MCQOPTIONS
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MCQOPTIONS
This section includes 1706 Mcqs, each offering curated multiple-choice questions to sharpen your Finance & Accounting knowledge and support exam preparation. Choose a topic below to get started.
| 1001. |
A trader has credited certain items of sales on approval aggregating ` 60,000 to Sales Account. Of these, goods of the value of `16,000 have been returned and taken into stock at cost ` 8,000 though the record of return was omitted in the accounts. In respect of another parcel of ` 12,000 (cost being `6,000) the period of approval did not expire on the closing date. Cost of goods lying with customers should be |
| A. | 12,000. |
| B. | 54,000. |
| C. | 6,000. |
| D. | None of the above. |
| Answer» D. None of the above. | |
| 1002. |
Carriage outward is debited to___________ |
| A. | Trading accounting |
| B. | Profit & loss account |
| C. | Balance shee |
| Answer» C. Balance shee | |
| 1003. |
Trade mark account is |
| A. | Real account |
| B. | Personal account |
| C. | Nominal account |
| D. | Non personal account |
| Answer» B. Personal account | |
| 1004. |
If you start with cash book favorable balance in Bank Reconciliation Statement, which item will beadded? |
| A. | Cheque deposited but not credited by the bank |
| B. | Cheques omitted to be deposited into bank |
| C. | Any amount directly collected by bank on behalf of customer but not recorded in cash book |
| D. | Debit side of cash book was overcast |
| Answer» D. Debit side of cash book was overcast | |
| 1005. |
Which of these are not required in a promissory note |
| A. | Acceptance ; |
| B. | Unconditional promise to pay ; |
| C. | Properly stamped; |
| D. | Payment to be made legal currency |
| Answer» B. Unconditional promise to pay ; | |
| 1006. |
Under _____ system , the hire vendor has a right to take back the goods |
| A. | Installment |
| B. | HP |
| C. | Installment and HP |
| D. | None of these |
| Answer» C. Installment and HP | |
| 1007. |
When the benefits of revenue expenditure is available for a period of two or three years, theexpenditure is known as- |
| A. | Revenue Expenditure ; |
| B. | Deferred Revenue Expenditure ; |
| C. | Capital Expenditure ; |
| D. | Depreciation. |
| Answer» C. Capital Expenditure ; | |
| 1008. |
Packing of goods for protecting the goods is debited in the |
| A. | Balance sheet |
| B. | Profit and loss account |
| C. | Trading account |
| D. | Trial balance |
| Answer» D. Trial balance | |
| 1009. |
Which of the following is a revenue expenses |
| A. | Raw material consumed ; |
| B. | Plant purchased ; |
| C. | Long term loan raised from bank; |
| D. | Share Capital |
| Answer» B. Plant purchased ; | |
| 1010. |
Provision for account on creditors has a _________________balance |
| A. | Debit |
| B. | Credit |
| C. | None of thes |
| Answer» B. Credit | |
| 1011. |
Madhu Ltd. forfeited 800 shares of `10 each issued at 10% premium to Shyam (` 9 called up) on which he did not pay ` 3 of allotment (including premium) and first call of `2. Out ofthese, 600 shares were re-issued to Ram as fully paid up for `9 per share. What is to amount to be transferred to capital Reserve? |
| A. | `2,400 |
| B. | ` 1,800 |
| C. | `3,000 |
| D. | `3,600 |
| Answer» B. ` 1,800 | |
| 1012. |
Which of the following is/are feature/features of Income and Expenditure Account? |
| A. | It follows Nominal Account |
| B. | All Capital incomes and expenditures are excluded |
| C. | Profit on sale of asset is credited |
| D. | All of the above |
| Answer» E. | |
| 1013. |
If a company has contingent liabilities, they appear in the |
| A. | Balance Sheet |
| B. | Directors‘ report |
| C. | Notes on account to Balance Sheet |
| D. | Chairman‘s report |
| Answer» D. Chairman‘s report | |
| 1014. |
_________ contains the transactions relating to goods that are returned by us to ourcreditors |
| A. | Return Inward; |
| B. | Return Outward; |
| C. | Sales Daybook; |
| D. | None of the above. |
| Answer» C. Sales Daybook; | |
| 1015. |
Which of the following is not an Asset? |
| A. | Stock of stationery |
| B. | Goodwill |
| C. | Profit and Loss Account (Credit Balance) |
| D. | Accounts Receivable |
| Answer» D. Accounts Receivable | |
| 1016. |
If actual bad debts are more than the provision for bad debts, then there will be a |
| A. | Credit balance of Provision for Bad Debts Account |
| B. | Debit balance of Provision for Bad Debts Account |
| C. | Debit balance of Bad Debts Account |
| D. | Debit balance of Discount on Debtors Account |
| Answer» C. Debit balance of Bad Debts Account | |
| 1017. |
As per the Companies Act, 1956 which of these are allowed to create secret reserves in their books ofaccount |
| A. | Banking Companies ; |
| B. | Insurance Companies ; |
| C. | Electricity Companies ; |
| D. | All the three |
| Answer» E. | |
| 1018. |
All revenue receipts and expenditure are shown in – |
| A. | Balance Sheet ; |
| B. | Trading and Profit and Loss A/c ; |
| C. | Cash Flow Statement ; |
| D. | Statement of Affairs |
| Answer» C. Cash Flow Statement ; | |
| 1019. |
Following businesses generally require customised software:Sol: |
| A. | Banking |
| B. | Medical |
| C. | Retail or point of Sale |
| D. | All of the above |
| Answer» E. | |
| 1020. |
Goods are transferred from Department X to Department Y at a price so as to include a profit of 33.33% on cost. If the value of closing stock of Department Y is ` 48,000, then the amount of stock reserve on closing stock will be |
| A. | 12,000 |
| B. | 9,000 |
| C. | 18,000 |
| D. | None of the above |
| Answer» B. 9,000 | |
| 1021. |
Credit balance in Cash Book means— |
| A. | Bank overdraft ; |
| B. | Bank deposit ; |
| C. | FD with Bank ; |
| D. | Cash embezzlement |
| Answer» B. Bank deposit ; | |
| 1022. |
The primary objective of the matching principle is to: |
| A. | Provide timely information to external decision-makers |
| B. | Provide full disclosure |
| C. | Recognize expenses in the same period as the related revenue |
| D. | All of the above |
| Answer» D. All of the above | |
| 1023. |
The components of Computerised Accounting System refers to : |
| A. | Business transactions are analysed, transactions recorded, prepare trial balance, preparation of balance sheet and profit and loss account |
| B. | From data entry to preparation of final statements |
| C. | Transformation of manual accounting system to CAS |
| D. | None of the above |
| Answer» B. From data entry to preparation of final statements | |
| 1024. |
The process of recording business transaction in a book of original entry is known as- |
| A. | Journals ; |
| B. | Balance ; |
| C. | Posting ; |
| D. | None |
| Answer» B. Balance ; | |
| 1025. |
Goods are sent to the Branch at cost plus 25%. The loading on invoice price is: |
| A. | 20%; |
| B. | 25%; |
| C. | 30%; |
| D. | None of the above. |
| Answer» B. 25%; | |
| 1026. |
—————— is also known as Appraisal system of depreciation |
| A. | Inventory system ; |
| B. | Survey system ; |
| C. | Annuity system ; |
| D. | Insurance |
| Answer» B. Survey system ; | |
| 1027. |
Sinking Fund is created for which of these purposes |
| A. | To repay or redeem a long term fixed liability ; |
| B. | To replace a wasting asset ; |
| C. | To replace a depreciable asset ; |
| D. | All the three |
| Answer» E. | |
| 1028. |
Income and Expenditure Account is prepared :Sol: |
| A. | By Business Organisation |
| B. | By Industrial Organisation |
| C. | By Not-for-Profit Organisation |
| D. | By All Organisations |
| Answer» D. By All Organisations | |
| 1029. |
Capital included in the Total of Balance Sheet of a Company is called : |
| A. | Issued Capital |
| B. | Subscribed Capital |
| C. | Called up Capital |
| D. | Authorised Capital |
| Answer» C. Called up Capital | |
| 1030. |
Which of the following statements about differences between financial and management accounting is incorrect? |
| A. | Management accounting information is prepared primarily for external parties such as stockholders and creditors; financial accounting is directed at internal users. |
| B. | Financial accounting is aggregated; management accounting is focused on products and departments. |
| C. | Management accounting pertains to both past and future items; financial accounting focuses primarily on past transactions and events. |
| D. | Financial accounting is based on generally accepted accounting practices; management accounting faces no similar constraining factors. |
| Answer» C. Management accounting pertains to both past and future items; financial accounting focuses primarily on past transactions and events. | |
| 1031. |
Bank Reconciliation Statement is: |
| A. | Ledger Account |
| B. | Part of cash book |
| C. | A separate statement |
| D. | A subsidiary of Journal |
| Answer» D. A subsidiary of Journal | |
| 1032. |
Which of the following is not classified as inventory in the financial statements? |
| A. | Finished goods ; |
| B. | Work-in-process ; |
| C. | Stores and spares |
| D. | Advance payments made to suppliers for raw materials |
| Answer» E. | |
| 1033. |
Purchase journal is kept to record |
| A. | All purchases of goods ; |
| B. | All credit purchases of goods ; |
| C. | All credit purchases; |
| D. | None of these |
| Answer» C. All credit purchases; | |
| 1034. |
Cash book shows ___________balance when there is an O.D. |
| A. | Debit |
| B. | Credit |
| C. | None of thes |
| Answer» C. None of thes | |
| 1035. |
When a large number of articles are sent on a sale or return basis,, it is necessary to maintain |
| A. | Sale journal |
| B. | Goods returned journal |
| C. | Sale or return journal |
| D. | None of the above. |
| Answer» D. None of the above. | |
| 1036. |
Total sales book indicates |
| A. | Total credit sales |
| B. | Total cash sales |
| C. | Total sales |
| D. | All the above |
| Answer» B. Total cash sales | |
| 1037. |
The following statements apply to equity/preference shareholders. Which one of them appliesonly to preference shareholders? |
| A. | Shareholders risk the loss of investment |
| B. | Shareholders bear the risk of no dividends in the event of losses |
| C. | Shareholders usually have the right to vote |
| D. | Dividends are usually given at a set amount in every’ financial year. |
| Answer» E. | |
| 1038. |
When the lessor receives payment, the credits— |
| A. | Lessee account |
| B. | Royalty account |
| C. | Short workings account. |
| D. | all |
| Answer» B. Royalty account | |
| 1039. |
As per section 78 of Company’s Act amount collected as premium on securities cannotbe utilized for: |
| A. | Issuing fully paid bonus shares to the members |
| B. | Purchase of fixed assets |
| C. | Writing off Preliminary Expenses |
| D. | Buy Back of its own shares |
| Answer» C. Writing off Preliminary Expenses | |
| 1040. |
Any donation received for a specific purpose is a |
| A. | Liability ; |
| B. | Assets ; |
| C. | Revenue receipts ; |
| D. | Capital receipts |
| Answer» E. | |
| 1041. |
A non-performing asset is: |
| A. | Money at call and short notice. |
| B. | Cash balance with bank |
| C. | An asset that ceases to generate income |
| D. | None of the above |
| Answer» D. None of the above | |
| 1042. |
Selling expenses should be divided among the different departments on the basis of ______ |
| A. | Sales |
| B. | Purchase |
| C. | Gross profit |
| D. | Net profit |
| Answer» B. Purchase | |
| 1043. |
When a B/R is endorsed by the Drawer what entry is passed by the Drawee— |
| A. | B/R A/c Dr. to Drawer A/c Cr. ; |
| B. | B/P A/c Dr. to Drawer A/c Cr. |
| C. | 3rd Party‘s A/c Dr. to B/P A/c Cr. ; |
| D. | No entry at all |
| Answer» E. | |
| 1044. |
Bank Overdraft is shown as a |
| A. | Current Liability ; |
| B. | Contingent Liability ; |
| C. | Unsecured Loan ; |
| D. | Provision |
| Answer» B. Contingent Liability ; | |
| 1045. |
A few errors committed in Ahhiwalia's books of account are given below. State which errors wouldaffect the Trial Balance. (a) Sales of `950 to Ram completely omitted from books of account (b) Purchases of `720 from Shyam entered in the purchases journal as `700 (c) Purchases Journal is overcast by `1,000 (d) Sales returns journal is undercast by `200 (e) Amount paid to Agarwal wrongly posted to the debit to Mittal's account (f) Bank overdraft shown under debit column in the Trial Balance (g) Sales of `500 to Sadiq entered in sales journal as sales to Mushtaq (h) Wages paid for installation of machinery debited to wages account |
| A. | a, c and g |
| B. | c, d and f |
| C. | c, d, e and h |
| D. | c, d, f and h |
| Answer» C. c, d, e and h | |
| 1046. |
Nominal accounts are related to |
| A. | Assets& liability |
| B. | Expenses & losses |
| C. | Debtors & creditor |
| Answer» C. Debtors & creditor | |
| 1047. |
Which of the following is NOT a revenue expenditure? |
| A. | Petrol consumed in motor vehicles ; |
| B. | Cost of saleable goods ; |
| C. | Bad debts ; |
| D. | Premium given on lease |
| Answer» B. Cost of saleable goods ; | |
| 1048. |
Materiality Principle is an exception to the |
| A. | Consistency principle |
| B. | Full disclosure Principle |
| C. | Accounting Period Assumption |
| D. | Prudence Principle |
| Answer» C. Accounting Period Assumption | |
| 1049. |
AS 31 consulted to IAS – |
| A. | 30 ; |
| B. | 32 ; |
| C. | 39 ; |
| D. | 40 |
| Answer» C. 39 ; | |
| 1050. |
Goods sold on credit will be entered in the |
| A. | Sales account |
| B. | Sales book |
| C. | Customers account |
| D. | Creditors account |
| Answer» C. Customers account | |