MCQOPTIONS
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MCQOPTIONS
This section includes 466 Mcqs, each offering curated multiple-choice questions to sharpen your Commerce knowledge and support exam preparation. Choose a topic below to get started.
| 201. |
_ The trade discount on purchases is recorded$? |
| A. | When it is received |
| B. | When the inventory is purchased |
| C. | When the inventory is sold |
| D. | Not at all recorded in the books |
| Answer» E. | |
| 202. |
_ Revenue from sale of product ordinarily is reported as part of earning in the period$? |
| A. | The planning takes place |
| B. | The sale is made |
| C. | The product is manufactured |
| D. | The cash is collected |
| Answer» C. The product is manufactured | |
| 203. |
_ Interest on Capital is _____ for the business$? |
| A. | Revenue |
| B. | Expense |
| C. | Gain |
| D. | None of the above |
| Answer» C. Gain | |
| 204. |
_ Economic life of an enterprise Is split into periodic interval as per ____ concept$? |
| A. | Materiality |
| B. | Periodicity |
| C. | Accrual |
| D. | Conservation |
| Answer» C. Accrual | |
| 205. |
_ Accounting is the process of matching$? |
| A. | Benefits and costs |
| B. | Revenues and costs |
| C. | Cash inflows and outflows |
| D. | Potential and real performance |
| Answer» C. Cash inflows and outflows | |
| 206. |
_ Those transactions for which there is no separate book, are recorded in the$? |
| A. | Cash book |
| B. | Bills receivable book |
| C. | Bills payable book |
| D. | Journal Proper |
| Answer» E. | |
| 207. |
_ Which of the following inventory valuation methods show higher profits during the period of rising prices?$? |
| A. | FIFO |
| B. | LIFO |
| C. | Weighted average cost method |
| D. | Simple average method |
| Answer» B. LIFO | |
| 208. |
_ Which of the following is a real account?$? |
| A. | Salary account |
| B. | Cash account |
| C. | Outstanding rent account |
| D. | Sundry creditors account |
| Answer» C. Outstanding rent account | |
| 209. |
_ Which of the following are the owners of a company?$? |
| A. | Proprietors |
| B. | Partners |
| C. | Shareholders |
| D. | Managers |
| Answer» D. Managers | |
| 210. |
_ Which of the following account will be credited when the goods are purchased on credit from Mr. Ali?$? |
| A. | Purchases account |
| B. | Mr. Ali account |
| C. | Cash account |
| D. | Sales account |
| Answer» C. Cash account | |
| 211. |
_ Shares for which amount is paid by public are called ____ shares$? |
| A. | Authorized |
| B. | Paid up |
| C. | Bonus shares |
| D. | All of the above |
| Answer» C. Bonus shares | |
| 212. |
_ Which of the following documents contains rules and regulations for internal management of the business?$? |
| A. | Memorandum of association |
| B. | Articles of association |
| C. | Prospectus |
| D. | Statutory Declaration |
| Answer» C. Prospectus | |
| 213. |
_ The maximum amount with which a company is registered is called$? |
| A. | Authorized capital |
| B. | Issued capital |
| C. | Paid up capital |
| D. | Called up capital |
| Answer» B. Issued capital | |
| 214. |
__An expenditure whose benefit is finished or enjoyed immediately is called__ |
| A. | Expense |
| B. | Liability |
| C. | Cost |
| D. | Income |
| Answer» B. Liability | |
| 215. |
__Salaries paid in advance should be shown on__ |
| A. | Asset side of the Balance sheet |
| B. | Liability side of the Balance sheet |
| C. | Credit side of the Trading account |
| D. | All of the above |
| Answer» B. Liability side of the Balance sheet | |
| 216. |
__Which of the following is not an item of Balance Sheet?__ |
| A. | Accounts receivable |
| B. | Accounts payable |
| C. | Sales revenue |
| D. | Marketable securities |
| Answer» D. Marketable securities | |
| 217. |
__Which of the following financial statements show the financial health of an organisation at a stated point of time?__ |
| A. | Balance sheet |
| B. | Trading and Profit & Loss account |
| C. | Cash flow statement |
| D. | Statement of retained earnings |
| Answer» B. Trading and Profit & Loss account | |
| 218. |
__In balance sheet, fixed assets are shown at__ |
| A. | Cost price |
| B. | Market value |
| C. | Fair value |
| D. | Written Down Value (WDV) |
| Answer» E. | |
| 219. |
__Which of the following item will be shown on debit side of debtors account?__ |
| A. | Discount received |
| B. | Return inwards |
| C. | Discount allowed |
| D. | Credit sales |
| Answer» E. | |
| 220. |
__The charter of a company which defines the limitations and powers of the company is called__ |
| A. | The memorandum of association |
| B. | Articles of association |
| C. | Statutory report |
| D. | Certificate of commencement |
| Answer» C. Statutory report | |
| 221. |
__If debit balances = credit balances, trial balance only shows or checks the _________ and it does not indicate that no errors were made during recording and posting.__ |
| A. | Arithmetic accuracy |
| B. | Errors of commission |
| C. | Omissions of economic events |
| D. | Understatements of balances |
| Answer» B. Errors of commission | |
| 222. |
__An entry which is made on both sides of a cash book is called__ |
| A. | Cash entry |
| B. | Contra entry |
| C. | Payment entry |
| D. | Compound entry |
| Answer» C. Payment entry | |
| 223. |
__A brief explanation recorded below every entry in General Journal is commonly known as__ |
| A. | Narration |
| B. | Explanation |
| C. | Summary |
| D. | Other Information |
| Answer» B. Explanation | |
| 224. |
__An 'account' records the ______ in the balance of an item__ |
| A. | Increase |
| B. | Decrease |
| C. | Increase or decrease |
| D. | Appreciation |
| Answer» D. Appreciation | |
| 225. |
__The normal balance of liability account is__ |
| A. | Credit balance |
| B. | Debit balance |
| C. | Cash balance |
| D. | Neither debit nor credit balance |
| Answer» B. Debit balance | |
| 226. |
__Which of the following are closed at the end of an accounting period?__ |
| A. | Nominal accounts |
| B. | Personal accounts |
| C. | Real accounts |
| D. | None of them |
| Answer» B. Personal accounts | |
| 227. |
__Which of the following specialized journal records "goods returned by the business"?__ |
| A. | Purchase journal |
| B. | Sales journal |
| C. | Purchase return journal |
| D. | Sales return journal |
| Answer» D. Sales return journal | |
| 228. |
__Which of the following accounts will be credited if a company purchases building for cash?__ |
| A. | Capital account |
| B. | Fixed assets account |
| C. | Building account |
| D. | Cash account |
| Answer» E. | |
| 229. |
__Does prudence concept allow a business to build substantially higher reserves or provisions than that are actually required?__ |
| A. | Yes |
| B. | No |
| C. | To some extent |
| D. | It depends on the type of business |
| Answer» C. To some extent | |
| 230. |
__Which of the following is an example of business liability?__ |
| A. | Land |
| B. | Building |
| C. | Cash |
| D. | Creditors |
| Answer» E. | |
| 231. |
__The maximum amount beyond which a company is not allowed to raise funds by issue of shares is__ |
| A. | Issued capital |
| B. | Reserve capital |
| C. | Nominal capital |
| D. | Subscribed capital |
| Answer» D. Subscribed capital | |
| 232. |
__Parties to a bill of exchange are__ |
| A. | Drawer |
| B. | Drawee |
| C. | Payee |
| D. | All of the above |
| Answer» E. | |
| 233. |
_Auditing refers to$? |
| A. | Reporting the financial information |
| B. | Examination of financial information |
| C. | Preparation of financial statements |
| D. | Maintaining the ledger accounts |
| Answer» C. Preparation of financial statements | |
| 234. |
_A Master Budget consists of$? |
| A. | Sales budget |
| B. | Production budget |
| C. | Material budget |
| D. | All of the above |
| Answer» E. | |
| 235. |
_What is the basic accounting equation?$? |
| A. | Capital + Liabilities = assets |
| B. | Assets + Liabilities = Capital |
| C. | Capital + Assets = Liabilities |
| D. | Liabilities - Capital = Assets |
| Answer» B. Assets + Liabilities = Capital | |
| 236. |
_An asset possesses which of the following?$? |
| A. | Future economic benefits for the business |
| B. | All kinds of benefits for the business |
| C. | Expenses for the business |
| D. | Merits & Demerits for the business |
| Answer» B. All kinds of benefits for the business | |
| 237. |
_The following is a statement showing the financial status of the comapany at any given time$? |
| A. | Trading account |
| B. | Profit & Loss statement |
| C. | Balance Sheet |
| D. | Cash Book |
| Answer» D. Cash Book | |
| 238. |
_The account that records expenses, gains and losses is$? |
| A. | Personal account |
| B. | Real account |
| C. | Nominal account |
| D. | None of the above |
| Answer» D. None of the above | |
| 239. |
_A higher inventory ratio indicates$? |
| A. | Better inventory management |
| B. | Quicker turnover |
| C. | Both A and B |
| D. | None of the above |
| Answer» D. None of the above | |
| 240. |
_The measure of how efficiently the assets resources are employed by the firm is called$? |
| A. | Liquidity ratio |
| B. | Leverage ratio |
| C. | Activity ratio |
| D. | Profitability ratio |
| Answer» D. Profitability ratio | |
| 241. |
_Capital of a business decreases if there is an increase in$? |
| A. | Drawings |
| B. | Income |
| C. | Gains |
| D. | Fresh capital |
| Answer» B. Income | |
| 242. |
_Current Assets - Current Liabilities = ?$? |
| A. | Capital + Liabilities = assets |
| B. | Absorbed capital |
| C. | Net assets |
| D. | Working capital |
| Answer» E. | |
| 243. |
_Net loss occurs when$? |
| A. | Expenses are greater than income |
| B. | Expenses are less than income |
| C. | Expenses = Income |
| D. | Liabilities are greater than income |
| Answer» B. Expenses are less than income | |
| 244. |
_Discount allowed is a kind of deduction from$? |
| A. | Account Payable |
| B. | Account Receivable |
| C. | Cash account |
| D. | Discount account |
| Answer» C. Cash account | |
| 245. |
_Which of the following will be debited if a business purchases goods on credit?$? |
| A. | Cash |
| B. | Debtor |
| C. | Creditor |
| D. | Purchases |
| Answer» E. | |
| 246. |
_____ principle requires that the same accounting method should be used from one accounting period to the next$? |
| A. | Conservatism |
| B. | Consistency |
| C. | Business entity |
| D. | Money measurement |
| Answer» C. Business entity | |
| 247. |
_A bill of exchange when drawn requires$? |
| A. | Noting |
| B. | Discounting |
| C. | Acceptance |
| D. | None of the above |
| Answer» D. None of the above | |
| 248. |
_The basic consideration(s) in distinction between capital and revenue expenditure is/are$? |
| A. | Nature of business |
| B. | Effect on revenue generating capacity of the business |
| C. | Purpose of expenses |
| D. | All of the above |
| Answer» E. | |
| 249. |
_Earned but not yet received income is treated as$? |
| A. | Asset |
| B. | Liability |
| C. | Loss |
| D. | Capital |
| Answer» B. Liability | |
| 250. |
_Bank Reconciliation statement is prepared by$? |
| A. | Accountant of business |
| B. | Manager of business |
| C. | Controller of business |
| D. | Accountant of the bank |
| Answer» B. Manager of business | |