accounting MCQs – Page 17

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 Review each marked answer and report any item that may be outdated or unclear.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
321. Depreciation appearing in the Trial Balance should be?
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A. Debited to P&L A/c

B. Shown as liability in Balance Sheet

C. Reduced from related asset in Balance Sheet

D. Both A. and C. above

322. Uncollected checks also referred as______________?
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A. Outstanding checks

B. Unpresented checks

C. Uncredited checks

D. Bounced checks

323. Under the direct write-off method of recognizing a bad debt expense. Which of the following statements is/are true?
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A. Revenue is overstated in the year of sales

B. It violates the matching principle of accounting

C. All of the above

D. The bad debt expense is not matched with the related sales

324. Period cost include which of the following ?
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A. selling Expenses & administrative expenses

B. Direct labor

C. factory overhead

D. selling Expense

325. The noting charges levied on dishonour of an endorsed bill by the Notary Public are to be borne by
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A. The holder of the bill

B. The endorser of the bill

C. The drawer of the bill

D. The person responsible for dishonour
326. A check returned by bank marked NSF means that:
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A. Check cant be cashed being illegal

B. Check has been forged

C. There are not sufficient funds in your account

D. Bank cant verify your identity

327. If a company has contingent liabilities, they appear in the__________?
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A. Directors report

B. Chairmans report

C. Balance Sheet

D. Notes on account to Balance Sheet
328. At the time of preparation of financial accounts, bad debt recovered account will be transferred to?
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A. Debtors A/c

B. Profit & Loss Appropriation A/c

C. Profit & Loss Adjustment A/c

D. Profit & Loss A/c
329. Which of the following is not a contingent liability?
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A. Arrears of fixed cumulative dividend

B. Debts included in Sundry Debtors which are doubtful in nature

C. Claims against the company not acknowledged as debts

D. Uncalled liability on partly paid shares

330. Insurance prepaid is shown as:___________?
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A. Current Asset

B. Fixed Asset

C. Current Liability

D. Income

331. Which of the following statement is considered as the accountants snapshot of firms accounting value as of a particular date?
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A. Cash Flow Statement

B. Retained Earning Statement

C. Income Statement

D. Balance Sheet
332. LIFO stands for__________?
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A. Last input, First Output

B. Lots in , Few out

C. Link input, Format Output

D. Last in, First Out
333. A cash book that is used to record the small payments of cash is generally referred as_________?
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A. Simple cash book

B. Petty cash book

C. Three column cash book

D. Two column cash book

334. Which English alphabet is similar to the shape of an account?
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A. I

B. H

C. T

D. None

335. Based on which of the following concepts, is Share Capital Account shown on the liabilities side of a Balance Sheet?
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A. Money measurement concept

B. Going concern concept

C. Business entity concept

D. Matching concept

336. If unexpired insurance appears in the Trial Balance, it should be:
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A. Debited to the Profit & Loss Account

B. Credited to the Profit & Loss Account

C. Shown on the assets side of the Balance Sheet

D. Shown on the liabilities side of the Balance Sheet

337. Under which of the following situations, is journal entry not passed in the books of the drawer?
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A. When a debtor accepts a bill drawn by the drawer

B. When a bill is sent to the bank for collection

C. When a bill is renewed at the request of the drawee

D. When a discounted bill is honoured by the drawee on the due date
338. An income statement in which each item expressed as percentage of Sale?
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A. common size income statement

B. Balance sheet

C. income statement

D. All of the Above

339. _________ Checks that are presented to bank but not yet credited by the bank.
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A. Uncredited checks

B. Unpresented checks

C. Outstanding checks

D. Bounced checks

340. Which of the following is not true with regard to preparation of Profit & Loss Account?
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A. Profit & Loss Account is prepared for a certain period and hence it is an interim statement

B. Net Profits are ascertained on the basis of current costs

C. Profit & Loss Account does not disclose the effect of non-financial items

D. Net Profits as disclosed by P&L Account is not absolute