Practice Test

1) On 31st dec.,2005 goods sold at a Sale price of Rs.30,000 were lying with the customers ,M to whom these goods were sold on 'Sale or Return basis ' and recorded as actual Sales.Since no consent was received from M,the adjustment entry was made presuming goods were sent on approval at a profit of cost + 20%.in the balance sheet,the stock with customers account will be shown at rs.

2) A sent some goods costing Rs.3,500 at a profit of 25% on Sale to B on Sale or Return basis .B Returned goods costing RS.800.At the end of the accounting period i.e.on 31st december,2005 the remaining goods were neither Returned nor were approved by him the stock on approval will be shown in the balance sheet at Rs.

3) Under Sales or Return or approval basis, the ownership of goods is passed only

4) A merchant sends out his goods casually to his dealers on approval basis .All such transactions are, however recorded as actual Sales and passed through the Sales book On 31-12-2005,it was found that 100 articles at a Sale price of 200 each sent on approval basis were recorded as actual Sales at that price .The Sale price was made at cost + 25 % . The amount of stock on approval will be amounting. to Rs.

5) A company sends its cars to dealers on 'Sale or Return' basis .All such transactions are, however recorded as actual Sales and passed through the Sales book. Just before the end of financial year , two cars which had cost RS.55,000 each have been sent on Sale or Return basis and have been debited to customers account at Rs.75,000 each, cost of goods lying with the customers will be

6) A trader has credited certain items of Sale on approval aggregating Rs.60,000 to Sales account .Of these ,goods of the value of Rs.16,000 have been Returned and taken into stock at cost Rs.8,000 though the records of Return was omitted in the accounts .In respect of another parcel of Rs.12,000 (cost being Rs.6,000) the period of the approval did not expire on closing date . Cost of goods lying with the customers should be

7) Under Sales or Return or approval basis, when transactions are few ,the seller, while sending the goods ,treats them as

8) Under Sales or Return or approval basis, when transactions are few &,the seller, at the end of the accounting year reverse the Sale entry , then what will be the accounting treatment for the goods Returned by the customers on a subsequent date

9) which of the following is not a main column of Sales or Return journal ?

10) Sales or Return day book and Sale or Return ledger are known as

11) In Sale or Return ledger

12) When the goods are returns by the customers within the specified time ,they are recorded

13) Under Sales or Return or approval basis, when transactions are few , & the seller, sends the goods on approval or return basis,the accounting treatment will be

14) Under Sales or Return or approval basis, when transactions are moderate , & the seller, sends the goods on approval or return basis,the accounting treatment will be

15) Under Sales or Return or approval basis, when transactions are large , & the seller, sends the goods on approval or return basis,the accounting treatment will be

16) Under Sales or Return or approval basis, when transactions are few , & the customer accepts the goods , the accounting treatment will be

17) when Sales or return journal is maintained ,a journal entry is passed for ?

18) when Sales or return day book & sales or return ledgers are maintained & the goods are sent to the customers on sale or return basis ,these are recorded

19) when Sales or return day book & sales or return ledgers are maintained & the goods are approved by the customers ,these are recorded

20) What is the objective behind selling goods on approval basic :

21) In case of sale of goods on approval basic, the sale will take place under which of the following case (s) ?

22) When the goods are sent on sale of the return basic, the sale of the accounted for

23) Under sales on return or approval basic (when transaction are few) the seller, sends goods by treating these as

24) In case business sends goods casually, If customers returns the goods on a subsequent date, which entry has to be passed :

25) At what price goods pending approval or return, as on the last day accounting year are valued

26) What account is created for goods lying with the customer as on the last day of the accounting year?

27) Which of these statement is true ?

28) A company sends its cars to dealers on 'sale or return' basis. All such transaction are, however treated like actual. sales and are passed through the sales day book. Just before and end pf the financial year, two cars which had cost Rs.50,000 each have been sent on 'sale or return' and have been debited to customers at Rs.80,000 each, cost of goods lying with the customers will be

29) A merchant sends out his goods casually to his dealers on approval basis. All such transaction are, however, recorded as actual sales and are passed through the sales book. On 31.12.2008, it was found that 200 article at a sale price of 200 each sent on approval basic were recorded as actual sales at that price. The sale price was made at cost plus 25% . The amount of stock on approval will be

30) On 31st December, 2008 goods sold at a sale price of Rs.15,000 were lying with a customer, to whom these goods were sold on 'sale or return basis' and received from him the adjustment entry was made presuming goods were sent on approval at a profit of cost plus 20%. In the balance sheet the stock with customers account will be shown at Rs.

31) Goods of Rs.600 (sales price) sent on sale in approval basis were includes in the sale of book.The profit included in the sales was 20% on cost. Stock with the party will increase closing stock by --

32) A trader has credited certain items of sales on approval aggregating Rs.50,000 to sales Account. of these, goods of the value of Rs.20,000 have been returned and takes into stock at cost Rs.10,000 though the record of return was omitted in the accounts. In respect of another parcel of Rs.12,000 (cost being Rs.6,000) the period of approval did not expire on the closing date. Cost of goods lying with customers should be

33) A sent Some goods costing Rs.3600 at a profit of 25% on sales to B on sale or return basis. B returned goods costing Rs.900. At the end of the accounting period i.e. on 31st December,2008, the remaining goods were neither returned nor were approved by him. The stock on approval will be shown in the balance sheet at Rs.

34) Mr.Z sent goods worth Rs.50,000 on 1st march on reject or approval basis. Goods worth Rs.25,000 were still pending with the customer on 31st March and the remaining goods were accepted by the customer.How Would you deal with the goods lying with the customers as 31st March . Assuming that the goods were invoiced at 25% above the cost price

35) Mr. P sent goods worth Rs.50,000 on 11th March on reject or approval basis. Out of which goods worth Rs.30,000 were accepted by the customers till 31st March and the remaining were still pending with the customers as on 31st March. How would you deal with the goods lying with the customer as on 31st March. Assumption 25% profit on cost --

36) A trader has credited certain items of sales on approval aggregating Rs.60,000 to Sales Account. Of these, goods of the value of Rs.16,000 have been returned and takes into stock at cost Rs.8,000 though respect of another parcel of Rs.12,000 (cost being Rs.6,000) The period of approval did not expire on the closing date. Cost of goods lying with customers should be

37) ABC Ltd. sells goods to its approval customers on sale or return basis at a profit of 20% on sales, treating as actual sales. On 26th March, 2006 goods costing Rs. 10,000 were sent to Annu Ltd. No confirmation has been received from Annu Ltd. till 31st March, 2006. The stock with customers to be shown as closing stock in the balance sheet of ABC Ltd. as on

38) Varun Ltd. sends goods to his customers on sales or Return recording it was a sale at the time of sending it for approval. During 2006, Varun Ltd. send goods to cost plus 33.33%. On September 2006. a letter of approval was received from a customer for Rs.40,000. In this respect, entry will be

39) There was no communication from the customer

40) The customer returned 20% of the goods on 31st March 2006

41) The customer approved 80% of the goods on 31st March,2006

42) The customer returned 20% of the goods an approved the balance on 31st March, 2006

43) The customer returned 20% of the goods approval 80% of the remaining goods on 31st march, 2006

44) When a large number of articles of are sent on a sale or return basis, it is necessary to maintain

45) Sale or Return Day Book and Sale or return Ledger is known as -

46) Which types of account is sale or return day book

47) When the goods are returned by the customers within the specified time, they are recorded

48) Under sales on return or approval basis, when transactions are numerous the seller while sending the goods treats then as :

49) Which of these statements is not true?

50) The total shown under Goods sent out column of the memorandum sale or return book is -

51) The total shown under goods sold column of the Memorandum sale or return book is

52) The total shown under goods returned column of the memorandum sale or return book

53) The total shown under Balance goods column of the memorandum Sale or return book is

54) Total of the Goods sent on approval day book on 31 March is

55) The balance of Goods on approval A/c in the Approval ledger

56) The balance in Z's A/c in the Approval Ledger will

57) The balance of Sales A/c in general ledger will be -

58) Under sales on return or approval basis, the ownership of goods is passed only