Deck 23: Accounting Concepts and Practices

Question 1

'Every debit has a corresponding credit' it is the concept of

A)Incomplete records
B)Cost sheets
C)Single entry system
D)Double entry system

Answer 1

Double entry system

Question 2

Accounting records transactions in term of

A)Commodity units
B)Production units
C)Monetary units
D)Expense units

Answer 2

Monetary units

Question 3

Income received in advance by a business units is

A)A liability
B)An assets
C)A loss
D)Gain

Answer 3

A liability

Question 4

Expenditure incurred by a publisher for acquiring copyright is a.

A)Deferred revenue expenditure
B)Capital expenditure
C)Revenue expenditure
D)Assets

Question 5

Loss of cash by theft committed by cashier after business hours is a

A)Revenue loss
B)Deferred revenue loss
C)Capital loss
D)Business loss

Question 6

An expenditure incurred to derive long term advantage is

A)Revenue expenditure
B)Expense
C)Capital expenditure
D)Deferred capital expenditure

Question 7

In accounting only ________ discount is recorded

A)Trade
B)Cash
C)Real
D)None of these

Question 8

Debit balance of all personal accounts are collectively called

A)Sundry creditors
B)Sundry debtors
C)Personal account balance
D)Total of personal accounts

Question 9

Discount on issue of share is

A)Capital loss
B)Revenue loss
C)Capital expenditure
D)Revenue expenditure

Question 10

Trial balance will detect

A)Errors of commission
B)Errors of omission
C)Errors of principle
D)Compensating errors

Question 11

Machinery purchased on account is recorded in

A)Journal
B)Ledger
C)Purchase book
D)Cash book

Question 12

The error disclosed by Trial Balance is

A)Wrong amount posted in ledger account
B)Error of principle
C)Non? recording of a transaction in the books of original entry
D)Errors of omission

Question 13

Cash discount is allowed by

A)Wholesaler
B)Debtor
C)Creditor
D)Retailer

Question 14

Rent prepaid is

A)Assets
B)Liability
C)Income
D)Expense

Question 15

Closing stock given in the trial balance will be taken to

A)P&L account only
B)Income and expenditure account only
C)Trading account only
D)Balance sheet only

Question 16

Sale of grass in the case of a sports club is

A)An assets
B)Revenue receipt
C)Capital receipt
D)Income

Question 17

In income & Expenditure accounts, we record

A)Items of capital nature alone
B)Items of revenue nature alone
C)Both
D)Items of expenditure

Question 18

Double entry system was propounded by

A)Chanakya
B)Lee
C)Confucius
D)Luca Pacioli

Question 19

Fixed assets purchased on hire purchased on hire purchase terms are recorded at

A)Net realization value
B)Cash value
C)Hire purchase price
D)Cost price

Question 20

Treatment of capital expenditure as revenue expenditure is

A)Errors of principle
B)Compensating errors
C)Errors of commission
D)Errors of omission

Question 21

In non - profit organizations excess of assets over liabilities is called

A)Capital block
B)General fund
C)Shareholders fund
D)Capital

Question 22

Collection of all accounts us called

A)Trial balance
B)Journal
C)Ledger
D)Cash book

Question 23

Source document for sales returns

A)Debit note
B)Credit note
C)Source note
D)Journal

Question 24

Petty cash book is prepaid under ______ system

A)Cash
B)Imprest
C)Credit
D)Mercantile

Question 25

Special journal is also called

A)Journal proper
B)Subsidiary books
C)Original books
D)Ledger

Question 26

Gross assets - liabilities will be equal to

A)Net assets
B)Total assets
C)Capital
D)Net liabilities

Question 27

Purchase ledger contains the accounts of

A)Debtors
B)Creditors
C)Total purchase
D)All the above

Question 28

Allowance made for prompt payment is called

A)Cash allowance
B)Cash discount
C)Trade discount
D)Discount

Question 29

Sales ledger contains accounts of

A)Suppliers
B)Customers
C)Total sales
D)All the above

Question 30

Credit note is sent by

A)Seller
B)Customer
C)Buyer
D)Borrower

Question 31

Total sales book indicates

A)Total credit sales
B)Total cash sales
C)Total sales
D)All the above

Question 32

Total sales made during a year is found out from the

A)Sales book
B)Sales account
C)Total sales book
D)All the above

Question 33

Sales return account is a _______ account

A)Personal
B)Nominal
C)Real
D)Current

Question 34

Debit note is prepared in connection with

A)Sales return
B)Purchase return
C)Sales
D)Purchase

Question 35

Goods sold on credit will be entered in the

A)Sales account
B)Sales book
C)Customers account
D)Creditors account

Question 36

Cash purchase of fixed asset is entered in the

A)Purchase book
B)General ledger
C)Cashbook
D)Purchase account

Question 37

Normally value of closing stock ________ in the trial balance

A)Appears
B)Does not appear
C)May or may not appear
D)Sometime appear

Question 38

Cost of goods sold plus selling expenses equals

A)Cost of production
B)Gross profit
C)Sales
D)Cost of sales

Question 39

Trading account is a _______ account

A)Personal
B)Real
C)Nominal
D)Expenses

Question 40

1/6 profit on sales means ________ on cost

A)1/6
B)1/5
C)¼
D)1/3

Question 41

In sole trader balance sheet asset are arranged in the order of

A)Liquidity
B)Permanence
C)Transferability
D)All the above

Question 42

________ is an expenditure which does not bring any benefit to the concern

A)Revenue expenditure
B)Capital expenditure
C)Deferred revenue expenditure
D)Loss

Question 43

Asset which reduce is value, on use, but are not replaced is called

A)Contingent assets
B)Fictitious assets
C)Intangible assets
D)Wasting assets

Question 44

Unearned income is a

A)Liability
B)Asset
C)Expense
D)Income

Question 45

Prepaid expenses are ______ account

A)Nominal
B)Personal
C)Personal account without name
D)Real

Question 46

Unexpired expenses is a _______

A)Liability
B)Asset
C)Income
D)Expenditure

Question 47

Transactions of a general nature which occur frequently are first recorded in the

A)General ledger
B)Special journal
C)Cashbook
D)Subsidiary book

Question 48

Income and expenditure account is the ______ account of a non trading concern

A)Balance sheet
B)P & L account
C)Ledger
D)General