MCQOPTIONS
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MCQOPTIONS
This section includes 657 Mcqs, each offering curated multiple-choice questions to sharpen your Testing Subject knowledge and support exam preparation. Choose a topic below to get started.
| 1. |
____ principle requires that the same accounting method should be used from one accounting period to the next |
| A. | Conservatism |
| B. | Consistency |
| C. | Business entity |
| D. | Money measurement |
| Answer» C. Business entity | |
| 2. |
If an effect of an error is cancelled by the effect of some other error, it is commonly known as |
| A. | Error of principle |
| B. | Compensatory errors |
| C. | Error of omission |
| D. | Error of commission |
| Answer» C. Error of omission | |
| 3. |
"Treating a revenue expenditure as a capital expenditure" is an example of |
| A. | Compensating error |
| B. | Error of principle |
| C. | Error of omission |
| D. | Error of commission |
| Answer» C. Error of omission | |
| 4. |
Narrations are given at the end of |
| A. | Final accounts |
| B. | Trial Balance |
| C. | Each Ledger account |
| D. | Each journal entry |
| Answer» E. | |
| 5. |
The basic consideration(s) in distinction between capital and revenue expenditure is/are |
| A. | Nature of business |
| B. | Effect on revenue generating capacity of the business |
| C. | Purpose of expenses |
| D. | All of the above |
| Answer» E. | |
| 6. |
X draws a bill on Y. X endorsed the bill to Z. ____ will be the payee of the bill. |
| A. | x |
| B. | y |
| C. | z |
| D. | None of the above |
| Answer» D. None of the above | |
| 7. |
Which account is the odd one out? |
| A. | Office furniture and equipment |
| B. | Freehold land and building |
| C. | Stock of raw materials |
| D. | Plant and machinery |
| Answer» D. Plant and machinery | |
| 8. |
The owner of consignment stock is |
| A. | Consignor |
| B. | Consignee |
| C. | Debtors |
| D. | None of the above |
| Answer» B. Consignee | |
| 9. |
Endorsement, discounting and collection of bills of exchange is made by |
| A. | Debtors |
| B. | Creditors |
| C. | Drawee |
| D. | Drawer |
| Answer» E. | |
| 10. |
Bills receivable is a |
| A. | Intangible fixed asset |
| B. | Tangible fixed asset |
| C. | Current asset |
| D. | Investment |
| Answer» D. Investment | |
| 11. |
The party who sends the goods for sales on fixed commission basis is known as |
| A. | Drawer |
| B. | Drawee |
| C. | Payee |
| D. | Consignor |
| Answer» E. | |
| 12. |
Joint venture account is a |
| A. | Nominal account |
| B. | Personal account |
| C. | Real account |
| D. | Dummy account |
| Answer» B. Personal account | |
| 13. |
Municipal tax Rs.6000 under dispute is a |
| A. | Contingent liability |
| B. | Revenue expenditure |
| C. | Current liability |
| D. | Current asset |
| Answer» B. Revenue expenditure | |
| 14. |
Difference of total of debit and credit side of the trial balance is transferred to |
| A. | Suspense A/c |
| B. | Difference A/c |
| C. | P & L A/c |
| D. | Trading A/c |
| Answer» B. Difference A/c | |
| 15. |
Legal expenses incurred on a suit for breach of contract to supply goods is a |
| A. | Capital expenditure |
| B. | Deferred Revenue expenditure |
| C. | Revenue expenditure |
| D. | Both 'b' and 'c' |
| Answer» D. Both 'b' and 'c' | |
| 16. |
Under diminishing balance method, depreciation |
| A. | Is constant every year |
| B. | Increases every year |
| C. | Decreases every year |
| D. | None of the above |
| Answer» D. None of the above | |
| 17. |
The parties to joint venture are called |
| A. | Friends |
| B. | Principal and agent |
| C. | Partners |
| D. | Co-ventures |
| Answer» E. | |
| 18. |
Heavy amount spent for the advertisement of new company product is |
| A. | Revenue expenditure |
| B. | Deferred Revenue expenditure |
| C. | Capital expenditure |
| D. | Either 'a' or 'c' |
| Answer» C. Capital expenditure | |
| 19. |
Cash Account is |
| A. | Personal account |
| B. | Real account |
| C. | Nominal account |
| D. | None of the above |
| Answer» C. Nominal account | |
| 20. |
Income includes |
| A. | Income earned |
| B. | Income received |
| C. | Income receivable |
| D. | All of the above |
| Answer» E. | |
| 21. |
The following error will affect the Trial Balance |
| A. | Error of partial omission |
| B. | Error of principle |
| C. | Error of complete omission |
| D. | All of the above |
| Answer» B. Error of principle | |
| 22. |
A company cannot issue redeemable preference shares for a period exceeding |
| A. | 10 years |
| B. | 20 years |
| C. | 30 years |
| D. | 15 years |
| Answer» C. 30 years | |
| 23. |
In case of opening Credit Balance, the word ______ are written on the credit side.` |
| A. | By Balance b/d |
| B. | To Balance b/d |
| C. | By Balance c/d |
| D. | To Balance c/d |
| Answer» B. To Balance b/d | |
| 24. |
Preliminary expenses are treated as |
| A. | Fixed asstes |
| B. | Current assets |
| C. | Intangible assets |
| D. | Miscellaneous expenditure |
| Answer» E. | |
| 25. |
Revenue expenditures are recorded in the |
| A. | Manufacturing account |
| B. | Trading account |
| C. | Profit & loss account |
| D. | All of the above |
| Answer» E. | |
| 26. |
Promissory note is prepared by |
| A. | Drawer |
| B. | Endorsee |
| C. | Drawee |
| D. | All of the above |
| Answer» D. All of the above | |
| 27. |
Petty cash is used for payment of |
| A. | Salaries & wages of the staff |
| B. | For purchase of assets |
| C. | Small expenses relating to postage's and conveyance etc. |
| D. | All of the above |
| Answer» D. All of the above | |
| 28. |
Profit is a part of |
| A. | Income |
| B. | Owner's capital |
| C. | Assets |
| D. | All of the above |
| Answer» C. Assets | |
| 29. |
Gross profit is equal to |
| A. | Opening stock + purchases - closing stock |
| B. | Net profit - expenses |
| C. | Sales - Closing stock + purchases |
| D. | Sales - Cost of goods sold |
| Answer» E. | |
| 30. |
Which of the following enhances the earning capacity of an asset? |
| A. | Reduction in operating costs |
| B. | Increase in working capacity of an asset |
| C. | Replacing damage parts of an asset |
| D. | Both 'b' and 'c' |
| Answer» E. | |
| 31. |
Profit & Loss account is prepared for a period of one year by following |
| A. | Periodicity concept |
| B. | Business entity concept |
| C. | Accrual concept |
| D. | None of the above |
| Answer» B. Business entity concept | |
| 32. |
Rs.5000 spent on maintenance of computer is |
| A. | Deferred capital expenditure |
| B. | Capital expenditure |
| C. | Revenue expenditure |
| D. | None of the above |
| Answer» D. None of the above | |
| 33. |
Parties to a bill of exchange are |
| A. | Drawer |
| B. | Drawee |
| C. | Payee |
| D. | All of the above |
| Answer» E. | |
| 34. |
Accommodation bill is drawn |
| A. | To finance actual purchase or sale of goods |
| B. | To facilitate trade transmission |
| C. | To cater the fund requirements of both the parties |
| D. | None of the above |
| Answer» D. None of the above | |
| 35. |
Which error cannot be revealed on the preparation of trial balance? |
| A. | Wrong totalling of account |
| B. | Compensatory errors |
| C. | Error of commission |
| D. | Wrong balancing of an account |
| Answer» C. Error of commission | |
| 36. |
Commission to promote credit sale by consignee is known as |
| A. | Del credere commission |
| B. | Over riding commission |
| C. | Ordinary commission |
| D. | Special commission |
| Answer» B. Over riding commission | |
| 37. |
Dividends are usually paid as a percentage of |
| A. | Net profit |
| B. | Authorized share capital |
| C. | Called up capital |
| D. | Paid up capital |
| Answer» E. | |
| 38. |
A proforma invoice is sent by |
| A. | Consignee to consignor |
| B. | Consignee to debtors |
| C. | Debtors to consignee |
| D. | Consignor to consignee |
| Answer» E. | |
| 39. |
One of the Fundamental accounting assumption is |
| A. | Materiality |
| B. | Going concern |
| C. | Business entity |
| D. | Dual aspect |
| Answer» C. Business entity | |
| 40. |
Loss leads to reduction in |
| A. | Capital |
| B. | Income |
| C. | Liabilities |
| D. | None of the above |
| Answer» B. Income | |
| 41. |
Transaction between business and owner are recorded following ____ concept |
| A. | Periodicity |
| B. | Business entity |
| C. | Prudence |
| D. | Going concern |
| Answer» C. Prudence | |
| 42. |
When will the bill mature if the date of maturity of a bill is a holiday |
| A. | Holiday itself |
| B. | Other agreed day |
| C. | Preceding working day |
| D. | Next working day |
| Answer» D. Next working day | |
| 43. |
Revenue from sale of product ordinarily is reported as part of earning in the period |
| A. | The planning takes place |
| B. | The sale is made |
| C. | The product is manufactured |
| D. | The cash is collected |
| Answer» C. The product is manufactured | |
| 44. |
Reserve capital means |
| A. | Part of subscribed uncalled capital |
| B. | Accumulated profit |
| C. | Part of Capital Reserve |
| D. | Part of Capital Redemption Reserve |
| Answer» B. Accumulated profit | |
| 45. |
Del-credere Commission is allowed to cover |
| A. | All types losses |
| B. | Abnormal loss |
| C. | Normal loss |
| D. | None of the above |
| Answer» E. | |
| 46. |
Interest on Capital is _____ for the business |
| A. | Revenue |
| B. | Expense |
| C. | Gain |
| D. | None of the above |
| Answer» C. Gain | |
| 47. |
Accounts payable has ____ balance |
| A. | Credit |
| B. | Debit |
| C. | Unfavorable |
| D. | Favorable |
| Answer» B. Debit | |
| 48. |
Economic life of an enterprise Is split into periodic interval as per ____ concept |
| A. | Materiality |
| B. | Periodicity |
| C. | Accrual |
| D. | Conservation |
| Answer» C. Accrual | |
| 49. |
Present liability of uncertain amount, which can be measured reliably by using a substantial degree of estimation is termed as |
| A. | Contingent liability |
| B. | Liability |
| C. | Provision |
| D. | Reserve |
| Answer» D. Reserve | |
| 50. |
Overriding commission is generally calculated on |
| A. | Cash sale only |
| B. | Total sales exceeding invoice value/cost |
| C. | Credit sales |
| D. | None of the above |
| Answer» C. Credit sales | |