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accounting MCQs

Practise multiple-choice questions from accounting for competitive examinations and subject revision. Review each marked answer and report any item that may be outdated or unclear.

accounting Mcqs
1. Which of the following accounts are closed at the end of an accounting period?
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A. Nominal accounts

B. None of them

C. Balance sheet accounts

D. Real accounts

2. Discount for quick repayment of debt is normally referred as____________?
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A. Prompt payment discount

B. Bulk discount

C. Cash discount

D. Trade discount

3. Which of the following statements are / is true? Events after Balance Sheet are?
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A. All changes after Balance Sheet date before its approval

B. The events after Balance Sheet date but before its approval by the board

C. All the significant events after the Balance Sheet date

D. The events after Balance Sheet date but before submitting it to the Registrar of Companies

4. The Basic accounting equation is___________?
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A. Assets=Capital+Liabilities

B. Assets=Cash+Capital

C. Assets=Expenses+Capital

D. Asset=Expense +Income

5. Journal proper is meant for recording_____________?
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A. None of these

B. Return of goods

C. All such transactions for which no special journal has been kept by the business

D. Credit purchase of fixed assets

6. Financial accounting provides financial information to all of the following external users except:
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A. Creditors

B. Government agencies

C. Managers

D. investors

7. In which of the following orders data is entered in journal?
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A. Numeric order

B. Bullets order

C. Alphabetical order

D. Chronological order
8. Assets having physical existence are called ___________?
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A. Liquid asset

B. intangible asset

C. Tangible asset

D. Current asset

9. Which of these errors affect only one account?
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A. Errors of carry forward

B. Errors of casting

C. All the three

D. Errors of posting

10. Capital expenditure is an expenditure which
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A. Results in the acquisition of a permanent asset

B. Results in the acquisition of a current asset

C. Benefits the current accounting period

D. Will benefit the next accounting period

11. Current assets Current liabilities=?
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A. Capital

B. Net working capital

C. Absorbed capital

D. Net assets

12. Assets-Liabilities=____________?
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A. Net income

B. Equity

C. Net expenses

D. Cash

13. Bookkeeping mainly concerns with which part of accounting process?
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A. Auditing the books of accounts

B. Analyzing

C. Recording financial information

D. Preparing financial statements

14. Which one of the following is a capital expenditure?
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A. Royalty paid in installments for the purchase of rights to manufacture and sell patient medicines.

B. Compensation paid to Directors on termination of their services

C. Expenditure incurred in connection with the renewal of a Trade Mark.

D. Gratuities paid to Directors on termination of their services.

15. If Cash=$1000 inventories=$4000 Debtors=$5000 fixed assets=? Capital+Liabilities=$15000 What is the Amount of total assets?
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A. $20,000

B. $5000

C. $10,000

D. $15,000

16. Difference in Bank Balance as per Pass Book and Cash Book may arise on account of_____________?
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A. Cheque issued but not presented

B. Cheque issued but dishonoured

C. Cheque deposited and credited by bank

D. Both A. and B.
17. Which of the following factors are primarily considered to determine the economic life of an asset?
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A. Tax regulations and asset usage

B. Tax regulations and SEBI guidelines

C. Passage of time, asset usage, and obsolescence

D. SEBI guidelines and Asset usage

18. Which of the following accounts can be classified as a real account?
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A. Rent income account

B. Cash account

C. Rent expenses account

D. insurance expenses account

19. Double entry means______________?
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A. Entry in two sets of books

B. Entry at two ends

C. Entry for two aspects of the transaction

D. Entry at two dates

20. he term 2/10-n/30 implies that ______ % discount will be given if the payment is made within days or full amount is receivable within 30 days?
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A. 2,10

B. 3,15

C. 10,30

D. 10,2