Top 1000+ Solved Financial Accounting MCQ Questions Answer
Q. Which one of the following should be considered a revenue expenditure?
a. 1000 paid for the execution of a new plant
b. Loss of `10,000 incurred in increasing the sitting accommodation of a hotel
c. Damage paid on account of breach of a contract to supply certain goods
d. Repair to machinery purchased, second han
Q. Which one of the following is a capital expenditure?
a. Compensation paid to Directors on termination of their services
b. Expenditure incurred in connection with the renewal of a Trade Mark.
c. Gratuities paid to Directors on termination of their services.
d. Royalty paid in installments for the purchase of rights to manufacture and sell patient medicines.
Q. Which of the following enhances the earning capacity of an asset?
a. Increase in working capacity of an asset
b. Reduction in operating costs
c. Replacing damaged parts of an asset
d. Both (a) and (c) above
Q. 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
Q. Which of these errors affect only one account
a. Errors of casting ;
b. Errors of carry forward ;
c. Errors of posting ;
d. All the three
Q. Which of these errors affect two or more accounts
a. Errors of complete omission ;
b. Errors of principle ;
c. Errors of posting to wrong account;
d. All the three
Q. Which of the following error is an error of principle
a. 5,000 received from Sham credited to Ram A/c
b. 5,000 incurred on installation of new plant debited to travelling expenses A/c
c. 500 paid for wages debited to salary A/c
d. 500 being purchase of raw material debited to purchase A/c ` 50
Q. Which of the following is an one sided error
a. 500 purchase of old equipment not recorded in the books of A/c at all;
b. 500 being expense on travelling expense credited to travelling expenses;
c. Both ;
d. None
Q. Any gain on the sale of non-current assets should be _________ from the net profit and the loss mustbe _________to the net profit in determining fund from operation
a. Added, Reduced ;
b. Added, Added ;
c. Deducted, Added ;
d. Deducted, Deducted
Q. Cash book records—
a. Only cash sales ;
b. All types of cash receipts and payments ;
c. Only revenue receipts
d. Only capital receipts
Q. In a three column cash book ---------- does not exist
a. Cash column ;
b. Bank column ;
c. Petty cash column ;
d. Discount column
Q. Which of these transactions will not be recorded in cash book—
a. Cash received from debtors ;
b. Cash paid to creditors ;
c. Salary remained outstanding
d. Cash deposited with bank
Q. The closing balance of a petty cash book is a / an —
a. Liability ;
b. Gain ;
c. Assets ;
d. Loss
Q. Which column of a cash book will not have credit balance —
a. Bank column ;
b. Discount column ;
c. Cash column ;
d. None