SSC CGL Finance – Double Entry, Books of Original Entry & Journal – Exam-Level Drill

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SSC CGL Finance – Double Entry, Books of Original Entry & Journal – 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.  
A business is started with cash ₹ 2,00,000 and stock ₹ 50,000. Then: goods bought on credit ₹ 40,000; goods sold to Xavier on credit ₹ 30,000; Xavier pays ₹ 29,400 in full settlement; rent paid ₹ 5,000. The total of the journal (debit column) is:

Correct Answer: C [₹ 3,55,000]

Explanation:

2,50,000 + 40,000 + 30,000 + 30,000 + 5,000 = 3,55,000 (the settlement entry totals 30,000).

2.  
A business is started with cash ₹ 2,00,000 and stock ₹ 50,000. Then: goods bought on credit ₹ 40,000; goods sold to Xavier on credit ₹ 30,000; Xavier pays ₹ 29,400 in full settlement; rent paid ₹ 5,000. The cash balance at the end is:

Correct Answer: D [₹ 2,24,400]

Explanation:

2,00,000 + 29,400 − 5,000 = 2,24,400.

3.  
Goods of list price ₹ 2,40,000 are bought at 12.5% trade discount and paid for at once with 4% cash discount. The discount recorded in the books is:

Correct Answer: A [₹ 8,400]

Explanation:

Only cash discount is recorded: 4% of 2,10,000 = 8,400.

4.  
₹ 8,000 is withdrawn in the middle of every month for a year. Interest on drawings at 9% p.a. is:

Correct Answer: C [₹ 4,320]

Explanation:

Answer: ₹ 4,320. 96,000 × 9% × 6/12 = 4,320.

5.  
Capital on 1 April ₹ 5,00,000. Additional capital ₹ 80,000 brought in on 1 January; ₹ 50,000 of capital withdrawn on 1 October. Interest on capital at 10% p.a. for the year ending 31 March is:

Correct Answer: D [₹ 49,500]

Explanation:

50,000 + 80,000 × 10% × 3/12 − 50,000 × 10% × 6/12 = 50,000 + 2,000 − 2,500 = 49,500.

6.  
Opening: assets ₹ 3,60,000, liabilities ₹ 90,000. Closing: assets ₹ 4,25,000, liabilities ₹ 1,05,000. Cash drawings ₹ 36,000 and goods taken for personal use ₹ 4,000; additional capital ₹ 25,000. Profit is:

Correct Answer: B [₹ 65,000]

Explanation:

50,000 + 40,000 − 25,000 = 65,000 (goods drawn are drawings too).

7.  
Opening balances: cash ₹ 25,000, stock ₹ 80,000, debtors ₹ 45,000, machinery ₹ 1,50,000, creditors ₹ 60,000, bank loan ₹ 40,000. In the opening entry, Capital Account is credited with:

Correct Answer: C [₹ 2,00,000]

Explanation:

Assets 3,00,000 − liabilities 1,00,000 = 2,00,000.

8.  
Goods costing ₹ 50,000 are lost in a fire. The insurance company admits 70% of the claim. The loss to be charged to the Profit and Loss Account is:

Correct Answer: B [₹ 15,000]

Explanation:

Claim 35,000; loss 15,000 (Loss by fire Dr 15,000, Insurance claim Dr 35,000, To Purchases 50,000).

9.  
Two-quantity comparisonTwo-quantity comparison (rate 12% p.a., year ends 31 March):
Quantity I: interest on drawings of ₹ 3,000 taken at the beginning of every month
Quantity II: interest on a single drawing of ₹ 36,000 taken on 1 October

Correct Answer: A [Quantity I > Quantity II]

Explanation:

QI = 36,000 × 12% × 6.5/12 = 2,340; QII = 36,000 × 12% × 6/12 = 2,160.

10.  
Spot My Mistake“The owner's household electricity bill of ₹ 4,500 was paid from the business cash: Electricity A/c Dr 4,500, To Cash A/c 4,500.” The account that should be debited is:

Correct Answer: D [Drawings Account]

Explanation:

A private expense of the owner paid by the business is drawings, not a business expense.

➤ 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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