Financial Accounting MCQs Quiz Multiple Choice Questions & Answers

1. AICPA Means

1. American Institute of Certified Public Accountants
2. American Institute of Campus Prediction Ability
3. American Intellectual of Certified Public Accountants
4. American Institute of Certified Person Account

2. Expand AICPA

1. American Institute of Certified Public Accountants
2. American Institute of Corporate Public Account
3. Accounting Institutions of Conventions Public Account.
4. None of these.

3. Interest on drawings is charged on

1. Asset
2. Capital
3. Inventory
4. Drawing

4. Which is the material things or possessions of the business

1. Asset
2. Liability
3. Capital
4. None of these.

5. Any irrecoverable portion of sundry debtors is known as  

1. Bad debt
2. Further bad debt
3. Provision for bad debt
4. Provision for doubtful debts

6. Which book is known as total of debit and credit  

1. Balance sheet
2. Trial balance
3. Journal
4. Ledger

7. Which one is list of all account balances

1. Balance sheet
2. Ledger
3. Profit and loss a/c
4. Trial balance

8. Recording of financial transactions is done in

1. Books
2. Journal
3. Trial balance
4. None of these.

9. Which is an account prepared to record all expenses at branch.

1. Branch account
2. Expense account
3. Branch expense a/c
4. None of these.

10. Which account is prepared wth a view to ascertain the gross profit of branch.

1. Branch account
2. Branch adjustment a/c
3. Branch expense a/c
4. None of these.

11. Which account is prepared to exercise control over the branch cash.

1. Branch account
2. Branch expense account
3. Branch cash account
4. None of these.

12. On which condition we  made adjustment for closing stock as well as opening stock in the purchaseaccount

1. By buying credit purchase
2. By buying
3. Adjusted purchases  
4. On installment basic

13. Amount of cash or other assets withdrawn by owner for his personal purpose called

1. Capital
2. Drawing
3. Withdrawal of cash
4. None of these.

14. Interest on capital is credited to----------------------- A /C

1. Capital a/c
2. Proprietors a/c
3. Combine a/c
4. Interest on capital a/c

15. Rent paid, salary paid which type of expenditure

1. Capital expenditure
2. Revenue expenditure
3. Deferred revenue expenditure
4. Capital receipt

16. Liability for partly paid investment what is this

1. Capital expenditure
2. Revenue expenditure
3. Deferred revenue expenditure
4. Contingent liability

17. Amount received during the course of trading operations are called

1. Capital receipt
2. Revenue expenditure
3. Capital expenditure
4. Revenue receipt

18. Which transaction is one where in items are exchanged for other items.

1. Cash
2. Credit
3. Barter
4. None of these.

19. What represents the amount invested by owner in to business

1. Cash
2. Stock
3. Capital
4. None of these.

20. Transit items may either be

1. Cash and credit transit
2. Cash in transit & goods in transit
3. Credit and barter transit
4. None of these.

21. A shipment of goods by a manufacturer to an agent tobe sold by him on commission basis on the risk    and account of the former called -------------------

1. Consigning
2. Consignment
3. Agreement
4. None of these.

22. Pass entry for consignors expenses

1. Consignment a/c DrTo Cash      
2. Consignment a/c Dr    To credit      
3. Cash a/c Dr    To consignee     
4. None of these.

23. The person who send the goods to the agent to be sold by him on commission is calle

1. Consignor
2. Consignee
3. Merchant
4. None of these

24. The head office prepares a combined balance sheet called ----------------- 

1. Consolidated balance sheet
2. Balance sheet of branch
3. Head balance sheet
4. None of these.

25. Any amount spend on increasing the earning capacity of a business is known as  

1. Contigent liability  
2. Capital expenditure
3. Revenue expenditure
4. Capital receipt

26. Expenditure incurred during one year known as  

1. Contigent  liability
2. Capital expenditure
3. Revenue expenditure
4. Capital receipt

27. What is the expenditure of revenue nature

1. Contingent liability
2. Capital expenditure
3. Revenue expenditure
4. Deferred revenue expenditure

28. What is to the original form of accounting

1. Cost accounting
2. Management accounting
3. Financial accounting
4. None of these

29. The amount of royalty payable is an expense to the lessee and is ------------------ in the royaltyaccount

1. Credited
2. Debited
3. Deducted
4. None of these

30. Who is a person to whom business occurs money  

1. Creditor
2. Debtor
3. Proprietor
4. None of these.

31. Assets acquired for long term use in business called

1. Current asset
2. Fixed asset
3. Wasting asset
4. None of these.

32. A person who owes money to the business is a

1. Debtor
2. Creditor
3. Investor
4. None of these

33. Branches keeping full system of accounting is called

1. Dependent  branches
2. Independent branches
3. Simple branches
4. None of these.

34. The head office prepares branch account to find out ------------------- earned by branch

1. Dividend
2. Revenue
3. Capital
4. Profit

35. Payment of monthly rent to land lord is 

1. Economic event
2. Non economic event
3. Substantial event
4. None of these.

36. What is short working?   

1. Excess of minimum rent over actual royalty
2. Below of minimum rent
3. Equal to minimum rent
4. Above to royalty

37. What is the another term of minimum rent

1. Fixed and copy right
2. Dead rent and fixed rent
3. Patent and copy right
4. Fixed and dead rent

38. Assets which have no real value but are shown in books of account for technical reasons are called

1. Fixed asset
2. Current asset
3. Fictions asset
4. None of these.

39. Assets which are held for a short period called

1. Fixed asset
2. Contingent asset
3. Current asset
4. None of these.

40. Recouping of short working arise in

1. Future
2. Present
3. Past
4. None of these

41. Which concept facilitates recording of business events on a uniform basis.

1. Going concern
2. Accounting entity
3. Money measurement
4. None of these.

42. Which principal have separate entity

1. Going concern concept
2. Money measurement concept
3. Accounting period concept
4. Accounting entity concept

43. Things which are purchased by business for resale called

1. Goods
2. Closing stock
3. Lease housing
4. None of these.

44. What represents goods sent by head office to the branch or by the branch to the head office but not received by other

1. Goods in transit
2. Cash in transit
3. Barter transit
4. None of these

45. Managers commission is calculated on

1. Gross profit
2. Notional profit
3. Net profit
4. Sales

46. The amount of reserve deducted from the

1. Gross profit
2. Managers commission
3. Net profit
4. None of these

47. The accounts for the dependent branches are maintained only in the books of

1. Head office
2. Sub office
3. Main office
4. None of these

48. Adjustment given in trial balance is known as

1. Hidden adjustment
2. Partly adjustment
3. Adjustment
4. Provision for discount on debtors

49. Trading and profit and loss account is known as ----------------------- statement

1. Income
2. Expense
3. Position
4. Revenue

50. Prepaid expenses is ------------------- to the business

1. Income
2. Expense
3. Asset
4. Liability