accounting MCQs – Page 4

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 Review each marked answer and report any item that may be outdated or unclear.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
61. Petty cash balance is a/an___________?
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A. Liability

B. None

C. Expenditure

D. Assets
62. Revenue and expense accounts are referred as______________?
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A. Banks account

B. Nominal accounts

C. Real account

D. Cash accounts

63. Which of these is a Part of cash in hand?
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A. B/R

B. Cheque Deposited with Bank

C. B/R endorsed

D. Postage stamps
64. Purchase journal is kept to record_____________?
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A. All purchases of goods

B. None of these

C. All credit purchases of goods

D. All credit purchases

65. Credit balance as per Cash Book mean____________?
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A. None of these

B. Surplus cash

C. Terms deposits with bank

D. Bank overdraft
66. Total depreciation of an asset cannot exceed its:
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A. Residual value

B. Depreciable value

C. Market value

D. Scrap value

67. Identify the nominal account
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A. Rent expenses account

B. Machinery account

C. Creditors account

D. Building account

68. For the business, capital is ____________?
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A. Expense

B. All of them

C. financial assets

D. Liability

69. Which of the following items should not be capitalized relating to fixed assets?
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A. Interest payable on loans or deferred credits taken for the acquisition or construction of fixed assets before they are ready for use

B. Administration and general expenses

C. Expenditure incurred on test runs and experimental production

D. Stand by equipment and servicing equipment

70. The process of recording transactions in different journals is called_________?
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A. Journalizing

B. Entry making

C. Adjusting

D. Posting

71. Benefits of preparing Bank Reconciliation Statement includes___________?
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A. All the three

B. Help know actual bank balance

C. Highlights under delay in clearance of cheques deposited but not credited

D. It bring out any errors committed in preparation of Cash book / Bank Pass Book

72. A book wherein various accounts are opened is called____________?
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A. Ledger

B. Trial Balance

C. Subsidiary books

D. Journal

73. BUSINESS paid rent amounting to $100? which of the following specialized journals records this transaction?
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A. Cash payments journal

B. Sales journal

C. Purchase journal

D. Cash receipts journal

74. The concession received on the price of defective goods is called:
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A. Discount

B. Cash discount

C. Allowance

D. Trading discount

75. Capital expenses are shown in___________?
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A. None of these

B. Trading A/c

C. Profit and Loss A/c

D. Balance Sheet
76. The balance of which of the following accounts do not disappear, once they are debited/credited to Trading Account?
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A. Purchases

B. Inward returns

C. Closing stock

D. Sales

77. When owner withdraw cash for its private use, it is called ___________?
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A. Expense

B. Drawing

C. Profit

D. Income

78. Capital increases if _________ increases?
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A. Drawings

B. Revenue

C. Expenses

D. Interest on capital

79. Debit balance = Credit balance in a trial balance indicates that:
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A. Mathematically Capital+Liabilities=Assets

B. Account balances are correct

C. No error in posting entries to ledger accounts

D. No error in recording transactions

80. Which of the following errors is an error of omission?
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A. Wages paid to Mohan have been debited to his account

B. Sale of ` 100 was recorded in the Purchases Journal

C. Repairs to buildings have been debited to buildings account

D. The total of the sales journal has not been posted to the Sales Account