SSC CGL Finance – Accounting: Meaning, Scope, Limitations & Basic Concepts – Exam-Level Drill

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SSC CGL Finance – Accounting: Meaning, Scope, Limitations & Basic Concepts – Exam-Level Drill – 10 questions, subject: Finance & Economics (Tier II Paper III). Every question has the correct answer with a one-line explanation; tap "Show Answer". Free practice for TNPSC, UPSC, SSC, Bank and RRB exams – Shanmugam IAS Academy, Coimbatore.

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1.  
At the start of the year a trader had assets ₹ 7,40,000 and liabilities ₹ 2,10,000; at the end, assets ₹ 9,10,000 and liabilities ₹ 2,60,000. He withdrew ₹ 5,000 every month and brought in fresh capital ₹ 40,000. His profit is:

Correct Answer: B [₹ 1,40,000]

Explanation:

Capitals 5,30,000 and 6,50,000 → 1,20,000 + 60,000 − 40,000 = 1,40,000.

2.  
Reverse questionClosing capital ₹ 4,20,000; profit for the year ₹ 75,000; drawings ₹ 30,000; no fresh capital. Opening capital was:

Correct Answer: A [₹ 3,75,000]

Explanation:

Opening = closing − profit + drawings = 4,20,000 − 75,000 + 30,000 = 3,75,000.

3.  
Opening capital ₹ 3,00,000; closing capital ₹ 3,48,000; profit ₹ 90,000; fresh capital ₹ 20,000. Drawings during the year were:

Correct Answer: C [₹ 62,000]

Explanation:

Drawings = 3,00,000 + 20,000 + 90,000 − 3,48,000 = 62,000.

4.  
A firm has assets ₹ 6,00,000 and liabilities ₹ 2,00,000. Then: (i) goods costing ₹ 30,000 are sold on credit for ₹ 45,000; (ii) the owner brings in ₹ 50,000 cash; (iii) an outstanding expense of ₹ 10,000 is paid; (iv) salary of ₹ 8,000 is due but unpaid. Capital is now:

Correct Answer: B [₹ 4,57,000]

Explanation:

4,00,000 + 15,000 + 50,000 − 8,000 = 4,57,000; paying an old liability does not touch capital.

5.  
Insurance paid in cash during the year ₹ 36,000. Prepaid insurance was ₹ 6,000 at the start and ₹ 9,000 at the end. Insurance expense of the year is:

Correct Answer: A [₹ 33,000]

Explanation:

36,000 + 6,000 (opening prepaid used now) − 9,000 (closing prepaid) = 33,000.

6.  
Opening creditors ₹ 55,000; cash paid to creditors ₹ 3,10,000; discount received ₹ 5,000; purchase returns ₹ 7,000; closing creditors ₹ 62,000. Credit purchases are:

Correct Answer: D [₹ 3,29,000]

Explanation:

3,10,000 + 5,000 + 7,000 + 62,000 − 55,000 = 3,29,000.

7.  
Cash purchases ₹ 40,000. Creditors: ₹ 20,000 at the start and ₹ 35,000 at the end; paid to creditors ₹ 1,50,000. Total purchases are:

Correct Answer: D [₹ 2,05,000]

Explanation:

Credit purchases 1,65,000 + cash purchases 40,000 = 2,05,000.

8.  
Two-quantity comparison
Quantity I: Profit when opening capital is ₹ 2,00,000, closing capital ₹ 2,30,000 and drawings ₹ 18,000
Quantity II: Commission income when cash received is ₹ 45,000, closing commission receivable ₹ 6,000 and opening receivable ₹ 4,000

Correct Answer: A [Quantity I > Quantity II]

Explanation:

QI = 30,000 + 18,000 = 48,000; QII = 45,000 + 6,000 − 4,000 = 47,000.

9.  
Reverse questionProfit for the year ₹ 64,000; drawings ₹ 24,000; fresh capital ₹ 30,000; closing capital ₹ 3,40,000. Opening capital was:

Correct Answer: A [₹ 2,70,000]

Explanation:

Opening = 3,40,000 − 64,000 + 24,000 − 30,000 = 2,70,000.

10.  
Which of the following transactions does NOT change the total of assets?

Correct Answer: B [Purchase of furniture for cash]

Explanation:

Furniture ↑ and cash ↓ by the same amount; the others change both sides of A = L + C.

➤ Full notes, shortcuts and every answer explained – SSC CGL 2026 Finance & Economics (Tier II Paper III) book (₹149): www.shanmugamiasacademy.in/study-materials/ssc-cgl-finance-economics

📘 SSC CGL 2026 – General Studies – Finance & Economics (Tier II Paper III)
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