Accounting MCQs

Question 1

Which of the following is not a long-term borrowing of a company?

Accepted Answer

Loans repayable on demand from banks

Answer

Debentures

Answer

Term loans

Answer

Long-term finance lease obligations

Question 2

A bill of exchange payable after a certain period is known as . . . . . . . . bill.

Accepted Answer

Time

Answer

Accommodation

Answer

Revenue

Answer

Dishonored

Question 3

Preference shareholders are entitled to a fixed rate of . . . . . . . .

Accepted Answer

dividend

Answer

interest

Answer

coupon

Answer

capital

Question 4

In life insurance, the risk insured is

Accepted Answer

not certain to occur and also the timming of its occurrence is not known

Answer

certain to occur and also the timing of its occurrence is known

Answer

certain to occur, but its timing of occurrence is not known

Answer

not likely to occur

Question 5

. . . . . . . . of net surplus of a life insurance company is given to policyholders as bonus.

Accepted Answer

95%

Answer

90%

Answer

80%

Answer

None of these

Question 6

Capital reduction account is used to . . . . . . . .

Accepted Answer

write off losses

Answer

transfer to capital

Answer

issue bonus shares

Answer

None of these

Question 7

Which of the following accounts is increased by credit entries?

Accepted Answer

Bank Overdraft

Answer

Purchases Account

Answer

Goodwill Account

Answer

Sales Returns Account

Question 8

Under . . . . . . . . policy, the sum assured becomes payable on the attainment of a specific age or on death whichever is earlier.

Accepted Answer

endowment policy

Answer

whole time life policy

Answer

with profit policy

Answer

None of these

Question 9

Balance sheet is prepared primarily with the following group in view of . . . . . . . .

Accepted Answer

Owners

Answer

Creditors

Answer

Government

Answer

Management