Accounting Mcqs

Page No. 16

Which of the following is TRUE about the treatment of insurance premium paid in advance


aCurrent asset


bCurrent liability


cShort term liability


dFixed asset


View Answer Current asset

Which of the following would NOT be considered as a component of 'cost' of stock?


aTransportation inward costs


bImport duties


cSalaries of selling staff


dPurchase price



When one or both aspects of a transaction are recorded in the wrong class or category of account, it is called


aError of principle


bError of omission


cError of commission


dError of original entry


View Answer Error of principle

Which of the following item will be shown on debit side of debtors account?


aDiscount received


bReturn inwards


cDiscount allowed


dCredit sales


View Answer Credit sales

The allocation of the cost of a tangible plant asset to expense in the periods, in which services are received from the asset, is termed as


aAppreciation


bDepreciation


cFluctuation


dNone of the above


View Answer Depreciation

Which of the following account will be credited when a typewriter is sold that has been used in the office?


aOffice equipment account


bCash account


cSales account


dPurchase account



Interest on loan paid by business is an example of


aRevenue expense


bIncome


cAsset


dReturn outward


View Answer Revenue expense

Which of the following account will be credited, if business bought goods on credit from Mr. Z?


aPurchases account


bMr. Z account


cCash account


dSales account


View Answer Mr. Z account

The unfavorable balance of Profit and Loss account should be


aAdded to liabilities


bSubtracted from current assets


cSubtracted from capital


dSubtracted from liabilities



Which of the following is an example of business liability?


aLand


bBuilding


cCash


dCreditors


View Answer Creditors

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