accounting MCQs – Page 18

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 Review each marked answer and report any item that may be outdated or unclear.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

341. Cash book is prepared by____________?
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A. Manager of a company

B. Accountant of business

C. Banks cashier

D. Bank

342. Introduction capital by owner of business is recorded on which side of a cash book?
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A. Expenditures

B. Receipts

C. Incomes

D. Payments

343. Postage stamps on hand are considered as_________?
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A. Bank

B. Prepaid expenses

C. Accounts receivable

D. Creditor

344. Bad debts recovered is:
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A. Credited to P&L A/c

B. Reduced from debtors in Balance Sheet

C. Debited to P&L A/c

D. Added to debtors in Balance Sheet

345. Profit on sale of old plant is:___________?
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A. Profit and Loss A/c

B. In Trading A/c

C. In Profit and Loss Appropriation A/c

D. Being a non operating item ignored

346. The cost of obsolete inventory acquired several years ago, to be considered in a keep vs. disposal decision is an example of :
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A. Opportunity cost

B. Uncontrollable cost

C. Avoidable cost

D. Sunk cost

347. Carriage on goods purchased is shown in:___________?
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A. Trading A/c

B. Shown in Balance Sheet

C. Profit and Loss A/c

D. Capitalized with work in progress

348. Which of these are not required in a promissory note?
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A. Properly stamped

B. Payment to be made legal currency

C. Acceptance

D. Unconditional promise to pay

349. Overhead cost is the total of ____________.
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A. all direct costs.

B. all indirect costs.

C. indirect and direct costs.

D. all specific costs

350. Which of the following is not a feature of a promissory note?
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A. It is payable to the bearer

B. It contains an unconditional promise to pay

C. It must be in writing

D. It must be signed by the maker

351. The compensation paid by the borrower of fund to lender, from the borrower point of the cost of borrowing fund is called?
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A. Required rate of return

B. All of the above

C. Nominal interest rate

D. Interest Rate

352. Consider the following data for a company during the month of June 2012 Budgeted hours 4,000 Standard hours for actual production 4,400 Maximum possible hours in the budget period 4,800 Actual hours 3,800 The activity ratio of the company during the month is
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A. 117%

B. 95%

C. 111%

D. 120%

353. Tender is an_____________?
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A. estimation of profit.

B. estimation of selling price.

C. estimation of units.

D. estimation of cost.

354. When a person purchasing goods on credit he becomes a_________in the books of the seller?
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A. Creditor

B. Defaulter

C. Debtor

D. Offender

355. Which of these is not an essential feature of a bill of exchange?
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A. In writing

B. Unconditional

C. Amount to be paid in foreign currency

D. Certainty of amount

356. Costs that change in response to alternative courses of action are called___________?
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A. Differential costs

B. Target costs

C. Sunk costs

D. Relevant costs

357. Favorable balance of cash book implies that
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A. Credit balance of cash book

B. Debit balance of cash book

C. Adjusted balance of cash book

D. Bank overdraft

358. In the books of the drawer, the accounting treatment involved on receipt of a bill of exchange duly accepted by the drawee is?
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A. ="color: #003f1a;">i. Debit Bills Receivable Account

B. e="color: #003f1a;">iv. Credit Sales Account

C. e="color: #003f1a;">ii. Debit Drawees Account

D. e="color: #003f1a;">iii. Credit Drawees Account

359. Investment in own share A/c appears in____________?
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A. Asset side

B. Netted from Capital

C. Liability side

D. Profit & Loss A/c

360. Computers taken on hire by a business for a period of twelve months should be classified as:___________?
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A. Intangible assets

B. Deferred revenue expenditure

C. Current assets

D. Not an asset

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