Business Accounting

1. Purchase Book records:

a. All Cash Purchases

b. All Credit Purchases Join with us on telegram:

c. Credit Purchase of goods in trade
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d. None of the above

2. A bank reconciliation statement is prepared to know the causes for the differances
between:

a. The balances as per cash column of cash book and the pass book

b. The balances as per bank column of cash book and the pass book

c. The balances as per bank column of cash book and cash column of cash book

d. None of the above

3. Fundamental Accounting Assumptions are:

a. Materiality

b. Business entity

c. Going Concern

d. Dual Aspect

4. Which of the following errors are not revealed by the Trial Balance:

a. Compensating Errors

b. Errors of Commission

c. Wrong Balancing of an account

d. Wrong totalling of an account

5. Which of the following is of capital nature:

a. Purchase of goods

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 b. Cost of repair

c. Wages paid for installation of machinary

d. Rent of a factory

6. Which of the following is not a sub fild of accounting:

a. Management accounting

b. Cos accounting

c. Financial accounting

d. Corporate accounting

7. The determination of expenses for an accounting period is based on the principle of:

a. Objectivity Join with us on telegram:

b. Matriality

c. Matching
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d. Periodicity

8. Which account is the odd one:

a. Furniture

b. Land and buldings

c. Stock of raw materials

d. Plant and machinery

9. Which of the following is the exmple of external users of accounting information:

a. Government

b. Owners

c. Management

d. Employees
10. Which financial statement represents the accounting equation
“assets=liabilities+owners’ equity”

a. Trading account

b. Profit and loss account

c. Balance sheet

d. Statement of cash flows

11. All the expenditures and reciepts of revenue nature go to:

a. Income statement

b. Trial balance

c. Balance sheet

d. Profit & Loss appropriation account

12. “Business unit is separate and distinct from the owner of it”, is based on

a. Money measurement concept

b. Going concern concept

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c. Business entity concept

d. Dual aspect concept t.me/naveen_grover_commerce

13. If two or more transactions of the same nature are journalised together having either
the debit or credit account common is known as:

a. Compound journal entry

b. Separate journal entry

c. Posting

d. Journalising

14. Parties to a bill of exchange are:

a. Drawer

b. Drawee
 c. Payee

d. All of the above

15. A ______ is sent to a customer when he returns the goods.

a. Debit note

b. Credit note

c. Proforma invoice

d. Bill

16. A ______ is sent to the seller when he is taken back the sold goods.

a. Debit note

b. Credit note

c. Proforma invoice

d. Bill

17. Noting Charges are paid at the time of _________ of a bill.

a. Retirement
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b. Renewal

c. Dishonour t.me/naveen_grover_commerce
d. Endorcement

18. Depreciation of fixed assets is an example of ______ expenditure.

a. Revenue

b. Deferred revenue

c. Petty

d. Capital

19. Interest on drawings is ______ for business.

 a. Expenditure

b. Loss

c. Gain

d. Investment

20. Writting of the transaction in the ledger is called ________

a. Posting

b. Journalising

c. Balancing

d. Auditing

21. The balance of petty cash is _________

a. An expense

b. Income

c. Asset

d. Liability
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22. A withdrawl of cash from the business by the proprietor should be credited to:

a. Drawings A/c

b. Capital A/c

c. Cash A/c

d. Current A/c

23. Drawings account is in the nature of ______

a. Personal account

b. Real account
 c. Nominal account

d. Suspense account

24. Prepaid expenses account is in the nature of _________

a. Personal account

b. Real account

c. Nominal account

d. Suspense account

25. Patent right account is in the nature of ___________

a. Personal account

b. Real account

c. Nominal account

d. Suspense account

26. Narrations are given at the end of ___________

a. Final accounts

b. Trial blance

c. Each ledger accounts

d. Each journal entry

27. All of the following are functions of accounting except:

a. Decision making
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b. Measurement
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c. Forecasting

d. Ledger posting

28. “Treating a revenue expense as a capital expenditure” is an example of:

a. Compensating error
 b. Errors of principle

c. Errors of omission

d. Errors of commission

29. Which of the following lists the balance and the title of accounts in the ledger on a given
date?

a. P&L Account

b. Balance sheet

c. Income statement

d. Trial balance

30. Under straight line method, depreciation is calculated on:

a. Written down value

b. Scrap value

c. Original cost

d. Revaluation cost
31. Transactions between owner and business are recorded as per:

a. Periodicity

b. Going concern

c. Prudence

d. Business entity

32. Which of the following is not a transaction?

a. Goods are purchased on cash basis for Rs. 1000.

b. Salaries paid for the month of May 2009.

c. Land is purchased for Rs. 10 lacs.

d. An employee is dismissed from the job.

33. Payment of personal expenses of the owners of business need to be recorded as:

a. Drawings
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b. Liabilities

c. Expenses
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d. Gains

34. If the date of maturity of a bill is a holiday, then the bill will mature on:

a. Next working day

b. Preceding working day

c. Holiday itself

d. Other agreed day

35. ______ principle requiers that the same accounting method should be used from one
accounting period to the next.

a. Conservatism

b. Business entity

c. Consistency

d. Money measurment

36. The petty cashier generally works on _________ system.

a. Accrual

b. Imprest

c. Balancing

d. None of these

37. “Asset should be valued at the price paid to acquire them” is based on:

a. Accrual concept

b. Realisation concept

c. Money measurement concept

d. Cost concept

38. Difference of totals of both debit and credit side of the trial balance is transfered to:

a. Suspense account

b. Trading account

c. P&L account

d. Current account

39. Carriage inward is debited to:

a. Suspense account
 b. Trading account

c. P&L account

d. P&L appropriation account

40. Expenses incurred to retain the title of a building is a ______.

a. Revenue expenditure

b. Capital expenditure

c. Deffered revenue expenditure

d. None of these

41. Discounting of bill by the drawer is done with _________.

a. Creditor Join with us on telegram:

b. Drawee

c. Bank
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d. Notary

42. It is generally assumed that the business will not liquidate in the near foreseeable future
because of:

a. Periodicity

b. Materiality

c. Matching

d. Going concern

43. Double colomn cash book records:

a. Only cash transactions

b. All transactions

c. Cash and bank transactions

d. Cash purchase and cash sales transactions

44. Errors of commission donot permit:

a. Correct totaling of the trial balance

b. Correct totaling of the balance sheet

c. Trial balance to agree

d. None of these

45. All the following have debit balance except one. That account is ______.

a. Wages account

b. Debtors account

c. Goodwill

d. Bills payable account

46. A bill of exchange requires _________

a. Acceptance

b. Registration

c. Noting

d. None of these

47. Outstanding salary account is:

a. Real account

b. Personal account

c. Nominal account

d. Suspense account

48. Drawings are deducted from _______.

a. Sales Join with us on telegram:

b. Purchases
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 c. Expenses

d. Capital

49. Purchase returns appearing in the trial balance are deducted from _________.

a. Purchase

b. Sales

c. Capital

d. Creditors

50. ______ will generally show a debit balance.

a. Bank loan

b. Bad debts recovered

c. Salary payable

d. Drawings

51. Purchase of a fixed asset on credit basis is recorded in _______.

a. Cash book

b. Purchase book

c. Journal propper

d. None of the above

52. Vikas & Co. is a :

a. Personal account

b. Real account

c. Nominal account

d. Suspense account
53. Depreciation arises because of:

a. Fall in the market value of the asset

b. Fall in the value of money

c. Physical wear and tear of the asset

d. Inflation in the market

54. A promissory note does not require:

a. Acceptance

b. discounting

c. Noting

d. None of these

55. Which of the following account will have credit balance?

a. Sales returns

b. Bills recievable

c. Carriage inwards
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d. Outstanding wages

56. Prepaid salary has a: t.me/naveen_grover_commerce

a. Credit balance

b. Debit balance

c. Negative balance

d. Zero balance

57. Goodwill is _______

a. Current account

b. Fictitious asset

c. Tangible asset
 d. Intangible asset

58. Joint venture account is _________

a. Personal account

b. Real account

c. Nominal account

d. Suspense account

59. When money is withdrawn from the bank, the bank _____ the account of the customer.

a. Credits
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b. Debits

c. Either (a) or (b)

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d. None of these

60. The cash account allowed to a debtor should be credited to:

a. Discount account

b. Customers’ account

c. Sales account

d. None of the above

61. In case of debit balance, the words ______ are written on the debit side.

a. To balance b/d

b. To balance c/d

c. By balance b/d

d. By balance c/d

62. The amount spent on the maintanance of plant & machinery is a _________.

a. Capital Expenditure

b. Revenue expenditure

c. Deferred capital expenditure Join with us on telegram:

d. Deferred revenue expenditure

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63. Bank pass book is also known as _________.

a. Bank book

b. Bank account

c. Bank coloum

d. Bank statement

64. Capital expenditure are recorded in the __________.

a. Balance sheet

b. Profit & loss account

c. Trading account
 d. Manuacturing account

65. Accounts receivable normally has ________ balance.

a. Credit

b. Debit

c. Favourable

d. Negative

66. An account is a formal record of changes in items of _________ nature.

a. Revenue

b. Expense

c. Debit

d. Similar

67. All the following errors do not affect the trial balance, except:

a. Compensating error

b. Errors of complete omission

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c. Errors of partial omission

d. Errors of principle t.me/naveen_grover_commerce

68. Financial statements are the part of ________.

a. Accounting

b. Book keping

c. All of the above

d. None of the above

69. The areas where in different accounting policies can be adopted are:

a. Providing depreciation

b. Valuation of inventories

c. Valuation of investments

d. All of the above

70. Bank account is _________.

a. Personal account

b. Real account

c. Nominal account

d. Intangible real account

71. “Advance recieved from customersis not taken at sales.” is based on:

a. Money measurement concept

b. Accrual consent

c. Consistency concept

d. Conservation

72. Heavy amount spent on advertisement is ________

a. Capital Expenditure

b. Revenue expenditure

c. Deferred capital expenditure

d. Deferred revenue expenditure

73. Cost of goods sold can be calculated by:

a. Balance sheet

b. Profit & loss account

c. Trading account
 d. Manuacturing account

74. The amount on repairs of newly purchased old motor car is debited to ______

a. Repairs account

b. General expenses account

c. Motor car account

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d. None of these
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75. Suspense account Dr.balance Rs.2000 in trial balance, will be recorded in the ______.

a. Liability side of the balance sheet

b. Asset side of the balance sheet

c. Cr.side of the P&L account

d. Dr.side of the P&L account

76. Liability for a bill discounted is a ___________.

a. Current liability

b. Contigent liability

c. Fixed liability

d. Long term liability

77. Capital braught in by the proprietor is an example of ________.

a. Increase in asset and increase in liability

b. Increase in liability and decrease in asset

c. Increase in asset and decrease in liability

d. Decrease in asset and decrease in liability

78. Cost of removal of business to a more convenient locality is _________.

a. Capital expenditure

b. Revenue expenditure

c. Deferred revenue expenditure

d. Deferred capital expenditure

79. Salary Rs.2000 payable to clerk is credited to _______.

a. Salary account

b. Cash account

c. Clerk’s account

d. None of these

80. Total of purchase return book is posted periodically to the credit of _____

a. Purchase return account

b. Cash book
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c. Journal propper
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d. None of these

81. Loss on issue of debentures is treated as ________

a. Intangible asset

b. Current asset

c. Current liability

d. Miscellaneous expenditure

82. In case of credit balance, the words _______ are written on the credit side.

a. To balance b/d
 b. To balance c/d

c. By balance b/d

d. By balance c/d

83. Prepaid insurance given in trial balance is recorded in _______

a. Trading account

b. P&L account

c. Balance sheet

d. None of the three

84. In a bank reconciliation statement, if you start with balance as per cash book, then
dividend collected by bank but not yet entered in the cash book within the period are__.

a. Added

b. Deducted

c. Not requiered to be adjusted

d. None of the above

85. Reserve for doubtful debts account is a ______.

a. Personal account

b. Real account

c. Nominal account

d. Intangible real account

86. Bank overdraft has a _______ balance.

a. Debit

b. Credit

c. Negative

d. Favourable
87. Under annuity method, interets is calculated on:

a. Original cost

b. Scrap value

c. Writtten down value

d. None of the three

88. Journal proper records :

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a. Bills receivable

b. Bills payables t.me/naveen_grover_commerce

c. Cash payments

d. Opening entry

89. If two or more transactions of he same nature are journalized together having either the
debit or the credit account common is known as ________.

a. Compound journal entry

b. Separate journal entry

c. Posting

d. Ledger posting

90. Following is not the example of external users

a. Government

b. Management

c. Investors

d. Suppliers and other creditors

91. If the effect of an error is cancelled by the effect of some other error, it is commonly
known as _________.

a. Error of principle
 b. Compensating errors

c. Error of omission

d. Error of commission

92. Interest on capital is _________.

a. An expenditure

b. An appropriation

c. A gain

d. A revenue

93. Commission recieved in advance account has a :

a. Credit balance

b. Debit balance

c. Negative balance

d. None of the above

94. Insurance unexpired account is a :

a. Personal account

b. Real account

c. Nominal account

d. Intangible real account

95. The amount spent on painting the new factoy. It is a_________.

a. Capital expenditure

b. Revenue expenditure

c. Deferred revenue expenditure

d. Deferred capital expenditure

96. Cash iscount allowed to a debtor should be credited to :

a. Discount account

b. Customers account

c. Sales account

d. Cash account

97. B/R is a _______.

a. Tangible asset

b. Intangible asset

c. Fixed asset

d. Current asset

98. Which of the following account will have debit balance?

a. Reserve for doubtful debts

b. Outstanding wages

c. Capital (machinery braught into business)

d. Loan to contractor

99. Which of the following error is an error of principle?

a. Wages paid to R has been debited to his account

b. The total of purchase journal has not been posted to puechase account

c. Sales to X Rs.200, posted to his account as Rs.2000

d. Furniture purchased on credit from N posted to machinery account

100. Discounting, Endorcement and collection of bill of exchange s made by :

a. Drawer

b. Drawee

c. Bank
 Creditor Business Accounting (Section 2)
1. Sales return appearing in the trial balance are deducted from _________.

a. Capital

b. Sales

c. Purchase

d. Cash

2. The trial balance shows closing stock of Rs.30,000. It will be recorded in __________.

a. Trading account

b. Profit and loss account

c. Profit and loss appropriation account.

d. Balance sheet

3. Carriage outward is debited to ______.

a. Trading account

b. P/L Account

c. Profit and loss appropriation account.

d. Balance sheet

4. Material costing Rs.700 in the erection of a machinery and wages paid for it amounting
to Rs.400 should be debited to _____________.

a. Material account

b. Wages account

c. Purchase account

d. Machinery account

5. Differance of totals of both debit and credit side of the trial balance is transfered to ___.

a. Current account
 b. Suspense account

c. Trading account

d. P/L Account

6. Which of the following is correct? Join with us on telegram:

a. Capital = Asset – Liabilities
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b. Capital = Asset + Liabilities

c. Asset = Liabilities – Capital

d. Liabilities = Asset + Capital

7. All of the following have debit balance except one. That account is ________.

a. Loan to contractor

b. Debtors account

c. Wages outstanding account

d. Goodwill

8. Which of the following statement is not true?

a. Book keeping is concerned with recording of financial data.

b. Goods given as sample should be credited to purchase account.

c. The balance of petty cash is an asset.

d. In case of a debt becoming bad, the amount should be credited to bad debts A/c.

9. Fundamental accounting assumptions are:

a. Going concern

b. Accrual
 c. Consistency

d. All of the three

10. Municipal tax of Rs.5000 under dispute is a _________.

a. Contigent liability

b. Current liability

c. Revenue loss

d. None of these

11. Writting of transaction in the ledger is called _______.

a. Journalising

b. Posting

c. Balancing

d. Costing

12. In the Ledger there are _________ coloumns.

a. 4

b. 6

c. 8

d. 10

13. Carriage charges paid for a new plant purchased if debited to carriage A/c would effect:

a. Plant A/c

b. Carriage A/c

c. Plant and Carriage A/c

d. None of these
14. The expired portion of capital expenditure is shown in the financial statement as _____.

a. An income

b. An expense

c. An asset

d. A liability

15. Users of accounting information include _____

a. Creditors

b. Lenders

c. Customers

d. All the above

16. Accounting standards in India are issued by ____________.

a. Central Govt.

b. State Govt.

c. Institute of charted accountants in India.

d. RBI

17. Cost of exceptional repairs of non recurring nature by way of overhauling of the entire
plant is:

a. Capital expenditure

b. Revenue expenditure

c. Deferred revenue expenditure

d. Capital loss

18. Unexpired commission is _________.

a. Nominal A/c

b. Real A/c
 c. Representative personal A/c

d. None of the above

19. The accounting policies once adopted are not changed unless there is an urgent need
for such change is based on

a. Money measurement concept

b. Accrual concept

c. Consistency Join with us on telegram:

d. Conservation
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20. Depletion method of depreciation is used in ______.

a. Cattle, loose tools .. etc

b. Mines and quarries

c. Machinery and building

d. None of these

21. Goods purchased from A passed through the sales book. The rectification of this error
will result in __________.

a. Decrease in gross profit

b. Increase in gross profit

c. No effect in gross profit

d. Increase in sundry debtors

22. Book debts normally has _______ balance.

a. Credit

b. Debit

c. Unfavourable

d. None of the above.

23. Outstanding wages in trial balance is recorded in ________.

a. Trading account

b. P/L Account

c. Profit and loss appropriation account.

d. Balance sheet

24. Errors are ______ mistakes.

a. Intentional

b. Unintentional

c. Undetected

d. None of these

25. _____ is not added in the total of the balance sheet.

a. Fixed liability

b. Current liability

c. Conigent liability

d. Outstanding liability

26. _______ reserve is not shown in the balance sheet.

a. General reserve

b. Secret reserve

c. Capital reserve

d. None of these

27. Capital expenditure provide _______ benefits.

a. Long period

b. Short period

c. Very short period

 d. None of these

28. The amount incurred on structural alterations to existing asset whereby its revenue
earning capasity is increased is ________

a. Capital expenditure

b. Revenue expenditure

c. Deferred revenue expenditure

d. Capital loss

29. Debts written off as bad if recovered subsequently are ________.

a. Credited to bad debts recovered A/c

b. Debited to the P&L A/c

c. Credited to debtors’ A/c

d. None of the above

30. Bills payable is __________.

a. Nominal A/c

b. Real A/c

c. Personal A/c

d. None of the above

31. Human assets have no place in accounting records is based on_______.

a. Money measurement concept

b. Accrual concept

c. Consistency

d. Conservatism

32. Sales return book records _______________.

 a. Cash sales return

b. Credit sales return

c. Both (a) and (b)

d. Purchase return

33. Accounts payable normally has _________ balance.

a. Credit

b. Debit

c. Unfavourable

d. None of the above

34. Depreciation on machinary in trial balance is recorded in _________.

a. Trading account

b. P/L Account

c. Profit and loss appropriation account.

d. Balance sheet

35. Fixed capital A/c is credited with __________.

a. Interest on capital

b. Profit of the year

c. Salary of the partner

d. None of the above

36. Interest on drawings is ________ for the business.

a. Expense

b. Capital

c. Gain
 d. Noneof the three

37. Loss leads to reduction in ____________.

a. Liability

b. Capital

c. Income

d. Asset

38. Financial position of the business is ascertined on the basis of ___________

a. Records prepared under book keeping process

b. Trial balance

c. Accounting report

d. None of the above

39. The determination of expenses for an accounting period is based on the principle of:

a. Objectivity

b. Materiality

c. Matching

d. Periodicity

40. Rent payable to the landlord is credited to ____________.

a. Cash A/c

b. Landlord A/c

c. Rent A/c

d. None of the three

41. Bad debt entry passed in:

a. Sales book

b. Cash book
c. Journal book

d. None of these

42. Goods were sold on credit basis to X for Rs.1000. this will be recorded in:

a. Cash book

b. Journal propper

c. Bills recievable book

d. Sales book

43. Compensation paid to retrenched employee is:

a. Capital expenditure

b. Revenue expenditure

c. Deferred revenue expenditure

d. Capital loss

44. Petty expenses paid in cash are recorded in:

a. Purchase book

b. Sales book

c. Petty cash book

d. Purchase return book

45. Current assets does not include:

a. Cash

b. Stock

c. Debtors

d. Furniture
46. Stock is ______.

a. Fixed asset

b. Current asset

c. Investments

d. Intangible asset

47. All the following have debit balance except:

a. 6% Debentures

b. Loan to contractor

c. Interest on debentures

d. Audit fees

48. Double coloumn cash book records :

a. Only cash transactions

b. All transactions

c. Cash and bank transactions

d. Cash purchase and cash sales transactions

49. Salary and wages is debited to:

a. Trading account

b. P/L Account

c. Profit and loss appropriation account.

d. Balance sheet

50. Wages and salary is debited to:

a. Trading account
 b. P/L Account

c. Profit and loss appropriation account.

d. Balance sheet

51. In a sole rade, income tax is recorded as ___________.

a. Drawngs

b. Liabilities

c. Expenses

d. None of these

52. Journal propper records _______.

a. Credit purchase

b. Credit sales

c. Purchase of asset on credit

d. Sales return

53. Capital expenditure are recorded in the ________.

a. Trading account

b. P/L Account

c. Manufacturing account

d. Balance sheet

54. Trial balance is a statement which shows the _____ or the _____ of all the accounts.

a. Balances ; Total and balances

b. Debit balances ; Credit balances

c. Opening balances ; Closing balances

d. Posted balances ; Total of balances

55. Land and building is a _________

 a. Fixed asset

b. Current asset

c. Fictitious asset

d. Intangible asset

56. Rings and pistons of an engine were changed to increase the fuel efficiency is a ______.

a. Capital expenditure

b. Revenue expenditure

c. Deferred revenue expenditure

d. Capital loss

57. Which of the following is nominal account?

a. Debtors

b. Loan

c. Provision for bad debt

d. Bank over draft

58. Profit leads to increase in _____

a. Asset

b. Capital

c. Both (a) and (b)

d. Fictitious assets

59. Which of the following account will have credit balance?

a. Bank over draft

b. Carriage inwards
 c. Prepaid expense

d. Bills recievable

60. Three coloumn cash book records ________.

a. Only cash transactions

b. All transactions

c. Cash bank and discount transactions

d. Cash purchase and cash sales transactions

61. The value of an asset after reducing depreciation from the historical cost is known as:

a. Fair value

b. Market value

c. Book value

d. Net realizable value

62. Trial balance is prepared according to :

a. Total method

b. Balance method

c. Total and balance method

d. All the three

63. The term _______ denotes the cost of services and things used for earning revenue.

a. Income

b. Expense

c. Loss

d. Revenue
64. A person who owes money to the business is a ____________.

a. Debtor

b. Creditor

c. Investor

d. Supplier

65. A ________ is a person to whom business owes money.

a. Debtor

b. Creditor

c. Investor

d. Proprietor

66. _______ denote goods brought for sale.

a. Sales

b. Expense

c. Purchase

d. Revenue

67. Assets acquired for long term use in the business are called _________.

a. Fixed assets

b. Current assets

c. Fictitious assets

d. Liquid assets

68. ________ is an example of wasting asset

a. Cash

b. Company van

c. Mines
 d. Loan

69. Assets acquired for short term use in the business are called _________.

a. Fixed assets

b. Current assets

c. Fictitious assets

d. Liquid assets

70. A ______ expenditure is incurred to maintain the business or to keep the business in
good working condition.

a. Capital expenditure

b. Revenue expenditure

c. Deferred revenue expenditure

d. Capital loss

71. _______ is the major source of revenue of any business.

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b. Advances
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c. Loan

d. Sales

72. _____ refers the amount invested by the owner into business.

a. Loan

b. Advance

c. Capital

d. Prepaid expenses

73. Assets having definite shape and physical existence are called ________.
 a. Tangible assets

b. Intangible assets

c. Wasting assets

d. Fictitious assets

74. Assets having no physical existence but are represented by rights in certain things are
called ________.

a. Tangible assets

b. Intangible assets

c. Wasting assets

d. Fictitious assets

75. Assets which get exhausted to the extent of of extraction are called __________.

a. Tangible assets

b. Intangible assets

c. Wasting assets

d. Fictitious assets

76. Assets which have no real value but are shown in the books of accounts only for
technical reasons are called ___________.

a. Tangible assets

b. Intangible assets

c. Wasting assets

d. Fictitious assets

77. __________ are the claims of outsiders against the business.

a. Assets

b. Liabilities

c. Miscellanious expenditure
 d. Investments

78. _____ are material things or pocessions or properties of the business including the
amount due to it from others.

a. Assets

b. Liabilities

c. General reserve

d. capital

79. ______ are liabilities which become due and payable within a short period.

a. Fixed liabilities

b. Long term liabilities

c. Current liabilities

d. Contigent liabilities

80. ______ are the liabilities which are payable after a long period

a. Fixed liabilities

b. Miscellanious expenditure

c. Current liabilities

d. Contigent liabilities

81. ______ is an example for long term liabilities

a. Creditors

b. Debentures

c. Overdraft

d. Bills payable

82. ______ is an example for fictitious asset

a. Machinery
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b. Stock

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d. Preliminary expenses

83. ______ is an example for tangible assets.

a. Furniture

b. Debtors

c. Patent

d. Discount on issue of shares and debentures

84. Accounting entity concept is also known as _______.

a. Going concern concept

b. Money measurement concept

c. Business entity concept

d. Accounting standards

85. The practice of apending notes regarding contigent liabilities in financial statements is in
pursuant to the convention of __________.

a. Revenue realisation

b. Full disclosure

c. Matching

d. Dual aspect

86. _______ is the collection of all accounts

a. Journal

b. Voucher

c. Invoices
 d. Ledger

87. _______ is the book of original entry.

a. Journal

b. Voucher

c. Invoices

d. Ledger

88. The process of ascertaining the balance of a particular account on a given date is:

a. Posting

b. Journalising

c. Balancing

d. Accounting

89. A _________ is both a journal and ledger

a. Cash book

b. Prime book

c. Trial balance

d. None of these

90. When the buyer returns goods to the seller or an allowance is claimed from him, A
_________ is prepared.

a. Credit note

b. Debit note

c. Invoice

d. Voucher

91. Whenever goods are taken back from customers or an allowance is granted to
customers, A ________ is prepared.
 a. Credit note

b. Debit note

c. Invoice

d. Voucher

92. ______ is the source document for writting purchase return book

a. Credit note

b. Debit note

c. Invoice

d. Voucher

93. ______ is the source document for writting purchase return book

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d. Voucher

94. Withdrawing more amount from the bank than the deposit in the account is termed as:

a. Deposit

b. Drawings

c. Recuring

d. Over draft

95. In case of overdraft, the pass book will show _________ balance.

a. Zero

b. Negative

c. Debit

d. Credit
96. ______ is a temporary account opened for making agree the trial balance for the
preparation of final accounts.

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c. Personal A/c

d. Temporary A/c

97. Journal entries made to correct the errors are called _________.

a. Rectifying entries

b. Opening entries

c. Closing entries

d. Adjustment entries

98. ________ is ascertained by preparing trading A/c.

a. Net profit

b. Gross profit

c. Proposed dividend

d. Income tax

99. ________ is ascertained by preparing P&L A/c.

a. Net profit

b. Gross profit

c. Proposed dividend

d. Income tax

100. ______ is prepared to find out the cost of goods produced.

a. Trading A/c
 b. P&L A/c

c. Manufacturing A/c

d. Current A/c

101. Income earned but not recieved is known as __________

a. Advance income

b. Proposed income

c. Earned income

d. Accrued income

102. Balance sheet is a / an ___________

a. Account

b. Statement

c. Collection of accounts

d. None of hese

103. _______ is the expense which is unpaid at the end of the accounting period.

a. Outstanding expenses

b. Prepaid expenses

c. Proposed expenses

d. Working capital

104. In the case of ____ method, depreciation charged in the initial years will be more

a. Fixed cost

b. Annuity

c. Dimnishing balance

d. None of these

105. ____ is to meet a libility or a diminution in the value of an asset.

 a. Reserve c. Surplus

b. Depreciation d. Provision

ANSWER KEY

1. b; 2. d; 3. b; 4. d; 5. b; 6. a;

7. c; 8. d; 9. d; 10. a; 11. b; 12. c;

13. c; 14. b; 15. d; 16. c; 17. c; 18. c;

19. c; 20. b; 21. a; 22. b; 23. d; 24. b;

25. c; 26. b; 27. a; 28. a; 29. A; 30. C;

31. a; 32. B; 33. A; 34. B; 35. D; 36. C;

37. c; 38. A; 39. C; 40. B; 41. C; 42. D;

43. b; 44. C; 45. D; 46. B; 47. A; 48. A;

49. b; 50. a; 51. A; 52. C; 53. D; 54. B;

55. a; 56. A; 57. C; 58. C; 59. A; 60. C;

61. c; 62. D; 63. B; 64. A; 65. B; 66. C;

67. a; 68. C; 69. B; 70. B; 71. D; 72. C;

73. a; 74. B; 75. C; 76. D; 77. B; 78. A;

79. c; 80. A; 81. B; 82. D; 83. A; 84. C;

85. b; 86. D; 87. A; 88. C; 89. A; 90. B;

91. a; 92. B; 93. A; 94. D; 95. C; 96. B;

97. a; 98. B; 99. A; 100. C; 101. D; 102. B;

103. a; 104. C; 105. D:

1. B : 2. B: 3. C : 4. B : 5. C : 6. D :
 7. C : 8. C : 9. A : 10. C : 11. A : 12. C :

13. A : 14. D : 15. B : 16. A : 17. C : 18. D :

19. C : 20. A : 21. C : 22. C : 23. A : 24. C :

25. B : 26. D : 27. D : 28. B : 29. D : 30. C :

31. d; 32. D; 33. A; 34. B; 35. C; 36. B;
37. D; 38. a; 39. B; 40. A; 41. C; 42. D;
43. C; 44. C;

45. d; 46. A; 47. B; 48. D; 49. A; 50. D; 51. C;

52. a; 53. C; 54. a; 55. D; 56. B; 57. D; 58. C;

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59. b; 60. B;

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61. a; 62. B; 63. D; 64. A; 65. B; 66. D; 67.C;

68. A; 69. D; 70. A; 71. B; 72. D; 73. C; 74.c;

75. B; 76. B; 77. A; 78. C; 79. C; 80. A; 81. D;

82. C; 83. C; 84. A; 85. C; 86. B; 87 . c; 88. A;

89. a; 90. B; 91. B; 92. A; 93. A; 94. B; 95. C;

96. b; 97. D; 98. D; 99. A; 100. A