d :
Fixed rent payable in addition to minimum rent
Correct Answer: d [Fixed rent payable in addition to minimum rent]
3. Receipts and Payments account is a
a :
Artificial Personal Account
b :
Personal Account
c :
Real Account
d :
Nominal Account
Correct Answer: c [Real Account]
4. Which of the following is of capital nature?
a :
Commission on purchases
b :
Cost of repairs
c :
Rent of factory
d :
Wages paid for installation of machinery
Correct Answer: d [Wages paid for installation of machinery]
5. Contingent liability would appear
a :
as a note in Balance Sheet.
b :
do not shown in the books of accounts.
c :
on the assets side of the Balance Sheet.
d :
on the liability side of the Balance Sheet.
Correct Answer: a [as a note in Balance Sheet.]
6. Income statement of a Charitable Institution is known as
a :
Statement of profit and loss
b :
Receipts and Payments Account
c :
Income and Expenditure Account
d :
Profit and Loss Account
Correct Answer: c [Income and Expenditure Account]
7. In Hire Purchase system cash price plus interest is known as
a :
Capital value of asset
b :
Book value of asset
c :
Hire purchase price of asset
d :
Hire purchase charges
Correct Answer: c [Hire purchase price of asset]
8. Bad debts are apportioned among departments in the proportion of
a :
Sales of each department
b :
Number of units sold by each department
c :
Cost of sales of each department
d :
None of the above
Correct Answer: b [Number of units sold by each department]
9. Which of the following is not a Fundamental Accounting Assumption?
a :
Going Concern
b :
Consistency
c :
Materiality
d :
Accrual
Correct Answer: c [Materiality]
10. Which of the following is an example of Capital Expenditure?
a :
Inventory of raw materials, work-in-progress and finished goods;
b :
Insurance premium;
c :
Taxes and legal expenses;
d :
None of the above.
Correct Answer: d [None of the above.]
11. The following account has a credit balance
a :
Plant and Equipment A/c
b :
Loans A/c
c :
Purchase A/c
d :
None of the above
Correct Answer: b [Loans A/c]
12. A and B purchased a piece of land for ` 30,000 and sold it for `60,000 in 2016. Originally A had contributed `12,000 and B `8,000. The profit on venture will be
a :
₹30,000
b :
₹60,000
c :
₹20,000
d :
Nill
Correct Answer: a [₹30,000]
13. Excess of hire purchase price over cash price is known as
a :
Installment
b :
Cash down payment
c :
Interest
d :
Capital value of asset
Correct Answer: c [Interest]
14. Which of the following is/are revenue expenditure?
a :
Consumable Stores
b :
Taxes and legal expenses
c :
Rent of factory building
d :
All of Above
Correct Answer: d [All of Above]
15. The person to whom bill is endorsed is known as __________.
a :
Drawer
b :
Drawee
c :
Endorsee
d :
None of the above
Correct Answer: c [Endorsee]
16. The debts which are not bad is known as
a :
Good debt
b :
Bad Debt
c :
Doubtful Debt
d :
None of the above
Correct Answer: a [Good debt]
17. A transaction without immediate cash settlement is known as
a :
Cash Transaction;
b :
Credit Transaction;
c :
Deferred Transaction;
d :
None of the above
Correct Answer: b [Credit Transaction;]
18. Bad debts Recovered ₹1,000. It will be
a :
Credited to Bad debts A/c
b :
Credited to debtor’s personal A/c
c :
Debited to creditor’s personal A/c
d :
Credited to bad debts recovered A/c
Correct Answer: d [Credited to bad debts recovered A/c]
19. Which of the following purpose is served from the preparation of Trial Balance?
a :
To check the arithmetical accuracy of the recorded transactions;
b :
To ascertain the balance of any ledger account;
c :
To facilitate the preparation of final accounts promptly;
d :
All of the above.
Correct Answer: d [ All of the above.]
20. Capital Profit arises from which of the following?
a :
Profit prior to incorporation;
b :
Premium received on issue of shares;
c :
Profit made on re-issue of forfeited shares;
d :
All of the above.
Correct Answer: d [ All of the above.]
21. The out flow of funds to acquire an asset that will benefit the business for more than one accounting period is referred to as —
a :
Miscellaneous Expenditure
b :
Revenue Expenditure
c :
Capital expenditure
d :
Deferred Revenue Expenditure
Correct Answer: c [Capital expenditure]
22. The cost of a Fixed Assets of a business has to be written off over its
a :
Natural Life
b :
Accounting Life
c :
Physical Life
d :
Estimated Economic Life
Correct Answer: d [Estimated Economic Life]
23. Receipts and Payments Account records
a :
Only revenue nature receipts
b :
Only capital nature receipts and payment
c :
Only revenue nature receipts and payments
d :
Both the revenue and capital nature receipts and payments
Correct Answer: d [Both the revenue and capital nature receipts and payments]
24. Excess of minimum rent over royalty is known as
a :
Maximum rent
b :
Excess workings
c :
Short workings
d :
Deficiency of actual royalty
Correct Answer: c [Short workings]
25. The person in whose favour the bill is endorsed is known as __________.
