Accounting MCQs
Accounting MCQs Test Preparation | Latest 2025 Quiz FPSC, NTS, KPPSC, PPSC, SPSC, BPSC, OTS, UTS, PTS, CTS, ATS, ETEA MCQs Test Questions.
Which of the following items should not be capitalized relating to fixed assets?
A: Interest payable on loans or deferred credits taken for the acquisition or construction of fixed assets before they are ready for use
B: Stand by equipment and servicing equipment
C: Expenditure incurred on test runs and experimental production
D: Administration and general expenses
Administration and general expenses
The balance of which of the following accounts do not disappear, once they are debited/credited to Trading Account?
A: Sales
B: Purchases
C: Inward returns
D: Closing stock
Closing stock
If goods worth 1,750 returned to a supplier is wrongly entered in sales return book as 1,570, then
A: Net Profit will decrease by 3,140
B: Gross Profit will increase by 3,320
C: Gross Profit will decrease by 3,500
D: Gross Profit will decrease by 3,320
Gross Profit will decrease by 3,320
Purchase journal is kept to record_____________?
A: All purchases of goods
B: All credit purchases of goods
C: All credit purchases
D: None of these
All credit purchases of goods
The beginnings inventory of the current year is overstated by 5,000 and closing inventory is overstated by 12,000. These errors will cause the net income for the current year by
A: 17,000 (overstated
B: 12,000 (understated
C: 7,000 (understated
D: 7,000 (overstate
The accountant of Leo Ltd. recorded a payment by cheque to a creditor for supply of materials as 1,340.56. The bank recorded the cheque at its correct amount of 3,140.56. The Company has not passed any rectification entries and the error is not detected through the bank reconciliation. The impact of this error is
A: The Trial Balance will not agree
B: The balance of creditors is understated
C: The purchases are understated
D: The favorable bank balance as per Pass Book is less than the Bank balance as per Cash book
The favorable bank balance as per Pass Book is less than the Bank balance as per Cash book
Which of the following errors affects the agreement of a Trial Balance?
A: Mistake in balancing an account
B: Omitting to record a transaction entirely in the subsidiary books
C: Recording of a wrong entry in the subsidiary books
D: Posting an entry on the correct side but in the wrong account
Mistake in balancing an account
Which of the following should not be treated as revenue expenditure?
A: Interest on loans and debentures
B: Annual fire insurance premiums on Plant and Equipment
C: Sales tax paid in connection with the purchase of office equipment
D: Small expenditures on long- lived assets, such as ` 20 for a paper weight.
Sales tax paid in connection with the purchase of office equipment
Capital expenditure is an expenditure which
A: Benefits the current accounting period
B: Will benefit the next accounting period
C: Results in the acquisition of a permanent asset
D: Results in the acquisition of a current asset
Results in the acquisition of a permanent asset
Which of the following is not a deferred revenue expenditure?
A: Expenses in connection with issue of equity shares
B: Preoperative expenses
C: Heavy advertising expenses to introduce a new product
D: Legal expenses incurred in defending a suit for breach of contract to supply goods