Accountancy: Unit-wise Group A Question Bank

1. Office management is the task of planning, organising, directing, coordinating and controlling the work of an office so that its objectives are achieved efficiently and economically.

2. Any two of: personnel; layout and environment; machines and equipment; records management; forms and stationery; communication; financial office work.

3. Any two of: receipt and sorting, recording, action, noting and drafting, approval and signature, dispatch, follow-up.

4. Office layout is the arrangement of furniture, machines, departments and staff within the available floor space so that work flows smoothly.

5. A noting is the written record of the facts of a case, the applicable rules, the views of the sections concerned and a proposed decision, written on the file for the deciding officer.

6. Drafting is the preparation, in the form in which it will be issued, of a letter or order to be sent out of the office.

7. Filing is the systematic arrangement and storage of documents so that any document can be traced and produced when needed.

8. An index is a guide that tells where a particular record is kept — it converts a name or subject into the file's address.

9. Any two of: to keep papers safe; to make documents easy to trace; to keep related papers together; to preserve evidence; to serve as the office memory; to save space and cost.

10. The retention period is the fixed length of time for which a class of record must be kept before it may be transferred or destroyed.

1. A financial institution is an institution whose main business is to collect money from savers and lend or invest it for those who need it, and to provide financial services such as deposits, loans, payments, insurance and foreign exchange.

2. 26 April 1956 A.D. (13 Baisakh 2013 B.S.).

3. Any two of: issuing currency; banker to the government; banker's bank; lender of last resort; monetary policy; foreign exchange management; supervision of banks; clearing house.

4. Nepal Bank Limited, 1994 B.S. (1937 A.D.).

5. Credit creation is the power of a bank to expand the supply of money by lending: a loan is credited to the borrower's account and becomes a new deposit, which supports further lending.

6. Insurance is a contract in which the insurer, in return for a premium, agrees to pay a stated sum to the insured if a stated event happens.

7. Any two of: fire, marine, motor, health, accident, crop and livestock insurance.

8. Crossing means drawing two parallel lines across the face of a cheque, directing the bank to pay it only into a bank account and never in cash.

9. Remittance is money sent by a person working away from home, usually abroad, to a person at home.

10. The money market deals in short-term funds and securities of up to one year; the capital market deals in long-term securities of more than one year.

1. Tax is a compulsory contribution imposed by the government on persons, goods, services and transactions to meet public expenditure, without a direct and proportionate return to the payer.

2. An indirect tax is a tax imposed on one person but borne by another — the burden is shifted to the final consumer.

3. Any two of: income tax, house and land tax, capital gains tax, vehicle tax.

4. Value Added Tax.

5. 1 Mangsir 2054 B.S.

6. 13 per cent (a single rate).

7. Permanent Account Number; nine digits.

8. Any two of: income tax, VAT, excise duty, customs duty, land and house tax, vehicle tax, registration fees, royalties, dividends from public enterprises, foreign grants.

9. A progressive tax is one whose rate rises as the income or wealth of the taxpayer rises, so the rich pay a larger share of their income than the poor.

10. Any two of: to raise revenue, to redistribute income, to control inflation, to protect domestic industry, to discourage harmful consumption, to encourage saving and investment.

1. Accounting is the process of identifying, measuring, recording, classifying, summarising and communicating economic information to those who need it.

2. Assets = Liabilities + Capital.

3. Any two of: financial accounting, cost accounting, management accounting.

4. An accounting standard is a written rule issued by an authorised professional body prescribing how a transaction or event must be recognised, measured, presented and disclosed in the financial statements.

5. The Institute of Chartered Accountants of Nepal (ICAN), through its Accounting Standards Board.

6. Nepal Financial Reporting Standards.

7. A chart of accounts is the complete, organised and numbered list of all the account heads used to record transactions, grouped into assets, liabilities, capital, income and expenses.

8. Any two of: banks and lenders, suppliers and creditors, the government and the tax authority, investors, auditors, the public.

9. On the credit side.

10. Book-keeping is only the recording of transactions in the journal and ledger; accounting goes further and includes summarising, analysing and interpreting the recorded data and preparing the final accounts.

1. A statement prepared on a particular date to explain and reconcile the difference between the balance of the bank column of the cash book and the balance of the passbook.

2. Any two of: cheques issued but not presented; cheques deposited but not collected; bank charges; interest allowed or charged; direct deposit by a customer; standing instructions; dishonoured cheque; errors.

3. Money is lying in the bank — a favourable balance.

4. A debit balance (an overdraft in the cash book is a debit balance in the passbook).

5. Higher — the trader has already reduced his cash book, the bank has not.

6. Any two of: bank charges and commission, interest allowed or charged, dividend collected, direct deposit by a customer, standing instructions, dishonour of a cheque.

7. The cash book after all items appearing only in the passbook have been entered in it, so that the remaining difference is only a matter of time.

8. The passbook.

9. To check the accuracy of both records and find errors; to find the true bank balance; to detect dishonoured cheques and unrecorded charges; to prepare the balance sheet; to prevent fraud.

10. The bank reconciliation statement.

1. An accounting error is a mistake in recording, posting, casting, carrying forward or summarising a transaction, or in applying an accounting principle.

2. A mistake in applying an accounting rule, such as treating a capital expenditure as a revenue expense. Example: wages paid for installing a machine debited to the wages account instead of being added to the machine's cost.

3. One of two or more errors, each of the same amount and on opposite sides, which cancel each other so that the trial balance still agrees.

4. One-sided errors: casting and balancing errors, posting to the wrong side, a wrong amount posted in one account only, partial omission.

5. Two-sided errors: errors of principle, complete omission, compensating errors, wrong account of the same class, a transaction entered twice in both accounts.

6. A suspense account is a temporary account opened to hold the difference in the trial balance until the errors causing it are found and corrected.

7. On the credit side.

8. An error of principle.

9. On the assets side.

10. Rent A/c Dr. 6,000; To Wages A/c 6,000.

1. Final accounts are the statements prepared at the end of the accounting period, after adjustments, to show the profit or loss of the period and the financial position on the closing date — the trading account, the profit and loss account and the balance sheet.

2. Cost\ of\ goods\ sold = Opening\ stock + Purchases + Direct\ expenses - Closing\ stock.

3. Added to the salary on the debit side of the profit and loss account and shown as a current liability in the balance sheet.

4. Deducted from rent on the debit side of the profit and loss account and shown as a current asset in the balance sheet.

5. Credited in the trading account on the credit side and shown as a current asset in the balance sheet.

6. Added to the capital on the liabilities side.

7. Deducted from the capital on the liabilities side.

8. An amount set aside out of profit to cover debts expected not to be recovered; it is debited to the profit and loss account and deducted from debtors.

9. Any two of: carriage inward, freight, wages, factory rent, fuel and power, customs and clearing charges.

10. Accounting notes are the explanations attached to the financial statements stating the accounting policies used, describing each item and disclosing contingent liabilities and other matters that the figures alone do not show.

1. Government accounting is the system by which a government records, classifies, summarises and reports its revenue, expenditure and financial position, in order to be accountable to the legislature and the public for public money.

2. Any two of: legal basis; cash basis; double-entry system; fund basis; uniformity of forms and chart of accounts; budget classification; two levels of accounting; banking arrangement; external audit.

3. The cash basis.

4. The Financial Comptroller General Office (महालेखा नियन्त्रक कार्यालय).

5. The government's main fund, into which all revenue must be deposited and from which nothing may be withdrawn except under an appropriation made by law.

6. Any two of: the Ministry of Finance, the Office of the Auditor General, a ministry or department at the centre, the Financial Comptroller General Office.

7. The accounting of the transactions of a district or local office, kept in the office itself in the bank cash book and reported monthly through the statement of expenditure.

8. The uniform, coded list of every revenue head, expenditure head, fund and asset a government office may use, prescribed by the FCGO.

9. Any two of: revenue accounting, expenditure accounting, store accounting, fund accounting, deposit and retention accounting, loan and grant accounting, asset and liability accounting.

10. The Office of the Auditor General.

1. Revenue accounting is the branch of government accounting that records the collection of government revenue, its deposit into the consolidated fund through the bank and its reporting.

2. Because revenue must reach the consolidated fund and be accounted for, and an office that held it as cash could spend it outside the budget.

3. The monthly return (राजस्वको फाँटबारी) showing head by head the revenue collected, the amount deposited and the cash still in hand.

4. 14224.

5. Any two of: 14227 passport fee; 14251 company registration fee; 14151 rent of government property; 14221 judicial fee; 14311 judicial fine.

6. The voucher by which revenue is recorded in the accounts, naming the head, the payer, the amount and the evidence.

7. The Treasury and Comptroller Office (कोष तथा लेखा नियन्त्रक कार्यालय).

8. No. The revenue must be deposited in full and the bill paid under an appropriation, through a payment order and the bank cash book.

9. Revenue collected = amount deposited into the consolidated fund + cash still in hand.

10. Any two of: to record every rupee with evidence; to ensure deposit into the consolidated fund; to compare collection with the estimate; to detect leakage; to supply the government's financial statement; to keep the account public.

1. The amount voted by the legislature for a particular budget head for the financial year.

2. The amount of the appropriation actually made available to the office by the Treasury and Comptroller Office, usually month by month or quarter by quarter.

3. Office materials 22311; furniture and fixtures 31121.

4. The document by which a government office authorises the Treasury and Comptroller Office to pay a stated amount to a stated person against a stated budget head.

5. Money paid to an officer or supplier before the bill is produced; it is a recoverable debt of that person to the government, not an expenditure.

6. The transfer journal voucher used where no money leaves the office — clearing an advance, transferring between heads or adjusting a deposit.

7. म.ले.प.फा.नं. २०९ (A.G.F. No. 209).

8. Any two of: budget release received; revenue deposited; retention and deductions received; refund of an unspent advance; amount transferred in.

9. The monthly return to the Treasury and Comptroller Office showing head by head the annual appropriation, the expenditure to date, the expenditure of the month, the uncleared advances and the available balance.

10. Available balance = annual appropriation − total expenditure to date − uncleared advances.

1. Store accounting is the branch of government accounting that records the receipt, storage, issue and balance of goods held by a government office, in quantity and in value.

2. Any two of: to record every receipt and issue; to show the stock balance at any time; to prevent loss, misuse and theft; to provide audit evidence; to help budgeting.

3. Any two of: furniture, computers, vehicles, machines, musical instruments.

4. A small card kept on the shelf or bin with the article, showing receipts, issues and the balance in hand.

5. The main store book, with one account or page for each article, showing the date, particulars, receipts, issues and balance.

6. For recording goods received into the store — date, description, specification, quantity, value and supplier.

7. The monthly or periodic statement of goods in hand, by head, sent to the higher office and used for reporting and budgeting.

8. A store inspection committee of at least two officers, one of whom is not connected with the store.

9. No. A written requisition and a signed जिन्सी निकासा फाराम are required.

10. With the store ledger (जिन्सी खाता).

1. A fund is a separate pool of money set aside for a specified purpose and accounted for separately from other money.

2. Fund accounting is the system of keeping a separate account, bank account and statement for each fund, so that its receipts and payments are recorded and reported on their own.

3. The government's main fund, into which all government revenue must be paid and from which nothing may be spent except under an appropriation made by law.

4. To meet unforeseen expenditure, usually while the legislature is not in session; the amount is later regularised by an appropriation.

5. The pool of federal revenue — principally VAT, income tax and royalties — shared with the provinces and the local levels.

6. The National Natural Resources and Fiscal Commission.

7. Money withheld from a payment due to a contractor, supplier or employee and held until a stated condition is satisfied.

8. Any two of: goods retention, works (construction) retention, personal retention.

9. Construction (or supplies) expenditure A/c Dr. (full bill); To Contractors' retention A/c (the amount withheld); To Bank / DTCO A/c (the net paid).

10. No. It is a liability of the office to the party from whom it was withheld; it must be returned, or forfeited to revenue only if the condition is not met.

1. Internal control is the whole system of policies, procedures, records and checks adopted by an organisation to keep its work accurate, efficient, lawful and honest and to safeguard its assets.

2. Any two of: to safeguard assets; to keep the records accurate and complete; to secure efficiency; to ensure compliance with the law; to prevent and detect fraud and error; to make an audit possible.

3. Any two of: segregation of duties; authorisation; documentation; physical control; reconciliation; supervision; rotation and compulsory leave; internal audit; budget comparison.

4. An audit is an independent examination of the books, records and supporting documents of an organisation so that the auditor may express an opinion on whether the financial statements show a true and fair view.

5. An audit carried out by the organisation's own employees, continuously, to test whether the internal control system is working and whether the records are accurate and the rules followed.

6. The audit carried out after the year end on the completed books and final accounts by an independent external auditor, ending in a report with an opinion.

7. Any two of: financial (regularity) audit, performance audit, management audit, propriety audit.

8. The Office of the Auditor General (महालेखापरीक्षकको कार्यालय).

9. The Public Accounts Committee (सार्वजनिक लेखा समिति).

10. The President, on the recommendation of the Constitutional Council.

1. The Ministry of Finance.

2. Any two of: preparing the budget; framing revenue and fiscal policy; managing the consolidated fund; arranging loans and grants; controlling public expenditure; fixing the terms of government borrowing.

3. Financial Comptroller General Office (महालेखा नियन्त्रक कार्यालय); it releases the budget, keeps the central accounts, supervises the Treasury and Comptroller Offices, consolidates the accounts, maintains the chart of accounts and the formats, and operates the computerised systems.

4. The District Treasury and Comptroller Office; it receives the budget release and makes the payments of the government offices in the district on their payment orders, and keeps the operating level accounts.

5. The Financial Comptroller General Office, through the Treasury and Comptroller Office.

6. Nepal Rastra Bank.

7. The National Planning Commission prepares the country's periodic development plan, sets the priorities and sectoral ceilings for the budget, appraises large projects and recommends the resource envelope.

8. The Ministry of Finance and the Office of the Auditor General (also acceptable: a ministry or department at the centre, and the FCGO).

9. The arrangement under which a government office keeps one designated bank account for all its receipts and payments, recorded in the bank cash book, under the Treasury Single Account.

10. The Public Accounts Committee (सार्वजनिक लेखा समिति).

1. A computer is an electronic device that accepts data, processes it according to stored instructions, stores the result and gives it out in a usable form.

2. Information technology is the whole set of devices, software, networks and methods by which information is collected, stored, processed and communicated.

3. Any two of: hardware, software, network, data, people, procedures.

4. An office package is a set of application software that does the ordinary work of an office; examples are Word, Excel, PowerPoint, Access.

5. Preparing a salary sheet, budget, stock register or bank reconciliation with formulae and totals.

6. The internet is a worldwide network of computers connected so that they can exchange information using common rules.

7. Any two of: speed; accuracy; storage and retrieval; automatic posting; instant reporting; communication; less paper; better control.

8. Any two of: cost; dependence; data loss; fraud and hacking; training; unemployment; health problems; garbage in garbage out; obsolescence.

9. Any two of: Tally, Swastik, Easy Account, Quick Book.

10. LMBIS — Line Ministry Budget Information System; SUTRA — Sub-National Treasury Regulatory Application.