JAIIB / CAIIB (IIBF) Practice Quiz

Question 1

A proprietor pays household rent of ₹18,000 from the business bank account. Applying the business-entity concept, the correct entry is:

Accepted Answer

Debit Drawings ₹18,000; credit Bank ₹18,000

Question 2

A branch is expected to continue operating. Consumable spare parts held as inventory for normal servicing do not qualify as property, plant and equipment. Under the cost-based inventory measurement rule, they should be measured at:

Accepted Answer

The lower of cost and net realisable value, not a forced-sale price

Question 3

Year-end inventory cost ₹2,40,000. Its net realisable value is ₹2,15,000. Prudence requires the inventory to be stated at:

Accepted Answer

₹2,15,000, so the anticipated loss is recognised now

Question 4

The trial balance shows salaries ₹90,000 and commission income ₹14,000. In the closing entries these nominal balances are transferred so that:

Accepted Answer

Salaries are debited to profit and loss, and commission income is credited

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