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2012 Commerce UGC NTA NET JRF Solved Previous Year Paper December 2012 Paper–III

Commerce UGC NTA NET JRF Solved Previous Year Paper December 2012 Paper–III

1. In accounting, profit prior to incorporation is treated as
A. Revenue Reserve
B. Secret Reserve
C. Capital Reserve
D. General Reserve
Ans : C

2. Receipts and Payments Account is prepared by
A. Manufacturing concerns
B. Non-Trading concerns
C. Trading concerns
D. Companies registered under Companies Act, 1956
Ans : B

3. Owners equity stands for
A. Fixed Assets minus Fixed Libilities
B. Fixed Assets minus Current Liabilities
C. Current Assets minus Fixed Liabilities
D. Total Assets minus Total outside Liabilities
Ans : D

4. When the Debt Turnover Ratio is 4, what is the average collection period?
A. 5 months B. 4 months
C. 3 months D. 2 months
Ans : C

5. Which of the following will result into sources of funds?
(i) Increase in current assets
(ii) Decrease in current assets
(iii) Increase in current liabilities
(iv) Decrease in current liabilities
Codes :
A. (i) and (iv) B. (ii) and (iii)
C. (i) and (iii) D. (ii) and (iv)
Ans : B

6. In marginal costing, contribution is equal to
A. Sales – Fixed cost
B. Sales – Variable cost
C. Sales – Profit
D. Sales – Variable cost + Fixed cost
Ans : B

7. The funds available with a company after paying all claims including tax and dividend is called
A. New Profit
B. Net Operating Profit
C. Capital Profit
D. Retained Earnings
Ans : D

8. Assertion (A) : Accounting information refers to only events which are concerned with business firm Reason (R) : Accounting information is presented in financial statements
Codes :
A. (A) is correct, but (R) is wrong
B. Both (A) and (R) are correct
C. (A) is wrong, but (R) is correct
D. Both (A) and (R) are wrong
Ans : B

9. When average cost is declining
A. Marginal cost must be declining
B. Marginal cost must be above average cost
C. Marginal cost must be below average cost
D. Marginal cost must be rising
Ans : C

10. ABC Ltd. has declared 40% dividend. Which one of the following does it mean?
A. The company has declared 40% of net profit as dividend
B. The company has declared 40% of profits after tax as dividend
C. The company will provide dividend 40% on issued capital
D. The company will provide dividend 40% on paid-up capital
Ans : D

11. The main objective of Accounting Standards is
A. To prepare the accounting reports which is easily understood by common man
B. To comply with the legal formalities
C. To harmonise the diversified accounting practices
D. To comply with the requirements of the International Accounting Standards (IAS)
Ans : C

12. Given below are two statements :
I. Activity ratios show where the company is going.
II. Balance Sheet ratios show how the company stand.
Codes :
A. I is correct, but II is wrong
B. Both I and II are correct
C. I is wrong, but II is correct
D. Both I and II are wrong
Ans : B

13. Income and Expenditure Account of non-profit organisation is a
A. Real Account
B. Nominal Account
C. Personal Account
D. Representative Personal Account
Ans : B

14. Which of the following statements are correct?
I. Inventory includes raw materials, finished goods and work-in-progress
II. Inventory is a part of the working capital
III. Inventory includes goods likely to be purchased
Codes :
A. I, II and III B. II and III
C. I and III D. I and II
Ans : D

15. If the current ratio is 2 : 1 and working capital is Rs.60,000, what is the value of the Current Assets?
A. Rs.60,000 B. Rs.1,00,000
C. Rs.1,20,000 D. Rs.1,80,000
Ans : C

16. Which of the following steps of purchase decision process is in sequence?
1. Problem recognition
2. Search for alternatives
3. Evaluation of alternatives
4. Purchase action
5. Post purchase action
Codes :
A. 1, 3, 2, 4, 5 B. 1, 2, 4, 3, 5
C. 2, 1, 3, 5, 4 D. 1, 2, 3, 4, 5
Ans : D

17. What is customer value?
A. Ratio between the customer’s perceived benefits and the resources used to obtain these benefits
B. Excess of satisfaction over expectation
C. Post purchase dissonance
D. None of the above
Ans : A

18. Match the items of List-I with items of List-II.
List-I List-II
(a) The silent mental repetition of information 1. Encoding
(b) The process by which we select a word or visual image to represent a perceived object 2. Rehearsal
(c) Where information is kept temporarily before further processing 3. Working Memory
(d) The stage of real memory in which information is processed and held for just a brief period 4. Store house
Codes :
(a) (b) (c) (d)
A. 2 1 4 3
B. 1 2 3 4
C. 3 2 1 4
D. 4 3 2 1
Ans : A

19. Fill in the blanks :
Statements Alternatives
(a) Loyal customers ____ products. 1. Less attention
(b) Loyal customers are____ sensitive. 2. Cheaper
(c) Loyal customers pay ____ to competitor’s advertising.3. Less price
(d) Serving existing customer is ____.4. Buy more
Codes :
(a) (b) (c) (d)
A. 3 1 2 4
B. 4 3 1 2
C. 2 1 3 4
D. 4 3 2 1
Ans : B

20. Assertion (A) : High customer expectations lead to dissatisfaction as product performance never matches them.
Reason (R) : Product performance is always customer specific.
Codes :
A. Both (A) and (R) are correct.
B. Both (A) and (R) are incorrect.
C. (A) is correct, but (R) is incorrect.
D. (R) is correct, but (A) is incorrect.
Ans : B

21. VAT is imposed
A. Directly on Consumers
B. On final stage of production
C. On all stages from production to final sales
D. None of the above
Ans : C

22. Which is used for short-term sales achievement?
A. Personal selling
B. Advertising
C. Sales Promotion
D. Public Relations
Ans : C

23. Public distribution system relates to
A. Marketing system
B. Retailing system
C. Industrial system
D. Selling system
Ans : B

24. Who do buy more, complain less, spread positive word of mouth, ensure a large customer base and repeat business?
A. Satisfied customers
B. Delighted customers
C. Industrial customers
D. None of the above
Ans : B

25. There are impulses which persuade a customer to buy certain products without evaluating the positive and negative value of the same.
A. Emotional motives
B. Blind motives
C. Egoistic motives
D. All of the above
Ans : D

26. Which subject is relevant to the study of consumer behaviour?
A. Economics B. Psychology
C. Sociology D. All of the above
Ans : D

27. Find an incorrect statement.
A. Consumer attitude can be summarized as evaluation of an object.
B. Attitudes are learned.
C. Attitudes are synonymous with behaviour.
D. Attitudes have motivational qualities.
Ans : C

28. Who is considered Father of Scientific Management?
A. Peter Drucker B. F.W. Taylor
C. Victor Vroom D. Henry Fayol
Ans : B

29. Who did give the concept of hierarchy of needs ?
A. Fredrick Herzberg
B. Victor Vroom
C. Douglas Mcgregor
D. A.H. Maslow
Ans : D

30. Assertion (A) : Management is a continuous process.
Reason (R) : Managers first plan, then organise and finally perform the function of controlling.
Codes :
A. Both (A) and (R) are correct and (R) is correct explanation of (A).
B. Both (A) and (R) are correct, but (R) is not a correct explanation of (A).
C. (A) is correct, but (R) is incorrect.
D. (A) is incorrect, but (R) is correct.
Ans : A

31. Induction of employees relates to
A. Organisational awareness
B. Training programme
C. Introduction
D. Assignment of duties
Ans : C

32. ‘Kinked’ demand curve is related with
A. Monopoly
B. Discriminating monopoly
C. Oligopoly
D. Perfect competition
Ans : C

33. Who is not associated with HRM?
A. Michael J. Jucius
B. Dale Yodar
C. Edvoin B. Flippo
D. K.K. Devit
Ans : D

34. Merit rating is not known as
A. Efficiency Rating
B. Service Rating
C. Job Rating
D. Experience Rating
Ans : C

35. Match the items of List-I with the items of List-II.
List-I List-II
(a) FEMA 1. 1986
(b) Indian Factories Act 2. 1999
(c) Industrial Dispute Act 3. 1948
(d) Consumer Protection Act 4. 1947
Codes :
(a) (b) (c) (d)
A. 4 2 3 1
B. 3 1 2 4
C. 2 3 4 1
D. 1 4 3 2
Ans : C

36. If price of any commodity decreases by 20% and the demand for that commodity increases by 40%, then elasticity of demand would be
A. perfectly elastic
B. perfectly inelastic
C. unit elastic
D. highly elastic
Ans : D

37. Which of the following statements is true?
A. In case of inferior goods, the income effect is negative, although the substitution effect is positive.
B. In inferior goods, the income and substitution effects are positive.
C. In inferior goods, the income and substitution effects are negative.
D. In case of inferior goods, the income effect is positive although the substitution effect is negative.
Ans : A

38. In perfect competition, the demand curve of a firm is
A. Vertical
B. Horizontal
C. Positively sloped
D. Negatively sloped
Ans : B

39. Which one is not non-financial incentive?
A. Additional bonus on minimum wasteful expenditure.
B. Permanent job.
C. Participatory decision making.
D. Recognition of individuality.
Ans : A

40. HRM does not include
A. job evaluation
B. performance appraisal
C. sales promotion
D. job enrichment
Ans : C

41. The term (1-B) is called
A. Level of the test
B. Power of the test
C. Size of the test
D. None of the above
Ans : B

42. The area under normal distribution covered within μ ± 36 limits is
A. 0.6827 B. 0.9545
C. 0.9973 D. 1.0000
Ans : C

43. Sampling distribution of mean is very close to the standard normal distribution when
A. Population is normally distributed.
B. Population is not normally distributed, but sample size is large.
C. Both A and B.
D. Neither A nor B.
Ans : C

44. If the value of co-efficient of determination is 0.64, what is the value of co-efficient of correlation?
A. 0.40 B. 0.80
C. 0.08 D. 0.04
Ans : B

45. Which one of the following is not a source of conflict in project ranking in capital budgeting decision as per NPV and IRR?
A. Independent Investment Project
B. No Capital Budget Constraints
C. No time disparity
D. None of the above
Ans : D

46. Match the following :
List-I List-II
(a) Trade policy 1. Economic conditions
(b) Trade flows 2. Economic policies
(c) Price trends 3. Global linkages
(d) Internal sectoral linkages 4. Structure and Nature of Economy
Codes :
(a) (b) (c) (d)
A. 3 1 2 4
B. 2 3 1 4
C. 1 2 3 4
D. 1 2 4 3
Ans : B

47. Which one of the following is not a benefit of privatisation?
A. Encourage entrepreneurship
B. Concentration of economic power
C. Better management of enterprise
D. Freedom from bureaucracy
Ans : B

48. ‘BOLT’ system in the Indian Securities market is related to
A. National Stock Exchange
B. Bombay Stock Exchange
C. Over the Counter Exchange of India
D. Multi Commodity Stock Exchange
Ans : B

49. Which one of the following is not a money market instrument?
A. Commercial paper
B. Participatory certificates
C. Warrants
D. Treasury Bills
Ans : C

50. Which one is related with microfinancing?
B. Anganwadi workers
C. Women Entrepreneurs
D. None of the above
Ans : A

51. Which one of the following is not an element of internal environment?
A. Mission/Objectives
B. Human Resources
C. Customers
D. Shareholders’ values
Ans : C

52. The presence of fixed costs in the total cost structure of a firm results into
A. Financial leverage
B. Operating leverage
C. Super leverage
D. None of the above
Ans : B

53. “The cost of capital declines when the degree of financial leverage increases.” Who advocated it?
A. Net operating income approach
B. Net income approach
C. Modigliani-Miller approach
D. Traditional approach
Ans : B

54. A view that the dividend policy of a firm has a bearing on share valuation advocated by James E. Walter is based on which one of the following assumptions?
A. Retained earnings is only source of financing
B. Cost of capital does not remain constant
C. Return on investment fluctuates
D. All of the above
Ans : A

55. Match the following :
List-I List-II
(a) Matching approach 1. Dividend Policy
(b) Structural ratios 2. Inventory Management
(c) Ordering quantity 3. Financing Working Capital
(d) Bonus shares 4. Capital Structure
Codes :
(a) (b) (c) (d)
A. 1 2 3 4
B. 3 4 1 2
C. 3 4 2 1
D. 2 1 3 4
Ans : C

56. Assertion (A) : Operating style of the international business can be spread to the entire globe.
Reason (R) : The style is limited to the internal economy only.
Codes :
A. Both (A) and (R) are true.
B. (A) is true, but (R) is false.
C. (A) is false, but (R) is true.
D. Both (A) and (R) are false.
Ans : B

57. The Comparative Cost Advantage Theory was given by
A. David Ricardo
B. Adam Smith
C. Raymond Vernon
D. Michael E. Porter
Ans : A

58. The companies globalise their operations through different means
A. Exporting directly
B. Licensing/Franchising
C. Joint ventures
D. All of the above
Ans : D

59. The components of W.T.O. are
A. Ministerial Conference
B. Disputes Settlement Body
C. Director General
D. All of the above
Ans : D

60. India is not associated with
C. BRICS D. None of the above
Ans : B

61. Which one of the following is true statement?
A. A balance of trade deals with export and import of invisible items only.
B. A balance of payment deals with both visible and invisible items.
C. The current account is not a component of balance of payment.
D. All of the above
Ans : B

62. SDRs are popularly known as
A. Currency Notes B. Paper Gold
C. Silver Coin D. Gold Coin
Ans : B

63. Which one is not international institution?
Ans : D

64. Assertion (A) : Indent may be open or closed.
Open indent does not specify the price and other details of the goods. The closed indent specifies the brand, price, number, packing, shipping mode, insurance, etc.
Reason (R) : This is required as a part of export procedures.
Codes :
A. Both (A) and (R) are correct.
B. Both (A) and (R) are not correct.
C. (A) is true, but (R) is false.
D. (R) is true, but (A) is false.
Ans : C

65. When a population is heterogeneous, it is divided into groups, so that there is homogeneity within the group and heterogeneity between the groups, and some items are selected at random from each group.
It is a case of :
A. Cluster Random Sampling
B. Systematic Random Sampling
C. Quota Sampling
D. Stratified Random Sampling
Ans : D

66. Match the items of List-I with items of List-II.
List-I List-II
(a) Selective credit control 1. Consumer Credit Regulation
(b) Encourage credit for desirable use 2. Cash Reserve Ratio
(c) Quantitative credit control 3. Variation in Margin
(d) Bank Rate 4. Re-discounting Rate
Codes :
(a) (b) (c) (d)
A. 4 2 3 1
B. 3 1 2 4
C. 1 3 2 4
D. 2 1 3 4
Ans : B

67. Assertion (A) : Use of paper money is replaced by plastic money. The future will see the electronic money clearance through satellite networking.
Reason (R) : RBI is encouraging e-banking.
Codes :
A. (A) is false, but (R) is true.
B. (A) is true, but (R) is false.
C. Both (A) and (R) are false.
D. Both (A) and (R) are true.
Ans : D

68. Which one is not Finance Company?
A. Hire-Purchase Finance Company
C. Mutual Benefit Finance Companies
D. Loan Companies
Ans : B

69. The Securities and Exchange Board of India was not entrusted with the function of
A. Investor Protection.
B. Ensuring Fair practices by companies.
C. Promotion of efficient services by brokers.
D. Improving the earnings of equity holders.
Ans : D

70. Which one is not Non-Marketable securities?
A. Corporate Securities
B. Bank Deposits
C. Deposits with Companies
D. Post Office Certificates and Deposits
Ans : A

71. Minimum Alternative Tax (MAT) under Sec.115 JB of the Income Tax Act is applicable on
A. Partnership firm
B. Association of persons
C. Certain companies
D. All types of companies
Ans : C

72. For the Assessment Year 2011-12, deduction under Sec. 80G is available without any limit but at the rate of 50% on
A. Prime Minister’s National Relief Fund
B. National Foundation for Communal Harmony
C. Jawahar Lal Nehru Memorial Fund
D. Chief Minister Relief Fund
Ans : C

73. Interest on capital paid by a firm to its partners, under the Income Tax Act, 1961, is allowed
A. 6% B. 12%
C. 15% D. 18%
Ans : B

74. Under capital gains head of the Income Tax Act, the income from sale of Household Furniture is
A. Taxable Income B. Capital Gain
C. Revenue Gain D. Exempted Income
Ans : D

75. Under Section 80E of the Income Tax Act, 1961 deduction in respect of payment of interest on loan taken for higher education shall be allowed up to
A. Rs.10,000 B. Rs.15,000
C. Rs.20,000 D. Without any limit Note : This paper contains fifty (50) objective-type questions, each question carrying two (2) marks. Attempt all of them.
Ans : D

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