Accounting Mcqs

Page No. 4

Which one of the following methods of inventory costing produces ending stock cost close to the market value of the inventory?


aFIFO


bLIFO


cAVCO or average cost


dNone of the above


View Answer FIFO

Which one of the following methods of inventory costing yields highest taxable income?


aFIFO


bLIFO


cAVCO or average cost


dStandard cost method


View Answer FIFO

All of the following are the methods of inventory costing except


aFIFO


bLIFO


cAVCO or average cost


dStock take


View Answer Stock take

An overstatement in the value of closing stock overstates all of the following except


aNet income


bCurrent assets


cCapital of the business


dCost of goods sold


View Answer Cost of goods sold

The value of inventories or stock is figured out at the lower of cost and


aPurchase price


bOpportunity cost


cRealizable value


dNet realizable value


View Answer Net realizable value

Provision for cash discount on debtors is a percentage of


aDebtors


bNet debtors


cNet debtors less provision for doubtful debts


dNet sales



Provision for doubtful debts account is a/an


aAsset account


bContra asset account


cNominal account


dLiability account


View Answer Contra asset account

Which of the following is a commonly used base to create the provision for doubtful debts?


aTotal purchases


bTotal credit sales


cTotal current assets


dTotal current liabilities


View Answer Total credit sales

Which accounting concept dictates the inclusion of 'provision for doubtful debts' in the financial statements?


aAccrual concept


bMatching concept


cGoing concern concept


dPrudence concept


View Answer Prudence concept

Which of the following is the most common cause of bad debt?


aDebtor refusal to repayment


bDebtor left the country


cDebtor committed a crime


dDebtor declared to be a bankrupt



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