1706 + Mcqs in Financial Accounting Page 19 McqOptions

901.	Branch adjustment account is in the nature of ______
A.	nominal
B.	personal
C.	real
D.	none of these
Answer» B. personal

Discussion

902.	Endowment fund receipt is traded as-
A.	Casual Receipt ;
B.	Revenue Receipt ;
C.	Loss ;
D.	Expenses
Answer» B. Revenue Receipt ;

Discussion

903.	In case specific fund is maintained, the expenses exceeding the amount of the fluids,should be recorded on:
A.	Liabilities side of the Balance Sheet
B.	Debit side the Income and Expenditure Account
C.	Credit side of the Income and Expenditure Account
D.	Assets side of the Balance Sheet
Answer» C. Credit side of the Income and Expenditure Account

Discussion

904.	Rent and rates are apportioned to different departments on the basis of
A.	floor area occupied
B.	no of workers
C.	sales of each dept
D.	value of the assets kept
Answer» B. no of workers

Discussion

905.	In sole trader balance sheet asset are arranged in the order of
A.	Liquidity
B.	Permanence
C.	Transferability
D.	All the above
Answer» B. Permanence

Discussion

906.	Payment of honorarium to secretary is treated as :Sol:
A.	Capital expenditure
B.	Revenue expenditure
C.	An income
D.	None of these
Answer» C. An income

Discussion

907.	From the profits of previous three years, Rs 150000, Rs 300000, and Rs250000/- and theloss in a year ( Rs. 100000/-) the value of goodwill at three years of purchase is ---------
A.	Rs 8,00,000
B.	Rs 6,00,000
C.	Rs 4,50,000
D.	all
Answer» D. all

Discussion

908.	In foreign branch fixed asset shall be converted at
A.	opening rate
B.	average rate
C.	rate of the date of purchase
D.	none of these
Answer» B. average rate

Discussion

909.	Which of the following is a Real A/c
A.	Salary A/c ;
B.	Bank A/c ;
C.	Building A/c ;
D.	Goodwill A/c
Answer» D. Goodwill A/c

Discussion

910.	If both the aspects of a same transaction appear in one account, it is called _______entry
A.	Simple journal entry
B.	Compound
C.	Contra entr
Answer» C. Contra entr

Discussion

911.	Following are forms of Intangible assets.Sol:
A.	Brand, Goodwill, Furniture, Design
B.	Goodwill, Patent Rights, Machinery
C.	Brand, Trademark, Copyrights, Know how
D.	all
Answer» D. all

Discussion

912.	Discount on issue of share is
A.	Capital loss
B.	Revenue loss
C.	Capital expenditure
D.	Revenue expenditure
Answer» B. Revenue loss

Discussion

913.	The expenses which have been incurred to bring the goods or making the goods ready for sales iscalled
A.	Administrative expenses
B.	Direct expenses
C.	Indirect expenses
D.	Revenue expenses
Answer» C. Indirect expenses

Discussion

914.	Which of the following is not an income ?Sol:
A.	Subscription
B.	Donation
C.	Sale of ticket
D.	Endowment Fund
Answer» E.

Discussion

915.	Chandu & Co.'s Account is a
A.	Real Account
B.	Nominal Account
C.	Representative Personal Account
D.	Artificial Personal Accounts
Answer» E.

Discussion

916.	Asset which reduce is value, on use, but are not replaced is called
A.	Contingent assets
B.	Fictitious assets
C.	Intangible assets
D.	Wasting assets
Answer» E.

Discussion

917.	Cost of goods old can be calculated by:
A.	Balance sheet
B.	Profit& loss account
C.	Trading accoun
Answer» D.

Discussion

918.	The balance of which of the following accounts do not disappear, once they are debited/credited toTrading Account.
A.	Sales
B.	Purchases
C.	Inward returns
D.	Closing stock
Answer» E.

Discussion

919.	What is transferred to hirer under installment payment system
A.	Ownership of assets
B.	Possession of assets
C.	ownership and possession of asset
D.	none of these
Answer» D. none of these

Discussion

920.	Debit note is prepared in connection with
A.	Sales return
B.	Purchase return
C.	Sales
D.	Purchase
Answer» E.

Discussion

921.	Which English alphabet is similar to the shape of an account?
A.	I ;
B.	T ;
C.	H ;
D.	None
Answer» C. H ;

Discussion

922.	The excess amount which the firm can get on selling its assets over and above the saleablevalue of its assets is calledSol:
A.	Surplus
B.	Super Profit
C.	Reserve
D.	Goodwill
Answer» E.

Discussion

923.	Which of these documents is not required for Bank Reconciliation
A.	Bank column of Cash Book ;
B.	Bank Pass Book ;
C.	Bank Statement ;
D.	Trial Balance
Answer» E.

Discussion

924.	Income and Expenditure Account is preparedly :Sol:
A.	Trending Organisation
B.	Non-trading Organisation
C.	Both (a) and (b)
D.	None of these
Answer» C. Both (a) and (b)

Discussion

925.	Choose the true statement-
A.	Income and gain A/cs shows increase on credit side
B.	Expenses and losses A/cs shows reduction in balance on debit side
C.	Assets A/c can have credit balance also ;
D.	Debtors are the owing of the business
Answer» B. Expenses and losses A/cs shows reduction in balance on debit side

Discussion

926.	The main purpose of accounting is to provide financial info to
A.	Shareholder
B.	Board of directors
C.	Tax authorities
D.	All of these
Answer» E.

Discussion

927.	When the royalty are less than the minimum rent ?Sol:
A.	Royalties account is debited with the actual amount of royalties earned
B.	Royalties account is debited with minimum rent
C.	Royalties account is debited with the amount paid to landlord
D.	Royalties account is debited with the excess of minimum rent over actual rent
Answer» B. Royalties account is debited with minimum rent

Discussion

928.	A consignee is entitled to ———————
A.	Commission on sales ;
B.	Reimbursement of the expenses ;
C.	Del credere commission;
D.	All of these
Answer» E.

Discussion

929.	The portion of the acquisition cost of the asset yet to be allocated is known as
A.	Written down value
B.	Accumulated value
C.	Salvage value
D.	Residual Value
Answer» B. Accumulated value

Discussion

930.	Recording of a transaction in a Journal is called
A.	Posting
B.	Journalising
C.	Transfer
D.	Ruling
Answer» C. Transfer

Discussion

931.	Receipts and Payments Account records
A.	Only revenue nature receipts
B.	Only capital nature receipts and payment
C.	Only revenue nature receipts and payments
D.	Both the revenue and capital nature receipts and payments
Answer» E.

Discussion

932.	Errors of carry forward from one year to another year affect:
A.	Personal account
B.	Real account
C.	Nominal account
D.	Both personal & Real accounts
Answer» E.

Discussion

933.	Receipts and Payments account is a
A.	Nominal Account
B.	Real Account
C.	Personal Account
D.	Artificial Personal Account
Answer» C. Personal Account

Discussion

934.	Investment in own share A/c appears in –
A.	Asset side ;
B.	Liability side ;
C.	Netted from Capital ;
D.	Profit & Loss A/c
Answer» B. Liability side ;

Discussion

935.	Goods worth ` 10,000 were purchased by B on which the traders allowed ` 500 trade discount andoffer to give 5% cash discount if immediate payment is made. The Purchase A/c will be debited by —
A.	10,000 ;
B.	9,800 ;
C.	9,000 ;
D.	9,500
Answer» E.

Discussion

936.	Which column of a cash book will not have credit balance —
A.	Bank column ;
B.	Discount column ;
C.	Cash column ;
D.	None
Answer» D. None

Discussion

937.	Sales made to Mahesh fir cash should be debited to
A.	Cash Account
B.	Mahesh
C.	Sales Account
D.	Purchase Account
Answer» B. Mahesh

Discussion

938.	The entry for creating a Provision for bad debts is
A.	Debit Provision for Bad Debts A/c and credit Debtors A/c
B.	Debit Debtors A/c and credit Provision for Bad Debts A/c
C.	Debit Provision for Bad Debts A/c and credit Profit & Loss A/c
D.	Debit Profit and Loss A/c and credit Provision for Bad Debts A/c.
Answer» E.

Discussion

939.	Which of the following is an external cause of depreciation
A.	Routine repair and maintenance ;
B.	Misuse ;
C.	Obsolescence ;
D.	Wear and tear
Answer» D. Wear and tear

Discussion

940.	Receipts and payment accounts, I & E account and balance sheet are the financial statement of
A.	Company
B.	Partnership firm
C.	Sole trader concern
D.	Nonprofit organization
Answer» E.

Discussion

941.	Which accounting concept or convention which, in times of rising prices, tends to understate asset values and overstate profits?
A.	The going concern concept
B.	The prudence concept
C.	The realisation concept
D.	The historical cost convention
Answer» E.

Discussion

942.	Recording of Fixed Assets at cost ensures adherence of
A.	Conservatism Concept
B.	Going Concern Concept
C.	Cost Concept
D.	Both (a) and (b) above
Answer» E.

Discussion

943.	Goods returned from X is entered as
A.	Debit X A/c; Credit Purchase Return A/c
B.	Debit X A/c; Credit Cash A/c
C.	Debit Sales Return A/c; Credit X A/c
D.	Debit X A/c; Credit Sales A/c
Answer» D. Debit X A/c; Credit Sales A/c

Discussion

944.	As per AS – 1, which of the following is not a Fundamental Accounting Assumptions?
A.	Conservatism
B.	Going Concern
C.	Consistency
D.	Accrual
Answer» B. Going Concern

Discussion

945.	According to which concept, proprietor of a business is treated as a creditors to the extent of hiscapital
A.	Money measurement
B.	Cost
C.	Dual aspect
D.	Business entity
Answer» E.

Discussion

946.	Entry representing the reversal or cancellation of an entry on the other side is called?
A.	Closing entry
B.	Contra entry
C.	Bank overdraft
D.	Adjusting entry
Answer» C. Bank overdraft

Discussion

947.	Closing entries are generally passed —
A.	At the time of opening new books of account ;
B.	At the time of closing the accounts;
C.	During the course of accounting period any time ;
D.	After certification of accounts
Answer» C. During the course of accounting period any time ;

Discussion

948.	The adjustment to be made for prepaid expenses is
A.	Add prepaid expenses to respective expenses and show it as an asset
B.	Deduct prepaid expenses from respective expenses and show it as an asset
C.	Add prepaid expenses to respective expenses and show it as a liability
D.	Deduct prepaid expenses from respective expenses and show it as a liability
Answer» C. Add prepaid expenses to respective expenses and show it as a liability

Discussion

949.	Bank reconciliation is a statement prepared to reconcile—
A.	Trial balance ;
B.	Cash book ;
C.	Bank A/c;
D.	Cash as per cash book with bank balance as per bank pass book
Answer» E.

Discussion

950.	Which of the following statements is true with regard to written down value method of depreciation? i. The rate at which the asset is written off reduces year after year ii. The amount of depreciation provided reduces from year to year iii. The rate of depreciation as well as the amount of depreciation reduce year after year iv. The value of the asset gets reduced to zero over a period of time
A.	Only (i) above
B.	Only (ii) above
C.	Both (i) and (ii) above
D.	(i),(ii) and (iii) above
Answer» C. Both (i) and (ii) above

Discussion

Explore topic-wise MCQs in Finance & Accounting.

Branch adjustment account is in the nature of ______

Endowment fund receipt is traded as-

In case specific fund is maintained, the expenses exceeding the amount of the fluids,should be recorded on:

Rent and rates are apportioned to different departments on the basis of

In sole trader balance sheet asset are arranged in the order of

Payment of honorarium to secretary is treated as :Sol:

From the profits of previous three years, Rs 150000, Rs 300000, and Rs250000/- and theloss in a year ( Rs. 100000/-) the value of goodwill at three years of purchase is ---------

In foreign branch fixed asset shall be converted at

Which of the following is a Real A/c

If both the aspects of a same transaction appear in one account, it is called _______entry

Following are forms of Intangible assets.Sol:

Discount on issue of share is

The expenses which have been incurred to bring the goods or making the goods ready for sales iscalled

Which of the following is not an income ?Sol:

Chandu & Co.'s Account is a

Asset which reduce is value, on use, but are not replaced is called

Cost of goods old can be calculated by:

The balance of which of the following accounts do not disappear, once they are debited/credited toTrading Account.

What is transferred to hirer under installment payment system

Debit note is prepared in connection with

Which English alphabet is similar to the shape of an account?

The excess amount which the firm can get on selling its assets over and above the saleablevalue of its assets is calledSol:

Which of these documents is not required for Bank Reconciliation

Income and Expenditure Account is preparedly :Sol:

Choose the true statement-

The main purpose of accounting is to provide financial info to

When the royalty are less than the minimum rent ?Sol:

A consignee is entitled to ———————

The portion of the acquisition cost of the asset yet to be allocated is known as

Recording of a transaction in a Journal is called

Receipts and Payments Account records

Errors of carry forward from one year to another year affect:

Receipts and Payments account is a

Investment in own share A/c appears in –

Goods worth ` 10,000 were purchased by B on which the traders allowed ` 500 trade discount andoffer to give 5% cash discount if immediate payment is made. The Purchase A/c will be debited by —

Which column of a cash book will not have credit balance —

Sales made to Mahesh fir cash should be debited to

The entry for creating a Provision for bad debts is

Which of the following is an external cause of depreciation

Receipts and payment accounts, I & E account and balance sheet are the financial statement of

Which accounting concept or convention which, in times of rising prices, tends to understate asset values and overstate profits?

Recording of Fixed Assets at cost ensures adherence of

Goods returned from X is entered as

As per AS – 1, which of the following is not a Fundamental Accounting Assumptions?

According to which concept, proprietor of a business is treated as a creditors to the extent of hiscapital

Entry representing the reversal or cancellation of an entry on the other side is called?

Closing entries are generally passed —

The adjustment to be made for prepaid expenses is

Bank reconciliation is a statement prepared to reconcile—