Deck 30: Ac Types, Balances, and Entries

Question 1

The type of A/c with a named credit balance is-

A)Expenses A/c .
B)Assets A/c .
C)Revenue A/c .
D)Suspense A/c

Answer 1

Revenue A/c .

Question 2

Overcasting of purchases journal would affect

A)Sales account .
B)Purchase account .
C)Supplier's account and purchase account
D)None of these

Answer 2

Purchase account .

Question 3

Any income or profit derived by carrying on the business or during the course of business is called-

A)Capital Receipt .
B)Revenue Receipt .
C)Revenue Gain .
D)Capital Gain

Answer 3

Revenue Receipt .

Question 4

Amount received from the proprietors as capital or loan receipt is treated as-

A)Capital Receipt .
B)Revenue Receipt .
C)Revenue Income .
D)Capital Income

Question 5

When the benefits of revenue expenditure is available for a period of two or three years, the expenditure is known as-

A)Revenue Expenditure .
B)Deferred Revenue Expenditure .
C)Capital Expenditure .
D)Depreciation.

Question 6

Endowment fund receipt is traded as-

A)Casual Receipt .
B)Revenue Receipt .
C)Loss .
D)Expenses

Question 7

Legacy are generally-

A)Capitalized .
B)Treated Loss .
C)Revenue Expenses .
D)Deferred Revenue expenses.

Question 8

Interest Account will have-

A)Debit balance only .
B)Credit balance only .
C)Debit or Credit balance .
D)No balance at all

Question 9

Purchase A/c will have-

A)No balance at all .
B)Debit balance .
C)Credit balance .
D)Debit or Credit

Question 10

Which of the following voucher is used to record transactions that do not affect bank & cash?

A)Journal Voucher .
B)Receipt Voucher .
C)Payment Voucher .
D)Nominal Voucher

Question 11

Opening entries are generally passed through-

A)General Journal .
B)Purchase Journal .
C)Profit and Loss A/c .
D)Suspense A/c

Question 12

Purchases made on credit not recorded at all would affect

A)Purchases account .
B)Supplier's account .
C)Purchases account and supplier's account
D)None of these

Question 13

Which of the following is the example of contingencies?

A)Compulsory acquisition of part of land of the company by the Government
B)A suit filed by the employee against the company
C)A debtor of the company is declared insolvent, resulting in bad debts to the company
D)All of (a), (b) and (c) above.

Question 14

Which of the following is not a contingent liability?

A)Claims against the company not acknowledged as debts
B)Debts included on debtors which are doubtful in nature
C)Uncalled liability on partly paid shares
D)Arrears of cumulative fixed dividends

Question 15

In an account if debit side > credit side, the balance is known as the:

A)Negative Balance .
B)Debit balance .
C)Positive Balance .
D)Credit balance

Question 16

Total depreciation of an asset cannot exceed its:

A)Scrap value .
B)Residual value .
C)Market value .
D)Depreciable value

Question 17

Amount paid to Gagan posted to the credit side of his account would affect

A)Gagan's account .
B)Cash account .
C)Cash account and Gagan's account .
D)None of these

Question 18

Which of the following statements is/are true ?

A)A sale of an asset is recorded in the Sales Book
B)Total of Return Outward Book is debited to Return Outward Account
C)The balance of Petty Cash Book is a liability
D)Cash Book is a subsidiary book as well as a ledger

Question 19

Which of the following is true regarding closing entries?

A)They must be followed by reversing entries
B)They transfer the balances in all of the Nominal Accounts to the Trading and Profit and Loss Account
C)They must be made after the reversing entries but before the adjusting entries
D)They must be made after the adjusting entries but before the reversing entries

Question 20

Which of the following assets is/are to be valued at the lower of cost and net realizable value?

A)Goodwill
B)Inventories
C)Investments
D)Both (b) and (c) above.

Question 21

A few errors committed in Ahhiwalia's books of account are given below. State which errors would affect the Trial Balance.
(a) Sales of `950 to Ram completely omitted from books of account
(b) Purchases of `720 from Shyam entered in the purchases journal as `700
(c) Purchases Journal is overcast by `1,000
(d) Sales returns journal is undercast by `200
(e) Amount paid to Agarwal wrongly posted to the debit to Mittal's account
(f) Bank overdraft shown under debit column in the Trial Balance
(g) Sales of `500 to Sadiq entered in sales journal as sales to Mushtaq
(h) Wages paid for installation of machinery debited to wages account

A)a, c and g
B)c, d and f
C)c, d, e and h
D)c, d, f and h

Question 22

Which of the following methods is not a practical way of realizing revenue?

A)Delivery method
B)Percentage-of-completion method
C)Production method
D)Moving average method

Question 23

The amount payable to a person as consideration for the use of rights vested in him is

A)Dividend
B)Royalty
C)Purchase consideration
D)Installment