Accounting MCQs

Question 1

A company cannot issue redeemable preference shares for a period exceeding . . . . . . . .

Accepted Answer

7 years

Answer

6 years

Answer

10 years

Answer

20 years

Question 2

Which of the following result in reduction of capital?

Accepted Answer

All of these

Answer

Reducing share capital

Answer

Reducing the amount payable to creditors

Answer

Appreciation in the value of assets

Question 3

Goods worth Rs. 200 returned by Mohan were taken into stock, but no entry was passed, is an error of . . . . . . . .

Accepted Answer

Omission

Answer

Commission

Answer

Principle

Answer

Compensatory

Question 4

Which of the following amounts shall be credited to Investor Education and Protection Fund, if they remain unpaid/unclaimed for seven years from the date they become due?

Accepted Answer

Matured debentures of a company

Answer

Tax arrears

Answer

Proceeds of sale of property

Answer

Provision for doubtful debts

Question 5

Provision for bad debts is calculated on . . . . . . . .

Accepted Answer

Debtors

Answer

Creditors

Answer

Sales

Answer

Purchases

Question 6

Payment of compensation to a worker, who has been discharged from service, is a:

Accepted Answer

Revenue expenditure

Answer

Capital expenditure

Answer

Deferred - revenue expenditure

Answer

Non-business expenditure

Question 7

Petty cash system is designed:

Accepted Answer

to cover the small expenditure to be paid in cash

Answer

to meet the needs of small businesses

Answer

to cover small and miscellaneous income

Answer

to cover both small incomes and expenditures

Question 8

Which of the following assets does not depreciate?

Accepted Answer

Land

Answer

Machinery and equipment

Answer

Patents

Answer

Furniture

Question 9

The main objective of providing depreciation is to:

Accepted Answer

allocate cost of the assets

Answer

create secret reserves

Answer

reduce the book value of assets

Answer

value the assets properly