Accounting for Managers Online MCQ Set 23

QN01. Daily Record of Transaction means

  1. Ledger
  2. Journal
  3. Trial Balance
  4. None of these
Answer

(B)Journal

QN02. The person to whom the amount has to be paid is known as ______________

  1. Drawee
  2. Drawer
  3. Acceptor
  4. Payee
Answer

(D)Payee

QN03. The appropriate book to record credit purchase of machinery is ______________.

  1. purchases book
  2. journal
  3. cash book
  4. petty cash book
Answer

(B)journal

QN04. Which account is generally used for rectification of errors?

  1. Memorandum account
  2. Suspense account
  3. Rectification account
  4. Adjustment account
Answer

(B)Suspense account

QN05. Premium received on issue of shares is a ______________. tempor

  1. capital receipt
  2. revenue receipt
  3. deferred capital receipt
  4. deferred revenue receipt
Answer

(A)capital receipt

QN06. The preparation of a Trial balance helps in ______________.

  1. locating errors in principle
  2. locating errors of omission
  3. locating clerical errors
  4. locating compensatory errors
Answer

(C)locating clerical errors

QN07. Which one of the following is capital expenditure?

  1. Cost of advertisement
  2. Purchase of a delivery van
  3. Purchase of raw material
  4. Purchase of machine oil
Answer

(B)Purchase of a delivery van

QN08. Interest on capital is credited to ______________ account.

  1. Expenses account
  2. Income account
  3. Capital account
  4. Asset account
Answer

(C)Capital account

QN09. Receipts and payments account is a ______________.

  1. Personal account
  2. Nominal account
  3. Real account
  4. Representative account
Answer

(B)Nominal account

QN10. Any amount received towards endowment fund is a ______________receipt.

  1. Ordinary
  2. Special
  3. Revenue
  4. Capital
Answer

(D)Capital

QN11. Income and expenditure account is a ______________.

  1. Real account
  2. Nominal account
  3. Personal account
  4. Representative account
Answer

(B)Nominal account

QN12. Sale of old newspaper is to be shown on the credit side of the ______________.

  1. cash book
  2. income and expenditure
  3. balance sheet
  4. trading account
Answer

(B)income and expenditure

QN13. Non-trading institutions prepare ______________.

  1. profit and loss account
  2. trading account
  3. manufacturing account
  4. income and expenditure account
Answer

(D)income and expenditure account

QN14. The process of recording financial transactions in the journal is called ______________

  1. Journalizing
  2. Utilizing
  3. Posting
  4. Balancing
Answer

(A)Journalizing

QN15. Accounting principles are generally based on ______________

  1. practicability
  2. Subjectivity
  3. convenience in recording
  4. Applicability
Answer

(A)practicability

QN16. Credit sales are recorded in ______________

  1. sales book
  2. cash book
  3. journal proper
  4. purchases book
Answer

(A)sales book

QN17. Debit balance in cash book means ______________

  1. overdraft as per pass book
  2. overdraft as per cash book
  3. credit balance as per pass book
  4. debit balance as per day book
Answer

(C)credit balance as per pass book

QN18. The balance of the petty cash book is ______________.

  1. an asset
  2. a liability
  3. an income
  4. an expenditure
Answer

(A)an asset

QN19. Preliminary expenses are an example of ______________

  1. deferred Revenue Expenditure
  2. revenue Expenditure
  3. capital Expenditure
  4. common expenditure
Answer

(B)revenue Expenditure

QN20. Wages is an example of ______________

  1. capital expenses
  2. indirect expenses
  3. direct expenses
  4. revenue expenses
Answer

(C)direct expenses

QN21. A bill drawn and accepted for a genuine trade transaction is termed as a ______________ bill.

  1. Trade
  2. Time
  3. Inland
  4. Personal
Answer

(A)Trade

QN22. Drawings account is related to ______________

  1. Nominal Account
  2. Personal Account
  3. Real Account
  4. None of the abov
Answer

(B)Personal Account

QN23. Returns outward book makes a record of ______________

  1. goods returned to the suppliers
  2. goods returned to customers
  3. goods returned to proprietor
  4. goods returned to neighbors
Answer

(A)goods returned to the suppliers

QN24. Error of commission do not allow ______________

  1. correct totalling of the balance sheet
  2. correct totaling of the trial balance
  3. the trail balance to agree
  4. correct totaling of the day book
Answer

(C)the trail balance to agree

QN25. Cancelling the original bill and drawing a fresh acceptance is known as ______________.

  1. retiring under rebate
  2. Discounting
  3. Renewal
  4. bill sent to bank for collection
Answer

(C)Renewal

QN26. In accounting, the benefit giving aspect is said to be

  1. Debit
  2. Credit
  3. Debit and Credit
  4. None of these
Answer

(B)Credit

QN27. The person who writes out the bill of exchange is known as

  1. Payee
  2. Drawee
  3. Drawer
  4. Acceptor
Answer

(C)Drawer

QN28. The balance of the petty cash book is ______________.

  1. an asset
  2. a liability
  3. an income
  4. an expenditure
Answer

(A)an asset

QN29. Revenue expenditure is intended to benefit ______________.

  1. current period
  2. future period
  3. past period
  4. both (1) and (2)
Answer

(A)current period

QN30. The person to whom the bill is endorsed is called ______________

  1. Endorse
  2. Endorse
  3. Drawe
  4. Drawe
Answer

(B)Endorse

QN31. Purchases made on credit not recorded at all would affect ______________.

  1. Purchases account
  2. Suppliers account
  3. Purchases account and suppliers account
  4. Wages account
Answer

(C)Purchases account and suppliers account

QN32. Which item is shown on the debit side of a trial balance?

  1. Rent outstanding
  2. Prepaid expenses
  3. Purchases returns
  4. Excess of income over expenses by the firm
Answer

(B)Prepaid expenses

QN33. The ______________ in a ledger helps in locating the accounts contained in it.

  1. Folio
  2. Pages
  3. serial number
  4. part number
Answer

(A)Folio

QN34. The assets of a business can be classified as ______________.

  1. only fixed assets
  2. only current assets
  3. fixed and current assets
  4. fictitious assets
Answer

(C)fixed and current assets

QN35. Non-trading institutions prepare ______________.

  1. Income and expenditure account
  2. Trading and profit and loss account
  3. Only trading account
  4. Only revenue account
Answer

(A)Income and expenditure account

QN36. Sales of old material must be shown on the credit side of ______________.

  1. cash book
  2. income and expenditure account
  3. balance sheet
  4. trading account
Answer

(B)income and expenditure account

QN37. The main aim of ______________ accounting is to ascertain cost relating to the various activities of the business and to have cost control.

  1. financial accounting
  2. cost accounting
  3. management account
  4. human resource accounting
Answer

(B)cost accounting

QN38. Bills payable book is to keep a record of ______________.

  1. bills payable to creditors
  2. bills received from supplier
  3. credit purchases
  4. credit sales
Answer

(A)bills payable to creditors

QN39. The amount brought in by the proprietor in the business should be credited to:

  1. cash account
  2. capital account
  3. drawing account
  4. bank account
Answer

(B)capital account

QN40. If a cheque sent for collection is dishonoured, the debit is given to ______________

  1. suppliers account
  2. bank account
  3. customers account
  4. cash account
Answer

(C)customers account

QN41. State which of the following errors will not be revealed by the trial balance ______________

  1. errors of complete omission
  2. errors of carrying forward
  3. wrong totaling of the purchases book
  4. error of partial omission
Answer

(A)errors of complete omission

QN42. The balance of cash account indicates ______________.

  1. . net income for the period
  2. net loss for the period
  3. net cash on hand
  4. net worth of the business
Answer

(C)net cash on hand

QN43. Outstanding salaries are shown as ______________

  1. an expense
  2. a liability
  3. an asset
  4. an income
Answer

(B)a liability

QN44. Prepaid insurance is ______________

  1. Nominal account
  2. Personal account
  3. Real account
  4. Prepaid account
Answer

(B)Personal account

QN45. ______________ is the person who prepares Bank Reconciliation Statement.

  1. customer of the bank
  2. ban
  3. neither of the above two
  4. reserve bank of India
Answer

(A)customer of the bank

QN46. Provision for bad debts is calculated on ______________

  1. creditors
  2. Sales
  3. Purchases
  4. Debtors
Answer

(D)Debtors

QN47. The discount column of a triple column cash book records ______________.

  1. trade discount
  2. cash discount
  3. quantity discount
  4. seasonal discount
Answer

(B)cash discount

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