Which one of the following is NOT true about Capital Expenditure?
Select correct option
They create future benefits
They are incurred to acquire fixed assets
They improve the financial position of the business
They reduce the profit of the concern
If Purchase price of machine = Rs. 400,000 Loss on disposal = Rs. 15,000 Residual value = Rs. 20,000 Useful life of machine = 5 years Find Sale price at the time of disposal =?
Select correct option
Rs. 15,000
Rs. 10,000
Rs. 20,000
Rs. 5,000
2
Which of the following is NOT a characteristic of Fixed Asset?
Select correct option
Of long life
To be used in the business
to generate revenue Easily
Convertible into Cash Not bought for the purpose of resale
When asset is sold, any profit or loss is computed by comparing the _______________with the amount received from sale.
When asset is sold, any profit or loss is computed by comparing the _______________with the amount received from sale.
Select correct option
Book value
Residual value
Purchased value
Salvage value
Which of the following is NOT a cause of disagreement between cash book and pass book?
Select correct option
Unpresented Cheques
Un-Credited Cheques
Direct Receipts
None of the above
Which of the following Organization converts raw material into finished goods?
Select correct option
Trading concern
Manufacturing concern
Merchandising concern
service concern
Bank Reconciliation Statement is prepared by:
Select correct option
Bankers
Accountant of the business
Statutory auditor
Manager
A sum of Rs. 50,000 was paid for customs duty and freight on machinery purchased from Japan. It is classified as:
Select correct option
Capital expenditure
Revenue expenditure
Deferred revenue expenditure
Capital receipt
Which of the following would be considered as revenue receipt?
Select correct option
Amount received from sale of share
Amount received from a debtor whose account was previously written off as bad
Amount received on sale of a portion of plant and machinery
Amount contributed by the proprietor in his business
Cost of goods sold + ending finished goods – opening finished goods=?
Cost of goods sold + ending finished goods – opening finished goods=?
Select correct option
Total factory cost
Cost of goods manufactured
Prime cost
Conversion cost
Supervisor's salary and equipment repair cost are examples of:
Factory overhead cost
Direct material cost
Direct labor cos
Finished goods cost
Which of the following is a revenue expenditure?
Oil to lubricate machines
Addition or extension of assets
Wages paid for the construction of building
Legal expenses on raising loans for the purchase of fixed assets
If, Cost of machine = Rs.400, 000 Useful life = 5 years Residual value = Rs.25, 000 Sale price = Rs.40, 000
Rs.75, 000
Rs.40, 000
Rs.55, 000
Rs.100, 000
The entry for Revaluation of an asset, in case of gain on revaluation will be:
Debit: Revaluation Reserve A/c Credit: Cost of Asset A/c
Debit: Revaluation Reserve A/c Credit: Accumulated Depreciation A/c
Debit: Cost of Asset A/c Credit: Revaluation Reserve A/c
Debit: Profit & Loss A/c Credit: Cost of Asset A/c
Which of the following assets are shown at written down value in balance sheet?
Current assets
Liquid assets
Floating assets
Fixed assets
Particulars Rs. Opening written down value of machine 4,10,000 Cost of machine purchased during the year 50,000 Depreciation during the year 20,000
Rs. 4, 40,000
Rs. 4, 30,000
Rs. 4, 80,000
Rs. 70,000
Money spent to acquire or upgrade physical assets is known as:
Revenue Expense
Capital Expense
Administrative Expense
Operating Expense
Fall in the market value of an asset
Fall in the value of money
Physical wear and tear
All of the given options
Expenses incurred for Salaries, heating and lighting are the examples of:
Preliminary Expense
Deferred Expense
Revenue Expense
Capital Expense
·
When the company deposit the cash in her bank account then what is the nature of the deposited amount:
It is the liability of the bank
It is the asset of the bank
It is the equity of the bank
The cost of an incomplete asset at the end of year in balance sheet is transferred to:
Capital account
Capital work in progress account
Particulars Rs. Opening written down value of machine 3,75,000 Cost of machine 50,000 Depreciation during the year 11,500 Closing written down value (WDV) of the Machines ?
Select correct option
Rs. 4,13,5000
Rs. 4, 25,000
Rs. 3, 36,500
Rs. 61,500
Total depreciation of an asset can not exceed its:
Select correct option
Scrap value
Residual value
Market value
Depreciable value
Particulars Rs. Opening written down value of machine 3,50,000 Cost of machine purchased during the year 40,000 Depreciation during the year 13,000 Closing written down value (WDV) of the Machines
Select correct option
Rs. 3, 77,000
Rs. 3, 90,000
Rs. 4, 12,000
Rs. 63,000
When a fixed asset in progress is completed, all costs are transferred to:
Select correct option
Profit & Loss A/c
Statement of owner’s equity
Relevant asset A/c
Profit & loss appropriation A/c
Which of the following is NOT a revenue expenditure?
select correct option
Petrol consumed in motor vehicles
Cost of saleable goods
Bad debts
Installation charges of machinery
In cost of goods sold statement, the ‘cost of material consumed’ is equal to:
Select correct option
Opening raw material inventory + Purchases – Ending raw material inventory
Opening raw material inventory - Purchases + Ending raw material inventory
Ending raw material inventory + Opening raw material inventory - Purchases Ending
raw material inventory + Opening raw material inventory + Purchases
Which of the following item needs to be entered in the Cash Book in order to bring it in line with the entries on the Bank Statement
Select correct option
A bank charges
An error on the Bank Statement
An uncredited deposit
An unpresented cheque
The differences between the balance of bank book statement and cash book is removed by making an adjusting entry through:
Select correct option
cash voucher
bank voucher
journal voucher
sales voucher
Which of the following assets is most likely to appreciate rather than depreciate?
Which of the following assets is most likely to appreciate rather than depreciate?
Select correct option
Land Motor vehicles
Plant and machinery
Fixtures and fittings
All of the below items are directly recorded by bank without intimating the business until the end of month, EXCEPT:
on Overdraft
bank chrges
_______ is the basic part of an item, which is processed to make a complete item:
Factory overhead
Raw material
Finished goods
work inproress
From the given particulars, calculate the rate of depreciation under the fixed installment method of depreciation:
Cost of Asset = Rs. 2,000 Residual Value = Rs. 400 Useful Life = 4 years
20%
30%
25%
33%
As asset has a cost of Rs. 2000 and rate of depreciation 10% p.a. What will be the amount of depreciation under diminishing balance method after 3 years?
2nd question ka fist hy 2000 pr depr 20% charge 2000*20/100 kroo to 400 ans aiy ga jo us ny diea hy
rs. 542
Rs. 1458
Rs. 1400
None of the above
In accounting accumulated depreciation is:
Treated as a reserve
Treated as a contra asset
reated as a surplus
Treated as an expense
Following information is available relating to a manufacturing concern:
Cost of Goods Sold Rs. 240,000 Opening Stock Rs. 20,000 Purchases Rs. 255,000
What will be the amount of Closing Stock?
Rs. 15,000
Rs. 25,000
Rs. 35,000
Rs. 45,000
Which of the following is NOT a rule for revaluation of fixed assets?
The change in the value should be permanent
Revaluation has to be carried out at regular intervals
Whole class of asset has to be revalued
If you start with cash book favorable balance in Bank Reconciliation Statement, which item will be added?
Cheque deposited but not credited by the bank
Cheques omitted to be deposited into bank
Any amount directly collected by bank on behalf of customer but not recorded in cash book
Debit side of cash book was overcast
Expenses incurred for Salaries, heating and lighting are the examples of:
Preliminary Expense
Deferred Expense
Revenue Expense
Capital Expense
A machine is purchased for Rs. 400,000. It has a residual value of Rs. 10,000 after 5 years. If machine is sold at Rs. 15,000, what will be the amount of profit or loss on disposal of machine?
Loss on disposal Rs. 5,000
Profit on disposal Rs. 5,000
Loss on disposal Rs. 15,000
Profit on disposal Rs. 15,000
Bank Reconciliation Statement is:
A memorandum statement
A ledger account
A part of cash book
A part of journal
As asset has a cost of Rs. 2000 and rate of depreciation 10% p.a. What will be the amount of depreciation under diminishing balance method after 3 years?
Rs. 542
Rs. 1458
Rs. 1400
Fixed Assets are always written on ___________ in the books of accounts.
Market Value
Historical Cost
Residual Value
Written Down Value
Which of the following assets are shown at written down value in balance sheet?
Current assets
Liquid assets
Cost of goods sold + ending finished goods – opening finished goods=?
Total factory cost
Cost of goods manufactured
Prime cost
The amount of depreciation charged on Furniture will be debited to:
Furniture Account
Depreciation Account
depriciation
Accumulated Depreciation A/c
All of the below items are directly recorded by bank without intimating the business until the end of month,
EXCEPT:
Bank Charges
bank charges
In cost of goods sold statement the ‘total factory cost’ is equal to:
Cost of material consumed + Labor cost
Cost of material consumed + Conversion cost
Cost of material consumed + Total factory cost
Cost of material consumed + Factory overhead
The entry of raw material issued to production units is:
Debit: Raw material A/c Credit: Work in process A/c
Debit: Work in process A/c Credit: Finished goods A/c
Debit: Work in process A/c Credit: Factory overhead A/c
Credit: Material Stock A/c
Which of the following is(are) example(s) of accruals?
Select correct option:
Electricity bills payable
Water supply bills payable
Wages payable
All of the given options
Which of the following shows company’s negative working capital?
Select correct option:
Current Asset > Current Liability
Current Asset < Current Liability
Current Asset = Current Liability
None of the given options
___________ is the detail of transaction in one's account provided by the bank.
Select correct option:
Bank statement
Bank reconciliation statement
Income statement
Financial statement
Total Sales are calculated by adding:
Select correct option:
Cash sales and cash received from debtors
Credit sales and cash received from debtors
Cash sales and credit sales
Cash ales and credit purchases
The amount of owner's equity in a business is affected by which of the following?
Select correct option:
The profitability of the business
Investments made in the business by the owner
The amount of dividends paid to stockholders
All of the given options
Expenses incurred for Salaries, heating and lighting are the examples of:
Select correct option:
Preliminary Expense
Deferred Expense
Revenue Expense
Capital Expense
Which of the following account balance/s is/are shown on credit side of Trial Balance? (It is assumed that all account balances are shown on normal balance)
Select correct option:
Capital account
Sundry creditors account
Accounts payable account
All of the given options
While making Profit & Loss account, Excess of expenses over income in a specified accounting period is called:
Select correct option:
Profit
Loss
Surplus
Deficit
__________ is the art of recording, classifying and summarizing the transactions and events of a business and interpreting the results thereof.
Select correct option:
Book-keeping
Accounting
Management
Auditing
In balance sheet fixed assets are shown at:
Select correct option:
Written down value (WDV)
Cost price
Market value
Fair value
Assets are divided in which of the following categories in balance sheet.
Select correct option:
Current assets, Long term assets and capital assets
Current assets, Long term assets and fixed assets
Current assets, Quick assets and business debts
Current assets, Fixed assets and deferred cost
In cost of goods sold statement the ‘cost of goods manufactured’ is equal to:
Select correct option:
Total factory cost + Opening work in process + Ending work in process
Total factory cost + Opening work in process – Ending work in process
Total factory cost - Opening work in process + Ending work in process
Ending work in process +Total factory cost – Opening work in process
Supervisor's salary and equipment repair cost are examples of:
Select correct option:
Factory overhead cost
Direct material cost
Direct labor cost
Finished goods cost
Bank Reconciliation Statement is:
Select correct option:
A memorandum statement
A ledger account
A part of cash book
A part of journal
Which of the following entry will be recorded for discount received in a control account?
Select correct option:
Discount Received (Dr) and Creditors Control A/c (Cr)
Discount Received (Dr) and Creditors A/c (Cr)
Creditors Control A/c (Dr) and Discount Received (Cr)
Debtors A/c (Dr) and Discount Received (Cr)
A form that allows individuals to compare their personal bank account records to the bank's records of the individual's account balance in order to uncover any possible discrepancies is known as:
Select correct option:
Bank statement
Income statement
Financial statement
Bank Reconciliation statement
Bank Reconciliation Statement is prepared by:
Select correct option:
Bankers
Accountant of the business
Statutory auditor
Manger
Particulars Rs. Opening written down value of machine 3,75,000 Cost of machine 50,000 Depreciation during the year 11,500 Closing written down value (WDV) of the Machines ?
Select correct option:
Rs. 4,13,5000
Rs. 4, 25,000
Rs. 3, 36,500
Rs. 61,500
Sales to Mr. “A” of Rs. 336 have been debited to Mr. “B” account, this will be rectified by:
Select correct option:
Debiting Mr. A’s account and crediting Mr. B’s account
Debiting Mr. B’s account and crediting Mr. A’s account
Crediting both accounts
Debiting both accounts
All the statements are correct about Journal voucher EXCEPT:
Select correct option:
Financial data is picked only from journal vouchers to Journal
These are used to record all transaction other than cash & bank
These are used to make corrections or adjustments to previous Receipt
Format of journal voucher is different from other vouchers
Which of the following contents are included in the Cost of goods sold?
Select correct option:
Opening stock
Purchases
Freight in
All of the given options
Which of the following Journal entry will be recorded when the bad debts are recovered?
Select correct option:
Cash account (Dr.) & Bad Debts recovered account (Cr.)
Accounts Receivable (Dr.) & Bad Debts recovered account (Cr.)
Bad debts recovered account (Dr.) and profit & loss account (Cr.)
Provision for doubtful debts account (Dr.) & cash account (Cr.)
Which of the following is NOT correct?
Select correct option:
Decrease in Assets will be credit
Decrease in Liabilities will be credit
Decrease in Expenses will be credit
Decrease in Revenue will be debit
Particulars Rs. Opening written down value of machine 1,00,000 Cost of new machine purchased during the year 50,000 Depreciation during the year 20,000 Closing written down value (WDV) ?
Select correct option:
Rs. 1,30,000
Rs. 1, 50,000
Rs. 1, 20,000
Rs. 70,000
An accounting system is used by a business to:
Select correct option:
Analyze transactions
Handle routine bookkeeping tasks
Structure information
All of the given options
In an account if debit side > credit side, the balance is known as the:
Select correct option:
Negative Balance
Debit balance
Positive Balance
Credit balance
Details of individual accounts are kept in a separate register / ledger called:
Select correct option:
Control Account
Subsidiary Ledger
General Journal
All of the given options
which of the following statement/s closing stock is/are shown?
Select correct option:
Profit and loss account
Balance sheet
Income statement
All of the given options
Which of the following particular/s is/are included in payment voucher?
Select correct option:
Name of organization
Cash payment
Date
All of the given options
Which of the following appears in both the Income Statement debit column and the Balance Sheet credit?
Select correct option:
Net income
Net loss
Dividends
Retained earnings
A book that keeps separate record for each account is known as:
Select correct option:
Trial Balance
Voucher
General Journal
General Ledger
Which of the following Organization converts raw material into finished goods?
Select correct option:
Trading concern
Manufacturing concern
Merchandising concern
Service concern
Franchise rights, goodwill and patents are the examples of:
Select correct option:
Liquid assets
Tangible assets
Intangible assets
Current assets
Cost of goods sold + ending finished goods – opening finished goods=?
Select correct option:
Total factory cost
Cost of goods manufactured
Prime cost
Conversion cost
accounting, which of the following account will be credited if the bad debts are recovered in cash?
Select correct option:
Cash a/c
Bad debt recovered a/c
Doubtful debts a/c
Provision for bad debts a/c
What should be credited, if rent paid in cash?
Select correct option:
Landlord’s account
Rent account
Cash account
Accounts receivable account
Sales to Mr. “A” of Rs. 336 have been debited to Mr. “B” account, this will be rectified by:
Select correct option:
Debiting Mr. A’s account and crediting Mr. B’s account
Debiting Mr. B’s account and crediting Mr. A’s account
Crediting both accounts
Debiting both accounts
If cost of sales is Rs. 60,000, income from sales Rs. 95,000 and direct expenses Rs. 10,000. Calculate Net profit.
Select correct option:
Rs. 15,000
Rs. 35,000
Rs. 55,000
Rs. 60,000
Particulars Rs. Opening written down value of machine 4,10,000 Cost of machine purchased during the year 50,000 Depreciation during the year 20,000 closing written down value (WDV) of the Machines ?
Select correct option:
Rs. 4, 40,000
Rs. 4, 30,000
Rs. 4, 80,000
Rs. 70,000
Which of the following voucher is used to record receipt of cash?
Select correct option:
Journal Voucher
Receipt Voucher
Payment Voucher
Nominal Voucher
In double entry system discount received is recorded as:
Select correct option:
Creditors a/c (Dr.), Discount received a/c (Cr.)
Discount received a/c (Dr.), Creditors a/c (Cr.)
Debtor a/c (Dr.), Discount received a/c (Cr.)
Discount received a/c (Dr.), Debtor a/c (Cr.)
The expenses which are NOT paid out of Gross Profit is classified as:
Select correct option:
Direct Expenses
General Expenses
Financial Expenses
Selling Expenses
Which of the following account(s) would be decreased with a debit?
Select correct option:
Capital
Retained Earnings
Revenues
All of the given options
Which of the following is fiscal Year of Government of Pakistan?
Select correct option:
1st January to 31st December
1st June to 31st May
1st July to 30th June
1st October to 30th September
Which of the following is/are inventory valuation method(s)?
Select correct option:
FIFO
LIFO
Weighted average
All of the given options
Which of the following particular/s is/are included in receipt voucher?
Select correct option:
Name of organization
Bank receipt
Date
All of the given options
Which of the following assets is most likely to appreciate rather than depreciate?
Select correct option:
Land
Motor vehicles
Plant and machinery
Fixtures and fittings
Which of the following item needs to be entered in the Cash Book in order to bring it in line with the entries on the Bank Statement?
Select correct option:
A bank charges
An error on the Bank Statement
An uncredited deposit
An unpresented cheque
Wages paid to laborers working in the manufacturing department is treated as an expense of:
Select correct option:
Cost of goods sold
Administrative expenses
Selling expenses
Marketing expenses
Bad debts written off (given in adjustment) always affect the:
Select correct option:
Debtors account
Creditors account
Cash account
Capital account
Carriage paid Rs. 50 for the newly purchased machinery if debited to carriage account will effect:
Select correct option:
Only carriage account
Only machinery account
Both carriage and machinery account
None of the given options
Cost of goods manufactured - opening work in process + ending work in process =?
Select correct option:
Cost of goods sold
Prime cost
Conversion cost
Total factory cost
If cost of sales is Rs. 95,000, income from sales Rs. 200,000 and operating expenses Rs. 300,000. What will be net result?
Select correct option:
Rs. 1, 95,000 Losses
Rs. 1, 95,000 Profits
Rs 1, 05,000 Profits
Rs1, 05,000 Losses
What is the proper order of the following steps in the accounting process? I. Prepare and analyze the trial balance II. Record relevant transactions and events in a journal III. Analyze each transaction and event from source documents IV. Post journal information to ledger accounts
Select correct option:
III. IV. I. II.
I. II. III. IV.
III. II. IV. I.
III. II. I. IV.
Sales to Mr. “A” of Rs. 336 have been debited to Mr. “B” account, this will be rectified by:
Select correct option:
Debiting Mr. A’s account and crediting Mr. B’s account
Debiting Mr. B’s account and crediting Mr. A’s account
Crediting both accounts
Debiting both accounts
Which of the following expenses are called financial expenses?
Select correct option:
Payment of rent & Salary expense
Markup on loan& Bank Charges
Interest & advertisement expense
Wages and Depreciation expense
Cash and other resources that are expected to turn to cash or to be used up within one year of the balance sheet date are called:
Select correct option:
Current liability
Current assets
Fixed assets
Long-term assets
Money spent to acquire or upgrade physical assets is known as:
Select correct option:
Revenue Expense
Capital Expense
Administrative Expense
Operating Expense
Which of the following might be a reason, when a Bank Statement show greater balance then Cash Book balance at the end of specified period?
Select correct option:
Unpresented cheques
Unrecorded bank charges
Uncredited cheques
None of the given options
Which of the following particular is NOT included in journal voucher?
Select correct option:
Name of organization
Bank receipt number
Debit amount
Credit amount
Consider the following data: Particulars Rs. Assets ? Owner's equity 35,000 Liabilities 90,000
Select correct option:
Rs. 35,000
Rs. 55,000
Rs. 1, 25,000
Rs. 1, 05,000
If, Cost of machine = Rs.400, 000 Useful life = 5 years Residual value = Rs.25, 000 Sale price = Rs.40, 000 Rate of depreciation = 40% What will be depreciation of machine after one years using diminishing balance method?
Select correct option:
Rs. 1, 60,000
Rs. 11,840
Rs. 34,560
Rs. 34,860
If, Cost of machine = Rs.400, 000 Useful life = 5 years Residual value = Rs.25, 000 Sale price = Rs.40, 000 Rate of depreciation = 40% What will be book value of machine after four years using straight line method?
Select correct option:
Rs.35, 000
Rs.40, 000
Rs.55, 000
Rs.75, 000
Amount generated from sales in a business is called:
Select correct option:
Income
Net Income
Gross Profit
Operating profit
___________= Gross profit < Operating Expenses
Select correct option:
Net Profit
Gross Profit
Net Loss
Gross Loss
Which of the following is an example of operating expense?
Select correct option:
Purchasing operating equipment
Purchasing cleaning services
Purchasing an investment in another company
Purchasing a computer for the accounting office
Net profit = Gross profit - _________
Select correct option:
Operating Expenses
Product Cost
Deferred Expenses
Direct Cost
which of the following statement/s closing stock is/are shown?
Select correct option:
Profit and loss account
Balance sheet
Income statement
All of the given options
If Gross profit Rs.16,500 and Cost of goods sold Rs.183,500, what will be the amount of Net Sales?
Select correct option:
Rs. 183, 500
Rs. 167, 000
Rs. 200, 000
Rs. 230, 000
Cost of goods manufactured + opening finished goods – ending finished goods =?
Select correct option:
Total factory cost
Cost of goods sold
Prime cost
Conversion cost
Goods sold to Mr. Salman for RS. 6,000 have been forgotten to enter in books of accounts, this is an example of:
Select correct option:
Error of Omission
Error of Commission
Error of Principle
Error of Original entry
Which of the following account balance is shown on credit side of Trial Balance? (It is assumed that all account balances are shown on normal balance)
Select correct option:
Cash account
Furniture account
Vehicle account
Capital account
A debit balance in the Bank Statement indicates:
Select correct option:
Cash at bank
Bank overdraft
Overpayment to creditors
Cash in hand
Increase in an expense is recorded on the:
Select correct option:
Left or credit side of the account
Right or debit side of the account
Left or debit side of the account
Right or credit side of the account
Expense incurred for operating activities of the business in providing goods and services is known as:
Select correct option:
Revenue expense
Capital expense
Deferred expense
Preliminary expense
Which of the following is NOT considered a part of financial statements?
Select correct option:
General Journal
Balance Sheet
Profit and Loss account
None of the given options
The goal of reconciliation is all of the following EXCEPT:
To discover the various things the bank has not done in the pass book but recorded in cash book
To discover anything that bank has passed through but the cash book has not
To put right anything that is wrong & draws an explanation for the differences
To discover any discrepancy that is due to timing rather than error
Which of the following is NOT a cause of disagreement between cash book and pass book?
Unpresented Cheques
Un-Credited Cheques
Direct Receipts
None of given
When a fixed asset in progress is completed, all costs are transferred to:
Profit & Loss A/c
Statement of owner’s equity
Relevant asset A/c
Profit & loss appropriation A/cProfit & loss appropriation A/c
_______ is the basic part of an item, which is processed to make a complete item:
Factory overhead
work in process
Raw material
Finished goods
The Cheques that has been deposited into the bank but not cleared until the end of the period are called as:
Unpresented Cheques
Un-Credited Cheque
Dishonored Cheques
Which of the following Organization converts raw material into finished goods?
Trading concern
Manufacturing concern
Merchandising concern
A company uses straight line method of depreciation for an item of equipment that cost Rs. 28,000, has a salvage value of Rs. 3000, and has a five year useful life. What will be the amount of annual depreciation?
Rs. 5,000
Rs. 6,000
Rs. 4,000
Rs. 3,000
A machine is purchased for Rs. 400,000. It has a residual value of Rs. 10,000 after 5 years. If machine is sold at Rs. 15,000, what will be the amount of profit or loss on disposal of machine?
Loss on disposal Rs. 5,000
Profit on disposal Rs. 5,000
Loss on disposal Rs. 15,000
Profit on disposal Rs. 15,000
Particulars Rs. Opening written down value of machine 3,75,000 Cost of machine 50,000 Depreciation during the year 11,500 Closing written down value (WDV) of the Machines ?
Rs. 4,13,5000
Rs. 4, 25,000
Rs. 3, 36,500
Rs. 61,500
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