Accounting MCQs

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

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.

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

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

A: Liability

B: Assets

C: Revenue receipts

D: Capital receipts

A: Research and development costs during the year

B: Interest on borrowed fund utilized for acquisition of Office Furniture

C: Installation charges paid in conjunction with the purchase of Office Equipment

D: Monthly rent of a machinery used in the business

A: It is already adjusted in the opening stock

B: It is adjusted in the Purchase A/c

C: It is adjusted in the Cost of Sale A/c

D: It is adjusted in the Profit &Loss A/c

A: If a Trial Balance tallies, it always means that none of the transactions has been completely omitted

B: A Trial Balance will not tally if a transaction is omitted

C: A customer to whom goods have been sold on credit cannot avail himself of a cash discount

D: A credit balance in the Pass Book indicates excess of deposits over withdrawals

A: Entering wrong amount in the subsidiary book affects the agreement of the Trial Balance

B: Undercasting or overcastting of a subsidiary book is an example or error of commission

C: Errors of principle do not affect the agreement of Trial Balance

D: Both

E: and

A: Error of casting affects personal accounts

B: Omission of a transaction from a subsidiary record affects only one account

C: Error of carry forward affects two accounts

D: Error of principle involves an incorrect allocation of expenditure or receipt between capital and revenue