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Bihar Board 12th Entrepreneurship Model Papers

Bihar Board 12th Entrepreneurship Model Question Paper 4 in English Medium

Time: 3 Hours 15 Min
Marks: 70

Instructions for the candidates:

1. Candidates are required to give their answers in their own words as far as practicable.
2. Figures in the right-hand margin indicate full marks.
3. 15 minutes of extra time has been allotted for the candidate to read the questions carefully.
4. This question paper has two sections: Section – A and Section – B.
5. In Section – A, there are 35 objective type questions which are compulsory, each carrying 1 mark. Darken the circle with black/blue ball pen against the correct option on OMR Sheet provided to you. Do not use Whitener/ Liquid/Nail on OMR Sheet, otherwise, the result will be treated as invalid.
6. In Section – B, there are Non-objective type questions. There are 18 Short answer type questions, out of which any 10 questions are to be answered. Each question carries 2 marks. Apart from this, there are 6 Long answer type questions, out of which any 3 of them are to be answered. Each question carries 5 marks.
7. Use of any electronic device is prohibited.

Objective Type Questions

Question No. 1 to 35 has four options provided out of which only one is correct. You have to mark, your selected option, on the OMR-Sheet. Each question carries 1 (one) mark. (35 × 1 = 35)

Question 1.
Project Appraisal is a /an
(a) Export Analysis
(b) Expert Analysis
(c) Profitable Analysis
(d) None of these.
Answer:
(c) Profitable Analysis

Question 2.
Management is an art of
(a) doing work oneself
(b) taking work from others
(c) both for doing work oneself and taking work from others
(d) none of these.
Answer:
(b) taking work from others

Question 3.
Risk Capital foundation was established in
(a) 1970
(b) 1975
(c) 1986
(d) 1988
Answer:
(b) 1975

Question 4.
Out of the following which is the method of quality control?
(a) Inspection method
(b) Statistical Quality Control Method
(c) Both (a) and (b)
(d) Neither (a) nor (b).
Answer:
(c) Both (a) and (b)

Question 5.
Project identification deals with
(a) viable product idea
(b) logical opportunity
(c) effective demand
(d) none of these.
Answer:
(b) logical opportunity

Question 6.
Duty of Entrepreneur is
(a) profit charging
(b) tax evasion
(c) environmental pollution
(d) none of these
Answer:
(a) profit charging

Question 7.
The best example of variable cost is
(a) Interest on capital
(b) Material cost
(c) Wealth tax
(d) Rent
Answer:
(b) Material cost

Question 8.
Responsibility of the entrepreneur is
(a) towards Society
(b) towards Government
(c) towards Environment
(d) all of these.
Answer:
(d) all of these.

Question 9.
Telephone expense is
(a) fixed
(b) variable
(c) semi-variable
(d) none of these.
Answer:
(c) semi-variable

Question 10.
IDBI was established in the year.
(a) 1944
(b) 1954
(c) 1964
(d) 1974
Answer:
(c) 1964

Question 11.
Element affecting growth rate is
(a) Competition
(b) Change in technology
(c) Creativity
(d) All of these.
Answer:
(a) Competition

Question 12.
Integration means
(a) expanding internally
(b) expanding externally
(c) expanding internally and externally
(d) none of these
Answer:
(c) expanding internally and externally

Question 13.
Naked debentures are
(a) fully secured
(b) partly secured
(c) unsecured
(d) none of these.
Answer:
(c) unsecured

Question 14.
The maximum wide scope is of
(a) brand
(b) labelling
(c) packaging
(d) trademark.
Answer:
(a) brand

Question 15.
Management is
(a) Art
(b) Science
(c) Both Art and Science
(d) None of these.
Answer:
(c) Both Art and Science

Question 16.
Labelling is
(a) compulsory
(b) necessary
(c) voluntary
(d) wastage of money.
Answer:
(b) necessary

Question 17.
Dividend is
(a) Net profit
(b) Approximation of profit
(c) Reserve fund
(d) Part of undistributed profit.
Answer:
(d) Part of undistributed profit.

Question 18.
Public deposit is the source of
(a) short-term finance
(b) long-term finance
(c) middle-term finance
(d) social investment.
Answer:
(a) short-term finance

Question 19.
IFCI was established in the year
(a) 1939
(b) 1948
(c) 1950
(d) 1956
Answer:
(d) 1956

Question 20.
Closing stock is
(a) source of fund
(b) application of fund
(c) no flow of fund
(d) none of these
Answer:
(a) source of fund

Question 21.
Ideal Current Ratio is
(a) 2 : 1
(b) 1 : 2
(c) 3 : 2
(d) 4 : 4
Answer:
(a) 2 : 1

Question 22.
Long-term loan bears
(a) a fixed rate of interest
(b) flexible rate of interest
(c) zero rates of interest
(d) none of these
Answer:
(a) a fixed rate of interest

Question 23.
Current ratio is
(a) Balance Sheet ratio
(b) Profit & Loss ratio
(c) Mixed ratio
(d) none of these
Answer:
(a) Balance Sheet ratio

Question 24.
Venture capital through firstly originated in
(a) India
(b) England
(c) America
(d) Japan.
Answer:
(d) Japan.

Question 25.
For business, marketing is
(a) compulsory
(b) necessary
(c) unnecessary
(d) luxury.
Answer:
(a) compulsory

Question 26.
Marketing expense is chargeable on
(a) industry
(b) businessmen
(c) consumers
(d) all of these.
Answer:
(c) consumers

Question 27.
Factor affecting the product design is in
(a) two parts
(b) four parts
(c) three parts
(d) none of these.
Answer:
(a) two parts

Question 28.
What does the break-even point show?
(a) Profit
(b) Loss
(c) Neither profit nor loss
(d) None of these.
Answer:
(c) Neither profit nor loss

Question 29.
A project is
(a) Cluster of activities
(b) Single activity
(c) Group of innumerable activities
(d) None of these
Answer:
(a) Cluster of activities

Question 30.
Aspects(s) of project evaluation is /are:
(a) Technical evaluation
(b) Financial evaluation
(c) Managerial evaluation
(d) All of these
Answer:
(d) All of these

Question 31.
Planning is:
(a) Goal-oriented
(b) Objective oriented
(c) Mental process
(d) All of these
Answer:
(c) Mental process

Question 32.
Subsidy is:
(a) Discount
(b) Concession
(c) Repayment
(d) none of these
Answer:
(b) Concession

Question 33.
Incentives are not concerned with
(a) Rebate
(b) Exemption from tax
(c) Provision of seed capital
(d) Lump-sum payment
Answer:
(d) Lump-sum payment

Question 34.
Printing expenses are:
(a) Fixed
(b) Variable
(c) Semi-variable
(d) None of these
Answer:
(c) Semi-variable

Question 35.
The best example of variable cost is:
(a) Interest on capital
(b) Material cost
(c) Wealth tax
(d) Rent
Answer:
(b) Material cost

Non-Objective Type Questions

Short Answer Type Questions

Question No. 1 to 18 are short answer type. Answer any 10 questions. Each question carries 2 males. (10 × 2 = 20)

Question 1.
What are the sources of short-term finance?
Answer:
Sources of short term finance:

• Bank sources
• Secured loans
• On the basis of inventory
• Bridge finance
• On the basis of receivables
• Bank overdraft
• Unsecured loan
• Revolving credit control
• Cash Credit.

Question 2.
What is the promotion of business?
Answer:
Promotion of a business is referred to that work which is done with the help of such factors i.e. labour, raw materials, money and machines.

Question 3.
Define cost.
Answer:
According to I.C.M.A. London, “Cost is the amount of expenditure (actual or notional) incurred or attributable to a specified thing or activity.”

Question 4.
Write in brief about quality control of export products.
Answer:
Maintaining quality control necessary for all industrial units. However, this is greatly necessary for manufacturing in the small scale sector because these manufacturers employ human resources to a greater extent in the manufacturing process. But because of various limitations quality control is maintained to a very limited extent. These factors are related to a lack of finance technical competency and absence of proper management.

Question 5.
What is the importance of the environment?
Answer:
Following are the importance of the environment:

• In searching of opportunities
• In maintaining the existence
• In getting success.

Question 6.
What is the role of planning in effective control?
Answer:
Importance of planning for a large business enterprise:

• Planning makes objectives clear and specific: The planning exercise makes the goals clear and specific because it begins with the determination of objectives.
• Planning provides directions: Due to planning employees and managers know how their activities relate to organisational goals.
• Planning reduces the risk of uncertainty: Planning helps to reduce the risks associated with uncertainties. In the process of planning attempts is made to look into the future and predict it.
• Planning facilitates decision-making by the manager: Planned targets are indicators on the basis of which alternative courses of action are considered.

Question 7.
What is the after-sale service?
Answer:
After sale-service means that service which is provided continuously for looking after the product after the sale.

Question 8.
Why is time boundness essential in a project?
Answer:
Project is a written account of various activities undertaken by a firm or entrepreneurs and their technical, commercial and social feasibilities. Project is made after analysis of essential document therefore there is a time limit for making project because of the project is made for particulars time and subject.

Question 9.
What do you mean by the cycle of working capital?
Answer:
Availability of enough working capital is indicative of liquidity of business and capacity to make prompts payments. Working capital is needed for making payment of day to day expenditure for meeting current liabilities and for availing benefit of cash discounts.

Question 10.
Mention any three factors affecting the growth.
Answer:
Following are the factors affecting the growth:

• Competition
• Change in technology
• Consumer trends
• Creativity
• Innovations.

Question 11.
Define Entrepreneurship and state its two features.
Answer:
As per thinkers of this viewpoint, entrepreneurship is the promotion of business and industry, organisation and capacity to undertake risks.
Definition: According to Horton Evans, “The entrepreneur is a person or group of persons who has the task of determining the kind of business to be operated.” According to forest frontz, “The entrepreneur is more than a manager. He is an innovator arid promotor as well.
Following are the features of entrepreneurship:

• Taking risks
• Profit oriented
• Group of persons
• Promoting business.

Question 12.
What is market feasibility?
Answer:
Market feasibility means selection of good market for enterprises.

Question 13.
How do entrepreneurs differ from employees?
Answer:
Entrepreneurs differ from employees are explaining by the following points:
Entrepreneur:

• An entrepreneur is a person who takes the risk to set-up an enterprise.
• The entrepreneur always face risk of profit or loss.
• An entrepreneur takes decision.

Employee:

• An employee is that person who is appointed by an entrepreneur for his help.
• The employee never face the risk of profit or loss.
• An employee does not make a decision.

Question 14.
What is the plant layout?
Answer:
Plant layout refers to that work which is done for setting up the plant and placement of the plant and machinery.

Question 15.
What is the role of planning in effective control?
Answer:
To facilitate control: By means of judicious planning, every manager executive tries to enforce his control to the best of his capacity over his subordinates in terms of their performance. In order to make the planning effective and meaningful, the performance of the subordinates can be adequately measured. Not only this even budget is an organ of planning and also a tool of control. Moreover,it also strengthens the administrative control. In America, once a high -profit administrator during the course of his conversation with one of his friends remarked that since 5 o’clock till the time of leaving the office .whatever had happened is no matter of anxiety because he could not help change it and he would think about what was likely to happen the following day and the following year because doing something on that account on that account lay in his power.

Question 16.
Why it is understood that entrepreneurship is active creativity.
Answer:
Entrepreneurship is creative in the sense that it involves the creation of value. By combining the various factors of production, entrepreneurs produce goods and services that meet the needs and wants of society. Every entrepreneurial act results in income and wealth generation. Even when innovations destroy the existing industries.

Entrepreneurship is creative also in the sense that it involves innovation—the introduction of new products, the discovery of new market and sources of supply of inputs, technological break thoughts as well as the introduction of newer organisational forms for doing things better, cheaper, faster and in the present context, in a manner that causes the least harm to the environment. It is possible that entrepreneurs in developing countries may not be pioneering innovative in introducing path-breaking, radical innovations.

Question 17.
Give three differences between shares and debentures.
Answer:
Difference between shares and debentures:
Share:

• A share is a symbol of ownership. It represents a portion of the capital.
• It is ownership security.
• A shareholder enjoys the voting right.
• The dividend is paid on shares. It is an appropriation of profit
• A share is unsecured.
• Shares can not be converted.

Debenture:

• A debenture is the symbol of loan. It represents the debt of a company.
• It is editorship security.
• A debenture holder does not have voting right.
• Interest is paid on debentures.lt is a charge against profit.
• A debenture is secured on the fixed or floating charges.
• Debentures can be converted into shares.

Question 18.
What is project identification?
Answer:
Before selling up of any enterprises, to searching for profitable opportunities and effective formation of the project by the entrepreneur is called project identification.

Question 19.
Is management in Art or Science?
Answer:
Management is both art and science. Management in the form of science, provides necessary guidance to managers because of its practical utility and application (in the form of principles) and management in the context of art helps the management to face very situation (by adopting the best possible way to do any work). Hence, it is logical to call management science as well as art.

Management is both an art and science, as well and are so well-knitted, that are inseparable. As an art, the management refers to behavioural sense, efficiency, skill, constructive thoughts ideas and development through practice etc.and in form of science, it refers to cause and effect, experimentation of rules, ability and a sense of forecast, etc. Thus, management is a dichotomy of art and science.

Question 20.
State one objective of project planning.
Answer:
The objective of the project report: To the evolution of investment opportunities.

Question 21.
What is Marketing Mix?
Answer:
Marketing mix implies a combination of all marketing elements or ingredients so that the objectives of the enterprise may be realised. The various elements of the mix are product, price, place and promotion.
According to Borden.” marketing mix, is the appointment of effort the combination the designing and the integration of the elements of marketing into a programme or mix which on the basis of the marketing forces, will best achieve the objectives of an enterprise at a given time.”

Question 22.
What is Gestation period?
Answer:
Gestation period means such period before starting of any enterprises. In other words, Planning period before setting up new enterprises.

Question 23.
What are the opportunity cost and joint cost?
Answer:
Austrian economists modified the concept of real cost and presented the concept of opportunity cost. Resources are limited to unlimited needs and hence, the production of one good means the sacrifice of the other. According to Benham, “The opportunity cost of anything is the next best alternative that could be produced instead by the same factors or by an equivalent group of factor costing the same amount of money. “Opportunity cost of a factor refers to its value available in its next best alternative use. The total expenses made by a firm for producing a particular quantity of the commodity is known as the total cost. In short-run, total cost includes both fixed as well as variable cost while in the long run, total cost includes the variable cost.

Question 24.
Give the formula of B.E.P.
Answer:
BEP = \(\frac{F \times S}{S-V}\)
Where, F = fixed cost
S = Projected sales
V = Variable cost

Long Answer Type Questions

Question No. 19 to 24 are Long answer type. Answer any 3 questions. Each question carries 5 marks. (3 × 5 = 15)

Question 19.
Why is the market assessment necessary for entrepreneurship?
Answer:
Market Assessment: The demand for products or services and the supply, apart from such factors, depends on various other factors,e.g., quality of the product, source of supply and tools of distribution. While assessing a market an entrepreneur must take care of the following things:
(i) Demand: The estimate of the demand must be determined after the product identification. While forming an estimate of the demand, the size of the market or the area should be taken care of in which the product is to be sold.

(ii) Supply and competition: The aspect of supply of the merchandise is of paramount importance at the time of market assessment. Supply refers to the replenishment of the goods from all resources. Even the imminent supply of goods and its resources should also be taken care of. The consideration of demand and supply should always be kept in mind. Generally, there is always a competition in terms of supply of almost all the products.

(iii) Cost and Price of the product: As already indicated that in determining the identity of a product, its cost is a major factor. On the basis of the cost of a product, the price is determined and this factor must be viewed in the wake of the prices of other competitive products.

(iv) Project Innovation and change: To facilitate the process of market analysis it becomes essential to look for innovative changes and to study the scope which is the job of an entrepreneur. It is also imperative to understand the technical advantages of such innovative change and its impact on the product reliability cost and its price.

Question 20.
What is the importance of quality control?
Answer:
Quality control refers to the finer characteristics of a product for the acquisition of which the control over the human resources and manufacturing conditions and factors, is acquired which can influence the finer qualities of the product.

All the ingredients required for the manufacturing of a product are, directly or indirectly, procured from nature itself and affect their characteristics due to some natural reasons, on the other hand, the manufacturing conditions like temperature, moisture, dust, impurity in air, movement or disturbance in the types of equipment, and wear out machines, etc, can bring about some changes in the manufacturing processes such, the right composition and ensure an authentically quality product, complete control over such conditions must be taken care of by which the quality may not get affected. According to G.J. Deshmund, “Quality control is a scientific technique the objective of which is to enhance the industrial or manufacturing efficiency which must satisfy the projected standards.”

Question 21.
Why is it essential to study the environment for an entrepreneur?
Answer:
The process of environmental scanning and analysis is very important to an entrepreneur. The evaluation of the existing changing circumstances the forecasting and the consequent impacts need to be assessed by an entrepreneur prior to determining his policies and planning and their successful implementation.

It is essential to evaluate and analyse the consequences of the changing business environment prior to giving a tangible shape to the planning and policies. The technical innovation, new social values problems of the community product market conditions etc. must be subjected to study which is instrumental in converting strategies and planning into reality. The competitive environment and its consideration is also an integral part of environmental scanning. To plan or conceive the counter strategies in view of the competitive threats, the environmental study and analysis is the prerequisite in this regard by a close study and a survey of the competitive threats, the environmental.

Question 22.
What are the main reason for management importances?
Answer:
Following are the reasons that are why management is important.

• Maximum results with minimum resources: Management tries to secure the maximum results through the use of minimum efforts and resources.
• The realisation of personal objectives: Some industrial concerns are doomed on account of strikes and lockouts. Such situations mainly arise when there is his management on the part of managers. Proper management visualises the situation and takes timely action in order to avoid any untoward happening.
• Economic growth: Management is a vital force for boosting the economic growth of a country. Until recent; it was thought that economic growth is mainly due to technology education and capital.
• Protection of investors interests: Most of the organisations are run by employees managers. They look after the interest of investors viz. Shareholders, debenture holders etc.

Question 23.
What are the two objectives of financial planning?
Answer:
Financial planning is the essential preparation of a financial blueprint of an organisation’s future operations. The objective of financial planning is to ensure that enough funds are available at the right time. It enables the management to foresee the fund requirements both the quantum as well as the timing. Likely shortage and surpluses are forecast so that necessary activities are taken in advance to meet those situations. Thus, financial planning strives to achieve the following objectives:

• To ensure availability of funds whenever these are required: This includes a proper estimation of the funds required for different purposes such as for the purchase of long-term assets or to meet day-to-day expenses of business etc.
• To see that the firm does not raise resources unnecessarily: funding is almost as bad as inadequate funding. Even if there is some surplus money, good financial planning would put it to the best possible use so that the financial resources are not left idle and don’t unnecessarily add to the cost.

Question 24.
Explain the various steps including in controlling process.
Answer:
Controlling is a systematic process involving the following steps:

• Step-I: Setting performance standards: The first step in the controlling process is setting up of performance standards. Standards are the criteria against which actual performance would be measured. Standards can be set in both quantitative as well as qualitative terms.
• Step-II: Measurement of actual performance: Once performance standards are set the next step is the measurement of actual performance. There are several techniques for the measurement of performance. These include personal observation, sample checking, performance reports, etc.
• Step-III: Comparing actual Performance with standards: This step involves a comparison of actual performance with the.standard. Such a comparison will reveal the deviation between actual and desired results. Comparison becomes easier when standards are set in quantitative terms.
• Step-IV: Analysing Deviations: Some deviation in performance can be expected in all activities. It is, therefore, important to determine the acceptable range of deviations. Critical point control and management by exception should be used by a manager in this regard.
• Step-V: Taking corrective action: The final step in the controlling process is taking corrective action. No correction action is required when the deviations are within acceptable limits.

Bihar Board 12th Accountancy Model Papers

Bihar Board 12th Accountancy Model Question Paper 4 in English Medium

Time : 3 Hours 15 Min
Full Marks: 100

Instructions for the candidates

1. Candidates are required to give their answers in their own words as far as practicable.
2. Figures in the right-hand margin indicate full marks.
3. While answering the questions, the candidate should adhere to the word limit as for as practicable.
4. 15 minutes of extra time has been allotted for the candidate to read the questions carefully.
5. This question paper has two sections: Section – A and Section – B.
6. In Section – A, there are 50 objective type questions which are compulsory, each carrying 1 mark. Darken the circle with black/blue ball pen against the correct option on OMR Sheet provided to you. Do not use Whitener/Liquid/Blade/Nail on OMR Sheet, otherwise, the result will be treated as invalid.
7. In Section – B there are Non-objective type questions. There are 25 Short answer type questions, out of which any 15 questions are to be answered. Each question carries 2 marks. Apart from this, there are 8 Long answer type questions, out of which any 4 of them are to answer. Each question carries 5 marks.
8. Use of any electronic device is prohibited.

Objective Type Questions

Question No. 1 to 50 have four options, out of which only one is correct, you have to mark the correct option on the OMR Sheet. (50 × 1 = 50)

Question 1.
Life membership fees received by a club is shown in
(a) Income & Expenditure A/c
(b) Balance Sheet
(c) Profit & Loss A/c
(d) None of these
Answer:
(b) Balance Sheet

Question 2.
Receipts and- Payments Account is a
(a) Personal A/c
(b) Real A/c
(c) Nominal A/c
(d) None of these
Answer:
(b) Real A/c

Question 3.
Payment of honorarium to the secretary is treated as
(a) Capital Expenditure
(b) Revenue Expenditure
(c) Cash Expenses
(d) None of these
Answer:
(b) Revenue Expenditure

Question 4.
Outstanding subscription is a/an
(a) Income
(b) Asset
(c) Liability
(d) None of these
Answer:
(b) Asset

Question 5.
Which of the following is not an income?
(a) subscription
(b) Donation
(c) Sale of ticket
(d) Endowment fund
Answer:
(b) Donation

Question 6.
Receipts and Payments Account usually indicates.
(a) Surplus
(b) Capital fund
(c) Debit balance
(d) Credit balance
Answer:
(b) Capital fund

Question 7.
Income and Expenditure Account generally indicates
(a) Surplus/deficit
(b) Cash Balance
(c) Capital Fund
(d) Net Profit/Loss
Answer:
(a) Surplus/deficit

Question 8.
In the absence of partnership deed, the partner will be allowed interest on the amount advanced to the firm
(a) @5%
(b) @6%
(c) @7%
(d) @8%
Answer:
(b) @6%

Question 9.
Which one is not the feature of partnership?
(a) Agreement
(b) Profit-sharing
(c) Limited Liability
(d) Two or more persons.
Answer:
(d) Two or more persons.

Question 10.
In the absence of partnership deed, interest on capital will be given to the partners at
(a) 8% p.a.
(b) 6% p.a.
(c) 9% p.a.
(d) None of these
Answer:
(d) None of these

Question 11.
The Current Account of the partners will be
(a) Debit Balance
(b) Credit Balance
(c) Both
(d) None of these
Answer:
(c) Both

Question 12.
Interest on partners capital is calculated on
(a) Capital in the beginning
(b) Capital at the end
(c) Average capital
(d) None of these
Answer:
(b) Capital at the end

Question 13.
Which of the following is an appropriation of profit?
(a) Interest on loan
(b) Interest on capital
(c) Salary
(d) Rent
Answer:
(b) Interest on capital

Question 14.
In the absence of any partnership agreement, the profits & losses of the firm are divided into
(a) capital ratio
(b) equal ratio
(c) any of these two ratios
(d) none of these
Answer:
(b) equal ratio

Question 15.
In an ordinary partnership, the maximum number of partners is
(a) 20
(b) 10
(c) 15
(d) 5
Answer:
(a) 20

Question 16.
In the absence of a partnership deed, partners are not entitled to receive
(a) Salaries
(b) Commission
(c) Interest on Capital
(d) All of these
Answer:
(d) All of these

Question 17.
The balance of Revaluation Account is transferred to old partners Capital A/c in there
(a) Old Profit or loss Sharing ratio
(b) New profit or loss sharing ratio
(c) Equal ratio
(d) none of these
Answer:
(a) Old Profit or loss Sharing ratio

Question 18.
Revaluation Account is a
(a) Personal Account
(b) Real Account
(c) Nominal Account
(d) None of these
Answer:
(c) Nominal Account

Question 19.
Sacrifice ratio is
(a) New ratio – Old ratio
(b) Old ratio – New ratio
(c) Gaining ratio – Old ratio
(d) Old ratio – Gaining ratio
Answer:
(a) New ratio – Old ratio

Question 20.
Goodwill is
(a) Tangible Asset
(b) Intangible Asset
(c) Current Asset
(d) None of these
Answer:
(b) Intangible Asset

Question 21.
The executors of a deceased partner will be paid interest on the amount due from the date of death of the partner at
(a) 5% p.a.
(b) 6% p.a.
(c) 7% p.a.
(d) 8% p.a.
Answer:
(b) 6% p.a.

Question 22.
Share of goodwill brought by a new partner in cash is shared by old partners in
(a) Sacrifice ratio
(b) Old ratio
(c) New ratio
(d) All of these
Answer:
(c) New ratio

Question 23.
Balance Sheet prepared after new partnership agreement, assets and liabilities a recorded at
(a) Original value
(b) Revalued figure
(c) Realisable value
(d) Either of (a) or (b)
Answer:
(b) Revalued figure

Question 24.
Which of the following assets is compulsorily revalued at the time of admission of a new partner?
(a) Stock
(b) Fixed Assets
(c) Investment
(d) Goodwill
Answer:
(d) Goodwill

Question 25.
Share Allotment Account is
(a) Personal Account
(b) Real A/c
(c) Nominal A/c
(d) None of these
Answer:
(a) Personal Account

Question 26.
Equity shareholders are
(a) Customers
(b) Owners
(c) Creditors
(d) Debtors
Answer:
(b) Owners

Question 27.
The total amount of liabilities side includes
(a) Authorised Capital
(b) Issued Capital
(c) Paid-up Capital
(d) Subscribed capital
Answer:
(c) Paid-up Capital

Question 28.
Shareholders get
(a) Interest
(b) Dividend
(c) Commission
(d) Profits
Answer:
(b) Dividend

Question 29.
Interest on calls in arrears is charged according to table ‘F’ at
(a) 5% p.a.
(b) 6% p.a.
(c) 7% p.a.
(d) 8% p.a.
Answer:
(d) 8% p.a.

Question 30.
Revaluation A/c is prepared at the time of
(a) Admission
(b) Retirement
(c) Death
(d) All of these
Answer:
(d) All of these

Question 31.
Which one of the following is the registered capital of the company?
(a) Paid-up capital
(b) Uncalled up capital
(c) Authorised capital
(d) Issued capital
Answer:
(c) Authorised capital

Question 32.
Debenture is a
(a) Loan certificate
(b) Cash certificate
(c) Credit certificate
(d) None of these
Answer:
(a) Loan certificate

Question 33.
Debenture holders are the
(a) Customers
(b) Owners
(c) Creditors
(d) Debtors
Answer:
(c) Creditors

Question 34.
Rate of interest on debentures is at
(a) 12% p.a.
(b) 20% p.a.
(c) fixed rate
(d) 15% p.a.
Answer:
(c) fixed-rate

Question 35.
Debentures can be redeemed out of
(a) Profit
(b) Capital
(c) Provision
(d) All of these
Answer:
(d) All of these

Question 36.
The premium on redemption of debentures is a
(a) Personal A/c
(b) Real A/c
(c) Nominal A/c
(d) Suspense A/c
Answer:
(b) Real A/c

Question 37.
The premium on redemption of Debenture A/c is
(a) Asset
(b) Expense
(c) Liability
(d) Income
Answer:
(b) Expense

Question 38.
The Current Assets include
(a) Stock
(b) Debtor
(c) Cash
(d) All of these
Answer:
(d) All of these

Question 39.
The dividend is usually paid on
(a) Authorised Capital
(b) Issued Capital
(c) Paid-up capital
(d) Called-up capital.
Answer:
(c) Paid-up capital

Question 40.
Interest on loans is
(a) Operating Expense
(b) Direct Expense
(c) Indirect Expense
(d) All of these
Answer:
(c) Indirect Expense

Question 41.
Interest on calls in arrears is charged according to ‘Table A’ at
(a) 5%p.a.
(b) 6% p.a.
(c) 8% p.a.
(d) 11% p.a.
Answer:
(a) 5%p.a.

Question 42.
Realisation Account is a
(a) Personal A/c
(b) Nominal A/c
(c) Real A/c
(d) None of these
Answer:
(c) Real A/c

Question 43.
Expenses on the dissolution of the firm are called
(a) Realisation expenses
(b) Legal expenses
(c) Loss Expenses
(d) None of these
Answer:
(a) Realisation expenses

Question 44.
X, Y and Z share profits in the ratio of 1/2 : 1/3 : 1/6. Z dies, New ratio of X and Y will be
(a) 3 : 2
(b) 2 : 3
(c) 2 : 1
(d) None of these
Answer:
(a) 3 : 2

Question 45.
The executors of a deceased partner will be a partner will be paid interest on the amount due from the date of death of the partner at
(a) 5% p.a.
(b) 6% p.a.
(c) 7% p.a.
(d) 8% p.a.
Answer:
(b) 6% p.a.

Question 46.
A and B share profits and losses in the ratio of 3 : 1. C is admitted into a partnership for 14 shares. The sacrificing ratio of A and B is
(a) equal
(b) 3 : 1
(c) 2 : 1
(d) 3 : 2
Answer:
(b) 3 : 1

Question 47.
A, B and C are equal partners in the firm. B retires and the remaining partners decide to share profits of the new firm in the ratio of 5 : 4. Gaining ratio will be
(a) 2 : 1
(b) 1 : 2
(c) 4 : 5
(d) 5 : 4
Answer:
(a) 2 : 1

Question 48.
A, B and C are sharing profits in the ratio of 1/2 : 1/3 : 1/6. C retired. Gaining ratio will be
(a) 2 : 1
(b) 2 : 3
(c) 3 : 2
(d) 1 : 2
Answer:
(c) 3 : 2

Question 49.
The decrease in the value of fixed assets is termed as
(a) Depreciation
(b) loss
(c) profit
(d) expense
Answer:
(a) Depreciation

Question 50.
The excess of average profits over the normal profits are called
(a) Super profits
(b) fixed profits
(c) abnormal profits
(d) normal profits
Answer:
(a) Super profits

Non-Objective Type Questions

Short Answer Type Questions

Question No. 1 to 25 are Short answer type questions. Answer any 15 out of them. Each question carries 2 marks. (15 × 2 = 30)

Question 1.
Explain the reason for the valuation of goodwill.
Answer:
Steps for valuation of Goodwill are shown below.
Steps Involved under Average Profit method.
Step 1: Calculate Adjusted (past) Profits or maintainable profit for each of the relevant years (given) after making adjustments relating to abnormal gains, profits, abnormal expenses and losses, incomes from non-trade investments, Proprietor’s remuneration etc.
Step 2: Calculate total profit by adding each relevant year’s adjusted profits.
Step 3: Calculate average profits:
Formula: Average profits = \(\begin{array}{l}
\text { Total Profit } \\
\text { No. of Years }
\end{array}\)
Step 4: Calculate Goodwill as under:
Goodwill = Average profit × No. of years purchase.

Question 2.
X, Y and Z are partners sharing profits in the ratio of 4 : 3 : 2. Y retires. X and Z decided to share profits and losses in future in the ratio of 5 : 4. Calculate gaining ratio.
Answer:

Question 3.
What are the objectives of a financial statement?
Answer:
Following are the objectives of financial statement: The basic objective of financial statements is to assist in decision making. But there many more other objective too.

• To serve as a media of information regarding profitability and financial health of the enterprise.
• To assist in investment decision making.
• To help in making planning.
• To help management in assessing the efficiency of the organisation.
• To provide financial information about changes in net resources arising out of business activities.
• To provide reliable information about economic resources and the obligation of business enterprise.
• To assist in estimating the earning potentials of the business.
• To disclose other information that is relevant to the needs of the users of the financial statements.

Question 4.
A firm’s current ratio is 2.5 : 1 Its liquid ratio is 1.5 : 1 If current liabilities are Rs. 15,000, calculate the amounts of current assets and stock.
Answer:
Calculation of current assets and stocks:

Question 5.
What is Ratio Analysis? Explain the importance of Analysis.
Answer:
Ratio Analysis: Ratio analysis means examination and interpretation of the numerical relationship of two numbers. In financial analysis, a ratio is used as an index or yardstick for evaluating the financial position and performance of a firm According to Myers, Ratio analysis is a study of the relationship among the various financial factors in business.
Importance of Accounting Ratios:

• Accounting ratios make the figures simple and understandable.
• Accounting ratios provide the basis for preparing budgets and also determining the future line of action.
• Accounting ratios facilitate comparative analysis of the performance.
• Accounting ratios help in making decisions from the information provided in the financial statements.
• Accounting Ratios indicate efficiency and the profitability of the business concern.
• The operational efficiency of the business can be ascertained by calculating the operating ratio.

Question 6.
Explain the importance of cash flow statement.
Answer:
Importance and uses of cash flow statement:

• Cash flow statement aims at highlighting the cash generated from operating activities.
• Cash flow statement helps in planning the repayment of the loan schedule and replacement of fixed assets.
• Cash is the centre of all financial decisions. It is used as the basis for the projection of future investment and financial plans of the enterprise.
• Cash flow statement helps in the efficient and effective management of cash.
• The management generally looks into the cash flow statement to understand the internally generated cash which is the best utilised for payment of dividends.
• Cash flow statement is useful as a tool of historical analysis.

Question 7.
Explain the types of cell references in Excel.
Answer:
Types of cell address in excel:

• Relative cell address: A Relative cell reference is one chat when copied from one position to another will adjust the formula cell address to suit the position it is in.
• Absolute cell Address: absolute and relative references are extremely important in Microsoft excel and they ensure that the formulas you are creating actually refer to the correct cells.
• Mixed cell Address: Essentially what this means is that one either the column or the row has the dollar symbol for example & C3.

Question 8.
Define DBMS.
Answer:
Database Management system (DBMS): A DBMS is a database program. Technically speaking it is a software system that asses a standard method of cataloguing, receiving, and running queries on data.

Question 9.
Explain the function of SQL command Create & Select.
Answer:

• Create: Creates a user-defined function in SQL Server and Azure SQL Database.
• Select: It means to select any file and then proceed further work in SQL Database.

Question 10.
Describe various uses of MS-Excel in accounting.
Answer:
Following are the various uses of Ms-Excel in Accounting:

• Select the current column
• Select the current row
• Resize the name box
• Activate Excel’s Ribbon
• View a macro within your workbook
• Subtraction, Summation, Dividing, multiplication
• Navigate the charts and other objects in a workbook.

Question 11.
Define types of SQL (DML & DOL.)
Answer:
Navigate to an existing name range:

1. DDL (Data Definition Language)
2. DML (Data Manipulation Language)
3. DQL (Data Query Language)
4. DCL (Data Control Language)
5. DAC (Data Administration Command)
6. TCC (Transaction Control Command)

Question 12.
Explain Database normalization
Answer:
Database normalisation is a process used to organize a database into tables and columns. The idea is that a table should be about a specific topic and that only those columns which support that topic are included. For example, a spreadsheet containing information about salespeople and customers serves several purposes.

Question 13.
Explain Entity, Attribute and Relation.
Answer:

• Entity: All entities have some attributes or properties that give them their identity.
• Attribute: An attribute is a property of a given entity, for example, Roll No. is a property of entity Student. An attribute instance is a particular property of an individual entity instance.
• Relation: The types of relationship between two entities are represented in E/R diagrams by a certain symbol. An entity may be associated with one none or occurrences of another entity.

Question 14.
Explain the logical function if () in Excel with example.
Answer:
IF: Tests a user-defined condition and returns one result if the condition is TRUE and another result if the condition is FALSE.
Ex. Formula = If (Logical – test, value – if – true, value – if – false.)

Question 15.
Describe in excel the Goal seeks under the what-if analysis tool.
Answer:
By using what: If analysis tools in Microsoft office excel, you can use several different sets of values in one or more formulas to explore the various results.
Goal seeks works with only one variable input value if you want to determine more than one input value, for example, the loan amount and the monthly payment amount for a loan you should instead use that solver add-in.

Question 16.
Describe the different processes of chart generation in excel.
Answer:
Process of chart generation in Excel:

• Step 1: Start Excel by default a blank worksheet opens.
• Step 2: Select the “Insert” tab.
• Step 3: Choose process in the list of chart types.
• Step 4: Add text to the first step in the process.
• Step 5: Customize the appearance of the flow chart.
• Step 6: Add an additional shape for each step in your business process.
• Step 7: Click the “Save” button on the quick access toolbar or press “ctreates” to save the completed business process flow chart before closing the worksheet.

Question 17.
Explain any three financial functions of excel.
Answer:
Three Financial Function of Excell:

• Present value (PV) equivalent to the value of the load or savings today, this function is used to estimate the loan size that could be paid off provided a periodic payment over a provided total number of payments and a provided periodic interest rate.
• Interest rate per period (RATE) equivalent to the interest rate generally monthly. This function is used to calculate the periodic interest rate required to pay off a provided present value with a provided periodic payment and a total number of payments.
• The number of payment periods (NPER) equivalent to the number of payment periods. This function is used to evaluate the total number of payment periods required to pay off a given present value with a provided payment and periodic interest rate.

Question 18.
Write the appropriate SQL command to create an invoice table with required columns.
Answer:

• For other objects, it is not so easy to come up with an equivalent database table structure.
• Consider an invoice each invoice object contains a reference to a customer object.
• You right consider simply entering all the customer data into the invoice tables.

Question 19.
Explain the function of Auto filter & sort in excel.
Answer:
Auto Filter: Auto filter is an easy way to turn the values in Excel column into specific filters based on the cell content.
Sort: When you enter data into your worksheet it is often unorganised making it difficult to examine. When analyzing the information in your spreadsheet, you may need to rearrange the data in different ways to answer different questions. Excel’s sorting features can help you rearrange your data so you can use it more efficiently.

Question 20.
Subscription received during the year 2013, Rs. 30,000. Subscription Rs. 20,000 was outstanding at the end of the previous year. Calculate the income from a subscription for the year 2013.
Answer:
Subscription for the year of 2013 – Rs. 30,000
Less: O/S at the end of the previous year – Rs. 20,000
Subscription for the year – Rs. 10,000

Question 21.
What is Profit and Loss Appropriation Account?
Answer:
Profit and Loss Appropriation AccountProfit and loss Appropriation account is an account which is prepared to carry out adjustments of partners rights and obligations such as salary payable to partners, commission, interest on capital interest on drawings and distribution of profit among partners. It is an extension of the profit and loss account. Net profit as shown by the profit and loss account is brought down to this account.

Question 22.
Ram and Rahim are partners. Ram invested Rs. 2,00,000 and Rahim Rs. 2,50,000. In the absence of partnership, deed distributes the profit Rs. 50,000 to each partner.
Answer:
In the absence of Partnership deed Profits are divided in equal ratio, therefore,
Share of Ram and Rahim – 25,000 each.

Question 23.
What is meant by reconstitution of a partnership firm?
Answer:
The partnership is created by an agreement, whenever, there is a change in the existing agreement, it amounts to the reconstitution of the Partnership firm.

Question 24.
What do you mean by normal profit and super profit?
Answer:
Normal profit means a reasonable return on capital employed, i.e. profit earned by a similar firm in the same industry, whereas super profit means the excess of actual profit over normal profit.

Question 25.
Rajratan and Mrityunjay who share profit in the ratio of 3 : 2 admit Shashi to give him \(\frac{1}{3}\) share. Calculate the new profit & loss sharing ratio.
Answer:
Profit sharing Ratio of Rajratan and Mritunjay = 3 : 2
Shashi’s share in firm = \(\frac{1}{3}\)
Let total pforit of firm = 1;
Remaining balance of profit = \(1-\frac{1}{3}=\frac{2}{3}\)
therefore, new ratio
Rajratan = \(\frac{2}{3} \times \frac{3}{5}=\frac{6}{15}\)
Mrityunjay = \(=\frac{2}{3} \times \frac{2}{5}=\frac{4}{15}\)
Shashi = \(\frac{1}{3} \times \frac{5}{5}=\frac{5}{15}\)
New Ratio of firm = 6 : 4 : 5

Long Answer Type Questions

Question no. 26 to 33 are Long answer type questions. Answer any 4 of them. Each question carries 5 marks. (4 × 5 = 20)

Question 26.
Distinguish between Sacrifice Ratio and Gaining Ratio.
Answer:
Distinguish between Sacrifice Ratio and Gaining Ratio:

Question 27.
How will you deal with the realisation expenses of the firm of Rashmi and Bindu in the following cases:
(i) Realisation expenses Rs. 1,00,000
(ii) Realisation expenses of Rs. 30,000 and paid by Rashmi.
(iii) Rashmi bears Realisation expenses for which she will be paid Rs. 70,000. The actual expenses incurred by Rashmi Rs. 1,20,000.
Answer:

Journal Entries

Question 28.
Distinguish between preference share and equity share.
Answer:
Following are the differences between preference shares and equity shares.

Question 29.
Distinguish between shares and debentures.
Answer:
Following are the differences between share and debentures.

Question 30.
Urbashi Ltd. purchased an established business for Rs. 50,000 payable Rs. 15,000 in cash and the balance by the issue of 9% debentures of Rs. 100 at a discount of 10%. Show journal entries.
Answer:

Question 31.
On 31st March 2013 Puja Ltd redeemed Rs. 2,50,000. 10% debentures out of profits. Show the Journal entries.
Answer:

In the books of Pooja Ltd

Question 32.
Rudra Company Ltd. issued 35000 equity shares of Rs. 10 each at a premium of Rs. 2 payable as follows:
On application – Rs. 3
On allotment – Rs. 5 (including premium)
The issues were fully subscribed and all the money were duly received Record necessary Journal entries.
Answer:

Question 33.
Mona Ltd. issued 4,000, 8% debentures of Rs. 100 each at a premium of 10% payable Rs 20 on the application and the balance with a premium on the allotment. Expenses on the issue of debentures were Rs. 500. Pass necessary Journal entries.
Answer:

Bihar Board 12th Entrepreneurship Model Papers

Bihar Board 12th Entrepreneurship Model Question Paper 3 in English Medium

Time: 3 Hours 15 Min
Marks: 70

Instructions for the candidates:

1. Candidates are required to give their answers in their own words as far as practicable.
2. Figures in the right-hand margin indicate full marks.
3. 15 minutes of extra time has been allotted for the candidate to read the questions carefully.
4. This question paper has two sections: Section – A and Section – B.
5. In Section – A, there are 35 objective type questions which are compulsory, each carrying 1 mark. Darken the circle with black/blue ball pen against the correct option on OMR Sheet provided to you. Do not use Whitener/ Liquid/Nail on OMR Sheet, otherwise, the result will be treated as invalid.
6. In Section – B, there are Non-objective type questions. There are 18 Short answer type questions, out of which any 10 questions are to be answered. Each question carries 2 marks. Apart from this, there are 6 Long answer type questions, out of which any 3 of them are to be answered. Each question carries 5 marks.
7. Use of any electronic device is prohibited.

Objective Type Questions

Question No. 1 to 35 has four options provided out of which only one is correct. You have to mark, your selected option, on the OMR-Sheet. Each question carries 1 (one) mark. (35 × 1 = 35)

Question 1.
Which of the following is an element of sensing the opportunities?
(a) Innovation quality
(b) Ability to perceive
(c) Insight into the change
(d) None of these
Answer:
(a) Innovation quality

Question 2.
Economic policies determine, what?
(a) Direction of Business
(b) Volume of Business
(c) Nature of Business
(d) Direction and volume of Business
Answer:
(b) Volume of Business

Question 3.
Incentives are not concerned with
(a) Exemption from tax
(b) Lump-sum payment
(c) Rebate
(d) Provision of capital
Answer:
(d) Provision of capital

Question 4.
The one included in demand forecasting is
(a) Short term forecasting
(b) Long term forecasting
(c) Consumer forecasting
(d) Marketing forecasting
Answer:
(a) Short term forecasting

Question 5.
Is included in the nature of marketing
(a) Customer
(b) Production
(c) Product planning
(d) Selling
Answer:
(c) Product planning

Question 6.
Which of the factors affect market assessment?
(a) Demand
(b) Production cost
(c) Selling price
(d) Microenvironment
Answer:
(b) Production cost

Question 7.
Demand forecasting is termed as what out of the following?
(a) Marketing
(b) Demand
(c) Supply
(d) Marketing Demand
Answer:
(d) Marketing Demand

Question 8.
Entrepreneur fulfils responsibilities:
(a) Managerial
(b) Social
(c) Statutory
(d) None of these
Answer:
(a) Managerial

Question 9.
To be considered in the selection of services
(a) Competition
(b) Product planning
(c) Practicality
(d) Market Assessment
Answer:
(c) Practicality

Question 10.
Essential elements of a selection of an Enterprise
(a) Secrecy
(b) Business Activity
(c) Area of Operation
(d) All of these
Answer:
(d) All of these

Question 11.
Factors which determine the form of organisation
(a) Location
(b) Study
(c) Size
(d) Innovation
Answer:
(d) Innovation

Question 12.
Increases sales and profit in the market
(a) Marketing
(b) Promotion
(c) Innovation
(d) Location
Answer:
(b) Promotion

Question 13.
Execution of project establishment
(a) Entry into the market
(b) Trial production
(c) Building construction
(d) All of these
Answer:
(d) All of these

Question 14.
Included in the establishment of enterprise
(a) Raw material
(b) Report
(c) profit-loss
(d) Technology
Answer:
(a) Raw material

Question 15.
Of all managerial activities planning is the
(a) Beginning and end
(b) Beginning
(c) End
(d) None of these
Answer:
(b) Beginning

Question 16.
A good plan is
(a) Expensive
(b) Flexible
(c) Rigid
(d) Time-consuming
Answer:
(b) Flexible

Question 17.
According to “Terry” types of planning are
(a) 04
(b) 14
(c) 16
(d) 08
Answer:
(a) 04

Question 18.
Incentives are not concerned with
(a) rebate
(b) exemption from tax
(c) provision of seed capital
(d) lump-sum payment
Answer:
(d) lump-sum payment

Question 19.
Project is not concerned with
(a) Risk
(b) Creativity
(c) Innovation
(d) Vision
Answer:
(b) Creativity

Question 20.
The project report is a summary of
(a) Analysis
(b) Facts
(c) Information
(d) All of these
Answer:
(d) All of these

Question 21.
Lack of standardization of the equipment is due to
(a) Regulatory Barriers
(b) Government Barriers
(c) External Constraints
(d) Internal Barriers
Answer:
(d) Internal Barriers

Question 22.
Resources of production functions are
(a) Money, Import
(b) Import, Export
(c) Commerce, Export
(d) Money, Import, Export, Commerce
Answer:
(b) Import, Export

Question 23.
Which of the following is a type of Physical Resource?
(a) Marketing
(b) Finance
(c) Resources
(d) None of these
Answer:
(c) Resources

Question 24.
Regular working capital is the part of
(a) Permanent working capital
(b) Variable working capital
(c) Regular & seasonal working capital
(d) All of the above
Answer:
(a) Permanent working capital

Question 25.
Long terms loan bears
(a) Flexible rate of interest
(b) Zero rates of interest
(c) Fixed-rate of interest
(d) Rate of 1% interest
Answer:
(c) Fixed-rate of interest

Question 26.
Included in the utility of BEP
(a) Profit improvement
(b) Risk valuation
(c) Diagnostic tool
(d) All of these
Answer:
(d) All of these

Question 27.
India Investment fund was established by
(a) IFCI
(b) State Bank
(c) Grindlay Bank
(d) Can Bank
Answer:
(b) State Bank

Question 28.
Non-Bank sources are
(a) Open Accounts
(b) Trade loans
(c) Public Deposits
(d) All of these
Answer:
(b) Trade loans

Question 29.
A personal account is related to
(a) all types of assets
(b) all types of income
(c) person, company and firm
(d) none of these
Answer:
(c) person, company and firm

Question 30.
Accounting system is
(a) single-entry system
(b) double entry system
(c) cost system
(d) both (a) and (b)
Answer:
(b) double entry system

Question 31.
Of all managerial activities planning is the
(a) beginning
(b) end
(c) beginning and end both
(d) none of these
Answer:
(a) beginning

Question 32.
Telephone expenses are
(a) fixed
(b) variable
(c) semivariable
(d) none of these
Answer:
(c) semivariable

Question 33.
Subsidy is
(a) discount
(b) concession
(c) repayment
(d) none of these
Answer:
(b) concession

Question 34.
Element affecting growth rate is
(a) competition
(b) change in technology
(c) creativity
(d) all of these
Answer:
(d) all of these

Question 35.
Long-term loan bears
(a) a fixed rate of interest
(b) zero rates of interest
(c) flexible rate of interest
(c) none of these
Answer:
(a) a fixed rate of interest

Non-Objective Type Questions

Short Answer Type Questions

Question No. 1 to 18 are short answer type. Answer any 10 questions. Each question carries 2 marks. (10 × 2 = 20)

Question 1.
Is management a profession?
Answer:
Management’s a well-defined body of knowledge there is an organization made to regulate whatever managers do. There is also a code of conduct for managers. But management’s not considered a profession because it needs a minimum number of qualifications, it’s essential for its practitioners to register themselves with a professional body and there’s no universally accepted code of conduct.

Question 2.
What does the opportunity cost?
Answer:
The opportunity cost of anything is the next best alternative that could be produced instead of the same factors by an equivalent group of factor costing the same amount of money.

Question 3.
What is short-term forecasting?
Answer:
Short-term forecasting refers to that forecasting which made for a short-time generally, short-term forecasting is made for the period of six months to one year.

Question 4.
What do you understand by expansion project?
Answer:
Under the expansion of project consisting the work, such as to the production of the new product to set up of new production unit to increase in capacity to produce goods and evolution of new markets.

Question 5.
How will you determine net working capital?
Answer:
Determination of networking capital = Net Working Capital = Current Assets – Current Liabilities
where,
Current Assets = Sundry debtors stock Cash, B/R prepaid expenses, etc.
Current Liabilities = Sundry Creditors Bill payable(B/P) outstanding etc.

Question 6.
What is Fund flow?
Answer:
A fund flow statement is a statement prepared to indicate the increase in the cash resources and the utilisation of such resources of business during the accounting period.
Unearning of fund flow: The term fund flow of funds means changes in working capital
Funds: Current Assets – Current liability

Question 7.
What is expressed by the solvency ratio?
Answer:
Solvency ratio: Solvency means the ability of a firm to pay its liabilities on the due date.
In a broader sense, the analysis of solvency can be divided into two groups:

• Short-term solvency
• Long-term solvency

Question 8.
State any two features of the modern concept of marketing.
Answer:
Following are two features of modern marketing:

• The modern concept of marketing lays maximum stress on consumers satisfaction
• In the modern concept of marketing goods and services are produced keeping on view the desires and requirements of the consumer or customers.

Question 9.
What are the elements of the project cycle?
Answer:
Followings are elements of the project cycle:

• Project formulation stage
• Project appraisal
• Selection of project
• Project implementation,
• Project commencing.

Question 10.
Write anyone cause of difference between fixed and working capital.
Answer:
Following are the causes of differences between fixed capital and working capital:

• Meanings
• Period
• Nature
• Sources
• Necessity.

Question 11.
What is the importance of venture capital?
Answer:
The amount of capital should be adequately balanced otherwise increase of over or under capitalisation, both the condition are total to a venture capital hence it must be available in a balanced proportion.

Question 12.
State any two factors which affect physical resources.
Answer:
Followings are the two factors which are affecting the physical resources:

• Location of land, size and its cost
• The conditions for installing machinery and its repairs etc.
• Effect on the environment.

Question 13.
Write three elements of the marketing mix.
Answer:
Following are the three elements of the marketing mix:

• Product mix
• Price mix
• Promotion mix.

Question 14.
Define Break-even analysis.
Answer:
“The break-even point is that point of sales volume where total revenues and total expenses are equal, it is also said as the point of zero profit or zero loss.”

Question 15.
Define venture capital.
Answer:
“The primary stage of finance which is related to the new and young organisation who wants to the regular development of their organisation given.

Question 16.
Is management considered a profession?
Answer:
Management fulfils some of the major characteristics of the profession (specialised knowledge, technical competency, training and experience and formal arrangement for enhancement of these. Priority to the feeling of devotion and service.) however some of the other characteristics (such as the formation of a professional union or body code of conduct etc.) are as yet not forcibly developed. Development of management as a profession in India even today is in the infantile stage and is making very slow progress.

Question 17.
What is product design?
Answer:
To making product design is a primary work of any enterprises because of the image and capacity of getting a profit of any enterprises are mostly depend on product design.

Question 18.
What is the object of branding?
Answer:
There are the following objects of Brand:

• The brand is a broad term which is used to identify a product
• Proud in a concrete or an abstract from establishes the identity of the product of a particular organisation that distinction is from that of other competitions
• Act the means of identity to a brand are included in the brand.
• The brand is a catalyst in the popularity and sales promotion of the product.

Long Answer Type Questions

Question No. 19 to 24 are long answer type. Answer any 3 questions. Each question carries 5 marks. (3 × 5 = 15)

Question 19.
Describe the nature of planning.
Answer:
Characteristics of Planning: Planning should have the following characteristic
(i) Objective-Based: A good planning is made keeping in view the objectives of the organisation. Whatever kind of plan may be and whichever department it may belong to it always makes scope for the various activities to be directed toward the achievement of goals.

(ii) Simple & Flexible: Planning should have the qualities of simplicity and flexibility. It should be simple in the sense that the person who implements it understand It. He should not feel the necessity of coming to planners again and again for seeking classification. Planning should be flexible as well.

(iii) Co-ordination: It should not be a lopsided plan proper co-ordination should be maintained within the cane accordingly without for its storage, It means it is lacking co-ordination.

(iv) Leading to efficiency and Economy: A properly drawn-out planning should lead to improving efficiency. It should suggest the right kinds of machines to be operated by workmen. It should also indicate the quality of raw materials to be used by the workmen. If the proper machine and proper raw material have been provided to the right kind of man the efficiency is bound to increase.

(v) Comprehensive: Planning should be comprehensive. It should deal with all aspects of the organisation. A list of all the activities of the organisation should be made. Even the smallest activity should not be an escape from this list.

(vi) Indicating Quantum: The overall targets are always given in the objectives. To achieve the prescribed target, each person in the organisation has to make his contribution. Good planning not only lays down the target of the expected outcome of each department but also of each sub-department.

Question 20.
Describe the factors affecting working capital.
Answer:
Factors affecting the working capital: There are the following factors affecting the working capital as:
(i) Nature and size of Business: The working capital depends on the nature of the business to a great extent. If a business is engaged in the production process more working capital will be required on other hand business firms engaged in trade activities will ‘require less working’ capital.

(ii) Business Cycles: The need for working capital keeps on increasing or decreasing according to business cycle. During Boom periods the businessman try to keep the maximum possible stock of goods in order to escape from the price increase.

(iii) Term of Buying & Selling: If businessman buy the necessary material for cash he requires more working capital. If the business unit has the policy of credit sales, more working capital will be required.

(iv) Duration of Production: The amount of working capital also depends upon the time taken in the manufacturing of a product. If the time required for the manufacture of the product is more, more working capital is needed to be.

(v) Volume & Procurement of Raw Material: If the amount to be spent on raw material is more in total investment more working capital will be required.

(vi) Manual Vs Automation: If a business unit uses automatic machines for production less working capital will be required. If the production is labour oriented like the workers engaged in tea, coffee, rubber etc. More working capital will be required.

(vii) Form of Taxation: Government policy of taxation also influences the need for working capital more capital will be required if all taxes are to be paid in advance, otherwise the need will be less.

(viii) Seasonal goods: If business units are engaged in such goods in which seasonal conditions play an important role need for working capital will be felt according to seasonal requirements.

(ix) The intensity of competition: If the market competition is intense, more amount of working capital is required as a competitive firm has to keep huge quantities of a long-range of products.

(x) Business growth: If a business is expanding it requires more money for raw materials wages etc.

Question 21.
Explain the nature of Management.
Answer:
Nature of Management: There is much important nature of Management as follows:
(i) Management is an art as well as science: Management can be treated as an art as well as a science because it has both qualities. It has similar qualities to science as well as arts.

(ii) Management is a process: It is a process because a large number of events are done under a management system for the achievement of certain goals or objectives. Such as planning, organising, staffing directing and controlling etc.

(iii) Management is a universal process: It is an important feature of management. It is called a universal process because it has gained a wide area of application. In fact, the principle of management can apply each and every form of the organisation either it may be business organisation, social or political organisation.

(iv) Management is a social process: Management can consider as a social process because it is concerned with human and their relationship.

(v) Management is a goal-oriented Approach: Management refers to a goal-oriented approach because it is directly related to the goals or objectives of the organisation. It provides a certain platform to the organisation to perform its various activities in the best way.

(vi) Management is a continuous process: It can be described as a continuous process because it is not an event which is concerned with the point of time. It is a never-ending process. It needed at every walk of life of an organisation.

(vii) Management is a creative function: It is a creative function because it creates so many things for all-around the development of people. It contributes to new investment incomes and new business etc in the nation.

Question 22.
Define planning. What are its features?
Answer:
Planning refers to opening the best alternatives after careful consideration. By imaging in the womb of future of option of the right advice and a follow up is termed as management or business planning. In other words, tomorrow’s job is to be determined right now or today is planning.

Definition of Planning: According to knootz and O’Donnell, “Planning is a judicious process which opens the door to various activities in which the decisions on objectives facts and pre-conceived estimates are to be taken.
According to W. H. Numan, “Generally to determine before what is to be done is planning. From this point of view, planning is a manifestation of vast human conduct.”
Characteristics or value of planning:

• Definite object and goal: Planning aims at achievement the certain objectives and every entrepreneur keeps such objectives in mind and plans accordingly.
• Forecasting: The second important phase of planning is to look towards the future with overuse of anticipation. According to Fell, “Planning is a synthesis of the forecasts be they be long term or short term, general or particulars forecasts.”
• Utility: Unity is also an essential feature of planning. At one time only one planning can be executed as any dual planing at a time can lead to chaos and uncertainty.
• Selection of the best among alternative courses of action: It refers to the option of the best alternatives available with the entrepreneur who has several options, policies and methods for managing the affairs.
• Planning is a continuous and flexible process: Future remains unpredictable. Nobody can assert with certainty what will happen tomorrow since planning is also recalled to future.
• Primary function: Planning, of course, is a primary function. In any commercial venture, planning is placed on the highest pedestal and the rest of the job are scored a secondary primary.
• Intellectual and mental process.

Question 23.
Explain the marketing concept and its objectives.
Answer:
The study of these five constituents is essential for the emergence of an enterprise:

• Labour or men: In all the resources of production, the ingredient of labour is the most mobilising element that stimulates all other factors and turns even the most useless thing into a useful one.
• Raw material: If the enterprise is production oriented a prior arrangement should be emphasised with regard to availability,type,cost/price and regular supply of the raw materials.
• Machine: Whatever be the scale of the enterprise whether big or small, machines are required in either case.
• Money: Money/capital is the lifeblood of an enterprise without which the establishment is an inconceivable presumption. The capital in the long and short term and its amount and the capital resources are a pre-emptive requirement.
• Market: A prior estimate is to be formed in terms of market consumption before the establishment of the enterprise.
• Place: It is also an important aspect and be decided where the enterprise should be set up.

Question 24.
Name the various elements included in total cost.
Answer:
Marketing is used almost by everybody as per his status ability need and environment as a normal word. All, therefore, mentioned ideas are the various aspects of marketing.
According to Pyle, “Marketing comprises both buying and selling activities.”

According to Clark and Clark, “Marketing consists of those efforts which affect transfers in the ownership of goods and services and provide for their physical distribution.”
There are the following functions of marketing manager:

• Buying: Buying is the first step in the marketing function. In a manufacturing unit, the raw material and int business unit, the finished goods is purchased.
• Selling: Selling is the most significant function of marketing. Selling refers to the transfer of merchandise or services from the owner to the customer.
• Pricing: The third important task is to determine the price of the products which necessitates a wider contemplation. According to the principle of Economics, the price of a product is linked to the demand and supply of a product.
• Physical distribution: This is the last function of marketing but not the least. Physical distribution implies the delivery of the product at an appropriate time, at the right place, in the right quantity and in right hands.

Bihar Board 12th Entrepreneurship Model Papers

Bihar Board 12th Entrepreneurship Model Question Paper 2 in English Medium

Time: 3 Hours 15 Min
Marks: 70

Instructions for the candidates:

1. Candidates are required to give their answers in their own words as far as practicable.
2. Figures in the right-hand margin indicate full marks.
3. 15 minutes of extra time has been allotted for the candidate to read the questions carefully.
4. This question paper has two sections: Section – A and Section – B.
5. In Section – A, there are 35 objective type questions which are compulsory, each carrying 1 mark. Darken the circle with black/blue ball pen against the correct option on OMR Sheet provided to you. Do not use Whitener/ Liquid/Nail on OMR Sheet, otherwise, the result will be treated as invalid.
6. In Section – B, there are Non-objective type questions. There are 18 Short answer type questions, out of which any 10 questions are to be answered. Each question carries 2 marks. Apart from this, there are 6 Long answer type questions, out of which any 3 of them are to be answered. Each question carries 5 marks.
7. Use of any electronic device is prohibited.

Objective Type Questions

Question No. 1 to 35 has four options provided out of which only one is correct. You have to mark, your selected option, on the OMR-Sheet. Each question carries 1 (one) mark. (35 × 1 = 35)

Question 1.
Is it necessary to give due consideration on internal resources before initiating a particular decision?
(a) Yes, it is necessary
(b) No, not necessary
(c) Necessary for External Resources
(d) None of the above
Answer:
(a) Yes, it is necessary

Question 2.
Which of the following is a factor affecting the identification of business opportunities?
(a) The volume of Internal demand
(b) Created opportunity
(c) Existing opportunity in the Environment
(d) None of the above
Answer:
(a) The volume of Internal demand

Question 3.
Learning processes involves.
(a) Drive
(b) Cue
(c) Response
(d) Drive, cue, and response
Answer:
(d) Drive, cue, and response

Question 4.
Subsidy is:
(a) Concession
(b) Discount
(c) Repayment
(d) None of these
Answer:
(c) Repayment

Question 5.
The business regulatory framework is concerned with what.
(a) Direction of Business
(b) Volume of business
(c) Regulation
(d) None of the above
Answer:
(c) Regulation

Question 6.
Do economic policies determine?
(a) Direction of Business
(b) Volume of Business
(c) Direction & Volume of Business
(d) None of these
Answer:
(c) Direction & Volume of Business

Question 7.
Short-term forecast involves a period of how many months?
(a) Twelve months
(b) Twenty four months
(c) Eighteen months
(d) Thirty-six months
Answer:
(a) Twelve months

Question 8.
Demand forecasting is termed as what out of the following?
(a) Marketing
(b) market demand
(c) demand and supply
(d) all of the above
Answer:
(b) market demand

Question 9.
Which of the following factors is to be considered while selecting a product or service?
(a) Competition
(b) Cost of production
(c) Profit possibility
(d) all of the above
Answer:
(b) Cost of production

Question 10.
Out of the following, what is essential: to study in the feasibility study?
(a) Cost
(b) Prince
(c) Operation
(d) All of the above
Answer:
(d) All of the above

Question 11.
Market demand is known as
(a) Demand forecasting
(b) Real demand
(c) Supply
(d) None of those
Answer:
(a) Demand forecasting

Question 12.
What creates imperfection in the market which ultimately increases the volumes of sales and profit?
(a) Innovation
(b) Promotion
(c) Marketing
(d) None of the above
Answer:
(a) Innovation

Question 13.
How will you formulate a general plan of Business?
(a) By production planning
(b) By cost planning
(c) By financial planning
(d) By doing all the above
Answer:
(d) By doing all the above

Question 14.
Which of the following is a problem connected with Business?
(a) Profit
(b) Money
(c) Sales
(d) Risk management
Answer:
(d) Risk management

Question 15.
On which out of the following the formulating of the general plan of a business depends.
(a) Project report
(b) Plant & production planning
(c) Marketing planning
(d) Financial planning
Answer:
(d) Financial planning

Question 16.
Lack of standardisation of the equipment is due to
(a) Internal constraints
(b) External constraints
(c) Government Barriers
(d) Regulatory Barriers
Answer:
(b) External constraints

Question 17.
The project cycle is not concerned with the following
(a) Pre-investment stage
(b) Constructive stage
(c) Normalisation stage
(d) Stabilisation stage
Answer:
(d) Stabilisation stage

Question 18.
Modernisation improves.
(a) Products
(b) Production
(c) Processes
(d) Capacity
Answer:
(d) Capacity

Question 19.
The gestation period is concerned with.
(a) Idea creation period
(b) Incubation period
(c) Implementation period
(d) Commercialisation period
Answer:
(c) Implementation period

Question 20.
What is required for fixed capital and working capital of any enterprise?
(a) Finance
(b) Marketing
(c) Planning
(d) None of the above
Answer:
(a) Finance

Question 21.
The term “fund” as used in fund flow analysis means
(a) Cash only
(b) Current Assets
(c) Current liabilities
(d) Excess of current Assets over current liabilities
Answer:
(d) Excess of current Assets over current liabilities

Question 22.
What affects the purchase of plant will have working capital?
(a) Decrease
(b) Increase
(c) No effect
(d) None of the above
Answer:
(a) Decrease

Question 23.
B.E.P. = ________
(a) \(\frac { FixedCost }{ \frac { P }{ V } ratio }\)
(b) \(\frac { FixedCost }{ Contribution } \times 100\)
(c) \(\frac { \frac { P }{ V } ratio }{ FixedCost }\)
(d) None of these
Answer:
(a) \(\frac { FixedCost }{ \frac { P }{ V } ratio }\)

Question 24.
P/V ratio = ________
(a) \(\frac { Contribution }{ Sales } \times 100\)
(b) \(\frac { Sales }{ Contribution } \times 100\)
(c) \(\frac { Contribution }{ Sales }\)
(d) None of these
Answer:
(a) \(\frac { Contribution }{ Sales } \times 100\)

Question 25.
Risk Capital Foundation was established in
(a) 1970
(b) 1975
(c) 1986
(d) 1988
Answer:
(b) 1975

Question 26.
Technological Development and Infrastructure Corporation of India was established in the year
(a) 1975
(b) 1986
(c) 1988
(d) 1990
Answer:
(c) 1988

Question 27.
What is management?
(a) Science
(b) Art
(c) Art and Science both
(d) None of these
Answer:
(c) Art and Science both

Question 28.
The foremost need for development in a country is of
(a) Physical Resources
(b) Economic Resources
(c) Efficient management
(d) None of these
Answer:
(b) Economic Resources

Question 29.
The present production system in fact is
(a) Direct production
(b) Indirect production
(c) Primary
(d) Secondary
Answer:
(b) Indirect production

Question 30.
Out of the following which is the method of quality control?
(a) Inspection method
(b) The statistical quality central method
(c) Both “A” and “B” above
(d) None of these
Answer:
(c) Both “A” and “B” above

Question 31.
Out of the following which is the method of production?
(a) The direct method of production
(b) The indirect method of production
(c) Both “A” and “B” above
(d) None of the above
Answer:
(c) Both “A” and “B” above

Question 32.
Marketing Expenditure is a burden
(a) On Industry
(b) On businessmen
(c) On consumers
(d) All of these
Answer:
(c) On consumers

Question 33.
The characteristics of a good brand are
(a) Short name
(b) Memorable
(c) Attractive
(d) All of these
Answer:
(d) All of these

Question 34.
The maximum wide scope is of
(a) Brand
(b) Labelling
(c) Packaging
(d) Trademark
Answer:
(a) Brand

Question 35.
Brand indicates
(a) Symbol
(b) Design
(c) Name
(d) All of these
Answer:
(d) All of these

Short Answer Type Questions

Question No. 1 to 18 are short answer type. Answer any 10 questions. Each question carries 2 marks. (10 × 2 = 20)

Question 1.
What is the relationship between opportunity and entrepreneur?
Answer:
The most important exception is the literature in management and organization theory on opportunity discovery or opportunity identification, or what Shane (2003) calls the “individual-opportunity nexus.” Opportunity identification involves not only technical skills like financial analysis and market research, but also less tangible forms of creativity, team building, problem-solving, and leadership. Entrepreneurship is an activity that involves the discovery, evaluation, and exploitation of opportunities to introduce new goods and services, ways of organizing, markets, process, and raw materials through organizing efforts.

Question 2.
Give any three objectives of environment scanning.
Answer:
The following is the objective of Environmental scanning:

• Identification of strength
• Identification of opportunities
• Identification of weakness
• Identification of threat.

Question 3.
What is the feasibility study?
Answer:
A feasibility study is an analysis of how successfully a project can be completed, accounting for factors that affect it such as economic, technological, legal and scheduling-factors.

Question 4.
Explain any two steps in the Execution of setting up an enterprise.
Answer:
An entrepreneur has to take the following steps in order to set up an enterprise.

• Selection of line of business: The entrepreneur has to decide the type of business in terms of manufacturing trading or service, then he has to select the types of goods and services to be will produce and distribute.
• Size of the Unit: Decision regarding the size of the unit of very important. The optimum size is one at which the average cost per unit is minimum.

Question 5.
Mention any three features of planning.
Answer:
Three features of planning are the following:

• Planning is a primary function of management.
• Planning contributes to the objective.
• Planning is forward-looking.

Question 6.
What are the objectives of project appraisal?
Answer:
Following are the objective of Project Appraisal:

• To extract relevant information for determining the success or failure of a project.
• To apply standard yardsticks for determining the rate of success or failure of a project.
• To determine the expected costs and benefits of the projects.
• To arrive at specific conclusions regarding the project.

Question 7.
What is fixed capital?
Answer:
Fixed capital is also known as fixed assets which refers to that part of the capital which is invested in fixed assets viz., land, building, machinery, furniture and equipment, etc. The objective of purchasing then is to earn income from them on a long-term basis. These assets remain involved for a long time, thus, called fixed assets.

Question 8.
Define the ratio.
Answer:
Ratios are useful tools that help companies and investors analyze and compare relationships between different pieces of financial information across an individual company’s history, an industry, or an entire business sector. ‘

Question 9.
What is the profit-volume ratio?
Answer:
The profit volume (PV) Ratio is the ratio of contribution over sales. It measures the profitability of the firm and is one of the important ratios for computing profitability.

Question 10.
What are the sources to mobilise financial resources?
Answer:
Following are the sources of stabilising financial resources:

• Loan from Banks
• Bank overdraft
• Cash credit
• Short term Loan
• Commercial paper/Bill
• Discounting of Bills Receivables
• Trade credit, etc.

Question 11.
State the characteristics of fixed capital?
Answer:
Following are the characteristics of fixed capital:

• Fixed capital is capital invested in fixed Assets
• Fixed capital is required for promoting business and its ancillary activities
• Fixed capital is used to acquire fixed assets These assets have low Liquidity because they are not easily saleable
• Fixed capital has a long-lasting existence
• Primary sources of fixed capital are shares. Debentures and long-term loans
• Fixed capital is used to meet the long-term need of the business some of which like amalgamation, merger
• etc.
• Fixed capital is a source of wealth
• Fixed capital improves financial analysis
• It provides long-term business stability.

Question 12.
What is the importance of finance in business?
Answer:
The goal of any finance function is to achieve three benefits: Business Support service, lowest costs and effective control of the environment, money is the lifeblood of a business and finance is the nerve centre. Finance is required to promote or create a business gain assets, develop products, run market surveys advertise. The conventional view of finance focuses or being reactive, efficient, quantitative and risk-averse. Now innovative views focus on being vision-oriented, opportunity and growth-focused, intuitive and risk-taking.

Question 13.
What is the production design? Discuss its phases.
Answer:
Product design process: The set of strategic and tactical activities, from idea generation to commercialization, used to create product design, in a systematic approach, product designers conceptualize and evaluate ideas, turning them into tangible inventions and products. The product designer’s role is to combine art, science, and technology to create new products that people can use. Their evolving role has been facilitated by digital tools that now allow designers to communicate visualize, analyse and actually produce tangible ideas in a way that would have taken greater manpower in the part.
Generally, the following points will be considered while preparing product design:

• Standardisation
• Reliability
• Reproducibility
• Product simplification
• Product price
• Maintainability
• Sustainability
• Servicing
• Consumer Quality

Question 14.
Give any three objectives of the project report.
Answer:
Following are the three objectives of project Report.

• To evaluation of investment opportunity.
• It is necessary to present a report for taking financial help.
• The project report is a systematical point of view for making a decision about investment.

Question 15.
What do you mean by the cycle of working capital?
Answer:
Availability of enough working capital is indicative of liquidity of business and capacity to make prompts payment. Working capital is needed for making payment of day to day expenditure for meeting current liabilities and for availing benefit of cash discount.

Question 16.
What is the marketing mix?
Answer:
Marketing mix implies a combination of all marking elements or ingredients so that the objective of the enterprise may be realised. The marketing mix is the appointment of effort the combination the designing and the integration of the elements of marketing into a programme or mix which on the basis of the marketing forces will best achieve the objectives of an enterprise at a given time.

Question 17.
Define cost.
Answer:
I.C.M.A London has defined the term ‘cost’ as a noun as well as a verb. As a noun, it means “the amount of expenditure (actual or nominal) incurred on or attributable to a specified thing or activity.” As a verb, it means to ascertain the cost of a specified thing or activity. The specific thing or activity may be a product, job, services, process or any activity. Thus, the cost can be termed as the number of resources given up in exchange for some goods or services.

Question 18.
What are the opportunity cost and joint cost?
Answer:
Opportunity cost: The opportunity cost of goods or services is measured in terms of revenue which could have been earned by employing that goods or services in some other alternatives use.

Joint cost: When two or more than two products are being produced. Some separate cost has occurred for a separate product which called separate cost but some type of expenses cost occurred the same for all types of products which is called joint cost.

Long Answer Type Questions

Question No. 19 to 24 are long answer type. Answer any 3 questions. Each question carries 5 marks. (3 × 5 = 15)

Question 19.
What do you mean by product and product mix? What is the product dimension?
Answer:
Meaning of Product: A product is an item offered for sale. A product can be a service or an item. It can be physical or in virtual or cyber form. Every product is made at a cost and each is sold at price. The price that can be charged depends on the market, the quality, the marketing and segment that is targeted. The product needs to be functionally able to do what it is supposed to, and do it with good quality, users and potential users must know why they need to use it, what benefits they can derive from it, and what it does difference it does to their lives.

Meaning of Product Mix: Products refers to anything which is offered to the public for sale. It may be a physical object, service or an idea, Product mix deals with decisions concerning varieties quality features, packaging, size, brand guarantee and services to be offered in respect of the firm’s product.
Dimensions of Products:

• Product line
• Product size
• Product output
• Product width
• Product quality and standard
• Product Brand
• Product Depth
• Product Labelling and Trademark
• Product packaging
• Product Designs.

Question 20.
What is meant by Brand? Explain the characteristics of a good brand.
Answer:
Meaning of Brand: A brand is a name, term, sign, symbol, or some combinations used to identify the products of one firm and to differentiate them from competitive offerings. A brand or trademark is an integral part of the symbol appearing on the product. A buyer identifies the product with the brand name and the seller gets a chance to earn goodwill in the market. According to the American Marketing Association. “A brand name is that part of the brand consisting of words or letters that comprise a used to identify and distinguish the firm’s offerings from those of competitors.”

The brand name gives the product a distinguishing mark which differentiates it from the products of the competing companies. For the buyers as well as sellers, the marketing process becomes more easily with the brand name. The brand mark s a symbol, design, or another element of a brand that can not be .poken. It could be recognised by sight only. For example, the symbol of ‘Maharaja’ of Air India, the inscribed polo layer on Ralph Lauren Polo Shirts, etc.

Branding is the management process by which a product is branded. It is a general term covering various activities such as giving a brand name to a product, designing a brand mark, and establishing and popularising it. Characteristics of Brand: A good brand name is helpful for advertising and publicity in the market. Name of the brand must be carefully selected. Even multinational marketing firms face a particularly acute problem in selecting brand names. A very good brand name in one country may prove disastrous in another.

However, the following are the essential characteristics of a good brand name:
Easy to Pronounce: The brand name should be simple, short and easy to pronounce for people of different cultures and for illiterate persons. Sometimes, people can not pronounce certain words correctly and then they feel hesitant to ask for that product e.g., Crompton, Raymond, Liberty, Woodland etc.

Easy to Remember: The brand which is easy to pronounce are also to remember. These products are easy to advertise.

Right Connotation: A brand should itself suggest something about the product-its use, quality, nature, purpose, performance or action, whenever a buyer sees or hears a brand name, some sort of image is formed in mind, e.g., Chavan Prash, Vicco Vajnardanti, Nescafe Coffee, Tiger Tea, Devdarshan Dhoop etc.
Legally Protectable: The brand name should be legally protected under the legislation. It should not contain any name based on geographical, historical or a name which is used by the general public in the general sense e.g., ghee, cola, transistor, etc. The name should be the creation of the producer like.
Nirma, Wheel in case of washing powder.
Lux, Hamam, PONDS, REXONA in case of toilet soaps. SUFFOLA, DHARA, SUN-FLOWER in case of vanaspati oil. FORHANS. PROMISE, CLOSE-PEPSODENT in case of toothpaste.
VIDEOCON, PHILIPS, SONY, ONIDA in case of TV. and VCR. GODREJ, KELVIN ATIOR, ALWYN,
VIDEOCON in case of Refrigerators etc.
Stability: Brand name should have a stable life and should not be affected by the change in fashion and style.
Uniqueness and Distinctiveness: The original name is one which is quite distinctive, which is not an imitation of others, e.g., RIN, SURF, PHILIPS, ONIDA, TATA, BATA, DCM, etc.

Question 21.
Briefly discuss the process of Planning.
Answer:
Process/Techniques/Steps of planning: Notwithstanding the size, status and nature of a business venture the process of planning is indispensable to all since its reality. However, identical planning can not be implemented in every case. Usually, business planning has to undergo the following stages:
(i) Fixation of Objectives: The first and foremost step is to define and determine the objectives of an enterprise otherwise the planning process can go haywire. The objectives may be on the long-term or short-term basis.

(ii) Collection and Analysis of Informations: First of all the objectives are defined and determined and thereafter for the realization of the objectives all the relevant information are obtained. Following an analysis of such information, the basis of planning is undertaken.

(iii) Selection of Alternative Sources: There are several ways of achieving the objectives. The evaluation of such options in terms of strategy, cost and effects need to be studied and from all the available alternatives the best one is to be followed.

(iv) Study the Limitations of Planning: planning is meant for the future. After deciding about the beautiful native its limitation should also be studied. After a review of the strategies for the realisation of the objectives, the problem hurdles in this way should also be evaluated by leaving a little space for any change.

(v) Formulation of the plan: In accordance with the objective here starts the process of planning. There need to move ahead in a sequence stepwise, after having evaluated the various aspects, a final shape is given to the future planning.

(vi) Formulation of sub-plans: With the help of the cardinal plan various sub-plans are undertaken to facilitate the achievement of the objectives. Such sub-plans are not independent entities rather they are the integral parts of the main plan.

(vii) Determining Time Limit: It becomes imperative to give a time frame to major and sub-plans. Every step of planning must be time-bound as which job is to be completed in how many days so as complete control on these activities could be ensured.

(viii) Evaluation: Planning is a perpetual phenomenon. It is not a one-time job and can never be concluded rather it warrants a consistent appraisal and it is also required to ensure compliance of actions with the planning.

Question 22.
Why time boundation is essential in planning?
Answer:
Business owners develop plans to reach their overall goals, and they usually find it useful to separate planning into phases. The different time frames of the planning process place the focus on time-sensitive aspects of the company’s structure and environment.

(i) Short Term Planning: Short term planning looks at the characteristics of the planning in the present and develops strategies for improving them, short term planning takes twelve months or less.

(ii) Medium Term planning: Medium-term planning usually for more than twelve months and fewer team 5yrs. It applies more permanents solutions to short-term problems. If there are quality issues, the medium-term response is to revise and strengthen the company’s quality control program.

(iii) Long Term Planning: Long-term planning organise for more than five years. In the long term, companies want to solve problems permanently and to reach their overall targets. Long-term planning reacts to the competitive situation of the company in its social, economic and political environment and develops strategies for adapting and influencing its position to achieve long term goals.

Question 23.
What do you mean by market assessment? What are the factors affecting market assessment?
Answer:
Market Assessment: Goods are produced and facilitate for providing services are created in anticipation of their demand the ultimate aim of these activities is that these reach these for whose these are meant. The commodities are needed for consumption and used by the ultimate consumers. The services are utilised by whose. Who was want to derive satisfaction out of them?

Factors Affecting the market assessment of follows:
(i) Satisfying customers needs: The concept of the market begins with the identification of the customer’s needs. It forces on producing goods or services commensurate with the wants of the customers. Thus it raises the standard of living of the customers.

(ii) Economic Development: Market plays an important role in raising the economic standard of a nation. It purchases and sale qualitative products of competitive rates not only for the internal consumption but also for more and more countries. On the other hand, it serves the citizens and on the other, it adds to the wealth of a nation. It tries to strengthen the foreign exchange reserves by exporting goods and services. Thus it strengthens a country on the economic front:

(iii) Accomplishing the Objectives of the sellers: Market helps in achieving the objectives of the sellers. The seller may be earning profit and public welfare. The market tends to find out what the customers want. The marketeers try to produce according to need felt of the ultimate customers. Thus the market plays an important role to achieve the two-fold objectives earning profit and satisfying customers.

(iv) Improves the standard of living: Market helps in raising the quality of life of common people and the standard of living by providing a new and improved variety of goods and services to them. It makes goods and services available at lower prices.

Question 24.
Define planning? What are its features?
Answer:
Planning: It is deciding in advance what to do how to do it, when to do it and who is to do it. It makes possible for things to occur which would not otherwise happen.
“Planning is selecting information and making assumptions regarding the future to formulate activities necessary to achieve organisational objectives.”

In words of Henri Fayol ‘Planning means to assess the future and make provision for it. The plan of action is at one and the same time the result envisaged in the line of action to be followed, the stage to go through the methods to use.
Features of Planning: The meaning of planning and its definition, as given above reveal its features, which may be stated as:
(i) The Basis function: Planning is the first function of management. It proceeds all other function viz. Organising, staffing, directing and controlling. Planning determines the objectives and course of action be followed without objectives and course of action, other functions are meaningless.

(ii) A continuity Activity: Plans need continuous review with the view to take cognisance of the nature of economics to keep an equilibrium in changing pattern of demand and supply. Involving co-ordination of different function of management and thus keep the business in perfect running condition, planning is a dynamic concept.

(iii) The activity of the cognitive domain: Planning relates to the cognitive domain. It is a domain of contemplation and thinking. Under planning, the managers think and arrive at a consensus of laying down ways and means to achieve the goal.

(iv) Efficiency increasing activity: Planning increase efficiency. Planned actions are always better than the non-planned ones. Planning establishes a system which helps in doing the job smoothly and quickly.

(v) Choice making activity: There may be different alternatives for finding a solution to a problem. Planning tends to choose the best course of action from different alternatives.

(vi) Based on forecasting: Planning follows forecasting. Forecasting is a technique of anticipating facts relating to the future. It is an intelligent guess of future. Planning is made on the basis of scientific predictions about the future.

(vii) Objective Oriented Activity: Planning gets inspiration from objectives. Koontz and O’Donnel have stated that “the purpose of every plan and all derivatives plan is to facilitate the accomplishment of enterprise purpose and objectives.”

Bihar Board 12th Accountancy Model Papers

Bihar Board 12th Accountancy Model Question Paper 3 in English Medium

Time : 3 Hours 15 Min
Full Marks: 100

Instructions for the candidates

1. Candidates are required to give their answers in their own words as far as practicable.
2. Figures in the right-hand margin indicate full marks.
3. While answering the questions, the candidate should adhere to the word limit as for as practicable.
4. 15 minutes of extra time has been allotted for the candidate to read the questions carefully.
5. This question paper has two sections: Section – A and Section – B.
6. In Section – A, there are 50 objective type questions which are compulsory, each carrying 1 mark. Darken the circle with black/blue ball pen against the correct option on OMR Sheet provided to you. Do not use Whitener/Liquid/Blade/Nail on OMR Sheet, otherwise, the result will be treated as invalid.
7. In Section – B there are Non-objective type questions. There are 25 Short answer type questions, out of which any 15 questions are to be answered. Each question carries 2 marks. Apart from this, there are 8 Long answer type questions, out of which any 4 of them are to answer. Each question carries 5 marks.
8. Use of any electronic device is prohibited.

Objective Type Questions

Question No. 1 to 50 have four options, out of which only one is correct, you have to mark the correct option on the OMR Sheet. (50 × 1 = 50)

Question 1.
Income & Expenditure Account records transaction of-
(a) Revenue nature only
(b) Capital nature only
(c) Both revenue and capital nature
(d) None of these
Answer:
(a) Revenue nature only

Question 2.
Donations received for special purposes-
(a) Should be credited to income & expenditure A/c
(b) Should be credited to separate account and shown in the balance sheet.
(c) Should be shown on the assets side
(d) None of these
Answer:
(c) Should be shown on the assets side

Question 3.
Subscription received by a school for organising annual function is treated as
(a) Capital Receipt
(b) Revenue Receipt
(c) Assets
(d) Earned Income
Answer:
(a) Capital Receipt

Question 4.
Out of the following items, which one is shown in the Receipts and Payments Account?
(a) Outstanding salary
(b) Depreciation
(c) Life Membership Fees
(d) Accrued subscription
Answer:
(d) Accrued subscription

Question 5.
The account is a summary of
(a) Income & Expenditure A/c
(b) Cash Book
(c) Balance sheet
(d) None of these
Answer:
(b) Cash Book

Question 6.
Capital fund is calculated-
(a) Income – Expenditure
(b) Assets – Liability
(c) Capital + Liability
(d) None of these
Answer:
(b) Assets – Liability

Question 7.
Subscription received in advance during the current year is
(a) An Income
(b) An Asset
(c) A Liability
(d) None of these
Answer:
(c) A Liability

Question 8.
Most transactions in non-trading concerns are-
(a) Cash
(b) Credit
(c) Cash and credit both
(d) None of these
Answer:
(a) Cash

Question 9.
If at the time of admission of a new partner, some profit & loss account balance appears in the books, it will be transferred to
(a) Profit and Loss Appropriation A/c
(b) All partners capital A/c
(c) Old partners capital A/c
(d) Revaluation A/c
Answer:
(b) All partners capital A/c

Question 10.
Assets and Liabilities are shown at their re-valued values in
(a) New balance sheet
(b) Revaluation A/c
(c) All partners capital A/c
(d) Realisation A/c
Answer:
(b) Revaluation A/c

Question 11.
If the Incoming partner brings the amount of goodwill in cash and also a balance exists in goodwill A/c, then this goodwill A/c is written off among the old partners in
(a) In new profit sharing ratio
(b) In old profit sharing ratio
(c) In sacrifice ratio
(d) In gaining ratio
Answer:
(b) In old profit sharing ratio

Question 12.
The amount of goodwill is paid by the new partner
(a) For payment of capital
(b) For sharing the profit
(c) For purchase of assets
(d) None of these
Answer:
(a) For payment of capital

Question 13.
Gaining Ratio is
(a) New Ratio – Sacrifice Ratio
(b) Old Ratio – Sacrifice Ratio
(c) New Ratio – Old Ratio
(d) Old Ratio – New Ratio
Answer:
(c) New Ratio – Old Ratio

Question 14.
On reconstitution of the firm, an increase in the value of assets will result in
(a) Gain to existing partners
(b) The loss to existing partners
(c) Neither gain nor loss to existing partners
(d) None of these
Answer:
(a) Gain to existing partners

Question 15.
Goodwill is a ______ asset
(a) Worthless
(b) Tangible
(c) Valueless
(d) Valuable
Answer:
(d) Valuable

Question 16.
Which accounts are opened when the capitals are fixed?
(a) Only capital accounts
(b) Only current accounts
(c) Liability account
(d) Capital and current A/c
Answer:
(d) Capital and current A/c

Question 17.
In the absence of a partnership deed, partners are not entitled to receive
(a) Salaries
(b) Commission
(c) Interest on capital
(d) All of these
Answer:
(c) Interest on capital

Question 18.
The relation of partners with the firm is that of-
(a) An owner
(b) An agent
(c) An owner and an agent
(d) Manager
Answer:
(a) An owner

Question 19.
Number of partners in an ordinary partnership firm maybe
(a) Maximum two
(b) Maximum ten
(c) Maximum twenty
(d) Maximum fifty
Answer:
(c) Maximum twenty

Question 20.
A preparing partnership deed is
(a) Compulsory
(b) Partly compulsory
(c) Voluntary
(d) None of these
Answer:
(a) Compulsory

Question 21.
Liability of partner is
(a) Limited
(b) Unlimited
(c) Determined by partnership Act
(d) None of these
Answer:
(b) Unlimited

Question 22.
The surrender value of an insurance policy means that value
(a) Which is received on the death of a partner.
(b) Which is received when a policy matures.
(c) Which can be received before the due date of the policy.
(d) None of the above
Answer:
(c) Which can be received before the due date of the policy.

Question 23.
On the retirement of a partner, goodwill will be credited to the capital account of
(a) Retiring partner
(b) Remaining partners
(c) All partners
(d) None of the above
Answer:
(b) Remaining partners

Question 24.
Partnership act provides that interest on the amount of capital balance left by the retiring partner be paid at
(a) 5%
(b) 6%
(c) Bank rate
(d) 8%
Answer:
(b) 6%

Question 25.
Excess of credit side over the debit side in Revaluation Account is
(a) Profit
(b) Loss
(c) Receipt
(d) Expense
Answer:
(a) Profit

Question 26.
Subject to the permission allowed, the maximum allowable discount on equity shares is
(a) 5%
(b) 10%
(c) 12%
(d) 20%
Answer:
(b) 10%

Question 27.
Amount of calls in Arrear is
(a) Added to capital
(b) Deducted from share capital
(c) Shown on the asset side
(d) Shown on the equity and liability side
Answer:
(b) Deducted from share capital

Question 28.
Forfeiture of shares results in the reduction of
(a) Paid-up capital
(b) Authorised capital
(c) Reserve capital
(d) Fixed assets
Answer:
(a) Paid-up capital

Question 29.
Discount allowed on the reissue of forfeited shares is debited to
(a) Share capital A/c
(b) Share forfeited A/c
(c) Profit & Loss A/c
(d) General reserve A/c
Answer:
(d) General reserve A/c

Question 30.
Company premium on issue of debenture is a
(a) Capital Gain
(b) Profit
(c) Revenue Receipt
(d) Asset
Answer:
(c) Revenue Receipt

Question 31.
Discount in the issue of Debentures is in the nature of
(a) Revenue Loss
(b) Capital Loss
(c) Deferred Revenue expenditure
(d) None of these
Answer:
(b) Capital Loss

Question 32.
On Liquidation of a company, the principal amount of debentures is returned
(a) First of all
(b) Last of all
(c) Before equity capital
(d) None of these
Answer:
(c) Before equity capital

Question 33.
Debenture holder receives
(a) Dividend
(b) Interest
(c) Both dividend and interest
(d) Bonus
Answer:
(b) Interest

Question 34.
According to SEBI guidelines, what percentage of the amount of debentures must be transferred to Debenture Redemption Reserve, before the commencement of redemption of debentures, in case of convertible debentures?
(a) 25%
(b) 50%
(c) 100%
(d) Zero
Answer:
(b) 50%

Question 35.
Profit on the redemption of debentures is transformed to which account?
(a) Capital Reserve Account
(b) Sinking Fund Account
(c) General Reserve Account
(d) Profit & Loss A/c
Answer:
(a) Capital Reserve Account

Question 36.
Proft on cancellation of own debenture is
(a) Revenue Profit
(b) Capital Profit
(c) Operating Profit
(d) Trading Profit
Answer:
(b) Capital Profit

Question 37.
Which of the following is correct profit or loss in case of the amount received from the sale of assets is Rs. 50,000, total assets is Rs. 60,000, total liabilities Rs. 20,000 and realisation exp. Rs.,2000?
(a) Rs. 8000 loss
(b) Rs. 12,000 loss
(c) Rs. 32,000 profit
(d) None of these
Answer:
(b) Rs. 12,000 loss

Question 38.
Sundry creditors amounted to Rs. 8000. These were paid at a discount of 5% Realisation A/c will be debited by
(a) Rs. 8000
(b) Rs. 7600
(c) Rs. 400
(d) Rs. 8400
Answer:
(c) Rs. 400

Question 39.
On dissolution of a firm, credit balance of partner’s capital account is paid to
(a) Partners
(b) Firm
(c) Wife
(d) None of these
Answer:
(a) Partners

Question 40.
On dissolution of the firm, partner’s capital A/c is closed through
(a) Realisation A/c
(b) Drawings A/c
(c) Bank A/c
(d) Loan A/c
Answer:
(c) Bank A/c

Question 41.
Which of the following is not a source of cash?
(a) purchase of fixed assets
(b) fund from operations
(c) issue of debentures
(d) sale of fixed assets
Answer:
(a) purchase of fixed assets

Question 42.
The ideal current ratio is
(a) 2 : 1
(b) 1 : 2
(c) 3 : 2
(d) 3 : 4
Answer:
(a) 2 : 1

Question 43.
The ideal debt equity ratio is
(a) 1 : 1
(b) 1 : 2
(c) 2 : 1
(d) 3 : 4
Answer:
(a) 1 : 1

Question 44.
Interpretation of financial statement includes
(a) criticism and analysis
(b) comparison and trend study
(c) drawing conclusion
(d) all of these
Answer:
(d) all of these

Question 45.
Dividends for the shareholders are
(a) payable tax amount
(b) tax-free amount
(c) interest
(d) none of these
Answer:
(d) none of these

Question 46.
Debenture holder receives
(a) dividend
(b) profit
(c) interest
(d) none of these
Answer:
(c) interest

Question 47.
Profit of cancellation of ‘Own debenture’ is transferred to
(a) profit & loss appropriation A/c
(b) debenture redemption A/c
(c) capital reserve A/c
(d) none of these
Answer:
(c) capital reserve A/c

Question 48.
The debenture is the part of
(a) share capital
(b) loan
(c) owned capital
(d) creditor
Answer:
(b) loan

Question 49.
Debenture carries interest at
(a) 12% p.a.
(b) 20% p.a.
(c) fixed rate
(d) 6% p.a.
Answer:
(c) fixed-rate

Question 50.
A company issues its shares at a premium under which Section of Indian Companies Act,1956?
(a) 78
(b) 79
(c) 80
(d) 81
Answer:
(c) fixed-rate

Non-Objective Type Questions

Short Answer Type Questions

Question No. 1 to 25 are Short answer type questions. Answer any 15 out of them. Each question carries 2 marks. (15 × 3 = 30)

Question 1.
State any three purposes for which share premium can be utilised?
Answer:
Following are the three purposes for which share premium can be utilised

• Issuing fully paid bonus shares to the members
• Writing off the preliminary expenses of Company
• In purchasing its own shares Buyback.

Question 2.
From the following information, calculate the stock turnover ratio.
Sales: Rs. 4,00,000
Average stock: Rs. 55,000
Gross Loss Ratio: 10%
Answer:
Sales = 4,00,000
Gross Loss Ratio = 10%
Average Stock = 55,000
Stock Turnover Ratio = Net sales/Avg. stock = 400000/55000 = 7.28 times

Question 3.
Prakash Industries issued Rs. 4,00,000, 9% debentures of Rs. 100 each on April 01, 2012, at a premium Of 6% redeemable at a premium of 10% on 31st March 2016. The debentures were redeemed on the due date. Pass only journal entries for the redemption of the debenture.
Answer:
In the Books of Prakash Industries.

Question 4.
Define the term DDL in RDBMS.
Answer:
A DDL is a language used to define data structure and modify data. For example, DDL commands can be used to add, remove or modify tables within a database. A data definition language has a pre-defined syntax for describing data.

Question 5.
Explain the primary key & candidate key.
Answer:
Primary key: A primary key is a column or a combination of columns that uniquely identify a record.
Candidate key: A candidate key can be any column or a combination of columns that can quality as a unique key in the database. There can be multiple candidate keys in one table. Each candidate key can quality as a primary key.

Question 6.
Explain Table, Record & Attributes in RDBMS.
Answer:

• Table: A table is a collection of data elements organised in terms of rows and columns.
• Records: Record in a table represents a set of related data.
• Attributes: The term “Attribute” is also used to represent a column. For example, in the Employee table, Name is a column that represents the names of the employee.

Question 7.
What is the chart in MS-Excel? Explain its importance.
Answer:
A chart is a powerful tool that allows you to visually display data in a variety of different chart formats such as Bar, Column, Pie, Line, Area, Doughnut. Scatter, Surface or Radar charts with Excel, it is easy to create a chart.
Following are the importance of chart:

• Visualization: Excel charts allow spreadsheet administrators to create visualizations of data sets.
• Automation: The Excel application automates the process of generating charts from existing data sets.
• Customisation: The chart functions in excel users to strike a balance between automation and customization.
• Integration: If a business or other organisation is using spreadsheet data managed within excel, using the chart function within excel aids integration of the data.

Question 8.
Mention any four provisions of the Partnership Act, in the absence of partnership deed.
Answer:
Following are the four provisions of the partnership Act, in the absence of partnership deed:

• Salary and commission
• Sharing of profits
• Interest on Capital
• Interest on Drawing

Question 9.
X and Y are partners. X’s capital is Rs. 10,000 and Y’s capital is Rs. 6,000. Interest is payable @ 6% p.a. on capital. Y is entitled to a salary of Rs. 200 per month. Profit for the current year is Rs. 8,000 before interest and salary to Y. Divide the profit between X and Y.
Answer:
Profit and Loss Appropriation Account.

Question 10.
What options are available to a company for allotment of debentures in case of over-subscription?
Answer:
In case of oversubscription following options available to a company:

• The excess application money on over applied debentures is refunded to the applicants
• Excess applications may be retained for adjustments towards allotment and call money. In such a case, applicants get pro-rata allotment
• Some applications may be rejected outright and applications money on such applications is returned.

Question 11.
Calculate the operating ratio from the following data:
Sale: Rs. 6,40,000
Sales Return: Rs. 40,000
Cost of goods sold: Rs. 4,60,000
Operating expense: Rs. 40,000
Answer:
Calculation of operating Ratio:

where, Net Sales = Sales – Return = 640,000 – 40,000 = 600,000

Question 12.
A company took a loan of Rs. 2,00,000 from a Bank and placed with the Bank debentures for Rs. 2,50,000 as collateral securities. Show how they will appear in the company’s Balance Sheet.
Answer:
Balance Sheet

Question 13.
The Current Assets of a company are Rs. 15,00,000. Its Current ratio is 3 : 1 and Liquid ratio is 1.25 : 1. Calculate the amount of Current Liabilities, Liquid Assets and Inventory.
Answer:

Quick (liquid) Assets = (500,000 × 1.25) = 625,000
Inventory = Current Assets – QuickAssets = 1500,000 – 625,000 = 875,000

Question 14.
Explain absolute cell references in Excel.
Answer:
An absolute reference is designed in a formula by the addition of a dollar sign (&). It can precede the column reference, the row reference, or both.

Question 15.
Define RDBMS.
Answer:
A rational database management system (RDBMS) is a program that lets you create an update, and administer a relational database.

Question 16.
Explain the functions of SQL command in the following:
Alter & Update.
Answer:
The SQL ‘ALTER’ table command is used to add, delete or modify columns in an existing table.
The SQL ‘UPDATE’ command can update records for single table only.

Question 17.
Define types of SQL (DML & DCL).
Answer:
DML: Data manipulation language (DML) is used to retrieve, store, modify, delete, insert and update data in the database.
DCLA: data control language (DCL) is a syntax similar to a computer programming language used to control access to data stored in a database.

Question 18.
Explain Database design.
Answer:
Database design is the process of producing a detailed data model of a database. This data model contains all the needed logical and physical design choices and physical storage parameters needed to generate a design in a data definition language which can then be used to create a database. A fully attributed data model contains detailed attributes for each entity. The term data Dase design can be used to describe many different parts of the design of an overall database system.

Question 19.
Explain Schema & Subschema.
Answer:
Schema: 4 scheme is the design or layout of a database management system. It will often have a list of units or entities that feature in the database and describe the relationships between them. A schema often remains unchanged despite the volatile nature of the database.
Sub-schema: A sub-schema is. the best described as the way that the data in a DBMS appears when viewed by an application or a user.

Question 20.
Explain the financial function NPV ( ) in Excel with example.
Answer:
In finance Net present value (NDU) is defined as the sum of the present values of incoming and outgoing cash flows over a period of time.

Question 21.
Describe the pivot table in Excel, under ‘what-if analysis tool.
Answer:
By using ‘what-if analysis tools in Excel we can use several different sets of value in one or more formulas to explore all the various results.

Question 22.
Describe the processes of sorting in Excel.
Answer:
Excel provides a tool for sorting the given data according to multiple fields, you can sort your data on up to 64 different fields. The field may be Name, address, number, grades or any other field.

Question 23.
Write appropriate SQL commands to create an Employ table with required columns.
Answer:
The SQL create table statement is used to create a table to store data. Integrity constraints like primary key, unique key, a foreign key can be defined for columns while creating the employee table. The integrity constraints can be defined at the column level or table level.
Table Name i.e. column-1, column-2
Data type i.e. char, data, No, etc.

Question 24.
State four features of Income and Expenditure Account.
Answer:
Following are the Four features of Income and Expenditure A/c:

• It is a Nominal account.
• It is prepared from the Receipts and payments Account and other relevant information.
• Items are capital nature are not shown in this account.
• It shows the income and expenditure of the current year only on an accrual basis.

Question 25.
Distinguish between Fixed capital and fluctuating capital.
Answer:
Following are the differences between Fixed and Fluctuating capital A/c.

Long Answer Type Questions

Question No. 26 to 33 are long answer type questions. Answer any 4 of them. Each question carries 5 marks. (4 × 5 = 20)

Question 26.
How would you calculate the amount payable to the retiring partner?
Answer:
Considering the following point, we can calculate the amount payable to the retiring partner.
(I) Entire amount co be paid in cash.
(i) If fund available:
Journal Entry:
Retiring partner’s capital A/c -Dr.
To Cash A/c
(ii) If the loan is taken from the bank:
(a) Bank or cash A/c -Dr.
To Bank loan A/c
(b) Retiring partner’s capital A/c -Dr.
To Bank or Cash A/c

(II) By transferring capital Balance into Retiring partner’s loan Account:
Journal Entry:
Retiring Partner’s Capital A/c -Dr.
To Retiring Partner’s Loan A/c

(III) Payment partly in cash and partly by transferring to loan A/c.
Journal Entry:
Retiring Partner’s Capital A/c -Dr.
To Cash A/c
To Retiring Partner’s Loan A/c

(IV) Payment of Retiring partner’s loan in Instalments.
Journal Entry:
(a) Interest A/c -Dr.
To Retiring Partner’s Loan A/c
(b) Retiring Partner’s Loan A/c -Dr.
To Cash or Bank A/c
(c) Profit & Loss A/c -Dr.
To Interest A/c

Question 27.
A, B arid C were partners in firm sharing profits in the ratio of 4 : 3 : 3. On 1.4.2013 they decided to dissolve the firm. On that date, A’s is capital was Rs. 1,25,000, B’s is capital was Rs. 45,000 and C’s capital was Rs. 15,000 (Dr.). The creditors amounted to Rs. 23,150 and cash in hand were Rs. 4,520. The assets realised Rs. 1,44,910 and the expenses of dissolution were Rs. 1,860. Prepare Realisation Account.
Answer:
The balance sheet on the date of dissolution is not given in the question. Hence Balance sheet on the date i.e. 1.09.2013 shall be prepared to ascertain the value of assets.

Question 28.
On 1st April 2013, Golu Ltd. was the holder of 500 shares of Rs. 10 each. He has paid Rs. 4 per share. At a meeting of the directors held on that date his shares were forfeited for non-payment of the first & final calls of Rs. 2 and Rs. 4 per share respectively. On 1st May 2013, these shares were re-issued fully paid to Maganlal for Rs. 4,500. Give Journal entries in the books of the company.
Answer:

Question 29.
Satyam Ltd. issued 15,000 debentures of Rs. 10 each payable as follows: Rs. 2 on the application, Rs. 3 on the allotment, Rs. 5 on first & final calls. All the debentures were applied for and allotted. All money due was received, pass necessary journal entries.
Answer:

Question 30.
Journalise the following transactions for issue of debentures
(a) A debenture issued at Rs. 95 and redeemed at Rs. 100
(b) A debenture issued at Rs. 95 and will be redeemed at Rs. 105.
(c) A debenture issued at Rs. 100 and will be redeemed at Rs. 105.
Answer:

Question 31.
Calculate cash flow from operating activities from the following balances:

Answer:

Question 32.
From the following Balance Sheets of Goodluck Ltd. prepare cash flow statement according to Revised Accounting Standard 3 by the indirect method:

Answer: