accounting MCQs – Page 8

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 Review each marked answer and report any item that may be outdated or unclear.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
141. What is the basic accounting equation?
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A. Liabilities+Capital

B. Capital+Liabilities=Assets

C. Assets+ liabilities =Capital

D. Capital+assets=liabilities

142. Discount received is a/an:
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A. Expense

B. Asset

C. Liability

D. Revenue
143. Auditing is what?
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A. maintaining the ledger records

B. Preparation financial statements

C. Examination of financial statements

D. Reporting the financial information

144. Double entry implies that
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A. Recording every transaction in books

B. Recording two aspects of every transaction

C. Recording entries in journal

D. Recording entries in Ledger account

145. Cash brought by the owner to start business is called__________?
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A. Capital

B. Loan

C. None of these

D. Drawing

146. Which of the following specialized journals records goods returned by customers?
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A. Purchases return journal

B. Sales journal

C. Sales return journal

D. Purchase journal

147. _______ the withdrawal of cash and goods by the owner of the busienss for his/her personal use?
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A. Outflow of cash

B. Depreciation

C. Drawings

D. Appreciation

148. Which of the following is the closing balance of a ledger account?
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A. Balance b/d

B. Balance e/d

C. Balance f/c

D. Balance c/d
149. A brief explanation recorded below every entry in general journal is commonly known as__________?
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A. Narration

B. Summary

C. Explanation

D. Other information

150. Which is the most important characteristic that all assets of a business have?
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A. Value of assets

B. Future economic benefits

C. Long life of assets

D. Intangible nature of assets

151. Which column of a cash book will not have credit balance___________?
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A. Cash column

B. Bank column

C. Discount column

D. None

152. Every business transaction affects at least ________ accounts?
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A. Two

B. Three

C. One

D. Infinite

153. Debit side of Bank Pass book corresponds to___________?
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A. Debit side of Cash Book

B. Credit side of Cash Book

C. Credit side of Balance Sheet

D. Debit side of Trial Balance

154. The periodic total of purchase day book is posted to____________?
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A. Purchase register

B. Credit purchase A/c

C. Purchase A/c

D. Cash purchase A/c

155. In accounting an Economic event is referred to as:
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A. Cash

B. Transaction

C. Bank statement

D. Exchange of money

156. ________ is the common base for preparing a trial balance?
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A. Ledger accounts

B. Balance sheet

C. Specialized journals

D. General Journal

157. Payment of expenses will ______ the assets
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A. Reduce

B. Increase

C. apportion

D. Overstate

158. Cash received for services rendered will______________?
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A. Increase equity and liability

B. Increase fixed assets and cash

C. Increase cash and equity

D. Increase cash and liability

159. If goods worth 1,750 returned to a supplier is wrongly entered in sales return book as 1,570, then
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A. Gross Profit will decrease by 3,500

B. Gross Profit will increase by 3,320

C. Net Profit will decrease by 3,140

D. Gross Profit will decrease by 3,320
160. Which of the following is a representative Personal A/c?
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A. Outstanding Salary A/c

B. Bad debts A/c

C. Rent A/c

D. SBI A/c