ICAB

Certificate Level
Accounting Sample Question
along with a solution

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 The Institute of Chartered Accountants of Bangladesh
Sample Question Paper
Certificate Level-Accounting
Time allowed: 90 minutes
Full Marks: 100

Section A: Scenario based questions-

As at 30 June 2019 and 30 June 2020 ABC Limited had the following summarized statement of financial
position:
30 June 2020 30 June 2019
Particulars Taka Taka
Assets
Non-current assets
Property, plant and equipment 2,543,000 2,401,000
Intangibles 550,000 584,000
Investments 406,000 -
3,499,000 2,985,000
Current assets
Inventories 685,000 598,000
Trade and other receivables 480,000 465,000
Prepayments 96,000 126,000
Cash and cash equivalents 426,000 200,000
1,687,000 1,389,000
Total assets: 5,186,000 4,374,000

Equity and Liabilities

Equity
Share capital 1,100,000 1,000,000
Share premium 342,000 200,000
Retained earnings 1,785,000 1,311,000
3,227,000 2,511,000
Non-current liabilities
Borrowings 500,000 1,000,000
Redeemable preference shares 200,000 -
700,000 1,000,000
Current liabilities
Trade payables 749,000 427,000
Accruals 108,000 131,000
Income tax payables 282,000 165,000
Provisions 120,000 140,000
1,259,000 863,000
Total Equity and Liabilities 5,186,000 4,374,000

ABC Limited's statement of profit or loss for the year ended 30 June 2020 was as follows:
2019-2020
Particulars Taka
Revenue 5,762,000
Less: Cost of sales (4,630,000)
Gross Profit 1,132,000
Less: Distribution cost (236,000)
Less: Administrative expenses (127,000)
Profit from operation 769,000
Add: Investment income 55,000
Less: Finance cost (68,000)
Profit before tax 756,000
Less: Income tax expenses (232,000)
Net profit after tax for the year 524,000

The following additional information is relevant:

30 June 2020 30 June 2019
Property plant and equipment
Cost 7,464,000 6,375,000
Less: Accumulated depreciation (4,921,000) (3,974,000)
2,543,000 2,401,000
Intangible assets
Cost 883,000 938,000
Less: Accumulated amortization (333,000) (354,000)
550,000 584,000

a) During the year, plant with an original cost of Taka 479,000 and a carrying amount at the date of
disposal of Taka 326,000 was sold for Taka 424,000 which was received in cash.
b) ABC Limited received Taka 20,000 during the year from the sale of highly liquid investments, which
were classified as cash and cash equivalents.
c) During the year, ABC Limited made a 1 for 20 bonus issue of its ordinary shares. The subsequent
issue of shares was made at a premium.
d) Included in trade and other receivables at the year-end was Taka 25,000 in relation to investment
income. The corresponding figure for 2019 was Taka 15,000.
e) Intangible assets with accumulated amortization at the date of disposal of Taka 40,000 were sold for
Taka 12,000. There were no acquisitions of intangible assets during the year.
f) Redeemable preference shares in the amount of Taka 200,000 were issued during the year.
Requirements:
Prepare a statement of cash flows for ABC Limited, for the year ended 30 June 2020 in accordance with
IAS 7.
 Statement of Cash Flows
For the year ended 30 June 2020
2019-2020
Taka
Cash flows from operating activities
Profit before tax

Investment income

Finance costs

Depreciation

Amortisation of intangible assets

Gain/loss on sale of property, plant and equipment

Gain/loss on sale of intangible assets

Increase/decrease in inventories

Increase/decrease in trade and other receivables

Increase/decrease in prepayments

Increase/decrease in trade payables

Increase/decrease in accruals

Increase/decrease in provisions

Cash generated from operations

Interest paid

Tax paid

Net cash flows from/used in operating activities

Cash flows from investing activities
Purchase of property, plant and equipment

Purchase of intangible assets

Purchase of investments

Proceeds from sale of property, plant and equipment

Proceeds from sale of intangibles

Investment income

Net cash flows from/used in investing activities

Cash flows from financing activities

 Proceeds from issue of share capital

Movements in borrowings

Dividends paid

Net cash flows from/used in financing activities

Net increase/decrease in cash and cash equivalents

Cash and cash equivalents at the beginning of the year

Cash and cash equivalents at the end of the year

Section B: Short Questions

1. The business entity concept helps in-

a) Determining the value of fixed assets
b) Determining the profit of the organization
c) Calculating net worth of the organization
d) None of the above

2. ABC Ltd. Purchased a machine on 01 January 2018 and whimsically selected reducing balance method
for calculating depreciation. On 01 January 2020, the company changed the depreciation method to straight
line to comply with the requirement of IAS 16. This change of method would be considered as:
a) Changes in accounting policy
b) Rectification of prior year’s error
c) Changes in accounting estimation
d) All of the above

3. A business can make a profit and yet have a decreased cash in hand and cash at bank. Which of the
following might cause this to happen?
a) The sale of non-current assets at a loss
b) The charging of depreciation in the Statement of profit or Loss and other comprehensive income
c) The lengthening of the period of credit given to customers
d) The shortening of the period of credit taken from suppliers

4. Which of the following are regarded as the fundamental concept?

a) The going concern concept
b) The business entity concept
c) The prudence concept
d) Correction concept

5. In performing a bank reconciliation exercise, which two of the following require an entry in the cash at
bank account?
a) Cheque paid in, subsequently dishonored on the bank transaction report
b) Error by bank
c) Bank charges
d) Lodgements credited after date
e) Outstanding cheques not yet presented
6. An error of principle would occur if plant and machinery purchased:
a) was omitted from the accounting records
b) was debited to the purchases account
c) was debited to the equipment account
d) was debited to the correct account but with the wrong amount

7. Which of the following is time span into which the total life of a business is divided for the purpose of
preparing financial statements?
a) Fiscal year
b) Calendar year
c) Accounting period
d) Accrual period

8. Mr. Y is a VAT registered trader whose sales and purchases carry VAT at the standard rate of 15%. He
sold goods to a customer on credit for BDT 4,700 inclusive of VAT. The double entry to record this
transaction is:
a) Debit Sales BDT 4,700, Debit VAT BDT 705, Credit Receivables BDT 5,405
b) Debit Sales BDT 4,000, Debit VAT BDT 600, Credit Receivables BDT 4,600
c) Debit Receivables BDT 5,405, Credit Sales BDT 4,700, Credit VAT BDT 705
d) Debit Receivables BDT 4,700, Credit Sales BDT 4,087, Credit VAT BDT 613

9. Which THREE of the following users of financial statements are likely to be interested in the financial
statements of a small private company?
a) Stock market analysts
b) Company employees
c) The company’s bank
d) Institutional shareholders
e) Suppliers

10. "Mr. Matin runs a sole trader business selling computers. On 12th January 2021, he employed his
daughter as an administrator for the business and took a computer from the store room for her to use in the
office.
What would be the double entry for this transaction?

a) Dr. Drawings Cr . Cost of sales

b) Dr. Non-current assets Cr. Inventory
c) Dr. Cost of sales Cr. Drawings
d) Dr. Cost of sales Cr. Non-current assets

11. ABC Limited has prepared a draft statement of profit or loss for the year to 30 June 2020 which shows
a gross profit of Taka 99,500. ABC Limited has now discovered that at both the beginning and at the end
of the period, one line of inventory, the Redex, has been included at selling price: Taka 1,240 at 30 June
2020 and Taka 3,720 at 1 July 2019. The Redex is always sold at a mark-up of 25% by ABC. After correcting
this error, ABC Limited’s gross profit for the year ended 30 June 2020 is:
a) Taka 99,996
b) Taka 99,004
c) Taka 98,880
d) Taka 100,120

12. The following bank reconciliation has been partially completed:

BDT
Balance per bank statement (overdrawn) 73,680
Uncredited lodgements 102,480
Unpresented cheques 87,240
What should the cash book balance be?
a) BDT 88,920 credit
b) BDT 88,920 debit
c) BDT 58,440 debit
d) BDT 58,440 credit

13. The cash book shows a bank balance of BDT 5,675 overdrawn at 31 August 20X5. It is subsequently
discovered that a standing order payment for BDT 125 has been entered twice, and that a dishonored
cheque for BDT 450 has been debited in the cash book instead of credited.
The correct bank balance should be:
a) BDT 5,100 overdrawn
b) BDT 6,000 overdrawn
c) BDT 6,250 overdrawn
d) BDT 6,450 overdrawn

14. Which of the following is not a factor that is considered for recognition of a fixed asset?
a) Ownership
b) Future economic benefits
c) Control
d) None of the above

15. XYZ Limited sells three products- Basics, Super and Luxury. The following information was available
at the year end.
Basic/Per Unit Tk. Super/Per Unit Tk. Luxury/Per Unit Tk.
Original cost 6 9 18
Estimated selling price 9 12 15
Selling and distribution costs to be incurred 1 4 5
Units Units Units
Units of Inventory 200 250 150
What is the value of inventory at the year end?
a) Taka 3,600
b) Taka 4,700
c) Taka 5,100
d) Taka 6,150

16. Indicate whether the following statements are true or false.

a. Prudence concept of accounting suggests applying conservatism at time of making accounting
estimates.

True
False

b. Analysis of transaction should be made before giving journal entry for that particular
transaction.
True
False

17. Indicate whether the following statements are true or false

a. When the prices of raw material inventory fluctuate frequently, FIFO method should be used for
valuing inventories.

True
False
 b. A business organization might need to use different methods of depreciation for calculating
depreciation of a particular class of asset.

True
False

18. Indicate whether the following statements are true or false

a. A company can give cash dividend from share premium account.

True
False

b. TM Limited has reduced its allowance for receivables by Taka 600.

This will increase gross profit by Taka 600.

True
False
This will increase net profit by Taka 600.
True
False

19. Put the missing word in the blank space

a) All fixed assets, except………………..are subject to depreciation.
b) Customers normally use accounting information before making ………………. buy decisions.

20. Put the missing word in the blank space

a) At the time of calculating Net Realizable Value (NRV) of an inventory, we use ……………….
Selling price.
b) …………………….. is the interest of the owner in a business.

21. Put the right number in assigned space

ABC & Co. has installed a new machine at its factory. It has incurred following costs:
a) Cost of the machine Tk. 250,000.
b) Initial delivery and handling cost Tk. 20,000.
c) Training cost Tk. 50,000.
d) Packaging cost Tk. 10,000.
e) VAT paid Tk. 15,000.
f) Cost of site preparation Tk. 60,000.
Find out the costs to be capitalized as per IAS-16?

22. Put the right number in assigned space

Mr. Anam is the owner of a stationery business. From the following information relating to his business
calculate the net profit.
COGS 182,000
Salaries paid 17,000
Rent paid 17,500
Cash sales 2,20,000
Credit sales 3,00,000
Outstanding Expenses: Salaries 5,000
Rent 2,500
23. Put the right number in assigned space
X Ltd. was established as an automobile manufacturing company on 1st January 2019. Primarily it issued
1000 ordinary shares of Tk. 170 each. The nominal value of each share is Tk. 100. The company also
issued 1000 redeemable preference shares of Tk. 10 each. The company declared and paid an interim
dividend @ 15% for both ordinary share and preference share on 01 July 2019. The company also declared
a final dividend @ 10% for ordinary share on 01 March 2020 for the year 2019. Calculate the amount of
interim dividend.

24. Put the right number in assigned space

Mr. Akhas, a sole-proprietor has the following assets and liabilities:
Land Tk. 55,000, Cash at Bank Tk. 6,500, Inventory Tk. 12,500, Creditors Tk. 5,000 and loan to Mr.
Akash Tk. 10,000.

What is the amount of capital?

-The end-
 Sample Question Paper Certificate Level-Accounting Answer

Section A: Scenario based questions Solve

Cash Flows for ABC Limited for the year ended 30 June 2020.

Statement of Cash Flows Preparation

Statement of Cash Flows for ABC Limited For the year ended 30 June 2020

2019-2020 Taka
Cash flows from operating activities
Profit before tax 756,000
Adjustments for:
Investment income (55,000)
Finance costs 68,000
Depreciation 947,000
Amortisation of intangible assets 21,000
Gain on sale of property, plant and equipment (98,000)
Loss on sale of intangible assets 28,000
Changes in working capital:
(Increase) in inventories (87,000)
(Increase) in trade and other receivables (15,000)
Decrease in prepayments 30,000
Increase in trade payables 322,000
(Decrease) in accruals (23,000)
(Decrease) in provisions (20,000)
Cash generated from operations 1,874,000
Interest paid (68,000)
Tax paid (232,000)
Net cash flows from operating activities 1,574,000
Cash flows from investing activities
Purchase of property, plant and equipment (1,089,000)
Proceeds from sale of property, plant and equipment 424,000
Proceeds from sale of intangibles 12,000
Purchase of investments (406,000)
Investment income received 45,000
Net cash flows used in investing activities (1,014,000)
Cash flows from financing activities
Proceeds from issue of share capital 242,000
Proceeds from issue of redeemable preference shares 200,000
Movements in borrowings (500,000)
Dividends paid 0
Net cash flows from financing activities (58,000)
Net increase in cash and cash equivalents 502,000
Cash and cash equivalents at the beginning of the year 200,000
Cash and cash equivalents at the end of the year 702,000

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 Sample Question Paper Certificate Level-Accounting Answer

Detailed Explanation and Calculations:

Operating Activities:

1. Profit before tax: Taka 756,000 (from the Statement of Profit or Loss).
2. Adjustments for non-cash items and non-operating activities:
o Investment income: Taka (55,000) (non-operating income, subtracted from
profit).
o Finance costs: Taka 68,000 (added back as they are financing activities).
o Depreciation:
 Closing accumulated depreciation: Taka 4,921,000
 Opening accumulated depreciation: Taka 3,974,000
 Accumulated depreciation on disposed assets: Taka 153,000 (Cost of Taka
479,000 - Carrying amount of Taka 326,000)
 Depreciation expense: Taka (4,921,000 - 3,974,000 + 153,000) = Taka
1,100,000
o Amortisation of intangible assets:
 Closing accumulated amortization: Taka 333,000
 Opening accumulated amortization: Taka 354,000
 Amortization on disposed assets: Taka 40,000
 Amortization expense: Taka (354,000 - 333,000 + 40,000) = Taka 61,000
o Gain on sale of property, plant, and equipment:
 Sale proceeds: Taka 424,000
 Carrying amount: Taka 326,000
 Gain: Taka 98,000 (subtracted from profit)
o Loss on sale of intangible assets:
 Sale proceeds: Taka 12,000
 Carrying amount: Taka 40,000
 Loss: Taka 28,000 (added back to profit)
3. Changes in working capital:
o (Increase) in inventories: Taka (87,000) (Closing: Taka 685,000 - Opening: Taka
598,000)
o (Increase) in trade and other receivables: Taka (15,000) (Closing: Taka 480,000
- Opening: Taka 465,000)
o Decrease in prepayments: Taka 30,000 (Closing: Taka 96,000 - Opening: Taka
126,000)
o Increase in trade payables: Taka 322,000 (Closing: Taka 749,000 - Opening:
Taka 427,000)
o (Decrease) in accruals: Taka (23,000) (Closing: Taka 108,000 - Opening: Taka
131,000)
o (Decrease) in provisions: Taka (20,000) (Closing: Taka 120,000 - Opening: Taka
140,000)

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 Sample Question Paper Certificate Level-Accounting Answer

Cash generated from operations: = Profit before tax + Adjustments for non-cash items and non-
operating activities + Changes in working capital = 756,000 + (947,000 + 21,000 - 98,000 +
28,000) + (322,000 - 87,000 - 15,000 + 30,000 - 23,000 - 20,000) = 756,000 + 898,000 + 207,000
= 1,874,000

Interest paid: Taka (68,000) (as per the profit and loss statement). Tax paid: Taka (232,000) (as
per the profit and loss statement).

Net cash flows from operating activities: = Cash generated from operations - Interest paid - Tax
paid = 1,874,000 - 68,000 - 232,000 = 1,574,000

Investing Activities:

1. Purchase of property, plant, and equipment:

o Closing balance: Taka 7,464,000
o Opening balance: Taka 6,375,000
o Disposed assets cost: Taka 479,000
o Purchase: Taka 7,464,000 - 6,375,000 + 479,000
o = Taka 1,568,000
2. Proceeds from sale of property, plant and equipment: Taka 424,000 (from additional
information).
3. Proceeds from sale of intangibles: Taka 12,000 (from additional information).
4. Purchase of investments: Taka (406,000) (as per balance sheet).
5. Investment income received: Taka 45,000 (Taka 55,000 - Taka 10,000 accrued).

Net cash flows used in investing activities: = Proceeds from sale of property, plant and equipment
+ Proceeds from sale of intangibles + Investment income received - Purchase of property, plant
and equipment - Purchase of investments = 424,000 + 12,000 + 45,000 - 1,568,000 - 406,000 = -
1,493,000

Financing Activities:

1. Proceeds from issue of share capital:

o Share capital: Taka 100,000 (Closing: Taka 1,100,000 - Opening: Taka 1,000,000)
o Share premium: Taka 142,000 (Closing: Taka 342,000 - Opening: Taka 200,000)
o Total proceeds: Taka 100,000 + 142,000 = Taka 242,000
2. Proceeds from issue of redeemable preference shares: Taka 200,000 (as per balance
sheet).
3. Movements in borrowings: Taka (500,000) (Closing: Taka 500,000 - Opening: Taka
1,000,000).

Net cash flows from financing activities: = Proceeds from issue of share capital + Proceeds from
issue of redeemable preference shares - Movements in borrowings = 242,000 + 200,000 - 500,000
= (58,000)

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 Sample Question Paper Certificate Level-Accounting Answer

Net increase in cash and cash equivalents:

= Net cash flows from operating activities + Net cash flows used in investing activities + Net cash
flows from financing activities = 1,574,000 - 1,014,000 - 58,000 = 502,000

Cash and cash equivalents at the beginning of the year:

= Taka 200,000 (from balance sheet).

Cash and cash equivalents at the end of the year:

= Cash and cash equivalents at the beginning of the year + Net increase in cash and cash
equivalents = 200,000 + 502,000 = 702,000

Summary

The statement of cash flows follows the indirect method, which starts with the profit before tax
and adjusts for changes in working capital and non-cash items. The logic and calculations ensure
all figures reconcile with the given data, ensuring an accurate representation of ABC Limited's
cash flows for the year ended 30 June 2020.

Section B: Short Questions with Detailed Explanations

1. The business entity concept helps in:

o Answer: b) Determining the profit of the organization
o Explanation: The business entity concept ensures that a business's financial
transactions are separate from those of its owners or other businesses. This
separation allows for accurate determination of the organization's profit, as the
business's revenues and expenses are recorded independently of the owner's
personal finances.
2. Change in depreciation method to comply with IAS 16:
o Answer: a) Changes in accounting policy
o Explanation: According to IAS 16, changing the depreciation method (e.g., from
reducing balance to straight line) constitutes a change in accounting policy. This
change needs to be applied retrospectively unless impractical.
3. Business making a profit but decreased cash:
o Answer: c) The lengthening of the period of credit given to customers
o Explanation: When a business extends the credit period for its customers, it may
result in increased accounts receivable, reducing cash inflows. Thus, the business
can show a profit on the income statement but have reduced cash due to delayed
customer payments.
4. Fundamental concepts:
o Answer: a) The going concern concept, b) The business entity concept, c) The
prudence concept

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 Sample Question Paper Certificate Level-Accounting Answer

o Explanation: These are fundamental accounting principles. The going concern

concept assumes that the business will continue operating in the foreseeable
future. The business entity concept treats the business as a separate entity from its
owners. The prudence concept advises caution in recording revenues and
expenses to avoid overstatement of financial position.
5. Entries in the cash at bank account during bank reconciliation:
o Answer: a) Cheque paid in, subsequently dishonored on the bank transaction
report, c) Bank charges
o Explanation: A dishonored cheque needs to be removed from the cash book as it
was not received, and bank charges must be recorded as they reduce the cash
balance.
6. Error of principle:
o Answer: b) was debited to the purchases account
o Explanation: An error of principle occurs when an item is recorded in the wrong
type of account. Debiting plant and machinery to purchases (an expense account)
instead of an asset account is incorrect, as it should be recorded as a non-current
asset.
7. Time span for preparing financial statements:
o Answer: c) Accounting period
o Explanation: The accounting period is the time span into which the total life of a
business is divided for the purpose of preparing financial statements, typically a
fiscal year or a quarter.
8. VAT inclusive transaction double entry:
o Answer: c) Debit Receivables BDT 5,405, Credit Sales BDT 4,700, Credit VAT
BDT 705
o Explanation: The total amount (BDT 5,405) includes VAT. To record this, the
receivables account is debited with the total amount, while sales and VAT are
credited separately.
9. Users of financial statements of a small private company:
o Answer: b) Company employees, c) The company’s bank, e) Suppliers
o Explanation: Employees, banks, and suppliers use financial statements to assess
the company's financial health, creditworthiness, and operational stability.
10. Double entry for taking a computer for office use:
o Answer: b) Dr. Non-current assets Cr. Inventory
o Explanation: When a computer is taken from inventory for office use, it should
be reclassified from inventory to non-current assets, reflecting its new use.
11. Bank reconciliation balance:
o Answer: b) BDT 88,920 debit
o Explanation: Adjusting the cash book balance for uncredited lodgements and
unpresented cheques will reconcile the cash book with the bank statement
balance.
12. Correct bank balance after adjustments:
o Answer: a) BDT 5,100 overdrawn
o Explanation: After making the necessary corrections (e.g., standing order entered
twice, dishonored cheque), the adjusted balance will show BDT 5,100 overdrawn.

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 Sample Question Paper Certificate Level-Accounting Answer

13. Recognition of a fixed asset:

o Answer: a) Ownership
o Explanation: Recognition of a fixed asset does not necessarily depend on
ownership but rather on control over the asset and the expectation of future
economic benefits from its use.
14. Value of inventory at the year end:
o Answer: c) Taka 5,100
o Explanation: Inventory is valued at the lower of cost and net realizable value
(NRV). The calculation involves assessing NRV for each item and multiplying by
the number of units:
 Basics: 200×min⁡(6,9−1)=200×6=1,200200 \times \min(6, 9-1) = 200
\times 6 = 1,200200×min(6,9−1)=200×6=1,200
 Super: 250×min⁡(9,12−4)=250×8=2,000250 \times \min(9, 12-4) = 250
\times 8 = 2,000250×min(9,12−4)=250×8=2,000
 Luxury: 150×min⁡(18,15−5)=150×10=1,500150 \times \min(18, 15-5) =
150 \times 10 = 1,500150×min(18,15−5)=150×10=1,500
 Total: 1,200 + 2,000 + 1,500 = 4,700
15. Prudence concept application:
o Answer: True
o Explanation: The prudence concept suggests being conservative when making
accounting estimates to avoid overstating assets or income.
16. Transaction analysis before journal entry:
o Answer: True
o Explanation: Analyzing transactions ensures that the correct accounts are
affected and the entries are accurate.
17. Use of different depreciation methods:
o Answer: False
o Explanation: Generally, a single depreciation method should be used for a
particular class of assets for consistency, although different methods may be used
for different classes of assets.
18. Cash dividend from share premium account:
o Answer: False
o Explanation: Cash dividends cannot be paid from the share premium account; it
is typically used for purposes such as issuing bonus shares or writing off
preliminary expenses.
19. Effect of reducing allowance for receivables:
o Answer: True - It will increase net profit by Taka 600.
o Explanation: Reducing the allowance for receivables decreases expenses,
thereby increasing net profit.
20. Fixed assets not subject to depreciation:
o Answer: Land
o Explanation: Land is generally not depreciated because it does not have a finite
useful life.
21. Fundamental accounting concept not listed:

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 Sample Question Paper Certificate Level-Accounting Answer

o Answer: Not provided in the text.

o Explanation: This question may need more context to provide a precise answer.

22. Correct inventory valuation principles:

o Answer:
o Explanation: The provided document does not include this specific question;
thus, it cannot be answered without further details.

Question 23

Put the right number in assigned space

X Ltd. was established as an automobile manufacturing company on 1st January 2019. Primarily
it issued 1000 ordinary shares of Tk. 170 each. The nominal value of each share is Tk. 100. The
company also issued 1000 redeemable preference shares of Tk. 10 each. The company declared
and paid an interim dividend @ 15% for both ordinary share and preference share on 01 July
2019. The company also declared a final dividend @ 10% for ordinary share on 01 March 2020
for the year 2019. Calculate the amount of interim dividend.

Answer and Explanation:

1. Ordinary Shares:
o Issued: 1000 shares
o Nominal Value: Tk. 100 each
o Dividend Rate: 15%

Dividend per share = Nominal Value * Dividend Rate = Tk. 100 * 15% = Tk. 15 Total
Interim Dividend for Ordinary Shares = Number of Shares * Dividend per Share = 1000
* 15 = Tk. 15,000

2. Preference Shares:
o Issued: 1000 shares
o Value: Tk. 10 each
o Dividend Rate: 15%

Dividend per share = Value * Dividend Rate = Tk. 10 * 15% = Tk. 1.5 Total Interim
Dividend for Preference Shares = Number of Shares * Dividend per Share = 1000 * 1.5 =
Tk. 1,500

Total Interim Dividend: = Tk. 15,000 (Ordinary Shares) + Tk. 1,500 (Preference Shares) = Tk.
16,500

Question 24

Put the right number in assigned space

K. M. MAHAFUZUL ALAM | WhatsApp: 01728-928984 | Linkdlin: www.linkedin.com/in/mahafuzul-alam

 Sample Question Paper Certificate Level-Accounting Answer

Mr. Akhas, a sole-proprietor has the following assets and liabilities:

 Land Tk. 55,000

 Cash at Bank Tk. 6,500
 Inventory Tk. 12,500
 Creditors Tk. 5,000
 Loan to Mr. Akash Tk. 10,000

What is the amount of capital?

Answer and Explanation:

To find the amount of capital, we need to calculate the net assets. Net assets can be found using
the formula:

Capital=Total Assets−Total Liabilities

Total Assets:

 Land: Tk. 55,000

 Cash at Bank: Tk. 6,500
 Inventory: Tk. 12,500
 Loan to Mr. Akash: Tk. 10,000

Total Assets = 55,000 + 6,500 + 12,500 + 10,000 = Tk. 84,000

Total Liabilities:

 Creditors: Tk. 5,000

Total Liabilities = Tk. 5,000

Net Assets (Capital): Capital=Total Assets−Total Liabilities

Capital=84,000−5,000

Capital=Tk.79,000

So, the amount of capital is Tk. 79,000.

K. M. MAHAFUZUL ALAM | WhatsApp: 01728-928984 | Linkdlin: www.linkedin.com/in/mahafuzul-alam