Accounting MCQs

Question 1

Which of the following appears in the profit and loss appropriation account?

Accepted Answer

Dividend

Answer

Interest on debentures

Answer

Provision for taxation

Answer

Provision for bad debts

Question 2

Which of the following inventory valuation methods show higher profits during the period of rising prices?

Accepted Answer

FIFO

Answer

LIFO

Answer

Weighted average cost method

Answer

Simple average method

Question 3

The main objective of providing depreciation is to

Accepted Answer

Create funds for replacement of fixed assets

Answer

Calculate the true net profit

Answer

Compute the actual cash profit

Answer

Reduce tax burden

Question 4

The three column cash book represents

Accepted Answer

Real, personal and nominal accounts

Answer

Real accounts

Answer

Nominal accounts

Answer

Nominal and personal accounts

Question 5

Carriage inwards refers to the cost of transportation for

Accepted Answer

Purchase of materials

Answer

Sale of products

Answer

Returns outward

Answer

Return of unsold goods

Question 6

Right shares are the shares

Accepted Answer

Offered to the existing equity shareholders

Answer

Issued by a newly formed company

Answer

Legally issued to the public at large

Answer

That have a right of redemption

Question 7

Which of the following is a real account?

Accepted Answer

Cash account

Answer

Salary account

Answer

Outstanding rent account

Answer

Sundry creditors account

Question 8

Which of the following is not an item of revenue expenditure?

Accepted Answer

Customs duty paid in connection with the import of equipment

Answer

Interest on deposits accepted

Answer

Annual insurance premium on inventory

Answer

Repairs and maintenance on machinery

Question 9

Which of the following is/are fixed asset(s)?

Accepted Answer

Patents

Answer

Closing inventory

Answer

Fixed deposit in a bank

Answer

Prepaid expenses