404e4Competitive 'f est for

Promotion to the Position of Manager Gr.IVin Kerala Statc Financial Enterprises Limited

PAPER II

Date: 03'd November 2013 Time 12 Noon to 01.30 pm

Total Marks : 100

Choose the best answer from among the options given under each question. AII questions cany

equal marks. There are four alternative answers lor every question. For each wrong answer one

fourth (0.25) of the marks assigned to that question will be deducted as penalty. If a candidate

gives more than one answer, it will be treated as wrong even if one of the given answers

happened to be correct; there will be same penalty of a wrong ans\\'er. Ila question is left blank,

there will be nc penalty for that question. Candidates may please indicate their answers by

darkening the bubbles against the queslion numbers in the OMR sheet provided, with black ink

ball point pen. Plcase read the instructions in the OMR sheet carefully to understand the correct

method of marking answers.

I . The Turnover and Gross Profit of a business for two vears are

20lt

1,80,000

45,000

2012

3,60,000

72,000

Ccnrnr:ti,-rr the operational efficiency of the business

A.lng e ascd R- Decreased C. Remain the same D. Can't say

2, Calculate the value of closing stock from the following

Tumover

Gross Profit

Opening Stock

Purchase

Sales

Gross Profit on cost

Due to fire. stock costir]g

claim ol < 8.000/-

< 60,000/-

t 90,000/-

T 1,20,000/-

33%%

< 25.000 nas destroycd and iusurance company admitted a

A. {40,000/- B. < 35,000/- c. {55.000/- D <60.000/-

3. The current ratio of a company is 2:1. Which of the fbllowing transactions wouldin.rprove the current ratio?

i. Repayment of a cunent liabilityii. Purchasing ofgoods on creditiii. Sale of office fumitureiv. Payment of Dividendv. Purchase of goods for cash

A.(i), (iii) & ( iv) B. (ii) & (v) C. (ii), (iv) & (v) D. All olthe above

4. Working Capital Gap

A. Shows the degree of the firm's reliance on long term bank finance

B. Shows the degree ofthe company's reliance on shareholders funds

C. Is equal to current assets less current liabilities other than bank borrowings

D. equal to total current assets

5. Interest coverage ratio of6 indicates

A. Sales are six times of interest

B. Profit after tax is 6 times of interest

C. Profit before tax is 6 times of interest

D. Eamings before interest and tax is 6 times of interest

6. The current ratio and quick ratio of the Company AB Ltd are nearly the same. This

suggest that

A. The company has got a sizeable investment in inventory

B. The company is a highly profitable one

C. The quick assets ofthe company are lowD- The cornpany has got a low investment in inventory

7. Which ofthe following change(s) does/ do not appear in a Cash Flow Statement?

A. Issue of Equity Shares

B. Conversion ofall Fully convertible Debentures into Equity Shares

C. Bonus issue of Equity Shares

D. Both (B) & (C) above

8. All are internal sources of short - term working capital, except:

A. Depreciation funds B. Trade Credit

C. Accrued Expenses D. Provision for Taxation

9. Increase in the amor.urt ofcreditors results inA. Decrease in cash B. No change in cash

C. Decrease in liability D. Increase in cash

10. Asok has the following rvorking capital ratios

2012 20llCr"rrrent Ratio 1.2:l 1.5:1

Debtors Velocity 75 days 50 days

Creditors Velocity 30 days 45 days

Stock Velocity 42 days 35 days

Which of the following statement is correct?

A. Asok's liquidity and working capital has improved in 2012

B. Asok is receiving cash from debtors more quickly in 2012 than in 2011

C. Asok is taking longer to pay suppliers in 20i2 than in 2011

D. Asok is suff'ering from a worsening liquidity positi on in2012

11. The ratio which is calculated to judge a firm's ability to pay its current liabilities within a

month or immediately is

A. Cunent Ratio B. Working Capital Tumover Ratio

C. Quick Ratio D. Debtor Tumover Ratio

12. The current Ratio of AB Ltd is 3.5:1 and its Working Capital amounts to t 1,00,0001.

The amount of Current Assets and Current Liabilities are:

Current Assets Current LiabilitiesA. <1,40,000/- <40,000/-

B. < 3,s0,000/

c. <2,80,000/- <80,000/-D. <1,00,000/- <3,50,000/-

13. The ratio *4rich establishes the relationship between fixed interest bearing securities and

equitl shares ofa comprny i.A. Debt- Equity Ratio B. Proprietary Ratio

C. Acid Test Ratio D. Capital Gearing Ratio

14. Raju earned a profit of < 1,50,000/- lor the year 2012-13. Butatthetimeof audit, it was

found that he purchased a machinery on 1.7.2012 lor {30,000/- and charged it as a

revenu. expense. The auditor advised him to rectify the error and to charge depreciation

@15% on it. Tl.re correct profit after rectification will be

A. t 1,77,s00/- B. { 1,80,200/- c { 1,80,000/- D. { 1,50,000/-

i5. Organizational decisions can be categorized into programmed and non programmed

decisions. Which of the following is a non- programmed decision?

A. Setting sales quota B. Revising employee compensation

C. Launching a new product D. Promotion ol supervisors

16. Which of the following best describes an organization's mission statement ?

A. A statement of activities for the year ahead

B. An expression ol organizational purpose

C. A list ofkey business objectives

D. A summary of the organization's five year plan

17. -------identifies the order of activities to be performed in order to achieve a particulargoal.

A. Budgeting B. Linear programming

C. Break-even analysis D. Scheduling

1 8. Which ol the lbllowing is not a function of budgeting?

A. Controlling B. Decision making

C. Motivating D. Planning

19. A Manager at the first level of management is known as a /an

A. Top executive B. Middle manager

C. Assembly line rvorker D. Supervisor

20. Controlling requires managers to:

A. Decide r','here decisions will be made B. Choose goals

C. Compare performance against the plan D. Obtain incentives

21 . A Manager wl.ro is responsible for human resources is a manaQer

A. Corporate genelal

C. Functionai

22. Conceptual skills are paramount inA. Top management

limit and period etc.

A. OD Control

B. Business level general

D. Frontline

B. Interest Control

is for controlling the loan amount

--positions.

B. Mid level management

C. Functional management D. Frontline management

23. In Suvarna Akshaya Overdraft of BAS

C. Interest Control Change D. None ofthe above

24. The fbllorving is not true *'ith CSDT in KSFE Branch Automation System (BAS)A. CSDT Register should be created before starting the Chilty Payment.B. In the CSDT, Only the liability amount of the chitty can be deposited.C. The period oICSDT should be below the completed months of transmission date

D. CSDT can be opened through General Transfer or any other mode

25. In Flexi Trade Loan of BAS software, rvhich one is the suitable options as given belowfor controlling the loan amount eligibilityA. Control Information. B. Loan RegisterC. interest Control D. Intelest Control Change

26. Software instructions intended to satisfy a user's specific processing needs are called --..---.-.-.----?

A. Operating SystemC. Documentation

27. The ascending order ola data hierarchy is

A. Bit-byte-record-fi eld-fi le-databaseB. Byte-bit-fi eld-record-fi le-databaseC. Byte-bit-record-fi le-fi eld-databaseD. Bit-byte-fi eld-record-fi le-database

28. What is the control unit's function in the CPU?A.To decode program instructionsB. To transfer data to primary storageC. To perform logical operationsD. To store program instructions

29. The technique ofplacing software or programs in a ROM Semiconductor chip is called

A. PROM B. EPROM C. Firmware D. Microprocessor

30. Compared with Secondary storage, Primary storage isA. Sloq,and inexpensive B. Fast and inexpensiveC. Fast and expensive D. Slon' and expensive

3 1 . l.inkage betrveen the CPU and the users is provided byA. Peripheral devices B. StorageC. Control Unit D. Software

32. The Computer device primarily used to provide hard copy is the ---------------A. CRT B. Line PrinterC. Compr"rter Console D. Card reader

33. \\rhat is the commonly used unit 1br measuring thc speed of data transmission?A. Bytes per second B.BaudC. Bits per Second D. Eithcr (B) or (C)

34. The larger the RAM of a Computer, the laster its processing speed is, since i1 eliminates -

A. Need of ROM B.Need lor extemal memoryC. Frequent disk I/o's D.Need for wider data path

B. Language ProcessorsD. Application Software

35. A Computer virus is a soltuale program which is basicallyA. Destructive of data B. An information diorderC. Non sellreplicating in nature D. Memory resident

36. What is the name ofthe virus program which does not have any Pre-trigger phase?

A. Trojan B. BombC. Worm D. Tapeworm

37.What is not true with KSFE Software CAS ?

A. Web based software B. Centralized Application SoftwareC. Customized Application Software D. Control Access Software

38. Among the following, a major function of CAS is

A. Receiving branch wiil get a printed copy of advice lrom CAS lor filing purposeB. The Inter Branch transactions can not be viewed at branches.C. IB originating branches will dovn'nload the Inter Branch transaction details to CAS.D. None of the above

39. IGRP stands forA. Interior Gateway Routing ProtocolB. Intemet Gateway Routing ProtocolC. Intemet Gigabit Routing ProtocolD. Interior Gigabit Routing Protocol

40. In the digital signature technique, the receiver ofthe message uses ----------------to creatcplain textA. Her own sector key B. Her on'n private keyC. Her own public ke1' D. The sender's public key

4i.ln KSFE, the loss cn saie i aiiciion ofpledged gold ornament

A- Should be nritten offB. Should be credited to Gold Loan Loss Recoverable A-lc

C. Should be debited to Gold Loan Loss A/cD. Should be debited to Gold Loan Loss Resoverable A/c

42. A photocopier purchased in March 20XX for < 2,00,000/-. Payment was mede on 5rr'

March 20XX and the machine rvas delivered in office on l0'n March 20XX. The same

was installed on 15tr'march 20XX and put to use on 2011' March 20XX. In KSFE 20XXyear final accotmls, the depreciation for the above asset is to be calculated for -------------davs.

A- 1 I daysC. 22 days

B.21 daysD.16 days

43. On 31" lvlarcl.r. the foreman's investment in statutory tickct account of KSFE shouldhavea..

A. Credit Balance B. Debit balance

C. Nil balance D. Anyone of the above

44.Capital introduced in the beginning by Ram is {40,0001. Further Capital introduced

during the year is { 1,000/-. Drawings is t200/- per month and the closing Capital is

{ 53, 600/- The amount of profit or loss for the year will be --------

A. ( 20,000/- profitC. { 15.000 profit

B. { 5,000 Loss

D. T 5,000 profit

45. While preparing Fund Flow Statement, decrease in Working Capital is trcated as ---------.A. An application of lunds B. A source ol funds

C. Both an application and source D. None ofthe above

46. Balance as per Cash Book is { 5,000/-. Cheque issued but not presented for payment

t2,000 and cireques sent for collection but not collected <1,500/-. The Bank had

s.rongl-v debited the account of firm by { 20/-. Balance as per Pass Book will be --------

A. t5,s80/- B. {4,520/- C. <5,520/- D. <s,480/-

47. If average stock is <50,000/- closing stock is t10,0001 lower than the value ofOpening Stock. Closing Stock will be ---*--A. <45,000/- B. { 16,000/- c. < 18.000/- D. <20,000/-

:i8. rii'Lrile plrjfaiirg iis fiiiatcial statement, a company urrder vaiued its closing stock by

T 50.000,/-. What rvill be the effect of this error?

A. The cu|icii1 :l iar's prr)fit rvill be understated and next year's profit will be overstated

B. 'lhe current year's profit u'ill be overstated and next year's profit will be understated

C. The current year's profit be overstated and there will be no effect on next year's profit

D. The profit rvill not be affected

49. Which of the following statement best describes Curent Assets?

A. Assets u'hich are currently located on the business premises

B. Assets rdrich are used to conduct the organization's current business

Cl. Assets rvhich irrc expected to be convefied into cash in the shofi tem.r

D- Assets r,vhich arc not expected to be converted into cash in the shorl tcrm

50. Long term solvenoy is indicated by

A. Liquidity Ratio B. Debr Equity Ratio

C. Interest coverage Ratio D. Retum on capital Employed

51 . A Gross Profit Ratio rnay not indicaleA. Earning pon'er B. The efficiency ofproductionC. The efficiency olpricing D The gap belween net sales and cost of

goods sold52. Which of the following is the problem encountered in financial statement analysis?

A. Development of benchmarks B. Window drcssingC. Price level changes D. All ofthe abovc

53. llthe current ratio is less than I then it can be definitely said that -

A. The net working capital is negative B. f'he net working capital is positiveC. The inventories are inadequate D. Cash in hand is inadequate

54. Which of the following statement is true?

A. Liquidity implies a firm's ability to pay its debts in the long runB. Working Capital gap is equal to current assets plus total current liabilitiesC. The number of days it takes to collect accounts receivables is known as averagc

collection period

D. Lesser the inventory tumover ratio, higher the efficiency of inventory management

55. A decrcase in the provision for doubtful debts results in?

A. An increase in liabilities B. A decrease in Working CapitalC. An increase in net profit D. A decrease in net profit

56. The debit side of a Trial Balance totals t 80001 more than the credit side. Which one olthc fbllor.ving errors would fully account lbr the diflerence ?

-4. 74,00C/- paid lor repairs ol plar.rt and machinery has been correctly entered in the

{lash Book and crcdited to Plant & Machinery A/cR. Discoiint received < 4,000/- has been debited to Discount Allorved A/cC, A receipt of t 8,0001 lor commission receivable has been omitted from the bookD. A petty cash balance of t 8,000/- has been omitted lrom the Trial Balance

57. A business can make a profit and yet have a reduction in its bank balance. Which one ofthe lollowing might cause this to happen?

A. The sale ofnon-current assets at a loss

B. The lengthening olthe period of credit given to customers

C. The lengthening ofthe period ofcredit taken from suppliersD. None of these

58. Consider the fbllor.ving two statements and choose the answer -

(i) A debit entry in the cash book will increase an overdraft in the accounts

(ii) A debit entry in the cash book will increase a bank balance in the accounts.

A. Both true B. Both falseC. (i) True and (ii) False D. (i) False and (ii) True

59. Erors of Principle and Enors of l'ransposition are two types of common errors. Which ofthe lollowing correctly states whether or not these errors will be revealed by preparing aTrial Balance?

Errors of Principle

A. Will not be revealed

B. Will not be revealed

C. Will be re-revealed

D. Will be revealed

free samples is debited to60. Goods distributed as

A. Drawings A/cC. Sales A/c

61. Loss caused by theft

Errors of Transposition

Will not be revealed

Will be revealed

Will not be revealed

Will be revealed

B. Adverlisemenl A./c

D. Trading A/c

of cash b1' cashier after business hours is

B. Revenue Loss

D. None of these

B. SeriousnessD. Sincerity

62. Sales for { 5,0001 was recorded as purchase. The effect of this enor will be

A. Gross Profit will decrease by t 10,0001

B. Gross Profit will increase by t 5,0001

C. Gross Profit will decrease by { 5,0001

D. Gross Profit will increase by t 10,0001

63. G-rori business letteis ari ci::,i:,.:lciizeil by the follou'ing personal quality ofthe writer:

A. Capital loss

C. Delerred revenue loss

A. FormalityC. Humour

64. Which of the following is not a guideline for writing a business letter?

A. Remember that you are often writing for multiple audiences

B. Write so that your letter is clear, concise, professional and friendlyC. State your purpose at the end of your documentD. Proofread for grammar all documents you send out

65. Which of the following is corect about hrll block-style business letters?

A. Paragraph indentat ion'B. All parls stafi a1 the le11 rnarginC. Return address appears on the right halfofthe pageD. Signature appears on the right hallof the page

66. which of the lollowing lorms ol decision making involves seeking expert opinioniteratively through anonymous parlicipation?

A. Brain storming B. Nominal Group C. Delphi Group D. Interactive group

67. Mr. Abhinav Mishra , a manager at KaNy Transportation Ltd., manages a team of 16employees who belong to different cadres. He always treats all his employees in thesame manner irrespective olthe cadre they belong. which of the following principles ofFayol did Mr. Mishra adopt?

A. DisciplincC. Espirit de corps

B. InitiativeD. Equity

68. on the basis of their frequency of use, plans are divided into two categories - single useand standing plans. These plans are of various types. Which of the foltowing types ofplans. heJp in simpliSing and str.eamlining the administrative activities of anorganization?

A. Prograrns B. Budgets C. Rules D. Procedures

69. The Management by Objectives (MBO) process not only gives subordinates a sense ofdirection, but it also allows them to

A. Dictate their orvn terms and conditionsB. Evaluate their own progress

C. Create tire vision of organizationD. Parlicipate in appraisal oftheir seniors

70. SWOT analysis evaluates the firnr's internal strengths and weaknesses and the impact ofenvironmental opportunities and threats. Which of the following best describes 'threat'in SWOT analysis?

A. An internal characteristic that has capacity to improve the organization's competitivesituation

B. An environmental condition that an organization can exploit to improve itscompetitiveness

C. An environmental condition that can adversely affect the organization's competitiveability

D- A powerful strategy that is supported by the cornpetitive valuable skills and experlisein key areas

10

71. In which of the following decision making techniques, group members rank the variousalternatives and decide on the best alternative?

72. Which of the following are general standards of behaviour that provide guidelines on

how much work should be done, the code ofbehavior to be lollowed etc.?

A.Rules B. Procedures C. Policies D. Norms

73. Managers perform a number of roles in an organization. Which of the lollowing roles

air.us to maintain a link between the organization and its extemal environment?

A. Delhi method

C. Nominal group

A. Figure head

C. Liaison

B. Interacting group

D. Brain storming

B. Leader

D.Monitoring

74. Zero-base Budgeting (ZBB) is based on a system where each function - old or new -must be justified in its entirety each time a new budget is formulated. ZBB has several

benefits i.r'hich include all of the following except

A. Effective allocation of resources

B. Improved effectiveness of performance audit

C. Lnproved productivity and cost effectiveness

D. Better focus on organizational objectives

75. Groul decision making has ceftain advantases over individual decision-making. Which

of the Ic'llo\','ing statements is not tlue with regard to group decision- making?

A. It allows pooling of knowledge and informationB. It's source ofpersonnel development

C. It discourages risk takingD. It's time consuming and costly

71