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1. The process of recording consumption of natural resources (or wasting assets) is called

A

Amortization

B

Depletion

C

Going Concern

D

Residual Value

2. The concept that the enterprise will continue in a foreseeable future is known as:

A

Amortization

B

Depletion

C

Going Concern

D

Residual Value

3. What from the following is NOT a capital expense?

A

Purchase of Property

B

Purchase of Office equipment

C

Replacement of Vehcile

D

Repair of vehicle

4. Which of the following is not a business transaction:

A

Purchasing Office supplies

B

Hiring a new Employee

C

Paying interest on business loan

D

Receiving fee for services

5. A company is owned by its:

A

Directors

B

Employees

C

Shareholders

D

Managers

6. There is a debit balance on the office expenses at the end of the financial year. In which section of the balance sheet this will be recorded:

A

Capital

B

Current Assets

C

Current Liabilities

D

Fixed Assets

7. Bank Reconciliation Statement is:

A

Ledger Account

B

Part of cash book

C

A separate statement

D

A subsidiary of Journal

8. The credit side of a profit and loss account records:

A

Direct Expenses

B

Direct Income

C

Indirect Expenses

D

Indirect Income

9. Which of the following is not an item of Balance Sheet:

A

Accounts receivable

B

Accounts payable

C

Sales revenue

D

Marketable securities

10. Which of the following book is both a journal and a ledger:

A

Cash Book

B

Sales Day Book

C

Trial Balance

D

Journal Proper

11. The short description of a transaction written at the end of a journal entry is known as:

A

Summary

B

Narration

C

Memo

D

Info

12. Income and Expenditure Account is a:

A

Nominal Account

B

Real Account

C

Personal Account

D

Artificial Personal Account q

13. Which of the following is of capital nature:

A

Commission on purchases

B

Cost of repairs

C

Rent of factory

D

Wages paid for installation of machinery

14. Which of the following is not a Fundamental Accounting Assumption:

A

Going Concern

B

Consistency

C

Accrual

D

Business Entity

15. Verification refers to:

A

Examination of journal and ledger

B

Examination of vouchers related to assets

C

Examining the physical existence and valuation of assets

D

Calculation of value of assets

16. Which of the following errors is not disclosed by a Trial Balance:

A

Errors of Principle

B

Errors of omission

C

Compensating Errors

D

All of the above

17. Double entry accounting system includes:

A

Accrual accounting only

B

Cash accounting only

C

Both cash and accrual accounting

D

None of the above

18. Which of the following purpose is served from the preparation of Trial Balance:

A

To check the arithmetical accuracy of the recorded transactions

B

To ascertain the balance of any ledger account

C

To facilitate the preparation of final accounts promptly

D

All of the above.

19. If a fixed amount is withdrawn on the first day of every month of calendar year by a partner in partnership firm, then for what period the interest on the total amount of drawings will be calculated:

A

4.5 months

B

5.5 months

C

6.5 months

D

7.5 months

20. Petty cash book has a balance of Rs 500. This represents:

A

profit

B

asset

C

liability

D

loss