
(a) Controller of Accounts
(b) Director General of Accounts
(c) Comptroller & Auditor General
(d) Central Accounts Section of the Reserve Bank.

15. The initial accounts of receipts and payments on behalf of the State Governments are maintained at the State Treasuries in the respective States who compile and render them monthly to the _____________ concerned.
(a) Controller of Accounts of the Department
(b) Pay and Accounts Office
(c) Accountant General
(d) Director General of Accounts

16. An important duty of Audit in relation to borrowings is to see that the proceeds of loans are properly brought to account and that they are expended only on objects for which the loans were originally raised or to which borrowed moneys may properly be applied in accordance with the sound principles of ____________.
(a) Public Debt
(b) Institutional Finance
(c) Public Finance
(d) Private Finance

17. The currency of India consists of coins issued under the Indian Coinage Act, 1906, as amended from time to time, one rupee notes issued by the Ministry of Finance and bank notes issued by Reserve Bank of India. Under the provisions of the Reserve Bank of India Act, 1934, the sole right to issue bank notes in India has been vested in the Reserve Bank with effect from April, ____________.
(a) 1934
(b) 1935
(c) 1936
(d) 1937

18. Bank notes issued by the Reserve Bank are of denominational value of two rupees, five rupees, ten rupees and one hundred rupees in Ashoka Pillar and ________ designs and are legal tender throughout India.
(a) Rajendra Prasad
(b) Krishnamachari
(c) Mahatma Gandhi
(d) Jawaharlal Nehru

19. At treasuries and sub-treasuries situated at places where there is no branchy or agency of the Bank, Government holds the _____________ responsible for keeping sufficient funds to meet all Government disbursements and for maintaining the balances as low as possible in order that money may not be locked up unnecessarily.
(a) Ministry of Finance
(b) Governor of RBI
(c) Currency Officers
(d) Treasury Officer

20. The transfer of funds between treasuries and sub-treasuries and branches and agencies of the Resen/e Bank is affected for the most part through the medium of currency chests belonging to the __________.
(a) Ministry of Home Affairs
(b) Ministry of Finance
(c) Controller of Accounts
(d) Reserve Bank of India.

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21. Assuming that there are no transactions elsewhere, the deposit of currency and bank notes in a currency chest decreases the amount of such notes in circulation and the deposit of rupees and rupee notes in the chest increases the assets of the ______________.
(a) Department of Currency Management
(b) Department of Education and Protection Department
(c) Issue Department of the Bank
(d) Department of Banking Regulation

22. With the phenominal growth and in the functions of Government involving huge outlays, accounts acquired a new dimension and the necessity for a more meaningful classification of transactions for presentation of Government operation in term s of functions, programmes and activities was actually felt. A team ( ___________) set up by the Government of India went into this question and made recommendations for reforming the structure of budget and accounts.
(a) Bhattacharjee Committee
(b) Ambedkar Committee
(c) Mukherjee Committee
(d) Patel Bhai Committee

23. The recommendations of the team were accepted by the Government of India and the Comptroller and Auditor-General of India, with the approval of the President, prescribed revised classification Government transactions which were given effect to from __________, by the Union, State and Union Territory Governments.
(a) 1972-73
(b) 1973-74
(c) 1974-75
(d) 1975-76

24. The Government Accounts are kept in the main _________ of accounts viz. (a) Consolidated Fund of India or State or Union Territory; (b) Contingency Fund of India or State or Union Territory and (c) Public Account.
(a) Divisions
(b) Parts
(c) Major Head
(d) Minor Head

25. In Part-II, namely, Contingency Fund, of the Accounts are recorded the transactions connected with the Contingency Fund set up by the Government of India or of a State or Union Territory Government under _________ of the Constitution / Section 48 of the Union Territories Act, 1963.
(a) Article 267
(b) Article 268
(c) Article 269
(d) Article 270

26. In Part III, namely, ____________ , of the Accounts, the transactions relating to Debit (other than those included in Part I), ‘Deposits’, ‘Advances’, ‘Remittances’ and ‘Suspense’ are recorded.
(a) Public Debt
(b) Public Account
(c) Consolidated Fund
(d) Contingency Fund

27. The main unit of classification in accounts is ______
(a) Major head
(b) Minor Head
(c) Sub-Head
(d) Sub-Major Head

28. Major Heads of account falling within the Consolidated Fund generally correspond to ___
(a) Functions
(b) Programme
(c) Activity
(d) Object

29. The detailed classification of account heads in Government Accounts and the order in which the Major and Minor Heads shall appear in all account records shall be such as are prescribed by the Central Government from time to time on the advice of the _______.
(a) Assistant Comptroller & Auditor General
(b) Additional Deputy Comptroller & Auditor General
(c) Deputy Comptroller & Auditor General
(d) Comptroller & Auditor General of India

30. With effect from _____________, the President in terms of Clause (1) of Article 239 of the Constitution, has directed the Administrators of the Union Territories of Arunachal Pradesh, Daman and Diu, and Pondicherry, subject to his control, also to discharge the functions of the Central Government under Article 150 of the Constitution in so far as such functions relate to the opening of sub-heads and detailed heads of accounts under the various Major and Minor Heads of Accounts within their respective territories.
(a) 1st January, 1987
(b) 1st March, 1987
(c) 1st April, 1987
(d) 1st June, 1987

31. In the coding pattern, the 1st digit in the Major Heads under ‘Receipt Heads’ (Revenue Account) is either 0 or 1, and the first digit for corresponding Major Heads for the same function in the Sections ‘Expenditure Heads’ (Revenue Account) ‘Expenditure Heads’ (Capital Account), and ‘Loans and Advances’ are derived by adding the number _________ to the first digit in the Major Heads in the ‘Receipt Head’ (Revenue Section).
(a) 0 or 02
(b) 2
(c) 3
(d) 4

32. Taxes collected by Government are classified under ——–
(a) Consolidated Fund
(b) Contingency Fund
(c) Public Account
(d) Public Debt

33. The treasury system under which the District Treasury is the basic unit and the focal point for the primary record of financial transactions of Government in the District with sub-treasuries under it at the Taluks / Tehsils in the District, was evolved more than ______.
(a) 40 years ago
(b) 50 years ago
(c) 80 years ago
(d) a century ago.

34. The __________ of the District is in general charge of the treasury and is personally responsible for its general administration, for the correctness of its returns and the punctuality of their submission, and for the safe custody of the cash and other valuables it contains ; but he takes no part in the daily routine of treasury business.
(a) Block Development Officer concerned
(b) Sub-Deputy Collector concerned
(c) Sub-Divisional Officer concerned
(d) Collector or Deputy Commissioner

35. Both the __________ and Treasurer being present, the locks and seals of the gates of the strong-room are made over intact by the guard and the room is opened, each official using his own key, and sufficient cash and notes to meet the probable demands of the day are taken out, made over to the Treasurer, and entered in his accounts.
(a) District Collector
(b) Deputy Commissioner
(c) Assistant Deputy Commissioner
(d) Treasury Officer.

36. In the case of receipts, the treasury checks the correctness of classification and completeness of the ___________.
(a) Bills
(b) Challans
(c) Vouchers
(d) Sub-Vouchers

37. In the cases where challans are countersigned by the departmental officers and the treasury does not handle cash business of the Government, _________ ensures the correctness of classification and completeness of challans and the depositor makes the remittances direct at the Bank.
(a) the Treasury Officer
(b) the Sub-Treasury Officer
(c) the Assistant Treasury Officer
(d) The departmental officer countersigning the challans

38. Currency Officers (RBI) are responsible for –
(a) Supplying coins to treasuries
(b) Supplying coins and notes to treasuries
(c) Arranging for transfer of funds between treasuries and banks and remittance of money between treasury and Currency Office
(d) Combination of all these functions.

39. The Finance Accounts of the Government are generally prepared in __________ part(s).
(a) 1 (one) part
(b) 2 (two) parts
(c) 3 (three) parts
(d) 4 (four) parts

40. The Constitution provides to constitute a Finance Commission at intervals of –
(a) 5 (five) years
(b) 10 (ten) years
(c) 15 (fifteen) years
(d) 20 (twenty) years

41. In the case of payment, claims are presented in the prescribed form at the treasury by the departmental drawing offices or by the public or pensioners. The bills presented by the public are countersigned by ___________.
(a) Village Chowkidar
(b) Member of Panchayat
(c) Municipal Councillor
(d) Departmental Officer

42. In the case of non-banking treasuries, the treasury also performs the function of __________.
(a) Checking the bills
(b) Checking the vouchers
(c) Checking the sub-vouchers
(d) Making the cash payments

43. The Accountant’s balance includes the balances of the sub-treasuries and also the remittances in transit between the treasuries in the district, which have to be deducted before agreement can be effected with the __________.
(a) Treasury Officer’s balance
(b) Sub-Treasury Officer’s balance
(c) Assistant Treasury Officer’s balance
(d) Treasurer’s balance

44. The Treasury Officer then verifies the cash, etc., in the hands of the Treasurer as shown in his balance and together with the Treasurer, locks it up under double lock in the strong-room which is then left for the night in-charge of the _____________.
(a) Supervisor
(b) Watchman
(c) Chowkidar
(d) Guard

45. The working of the treasury proceeds in this from day-to-day and the monthly process is completed by the cash (coin and notes) present in the district treasury on the last day of the month being verified by the ____________ himself or , if he is absent from headquarters or is otherwise unable to perform the duty, by a responsible assistant, the cash in each sub-treasury being similarly verified by the local officer-in-charge. An actual cash balance report for the whole district is then drawn up with which the account balance is compared.
(a) Accountant
(b) Treasurer
(c) District Treasury Officer
(d) Collector

46. The point has now been reached for the despatch of the monthly returns to the Accountant General. These monthly returns which in the case of treasuries are separate for transactions of the State and for those of the Union, consist of (i) schedules of payment in two parts, the first relating to the payment made from the first to the 10th of the month and the second part to those made during the rest of the month ; (ii) schedule of receipts ; (iii) a list of payments ; and (iv) a cash account. These are written up daily in the treasury from the __________ Cash Book and the registers subsidiary thereto, and the vouchers are day by day numbered, arranged and put away under lock and key.
(a) Treasurer’s
(b) Accountant’s
(c) Sub-Treasury Officer’s
(d) Treasury Officer’s

47. The first batch of payment schedules, supported by necessary vouchers is sent to the Accountant General on the 10th and 11th of the month ; and the remaining schedules supported by necessary vouchers, the List of Payments and the Cash Account, which is accompanied by a certificate of agreement of the account balance with the balance reported in the cash balance report of the treasury for the last day of the month, are sent on the __________.
(a) last day of the month
(b) first day of the succeeding month
(c) 10th day of the succeeding month
(d) 11th day of the succeeding month

48. The Schedules, List of Payments and Cash Account described above, as sent from each treasury monthly to the accountant General, represent the first state of compilation of the __________ accounts.
(a) Divisional
(b) District
(c) Government
(d) Public

49. In matters of accounts and check at the treasury, the Collector with the Treasury Officer under him, is responsible to the Accountant General whose instructions he is bound to carry out. The Accountant General does not, however, ordinarily interfere with the Collector’s responsibility for the ___________ working of the Treasury further than by constant correspondent with him for the removal of irregularities detected in the accounts and returns submitted.
(a) Normal
(b) Practical
(c) Smooth
(d) proper

50. The system of central audit is confined to the offices of the Accountants-General (Audit) located in the different __________.
(a) Towns
(b) Cities
(c) Districts
(d) States