Accounting Mcqs

Page No. 7

Which of the following is the normal balance of an accumulated depreciation account?


aDebit balance


bCredit balance


cNil balance


dNone of the above


View Answer Credit balance

A company purchased a vehicle for Rs.6000. It will be used for 5 years and its residual value is expected to be Rs.1000. What is the annual amount of depreciation using straight line method of depreciation?


aRs. 1000


bRs. 2000


cRs. 3000


dRs. 5000


View Answer Rs. 1000

Under which depreciation method, the amount of depreciation expenses remains same throughout the life of the asset?


aStraight line method


bReducing balance method


cNumber of units produced method


dMachine hours method


View Answer Straight line method

What is depreciation?


aCost of a fixed asset


bCost of a fixed asset's repair


cThe residual value of a fixed asset


dPortion of a fixed asset's cost consumed during the current accounting period



A current asset that is convertible to cash within 3 months can be referred to as


aCash asset


bOperating asset


cIntangible assets


dCash equivalent


View Answer Cash equivalent

The expenses related to the main operations of a business are referred to as


aAdministration expense


bNon-administration expense


cSelling expense


dOperating expense


View Answer Operating expense

Current assets are also known as


aGross working capital


bInvested capital


cAssets


dCash


View Answer Gross working capital

Which of the following does not appear in Balance sheet?


aBuilding


bCash


cGoodwill


dRent expenses


View Answer Rent expenses

Goodwill is classified as which one of the following assets?


aFixed


bLong term


cCurrent


dIntangible


View Answer Intangible

Which of the following financial statements shows the movement of cash and cash equivalents during an accounting period?


aIncome statement


bBalance sheet


cCash flow statement


dStatement of changes in equity


View Answer Cash flow statement

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