accounting Mcqs
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

261. Which of the following statements is false ? select the false from below options
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A. A person who owes to the business is called Debtor

B. Balance Sheet discloses financial position of the business

C. Assets are to be shown in the Balance Sheet at the realizable value

D. Decrease in the value of the asset could decrease the value of a liability

262. One of the most important tools in cost planning is__________?
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A. Direct cost

B. Cost Sheet

C. Marginal Costing.

D. Budget
263. The drawer of a trade bill passes relevant entries with regard to the transaction involved in it. But, in case of an accommodation bill, he passes an entry in addition to the usual entries. The additional entry so passed is with respect to
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A. Sending the bill to bank for collection

B. Discounting of the bill with the bank

C. Remitting or receiving the amount

D. Payment of the bill on due date

264. Depreciation is calculated on the____________?
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A. Cost or market values whichever is less

B. Cost price of asset

C. Market price

D. Cost+ Transport+ Installation expenses
265. Depreciation Account appearing in the Trial Balance is shown in:
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A. Trading A/c

B. Deducted from the concerned assets A/c

C. Shown on the liability side

D. Profit and Loss A/c
266. ____________is also known as Appraisal system of depreciation?
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A. Annuity system

B. Survey system

C. Insurance

D. Inventory system
267. ___________ are checks that are issued by the business but not yet presented to bank
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A. Outstanding checks

B. Uncollected checks

C. Bounced checks

D. Uncredited checks

268. Non Trading institution prepare:______________?
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A. Manufacturing account

B. Income and Expenditure Account

C. Cost of good sold

D. profit and loss account

269. Average Accounting Return is a measure of accounting profit relative to:
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A. Cost

B. Book value

C. Intrinsic value

D. Market value

270. Petty cash fund is supposed to be replenished?
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A. Every year

B. At the end of every accounting period

C. Every day

D. Every half year

271. A Bill of Exchange is drawn on 1st April, 2018 payable after 3 months. The due date of the bill is?
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A. 4th July,2018

B. 1st July,2018

C. 30th June,2018

D. 4th August,2018

272. The Profit and Loss Account shows the:
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A. Financial results of the concern for a period

B. Cost of goods sold during the period

C. Financial position of the concern on a particular date

D. Financial results of the concern on a particular date

273. Closing stock appearing in the Trial Balance is shown in:
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A. Balance Sheet only

B. Trading A/c only

C. Profit and Loss A/c

D. Trading A/c and Balance Sheet

274. Which of the following will not appear in Profit and Loss Account of a business?
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A. Reserve for discount on Sundry Creditors

B. Bad debts

C. Accrued expenses

D. Drawings
275. The entry for creating a Provision for bad debts is_____________?
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A. Debit Debtors A/c and credit Provision for Bad Debts A/c

B. Debit Provision for Bad Debts A/c and credit Debtors A/c

C. Debit Profit and Loss A/c and credit Provision for Bad Debts A/c.

D. Debit Provision for Bad Debts A/c and credit Profit & Loss A/c

276. When bill discounted with the bank is dishonored?
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A. Bills Receivable Account is credited in the books of drawer

B. Bank Account is debited in the books of drawer

C. Bills Payable Account is debited in the books of drawer

D. Acceptors Account is debited in the books of drawer
277. Goods in stock worth 800 are destroyed by fire and the Insurance Co. is accepted the claim for 600. Adjustment would involve
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A. Debit of 800 to Trading Account and credit of 600 and 200 to insurance company and

B. Credit insurance company for 600

C. fit and Loss Account respectively

D. Deduct the 800 from closing stock in the Trading Account

E. dit of 800 to Trading Account</strong>

F. Debit of 600 and 200 to insurance company and Profit and Loss Account respectively and
278. During the accounting period, sales revenue is Rs. 25,000 and accounts receivable increases by Rs. 8,000. What will be the amount of cash received from customers for the period?
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A. Rs. 25,000

B. Rs. 8,000

C. Rs. 17,000

D. Rs. 33,000

279. Tax deducted at source appears in the Balance Sheet
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A. On the liabilities side under provisions

B. On the assets side under loans and advances

C. On the liabilities side under current liabilities

D. On the assets side under current assets

280. An average cost is also known as________?
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A. Fixed cost

B. Total cost

C. Variable cost

D. Unit cost
281. Standing orders are ________
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A. Entered in the petty cash balance

B. Debited in the cash book

C. Credited in the cash book

D. Entered in the bank statement

282. Gross Profit is equal to_________?
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A. Sales Cost of goods sold

B. Sales Closing Stock + Purchases

C. Opening Stock + Purchases Closing Stock

D. None of the above

283. A foreign bill of exchange is generally drawn up in___________?
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A. Triplicate

B. Single

C. Quadruplicate

D. Duplicate

284. Bank reconciliation statement is prepared by____________?
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A. Accountant of the business

B. Controller of the bank

C. Manager of the business

D. Accountant of the bank

285. Cash book records:______________?
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A. Cash receipts

B. Cash payments

C. Cash payments and cash receipts

D. Neither cash payments nor cash receipts

286. Tax deducted at source A/c appears in___________?
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A. Liability side

B. Profit & Loss A/c

C. Assets side

D. Debited to Capital A/c

287. An entry which is made on both sides of a cash book is called__________?
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A. Payment entry

B. Compound entry

C. Contra entry

D. Cash entry

288. A Ltd. Has sales of 2,200, total fixed cost of 570, variable cost of 1,540, raw material consumed of ` 1,100, number of units sold 22,000. What shall be the BEP 9 in units) if raw material price is reduced by 2%?
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A. 18,560

B. 19,000

C. 18,750

D. 18,387
289. Bank charges amounting to $5000 was not entered in the cash book. Identify the correct adjustment in cash book?
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A. Bank charges will be added to cash book balance

B. Bank charges will be debited in cash book

C. Bank charges will be credited in cash book

D. Bank charges need no adjustment in cash book

290. Drawings by owner of business are generally recorded on which of the following side of a cash book?
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A. Payments

B. Incomes

C. Receipts

D. Expenditures

291. Which of these is not an operating income?
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A. Income from sale of trading goods

B. Interest on FDs

C. None

D. Bad debts recovered

292. Budgeted sales for the next year is 5,00,000 units. Desired ending finished goods inventory is 1,50,000 units and equivalent units in ending W-I-P inventory is 60,000 units. The opening finished goods inventory for the next year is 80,000 units, with 50,000 equivalent units in beginning W-I-P inventory How many equivalent units should be produced?
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A. 5,80,000

B. 5,50,000

C. 5,00,000

D. 5,75,000

293. Postdated checks are considered as__________?
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A. Cash

B. Cash reserve

C. Accounts receivable

D. Bank balance

294. Arrangement of Balance Sheet in a logical order is known as __________?
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A. Make up of Balance Sheet

B. Dressing Balance Sheet

C. Formatting Balance Sheet

D. Marshalling Balance Sheet
295. A company was entered in hire purchase agreement and had to pay $1000 per month. Three payments were made via bank account but no entry was found in cash book. Identify the correct adjustment in cash book
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A. $3000 will be added to cash book balance

B. $3000 will be subtracted from cash book balance

C. $2000 will be deducted from cash book balance

D. $1000 will be added to cash book balance

296. Recent developments have made much of a companys inventory obsolete. This obsolete inventory should be?
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A. Shown in the Balance Sheet at its replacement cost

B. Shown in the Balance Sheet at cost, but classified as a non-current asset

C. Carried in the accounting records at cost until it is sold

D. Written down to zero or its scrap value
297. Accommodation bills are generally for?
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A. All the three

B. Genuine trade reasons

C. To help augment money supply

D. For mutual financial accommodation
298. Warehouse rent is a part of _________?
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A. prime cost.

B. distribution cost.

C. factory cost.

D. production cost

299. Riaz holds an average inventory of 36,000(CP) with an inventory turnover of 5 times. If the firm makes a gross profit of 25% on sales, find the total sales of the company.
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A. 2,00,000

B. 2,40,000

C. 1,80,000

D. 2,10,000

300. Which of the following are/is not a fixed asset?
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A. Stock

B. Vehicle

C. Fixed deposit in bank

D. Both A. and C. above