Top 1000+ Solved Financial Accounting MCQ Questions Answer

a. Shown as a deduction from contract work-in-progress on asset side

b. Shown as a liability

c. Credited to P&L A/c

d. Either (a) or (b) above

a. Balance Sheet

b. Directors‘ report

c. Notes on account to Balance Sheet

d. Chairman‘s report

a. Written down to zero or its scrap value

b. Shown in the Balance Sheet at its replacement cost

c. Shown in the Balance Sheet at cost, but classified as a non-current asset

d. Carried in the accounting records at cost until it is sold

a. Finished goods ;

b. Work-in-process ;

c. Stores and spares

d. Advance payments made to suppliers for raw materials

a. Inventory valuation affects only the income statement

b. Undercasting or overcastting of subsidiary book is an example of error of commission

c. Capital expenditure wrongly treated as revenue is an example of error of commission

d. Inventories should be valued at lower of historical cost and current replacement cost

a. Provision for bad debts appears as a liability on the Balance Sheet

b. The provision for bad debts is owed to the proprietor

c. Bad debts could be less than the provision for bad debts

d. Bad debts could exceed the provision for bad debts

a. Credit balance of Provision for Bad Debts Account

b. Debit balance of Provision for Bad Debts Account

c. Debit balance of Bad Debts Account

d. Debit balance of Discount on Debtors Account

a. Debit Profit and Loss Account and deduct the provision from debtors

b. Credit Profit & Loss Account and deduct the provision from debtors

c. Credit Profit and Loss Account and add the provision to debtors

d. Debit Profit & Loss Account and add the provision to debtors

a. The bad debt expense is not matched with the related sales

b. Revenue is overstated in the year of sales

c. It violates the matching principle of accounting

d. All of the above

a. Debtors A/c

b. Profit & Loss A/c

c. Profit & Loss Adjustment A/c

d. Profit & Loss Appropriation A/c

a. General Reserve A/c

b. Profit & Loss A/c

c. Asset A/c

d. Capital Reserve A/c

a. Replacement cost – Accumulated Depreciation

b. Historical cost – Salvage Value

c. Historical cost – Depreciation portion thereof

d. Original cost adjusted for general price-level changes

a. An Asset in the Balance Sheet

b. A Liability

c. By adjusting it in the P & L A/c

d. Both (b) and (c) above

a. Current Asset

b. Current Liability

c. Fixed Asset

d. Income

a. Debited to P&L A/c

b. Shown as liability in Balance Sheet

c. Reduced from related asset in Balance Sheet

d. Both (a) and (c) above