Deck 47: Single Entry System and Profit Calculation

Question 1

If opening capital is Rs.5,000. closing capital - Rs.7,000. drawings - Rs.1,000 and additional capital introduced during the year is Rs.500. then, the amount of profit made would amounted to

A)Rs.1,500
B)Rs.2,500
C)Rs.2,000
D)Rs.3,000

Answer 1

Rs.2,500

Question 2

If the opening capital is Rs.20,000 and closing capital is Rs.25,000. drawings made amounted to Rs.1,800. then, the amount of Rs.________ must be introduced as an additional capital during the year in order to earn a profit of Rs.2,800.

A)Rs.6,000
B)Rs.9,600
C)Rs.4,000
D)Rs.400

Answer 2

Rs.4,000

Question 3

Under single entry system, certain transactions are recorded :

A)At regular intervals
B)At the end of the accounting period
C)Totally
D)None of the above

Answer 3

Totally

Question 4

Under single entry system details of

A)Expenses will not be available
B)Revenues will not be available
C)Expenses and revenues will not be available
D)None of the above

Question 5

Under single entry system, only personal accounts are kept and in some cases:

A)Cash account is maintained
B)Fixed assets accounts are maintained
C)Liabilities account are maintained
D)All of the above

Question 6

Statement of affairs is prepared for ascertaining:

A)Financial position of the business
B)Trading profit or loss
C)Capital of the owner
D)All of the above

Question 7

From incomplete records, it is possible to prepare

A)Ledger accounts
B)Trial balance
C)Statement of affairs
D)All of the above

Question 8

Single entry can be adopted by :

A)Small firms
B)Joint stock company
C)Registered co-operative societies
D)All of the above

Question 9

The amount of credit sale is ascertained by :

A)Preparing Total Debtors' Account
B)Prepare Trading Account
C)Preparing Statement of affairs
D)None of the above

Question 10

The capital at the beginning of the accounting year in case of single entry system is determined by opening

A)Opening statement of affairs
B)Cash account
C)Bank account
D)None of the above

Question 11

Single entry book-keeping means

A)Incomplete records
B)Loose and defective system of recording
C)No proper record of accounting
D)All the above

Question 12

Statement of Affairs is a statement of

A)Statement of assets and liabilities
B)Ledger account balances
C)Cash and bank balances
D)Statement of assets

Question 13

Procedure of conversion of Single entry books into Double entry

A)Depends upon the nature of the records maintained in the single entry
B)To prepare a statement of affairs at the starting date of the selected accounting
C)Some items like allowance, bad debt, dishonoured bills must be included
D)All the above

Question 14

Under the net worth method, the profit can be ascertained by preparing

A)Profit and loss account
B)Cash account
C)Statement of Affairs
D)Statement of Profit

Question 15

The closing capital can be ascertained by preparing

A)Cash account
B)Statement of Affairs
C)Trial balance
D)Profit and Loss account

Question 16

Profit under the net worth method, when there are no drawings and no additional capital is the difference between:

A)Assets and Liabilities
B)apital and Liabilities
C)Assets and Capital
D)Closing Capital and Opening Capital

Question 17

To ascertain the real profit, the difference between the closing capital and opening capital is adjusted by:

A)Deducting the drawings and adding the additional capital introduced
B)Adding the drawings and deducting the additional capital introduced
C)Deducting both the drawings and the additional capital
D)Adding both the drawings and the additional capital.

Question 18

Under single entry system the main account book kept is

A)Purchases book
B)Sales book
C)Cash book
D)Returns Inwards Book

Question 19

The system of keeping incomplete record is known as

A)Single entry
B)Double entry
C)Dual entry
D)None of these.

Question 20

In single entry system sales are computed by adding

A)Cash sales and cash received from debtors
B)Cash sales and credit sales
C)Credit sales and cash received from debtors.
D)None of these.

Question 21

The single entry system cannot be adopted by

A)Sole proprietorship
B)Partnership concern
C)Joint stock companies
D)All of the above

Question 22

The minimum share application money is

A)Rs.5 per share
B)5% of nominal value of shares
C)10% of nominal value of shares
D)20% of nominal value of shares.

Question 23

When closing capital is more than opening capital it means

A)Profit
B)Loss
C)Withdrawal of capital
D)None of these

Question 24

Which method is used under single entry system to find out the profit or loss?

A)Double entry system
B)Statement of affairs method
C)Cash book
D)All of the above

Question 25

Credit purchase is determined by preparing

A)Purchase Account
B)Debtor's Account
C)Creditor's Account
D)Cash A/c

Question 26

Under Incomplete records only _____ accounts are maintained.

A)personal
B)impersonal
C)real
D)nominal

Question 27

Single entry system contains

A)All the relevant accounts
B)Only personal accounts
C)Real accounts only
D)Personal accounts and cash book.

Question 28

Bill dishonored is shown in

A)Bills receivable account
B)Bills receivable account and Debtor account.
C)Debtor account.
D)None of the Above

Question 29

Credit sales can be ascertained by preparing

A)Creditors account
B)Debtors account
C)Both of the above
D)None of the Above

Question 30

Credit purchases can be ascertained by preparing

A)Creditors account
B)Debtors account
C)Both of the above
D)None of the above

Question 31

The advantage of a single entry system

A)It is a very simple method
B)It is less expensive
C)It is mainly suited to small business
D)All of the above

Question 32

The disadvantage of single entry system

A)Incomplete and Unscientific System
B)Difficulty in preparing Balance Sheet
C)True Profit or Loss cannot be ascertained
D)All of the above

Question 33

The content of single entry system is

A)Double entry
B)Single entry
C)No entry
D)A mixture of all the above

Question 34

Net Profit under single entry system is equal to

A)Capital+ Additional Capital - Drawings- Opening Capital
B)Capital - Additional Capital -Drawings - Opening Capital
C)Capital - Additional Capital + Drawings - Opening Capital
D)Capital+ Additional Capital +Drawings + Opening Capital

Question 35

Receipts and Payments Account generally shows:

A)A Debit balance
B)A Credit balance
C)Surplus or Deficit
D)Capital Fund

Question 36

Income and Expenditure Account records transactions of:

A)Revenue nature only
B)Capital nature only
C)Both revenue and capital nature
D)Income of only revenue nature and expenditure of revenue and capital nature

Question 37

Income and Expenditure Account reveals

A)Surplus or Deficiency
B)Cash in Hand
C)Net Profit
D)Capital Fund

Question 38

The amount of 'Subscription received from members' by a Not-for Profit Organisation is shown in which of the following:

A)Debit side of Income and Expenditure Account
B)Credit side of Income and Expenditure Account
C)Liability side of Balance Sheet
D)Assets side of Balance Sheet

Question 39

Donation received for a special purpose:

A)Should be credited to Income and Expenditure Account
B)Should be credited to separate account and shown in the Balance Sheet
C)Should be shown on the assets side of the Balance Sheet
D)Should not be recorded at all

Question 40

The amount of Entrance Fees received regularly by a Not-for Profit Organisation is shown in which of the following:

A)Liability side of Balance Sheet
B)Assets side of Balance Sheet
C)Debit side of Income and Expenditure Account
D)Credit side of Income and Expenditure Account

Question 41

Out of the following items, which one is shown in the Receipts and Payments Account:

A)Outstanding Salary
B)Depreciation
C)Life Membership Fees
D)Accrued Subscription

Question 42

Receipts and Payments Account is a:

A)Personal Account
B)Real Account
C)Nominal Account
D)All of the above

Question 43

Donations received for a special purpose will be taken to the

A)Income and Expenditure A/c
B)Assets side of the B/S
C)Liabilities side of the B/S
D)None of the above

Question 44

Non-trading concern prepare

A)Receipts and Payments A/c
B)Balance Sheet
C)Income and Expenditure A/c
D)All of the above

Question 45

Receipts and Payments Account of non-trading concerns is a

A)Nominal Account
B)Real Account
C)Personal Account
D)All of the above

Question 46

Income and Expenditure Account is prepared in non-trading concerns in lieu of

A)Manufacturing Account
B)Profit and Loss Account
C)Trading Account
D)Cash Book

Question 47

General donations of relatively large amount is recorded on the

A)Income side of Income and Expenditure Account
B)Liabilities side of Balance Sheet
C)Receipts side of Receipts and Payments Account
D)both b. and c.

Question 48

The Income and expenditure account begins with

A)Debit balance
B)Credit balance
C)No balance
D)Balance from the previous year

Question 49

The receipts and Payments account records receipts and payment of

A)Revenue nature only
B)Capital nature only
C)Revenue as well as capital nature
D)None of the above

Question 50

A profit on the sale of furniture of a club will be taken to:

A)Cash account
B)Receipts and payment account
C)Income and expenditure account
D)Balance sheet

Question 51

Entrance fees are generally

A)Capitalised
B)Taken as income
C)Treated as a liability
D)Special reserve

Question 52

Legacy for specific purpose is :

A)Added to the specific fund
B)Shown in Income and expenditure account
C)Shown as separate liability
D)None of the above

Question 53

Subscription received in advance is

A)An income
B)An asset
C)Liability
D)None of the above

Question 54

Income and expenditure account reveals

A)Cash in hand
B)Surplus or deficiency
C)Capital account
D)None of the above

Question 55

Not - for - profit organisations institutions prepare

A)Profit and loss account
B)Manufacturing account
C)Income and expenditure account
D)All of the above

Question 56

Non-trading organization prepares

A)Income and Expenditure A/c
B)Trading and profit and loss A/c
C)Trading A/c only
D)Profit and loss A/c only

Question 57

Receipts and Payment A/c is a summary of

A)Debit and credit balances of ledger A/c
B)Cash receipts and payments
C)Income and Expenses
D)All of the above

Question 58

Subscription received in advance by a club are shown in

A)Credit side of Income and Expenditure A/c
B)Asset side of Balance Sheet
C)Liabilities side of Balance Sheet
D)Debit side of Income and Expenditure A/c

Question 59

Donations received for a special purpose are

A)Asset
B)Revenue receipt
C)Capital Receipt
D)None of the above

Question 60

Receipts and Payment A/c is a

A)Nominal A/c
B)Real A/c
C)Personal A/c
D)Both nominal and personal A/c

Question 61

Income and Expenditure A/c is a

A)Nominal A/c
B)Real A/c
C)Personal A/c
D)None of the above

Question 62

Income and Expenditure A/c reveals

A)Cash in hand
B)Surplus or deficiency
C)Capital A/c
D)Profit or Loss

Question 63

Small amount of entrance fee is considered as

A)Assets
B)revenue income
C)capital income
D)Liabilities

Question 64

Sale of old newspapers is-

A)Capital Receipt
B)Revenue Receipt
C)Asset
D)Profit

Question 65

Income and Expenditure Account records-

A)Capital items
B)Revenue items
C)A and B both
D)None of these

Question 66

Entrance fee, unless otherwise stated, is treated as-

A)Revenue Receipts
B)Capital Receipts
C)Liability
D)None of these

Question 67

Receipts and Payments Account usually indicates-

A)Surplus
B)Capital Fund
C)Debit Balance
D)Credit Balance

Question 68

In not-for-profit organisations, excess of expenditure over income is called-

A)Loss
B)Profit
C)Deficit
D)Surplus

Question 69

The excess of assets over liabilities in non-trading concerns is treated as-

A)Capital Fund
B)Capital
C)Profit
D)Net Profit

Question 70

Subscriptions received in advance by a Club are shown on .......... side of the Balance Sheet-

A)Assets Side
B)Liabilities Side
C)Debit Side
D)Credit Side

Question 71

Outstanding subscription is a/an

A)Income
B)Asset
C)Liability
D)None of these

Question 72

Income and expenditure Account shows a balance of:

A)Cash in in hand
B)Capital Account
C)Net Profit
D)Excess of revenue over expenditure or vice versa.