Accounting MCQs
Accounting MCQs Test Preparation | Latest 2025 Quiz FPSC, NTS, KPPSC, PPSC, SPSC, BPSC, OTS, UTS, PTS, CTS, ATS, ETEA MCQs Test Questions.
If a company has contingent liabilities, they appear in the__________?
A: Balance Sheet
B: Directors report
C: Notes on account to Balance Sheet
D: Chairmans report
Notes on account to Balance Sheet
Which of the following factors are primarily considered to determine the economic life of an asset?
A: Passage of time, asset usage, and obsolescence
B: Tax regulations and SEBI guidelines
C: Tax regulations and asset usage
D: SEBI guidelines and Asset usage
Passage of time, asset usage, and obsolescence
In which of the following methods, the cost of the asset is spread over in equal proportion during its useful economic life?
A: Straight-line method
B: Written down value method
C: Units-of-production method
D: Sum-of-the years-digits method
Straight-line method
Which of the following statements is correct about Depreciation?
A: Depreciation cannot be provided in case of loss in a financial year
B: Depreciation is a charge against profit
C: Depreciation is provided in the books only when there is profit
D: Depreciation is an appropriation of profit
Depreciation is a charge against profit
Which of the following statements best describes the purpose of depreciation?
A: Regular reduction of asset value to correspond to changes in market value as the asset ages
B: A process of correlating the market value of an asset with its gradual decline in physical efficiency
C: Allocation of cost in a manner that will ensure that Plant and Equipment items are not carried on the Balance Sheet in excess of net realizable value
D: Allocation of the cost of an asset to the periods in which services are received from the asset
Allocation of the cost of an asset to the periods in which services are received from the asset
The main objective of providing depreciation is to?
A: Calculate the true profit
B: Show the true financial position in the Balance Sheet
C: Provide funds for replacement of fixed assets
D: Both and
E: above
Show the true financial position in the Balance Sheet
Depreciation is a process of____________?
A: Valuation
B: Valuation and allocation
C: Allocation
D: Appropriation
Allocation
The portion of the acquisition cost of the asset yet to be allocated is known as___________?
A: Written down value
B: Accumulated value
C: Salvage value
D: Residual Value
Written down value
Which of the following statements is true with regard to written down value method of depreciation?
A: The rate at which the asset is written off reduces year after year
B: The amount of depreciation provided reduces from year to year
C: The rate of depreciation as well as the amount of depreciation reduce year after year
D: The value of the asset gets reduced to zero over a period of time
The rate at which the asset is written off reduces year after year
The accounting process of gradually converting the unexpired cost of fixed assets into expenses over a series of accounting periods is_________?
A: Depreciation
B: Physical deterioration of the asset
C: Decrease in market value of the asset
D: Valuation of an asset at a point of time
Depreciation