test yourself on consigment

8/6/2019 Test Yourself on Consigment

1/6

Since 1989

SREERAM COACHING POINT[An Exclusive Place for CA Coaching]

-- The Best of All and The Best for All --

Visit us at: www.sreeramcoachingpoint.com

Mail us at [email protected] Phone: 044 2814 2616, 2489 3830, 3296 4602

1

L. Muralidharan, FCA, AICWACall me @ 094440 48990

Mail me at : [email protected]

CONSIGNMENT

1 Consignment would involve:a. Sale of goods between principal and agentb. Partnership business between partiesc. Transfer of goods to agent by principal.d. Accommodation of bill

2. Goods sent on consignment are recorded ata. Cost priceb. Invoice pricec. Selling priced. Catalogue price

3. Loading on goods sent on consignment is the difference between:

a. Selling price and cost priceb. Invoice price and selling pricec. Invoice price and cost priced. Credit price and cash price

4. Majority of non-recurring expenses are normally incurred bya. Consignorb. Customerc. Carrierd. Consignee

5. Consignee is entitled fora. Salaryb. Expensesc. Commission on salesd. Profit

6. Consignee isa. Agent of consignorb. Partner of consignorc. Principal of consignord. Employee of consignor

7. Consignee can claima. For expenses on consignmentb. For commission on sales effectedc. Either a or bd. Both a & b

8. Goods lost in transit shall be accounted only ata. Cost price (including expenses)b. Invoice price (including expenses)c. Selling price (excluding expenses)d. Net realizable value

9. To make consignee sell the goods sent on consignment, consignor shalla. Fix higher rate of commissionb. Fix del credere commissionc. Allow consignee to participate in profitsd. Demand advance money in cash or Bills


2/6

Since 1989





2



10. Loading is required fora. Goods sent on consignmentb. Closing stock lying at consignees placec. Goods returned by consigneed. All of the above

11. Non-recurring expenses incurred by consignor are loaded ona. All units sold by consigneeb. All units sent by consignorc. All units unsold by consigneed. All units sent except damaged/lost

12 Del credere commission is calculated ona. Total sales effected by consigneeb. Credit sales effected by consigneec. Cash sales effected by consigneed. Total sales Sales returns effected by cnee

13 Over riding commission is the commission ona. Additional commission on cash salesb. Additional commission on credit salesc. Extra revenue over normal salesd. None of the above

14 NRV of the unsold stock is arrived at bya. Multiplying the selling price and the unsold stockb. Calculating the future commission payablec. a-bd. a+b

15. Consignment account is

a.

Nominal accountb. Real accountc. Personal accountd. Memorandum account

16. Goods sent on consignment account is aa. Personal accountb. Real accountc. Nominal accountd. Impersonal account

17 Consignees personal account is prepared to find outa. Profit or loss on consignment accountb. Sums due to or due from consigneec. Commission payable to consigneed. Appropriation of profit with consignee

18. Insurance claim against abnormal loss account shall be transferred toa. Consignment accountb. Profit and loss accountc. Goods sent on consignment accountd. Consignees personal account


3/6

Since 1989





3



19. Consignee records all excepta. Recurring expenses incurred by consigneeb. Non recurring expenses incurred by consigneec. Commission eligible for salesd. Unsold stock held by consignee

20. The document sent detailing the sales effected, unsold stock, expenses incurred by consignee isa. Pro-forma invoiceb. Current accountc. Account salesd. Sales account

21. Bad debts incurred by consignee, so he will not transfer the burden to consignor when he ispaid

a. Commissionb. Over riding commissionc. Del credere commissiond. Commission on profit

22. The balancing figure in goods sent on consignment account of a trader consignor is to betransferred to

a. Purchases or trading accountb. Manufacturing accountc. Profit and loss accountd. Retained as closing stock

23. The following are part of non-recurring expenses:a. Freightb. Insurancec. Cartaged.

All the above24. Goods loss in transit cannot be recovered from the insurance company as consignee had taken

del credere commission: Is it correct?a. Incorrectb. Correctc. Sometimes correctd. None of the above

25. When goods are sent on consignment, consignment account shall be debited and credit shall beoffered to

a. Consignees accountb. Purchases accountc. Goods sent on consignment accountd. Capital account of consignor

26. While recording the transaction in the form of journal entry, there is no difference between cashsales and credit sales in the books of consignor.

a. Trueb. Falsec. Not relevantd. Partly true


4/6

Since 1989





4



27. Removal of loading on opening stock shall be debited to consignment account.a. Trueb. Falsec. Not relevantd. Partly true

28. Removal of loading on closing stock shall be debited to consignment account.a. Trueb. Falsec. Not relevantd. Partly true

29. Freight expenses incurred by the consignee for returning goods to consignor shall be added asnon-recurring expenses for valuing closing stock.

a. Correctb. Incorrectc. Partially correctd. None of the above

30. In case consignee participates in the profit, expenses incurred in the return of unsuitable goodsto consignor shall not be considered in the computation of profit entitlement

a. It is correct for consignmentb. It is correct for consigneec. It is incorrect for consignord. It is incorrect in accounting

31. In case consignee participates in the profit, expenses incurred in the return of unsuitable goodsto consignor shall not be considered in the computation of profit on consignment

a. It is correct for consignmentb. It is correct for consigneec.

It is incorrect for consignord. It is incorrect in accounting

32 Irrecoverable debts in consignees books shall bea. Debited to bad debts accountb. Debited to Profit & Loss accountc. Debited to consignors accountd. Debited to Provision for bad and doubtful debts account

33 Irrecoverable debts in consignees books shall bea. Debited to consignors accountb. Debited to del credere commission accountc. Debited to bad debts accountd. Either a or b

34 Treatment for normal loss in the valuation of closing stock isa. Ignore itb. Insure itc. Include itd. Inflate it

35 Abnormal loss isa. Excessive lossb. Accidental lossc. Damage resulting into obsoleted. All of the above


5/6

Since 1989





5



36 When the details of expenses met out by consignee is not provided, for valuation of stockpurposes

a. Consider all expenses of consigneeb. Ignore all expenses of consignorc. Consider all expenses of consignord. Ignore all expenses of both

37 Provide for commission for unsold stock in the books of consignor on the lines of principle ofconservatism

a. Recommended practiceb. Ignore it as the sale had not taken placec. Consider it as consignee will sell in the futured. Consider even the sale also in any case goods will be sold in the future

38 Goods are sent at invoice price becausea. Consignor wanted to preserve the secret of margin from consignee.b. As a matter of statutory requirement to accompany a document along with theconsignment at probable selling price.c. Indicate the likely commission payable to consigneed. To value the closing stock at invoice price.

39 Goods lost at consignees place shall be claimed only bya. Consignorb. Consigneec. Insurance companyd. Godown owner

40 Consignment business hasa. Going concern conceptb. Conservatism principlec.

Dual aspect conceptd. All the above

41 The following statement is not falsea. Consignment and sale are sameb. Consignor and consignee are partnersc. Unsold stock is valued lower of cost or NRVd. Consignment is like sale or return

42 The following statement is not truea. Stock is valued at lower of cost or NRVb. Stock is to valued at purchase cost plus recurring expenses of consigneec. Del credere commission is calculated on total salesd. Consignment account is nominal account

43 Non-recurring expenses/non-selling expenses incurred by consignee is taken in thecomputation of Abnormal loss reported at consignees godown

a. Falseb. Truec. Partly trued. Neither true nor false


6/6

Since 1989





6



44 Non-recurring expenses/non-selling expenses incurred by consignee is taken in thecomputation of Abnormal loss reported on transit

a. Falseb. Truec. Partly trued. Neither true nor false

45 Abnormal loss is treated like closing stock; thereforea. It should be valued only at costb. It should be valued at NRVc. Lower of a and bd. None of the above

1000 boxes costing Rs.250 each sent on consignment. Rs.10000 spent on freight. 20 boxes weredamaged beyond repair. Insurance company paid Rs.4000. Consignee took delivery of 1000

boxes and spent for carriage and freight on taking delivery Rs.19600. Sold 900 units byconsignee for Rs.412 each. Commission is 10%

46 What is the cost of damaged boxes?a. 5000b. 5239c. 5200d. 8240

47 What is the loss to be transferred to profit and loss account?a. 8240b. 4240c. 5200d. 1200

48

How many units were taken delivery by consignee?a. 920b. 980c. 900d. None of the above

49 Consignees expenses of freight shall be applied ona. 1000 unitsb. 900 unitsc. 980 unitsd. 960

50 What is the value of closing stock?a. 20000b. 22400c. 22960d. 22368

A L L T H E B E ST

test yourself on consigment

Documents