accounting MCQs – Page 13

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 Review each marked answer and report any item that may be outdated or unclear.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

241. Which of the following is a real account?
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A. Office equipment

B. Insurance expense

C. Rent expenses

D. Rent income

242. Which of the following statements is/are true ?
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A. Cash Book is a subsidiary book as well as a ledger

B. The balance of Petty Cash Book is a liability

C. A sale of an asset is recorded in the Sales Book

D. Total of Return Outward Book is debited to Return Outward Account

243. Which of the following accounts appear(s) in the Balance Sheet of a business?
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A. an style="color: #003f1a;">i. Stock at the end of the financial year

B. pan style="color: #003f1a;">iii. Drawings

C. pan style="color: #003f1a;">ii. Stock at the beginning of the financial year

D. pan style="color: #003f1a;">iv. Prepaid Rent

E. pan style="color: #003f1a;">v. Interest received but not yet earned

244. IFRS 9 explains about?
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A. Inventory

B. Expenses

C. Accounts Payable

D. Accounts Receivable

245. A cash deposit made by business appears on the bank statement as _______ balance?
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A. Expenses

B. Credit

C. Debit

D. Liability

246. Which of the following error results in unadjusted cash book balance?
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A. Deposit in transit

B. Outstanding checks

C. Unpresented checks

D. Omission of Bank charges

247. If actual bad debts are more than the provision for bad debts, then there will be a_____________?
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A. Debit balance of Discount on Debtors Account

B. Credit balance of Provision for Bad Debts Account

C. Debit balance of Bad Debts Account

D. Debit balance of Provision for Bad Debts Account

248. Consider the following data pertaining to the production of a company for a particular month :
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A. e="color: #003f1a;">Total manufacturing cost charged to product 3,39,165

B. 65,025

C. e="color: #003f1a;">The amount of factory overheads applied to production is

D. e="color: #003f1a;">Closing stock of raw material 10,380

E. 95,020

F. ="color: #003f1a;">Opening stock of raw material 11,570

249. In the Bank reconciliation statement Deposit in transit is usually:
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A. Subtracted from bank balance

B. Subtracted from cash book balance

C. Added to bank balance

D. Added to Cash book balance

250. Payment of rent expenses is recorded on which side of cash book?
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A. Income

B. Expense

C. Payments

D. Receipts

251. Cash book with cash and discount column is mostly referred as________?
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A. Three column cash book

B. Two column cash book

C. Simple cash book

D. Petty cash book

252. Which of the following shall not be deducted from net profit while calculating managerial remuneration?
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A. Debts considered bad and written off

B. Loss on sale of undertaking

C. Liability arising from a breach of contract

D. Directors remuneration

253. Find the cost of goods sold if goods are sold for 2,000 at 25% profit on cost?
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A. 1,500

B. 1,000

C. 1,600

D. 1,800

254. A cash book with cash, bank and discount column is commonly referred as________?
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A. Petty cash book

B. Two columns cash book

C. Cash book

D. Three columns cash book

255. When production is equal to sales, which of the following is TRUE?
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A. The use of absorption costing causes inventory value to increase more than they would though the use of variable costing

B. The use of absorption costing produces a lower net income than the use of variable costing

C. The use of absorption costing produces a higher net income than the use of variable costing

D. No change occurs to inventories for either use absorption costing or variable costing methods

256. On scrutiny of a firms books of accounts, it was observed that the following errors have occurred in the previous years but have not yet been rectified.
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A. e="color: #003f1a;">The impact of this on the reported net income for the year ending March 31, 2013 is

B. ="color: #003f1a;">i. Depreciation for 2011-2012- 7,000 understated

C. e="color: #003f1a;">ii. Accrued expenses as at March 31, 2013 10,000 understated

257. Unpresented checks also referred as____________?
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A. Uncredited checks

B. Bounced checks

C. Outstanding checks

D. Uncollected checks

258. $5000 deposited in bank account was entered twice in the cash book. Identify the correct adjustment in cash book.
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A. $10,000 will be debited

B. $10,000 will be credited

C. $5000 will be debited

D. $5000 will be credited

259. Payments received in advance from a customer for a contract can be__________?
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A. Shown as a deduction from contract work-in-progress on asset side

B. Credited to P&L A/c

C. Shown as a liability

D. Either A. or B. above

260. Favorable balance of bank statement implies that
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A. Bank overdraft

B. Adjusted balance

C. Credit balance

D. Debit balance

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