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Q - 1 .Issue of shares at a discount should be authorized by the members by passing a resolution in the general meeting and resolution of members should specify the rate of discount which should not exceed 10% of the face value of the shares Further this is subject to

Obtention of sanction from Company Law Board
These shares must be issued with in 2 months
Both (a) and (b)
None of the above

Q - 2 .A floating charge means

Charge at the time or before the company is floated
Charge on all floating assets of the company
An equitable charge on all assets of the company
Any of the above

Q - 3 .The amount which the firm owe to outsiders

Assets
Capital
Liabilities
Intangible assets

Q - 4 .This is the amount by which an asset is expected to lose its value. What is this

Market value
Wear and tear
Depreciation
NAP

Q - 5 .Creditors Velocity expresses the

Maximum period for which credit is given
Average period of credit enjoyed
Minimum period of credit given
Minimum period for which credit enjoyed

Q - 6 .Gold Loans are given only to properly introduced persons because of

RBI s directives
Bank will lose the right to sell the gold if the pledgee s title is defective
Sec.131 of Negotiable Instrument Act
All the above

Q - 7 .The Net Working Capital refers to

Liquid surplus
Borrowers Contributions from long term source to short term use
Excess Current Asset over Current Liability
All the above

Q - 8 .Total Current Asset of a unit is Rs.300 lacs. Other Current Liabilities is Rs.200 lacs. The MPBF as per Ist Method & 2nd method can be

75 and 25 lacs
25 lacs and 75 lacs
Rs.100 lacs & Rs.150 lacs
Rs.20 lacs & Rs.80 lacs

Q - 9 .The following is not usually classified as Other Non Current Assets

Advance given to Directors
Tender Deposit
Receivable outstanding beyond 12 months
Preliminary and Pre operative expenses

Q - 10 .Financial leverage means

use leveraged lease to plan tax liability
High degree of solvency
Law bank finance
Use of more debt capital to increase profit

Q - 11 .The State Govt. wants to seize the goods pledged to bank as the borrower has defaulted in payment of tax. In this case,

Govt dues enjoys priority over bank dues
Bank dues enjoys priority over Government dues
Both enjoys equal priority
The Government cannot seize the goods

Q - 12 .Accounting software may be written in any one of the computer languages such as

Windows, UNIX etc
JAVA C+ etc
COBOL, Foxpro etc
None of the above

Q - 13 .For determining the advance amount the shares will be valued on the basis of

Current market price
Average market price for the last 12 months
Face Value
A or B whichever is lower

Q - 14 .Reserve created out of profit from business operation is known as

Capital Reserve
Profit Reserve
Revenue Reserve
Free Reserve

Q - 15 . A Company makes a single product with a sales price of Rs.10/- and a marginal cost of Rs.6/-. Fixed Cost are Rs.60000/- p.a. In this case, Number of units at break even

15000
10000
6000
None of Above

Q - 16 .The value which the bond holder gets on maturity is called

Maturity value
NAV
the redemption value
IRR

Q - 17 .If the partnership does not mention any method of maintaining capital account then _______ method of capital has to be used

Fluctuating capital account
Partners Current account
Capital account
Fixed capital account

Q - 18 .A Mortgage cannot be enforced in the absence of

Delivery of the title deeds
Legal Opinion
Narration in Title deeds register
Pecuniary obligation

Q - 19 .The charge by way of lien over goods belonging to a company must be registered with Registrar of Companies within a period of

30 days of creation of law
This charge need not be registered as this is not hypothecation, mortgage etc
30 days of default in repayment
A or C whichever is earlier

Q - 20 .Tangible Networth is computed by

Total Tangible Asset less outside liabilities
Capital, free reserves & surplus less Intangible Asset
Networth less Intangible Asset
All the above

Q - 21 .If a firm borrows money its capital would be reduced

This statement is false
This statement is true
The same is acceptable
None of the above

Q - 22 .The amount which the owner of the business has invested in the firm and can claim from the firm is known as ___________

Capital
Loan
Term Loan
Fixed Asset

Q - 23 .If the rate of a currency A is known in terms of currency B and rate of Currency B in terms of Currency C , we can derive the rate of currency A interms of Currency C using the technique of cross currency

Exchange rate
Cross rate
Forward rate
None of the above

Q - 24 .According to section 79A inserted by Companies Amendment Act 1999 ____ shares means equity shares issued by the company to employees or directors at a discount or for consideration other than cash for providing know how or making available right in the intellectual property rights or value addition, by whatever name called

Employees stock option
Equity shares
Sweat equity
None of the above

Q - 25 .A Mortgage of the mortgaged property is called

Sub-mortgage
Second Mortgage
Re-mortgage
Fraudulent Mortgage

Q - 26 .Opening stock of raw material is Rs.30 lacs, closing stock is Rs.50 lacs. Annual purchase is Rs.500 lacs. What is the average period of holding of Raw Materials?

2 M
1.5 M
1 M
NOA

Q - 27 .Interest charged in advance accounts as per RBI directive can not be subject to scrutiny by court. This is provided in

Section 35A of BR Act
Section 21(A) of BR Act
Of BR Act
Section 26 of RBI Act

Q - 28 .A method of calculating depreciation of an asset , which assumes that the asset will lose an equal amount of value each year is known as

Salvage value
Depreciation
Straight line Method of calculation
Accumulated Depreciation

Q - 29 .A scheme under which the company grants option (A right but not an obligation ) to an employee to apply for shares of the company at a pre determined price is known as

Employees Stock Option Scheme (ESOS)
Equity shares
Sweat Equity
None of the above

Q - 30 .The home currency price of one unit of a foreign currency is quoted eg USD 1 = Rs43.20

Indirect quotation
Exchange rate
Rate of USD
Direct quotation

Q - 31 .Banking Ombudsman is appointed by

Central Government / Ministry of Finance
State Government
IDBI
RBI

Q - 32 .A Customer Service Meet should be organized at every Branch

Once in a Fortnight
Once in a Quarter
Once in a Month
Once in a Half-Year

Q - 33 .As per NABARD guidelines the minimum Internal Rate of Return for Agricultural Project is

15%
25%
30%
18%

Q - 34 .Computers are basically classified into

Analogue Computers and Digital computers
Hardware and software
Wipro and Infosysis
All the above

Q - 35 .Investment in Shares of other companies can be classified as Current Asset only when the shares are

Quoted
Relate to trade investment
A & B
Shares cannot be classified as Current Assets

Q - 36 .A unit is showing a net profit of Rs.46,000/-. Dividend received Rs.8000/-. Operating expenses is Rs.96000/-. Find the gross profit

134000
150000
142000
132000

Q - 37 .____is the value of an established business over and above the value represented by it s tangible assets

Assets
Liabilities
Goodwill
None of the above

Q - 38 .A person who owes money to a firm , mostly on account of credit sales of goods is called

Creditor
Debtor
Borrower
lender

Q - 39 .The following is not a chargeable current assets

Book debt
Spares
Work in process
Construction work in progress

Q - 40 .While calculating the value of (1+.10)3 (to the power of 3) the same can be calculated

Manually
using calculator
using MS Excel
all the above

Q - 41 .An Annuity is an ordinary Annuity if,

Payments are required to be made at the beginning of each period
Payments are required to be made at the middle of each period
Payments are required to be made at ordinary installments
Payments are required to be made at the end of each period

Q - 42 .An operation by which one can make risk free profits making use of the interest differentials between two places is called

Open market operation
Profitability
Free market
Arbitrage

Q - 43 .What is the formula for charging compound interest with Annual Compounding

I = Pnr
P+I
A = P( 1+r)n
Any of the 3

Q - 44 .A firm paid Rs.16 lacs for purchase of a business with machinery worth Rs.10 lacs and other assets worth Rs.4 lacs. In this case the difference of Rs.2 lacs is treated as

P&L Loss on purchase of asset
Goodwill Intangible Asset
Fixed Asset by inflating the value of fixed asset
Current Asset by inflating the value of current asset

Q - 45 .If a sum of Rs10,000/accumulates to Rs16,000/after 3 years at simple Interest , what is the rate of Interest.

16%
25%
23%
20%

Q - 46 .Amount of Investment under Securities held to maturity should not exceed --------- of Bank s total investment

Twenty percentage of the Bank s total investment (20% of total investment)
Twenty five percentage of the Bank s total investment (25% of total investment)
Forty nine percentage of the Bank s total investment (49% of total investment)
Forty percentage of the Bank s total investment (40 % of total investment)

Q - 47 .Holding period of Receivables is calculated with reference to

Cost of Sales
Cost of Production
Gross Sales
NOA

Q - 48 .A credit facility will be classified as NPA if_____remains past due for one quarter

Interest
Instalment
A or B
A & B

Q - 49 .The following is a Term Liability

Debentures payable within a year from the date of Balance Sheet
Preference Shares payable within a period of one year from the date of Balance Sheet
Term Loan instalments payable in a year
Deposit from public payable in 2 years time

Q - 50 .The capital which is stated in the Memorandum of Association is known as

Memorandum Capital
Paid up capital
Authorised capital
Issued capital

Online Tests for Legal & Regulatory Aspects of Banking

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