Financial Accounting MCQ June 2021

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Find below Financial Accounting MCQ June 2021

  • Which of the following is not a Qualitative characteristic of Financial Statement?
    (a) Cost Principle
    (b) Understandability
    (c) Relevance
    (d) Reliability
  • Name the book in which, entries are recorded on the basis of credit notes issued.
    (a) Sales Book
    (b) Purchase Book
    (c) Sales Return Book
    (d) Purchase Return Book
  • Exception to consistency principle is
    (a) Cost Principle
    (b) Going Concern Principle
    (c) Matching Principle
    (d) Prudence Principle
  • The balance in consignment account shows
    (a) Amount receivable from consignee
    (b) Amount payable to consignee
    (c) Profit/ loss on consignment
    (d) Closing stock with consignee
  • Provision for bad debts is
    (a) Real Account
    (b) Nominal account
    (c) Personal account
    (d) None of the above
  • The business is treated as distinct and separate from its owners on the basis of the
    (a) Going concern concept
    (b) Conservatism concept
    (c) Matching concept
    (d) Business entity concept
  • Due to retrospective effect on revision of salary of employees, the arrears of salary relating to past years, payable in current year is
    (a) Prior – period item
    (b) Extra – ordinary item
    (c) Ordinary item requiring separate disclosure
    (d) Contingent item
  • Discount given in the Sales – Invoice itself is
    (a) Cash discount
    (b) Trade discount
    (c) Rebate
    (d) Allowance
  • Canteen expenses are apportioned among departments in the proportion of
    (a) Departmental floor space
    (b) Departmental direct wages
    (c) Departmental sales
    (d) Departmental No. of employees
  • Both cash and credit transactions are recorded, on the basis of
    (a) Accounting Period Concept
    (b) Going Concern Concept
    (c) Business Entity Concept
    (d) Accrual Concept
  • Which of the following book is both a journal and a ledger?
    (a) Cash Book
    (b) Sales Day Book
    (c) Bills Receivable Book
    (d) Journal Proper
  • Interest received in advance account is a
    (a) Nominal Account
    (b) Real Account
    (c) Artificial Personal Account
    (d) Representative Personal Account
  • Shiva draws a bill on Sanat on 25th October, 2018 for 90 days, the maturity date of the bill will be
    (a) 27th January, 2019
    (b) 26th January, 2019
    (c) 25th January, 2019
    (d) 28th January, 2019
  • Peeru and Simu entered in the business of buy and sale of food grain for a period of one year and sharing the profit in the ratio of 3:2, this agreement is a
    (a) Partnership
    (b) Consignment
    (c) Joint-venture
    (d) Lease
  • At the end of the year 2017-18, Prepaid Insurance Premium `7,500 appeared in the Trial Balance, it will be shown
    (a) only in Profit & Loss Account.
    (b) only in Balance Sheet.
    (c) both in Profit & Loss Account and in Balance Sheet.
    (d) not in Both in Profit & Loss Account and in Balance Sheet.
  • Contingent Liability would appear
    (a) on the liabilities side of the Balance Sheet.
    (b) on the assets side of the Balance Sheet.
    (c) as a note in the Balance Sheet.
    (d) None of the above
  • Debtors Ledger Adjustment Account is opened in the
    (a) Debtors Ledger
    (b) Creditors Ledger
    (c) General Ledger
    (d) Both Creditors Ledger and General Ledger

Financial Accounting MCQ June 2021 Test Series Coming Soon

  • Generally sacrifice ratio is concerned with the situation of
    (a) Admission of a new partner
    (b) Retirement of a partner
    (c) Dissolution of firm
    (d) Conversion of firm into company
  • KCS purchased a machine from JPS on hire purchase system, whose cash price was 8,64,000.
    2,16,000 being paid on delivery and balance in three annual installments of 2,88,000 each. The amount of interest included in first installment would be
    (a) 72,000
    (b) 57,600
    (d) `36,000
  • Which of the following is a resource owned by the business with the purpose of using it for generating future profits?
    (a) Loan from Bank
    (b) Owner’s Capital
    (c) Trade Mark
    (d) All of the above
  • Chandu & Co.’s Account is a
    (a) Real Account
    (b) Nominal Account
    (c) Representative Personal Account
    (d) Artificial Personal Accounts
  • Purchase of a laptop for office use wrongly debited to Purchase Account. It is an error of
    (a) Omission
    (b) Commission
    (c) Principle
    (d) Misposting
  • Which of the following term is most suitable for writing off Patent?
    (a) Depletion
    (b) Amortization
    (c) Depreciation
    (d) All of the above
  • Memorandum Joint Venture Account is prepared when
    (a) the separate set of books is maintained for Joint Venture.
    (b) each Co-venturer keeps records of all transactions.
    (c) each Co-venturer keeps records of their own transactions only.
    (d) All of the above cases
  • Which of the following commission is allowed by the consignor to the consignee to encourage the consignee for putting-up hard work in introducing new product in the market?
    (a) Del-credere Commission
    (b) Over-riding Commission
    (c) Hard work Commission
    (d) Ordinary Commission
  • If Ram’s acceptance which was endorsed by us in favour of Saleem is dishonored, then the amount will be debited in our books to
    (a) Saleem
    (b) Ram
    (c) Bills Receivable Account
    (d) None of the above
  • In case of a Club, the excess of expenditure over income is called as
    (a) Surplus
    (b) Deficit
    (c) Capital Fund
    (d) Investment in Fixed Assets
  • A Charitable Institution has 250 members with a annual subscription of 5,000 each. The subscription received during 2018-19 were11,25,000, which include 65,000 and25,000 for the years of 2017-18 and 2019-20 respectively. Amount of outstanding subscription for the 2018-19 will be
    (a) 90,000
    (c) 2,15,000
    (d) 1,90,000
  • When stock is valued at cost in one accounting period and at lower of cost and Net realizable value in another accounting period
    (a) Prudence Principle conflicts with Consistency Principle.
    (b) Matching Principle conflicts with Consistency principle.
    (c) Consistency Principle conflicts with Accounting Period Assumption.
    (d) None of the above
  • Materiality Principle is an exception to the
    (a) Consistency principle
    (b) Full disclosure Principle
    (c) Accounting Period Assumption
    (d) Prudence Principle
  • In a Cash Book Debit balance of 112 brought forward as credit balance of 121, while preparing a Bank Reconciliation Statement taking the balance as per Cash Book as the starting point:
    (a) 112 to be added
    (b)121 to be added
    (c) 233 to be added
    (d)112 to be subtracted

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