Accounting is the art of recording classifying and summarize financial transactions in the preparation of financial statements.It is a systematic process of identifying, recording, measuring, classifying, verifying, summarizing, interpreting and communicating financial information. It reveals profit or loss for a given period, and the value and nature of a firm’s assets, liabilities and owners’ equity.It encompass Financial Cost Advance, and managerial Accounting as well. Latest GAAP principles have been updated over here in form of Mcqs respectively.Just follow the Mcqs online quiz being dispatched over here with respect to your preparation for entry admission test NTS PPSC OTS PTS and missllenous job exams simultaneously.
Here we have large collection of Accounting Mcqs for all Students and jobs test preparation purpose. These Accounting Mcqs will be updated on daily basis and added more multiple choice question about Accounting frequently.You can prepare your Accounting Subject for different Entry Test, Jobs Test,Recruitment Test and interviews here.
Accounting Mcqs Online with Answer for Entry Test NTS PPSC PTS OTS
Accounting
Latest Accounting Mcqs Online with Answers.
If debit side of a bank account is greater than credit side it indicates which of the following?
A. Cash at bank
B. Bank understatement
C. Bank overdraft
D. Balance overstatement
Right Answer: Cash at bank
Tell us how can we improve this Mcqs?
The balance of Revaluation Reserve pertaining to an asset that has been disposed off or retired can be transferred to?
A. General Reserve A/c
B. Profit & Loss A/c
C. Asset A/c
D. Capital Reserve A/c
Right Answer: Capital Reserve A/c
Tell us how can we improve this Mcqs?
Credit memo or credit note No. is entered in which of the following journal?
A. General journal
B. Cash journal
C. Purchase journal
D. Sales return day book
Right Answer: General journal
Tell us how can we improve this Mcqs?
Specialized journals are more adequate for which TYPE OF BUSINESSES?
A. Small businesses
B. Big businesses
C. Sole proprietorship
D. Partnership
Right Answer: Big businesses
Tell us how can we improve this Mcqs?
Goods sent on approval basis’ have been recorded as ‘Credit sales’. This is an example of?
A. Error of principle
B. Error of commission
C. Error of omission
D. Error of duplication
Right Answer: Error of principle
Tell us how can we improve this Mcqs?
Journal proper is meant for recording?
A. Credit purchase of fixed assets
B. Return of goods
C. All such transactions for which no special journal has been kept by the business
D. None of these
Right Answer: All such transactions for which no special journal has been kept by the business
Tell us how can we improve this Mcqs?
Cash purchases is recorded in which of the following specialized journals?
A. Purchase journal
B. Sales journal
C. Purchases return journal
D. Cash payments journal
Right Answer: Cash payments journal
Tell us how can we improve this Mcqs?
Which of the following is a type of cash receipt journal + cash payment journal?
A. Bank statement
B. Statement of cash flow
C. Cash book
D. Cash documents
Right Answer: Cash book
Tell us how can we improve this Mcqs?
The main objective of providing depreciation is to?
A. Calculate the true profit
B. Show the true financial position in the Balance Sheet
C. Provide funds for replacement of fixed assets
D. Both A. and B. above
Right Answer: Show the true financial position in the Balance Sheet
Tell us how can we improve this Mcqs?
A brief explanation recorded below every entry in general journal is commonly known as?
A. Narration
B. Explanation
C. Summary
D. Other information
Right Answer: Narration
Tell us how can we improve this Mcqs?
Liabilities are which of the following?
A. Resources
B. Obligations
C. Future benefits
D. Expenses
Right Answer: Obligations
Tell us how can we improve this Mcqs?
When a person purchasing goods on credit he becomes a_________in the books of the seller?
A. Debtor
B. Creditor
C. Defaulter
D. Offender
Right Answer: Debtor
Tell us how can we improve this Mcqs?
Which of the following enhances the earning capacity of an asset?
A. Increase in working capacity of an asset
B. Reduction in operating costs
C. Replacing damaged parts of an asset
D. Both A. and C. above
Right Answer: Both A. and C. above
Tell us how can we improve this Mcqs?
If a transaction is completely omitted from the books of accounts, will it affect the agreement of a trial balance?
A. Yes
B. No
C. Transactions can’t be omitted
D. none of these
Right Answer: No
Tell us how can we improve this Mcqs?
An Art of reading, classifying & Summarizing of accounts in a systematic way is called?
A. Accounting
B. Accountancy
C. Auditing
D. Book Keeping
Right Answer: Accounting
Tell us how can we improve this Mcqs?
Posting is the process of?
A. Posting the letters in drop box
B. Posting suitable person to a suitable job
C. Entering in the ledger the information contained in the ledger
D. All the three
Right Answer: Entering in the ledger the information contained in the ledger
Tell us how can we improve this Mcqs?
Keeping the log of financial information in books of original entries is called?
A. Recording
B. summarizing
C. Grouping
D. Processing
Right Answer: Recording
Tell us how can we improve this Mcqs?
Which of the following is known as the base for preparing trial balance?
A. Journal
B. Cash account
C. Ledger account
D. Balance sheet
Right Answer: Ledger account
Tell us how can we improve this Mcqs?
If credit side of a bank account is greater than the debit side, it indicates which of the following?
A. Bank overdraft
B. Cash at bank
C. Bank balance
D. Current Asset
Right Answer: Bank overdraft
Tell us how can we improve this Mcqs?
Which of the following is a liability?
A. Cash
B. Equipment
C. Debtors
D. Creditors
Right Answer: Creditors
Tell us how can we improve this Mcqs?
Which is the most important characteristic that all assets of a business have?
A. Long life of assets
B. Value of assets
C. Intangible nature of assets
D. Future economic benefits
Right Answer: Future economic benefits
Tell us how can we improve this Mcqs?
Goodwill A/c is a/an?
A. Nominal A/c
B. Tangible Asset
C. Intangible Asset
D. Fictitious Asset
Right Answer: Intangible Asset
Tell us how can we improve this Mcqs?
A systematic way to maintain the books of accounts is called?
A. Accountancy
B. Economics
C. Book Keeping
D. Auditing
Right Answer: Book Keeping
Tell us how can we improve this Mcqs?
Cash discount is provided on?
A. Purchases
B. Prompt payment
C. Sales
D. Sales return
Right Answer: Prompt payment
Tell us how can we improve this Mcqs?
During the year 2011-2012, the value of closing inventory was overstated by 25,000. Which of the following is true?
A. The cost of goods sold was overstated during 2011-2012 and income will be understated during 2012-2013
B. The income was overstated during 2011-12 and closing inventory will be overstated during 2012-2013
C. The retained earnings was overstated during 2011-2012 and retained earnings will be understated during 2012-2013
D. The cost of goods sold was understated during 2011-2012 but retained earnings will not be affected during 2012-2013
Right Answer: The retained earnings was overstated during 2011-2012 and retained earnings will be understated during 2012-2013
Tell us how can we improve this Mcqs?
Credit purchase of plant and machinery is recorded in which of the following journals?
A. General journal
B. Cash journal
C. Purchase journal
D. Purchase return journal
Right Answer: General journal
Tell us how can we improve this Mcqs?
Amount paid to Masood posted to the credit side of his account would affect?
A. Masood’s account
B. Cash account
C. Cash account and Gagan’s account
D. None of these
Right Answer: Masood’s account
Tell us how can we improve this Mcqs?
Sales return is also known as?
A. Return received
B. Return Payed
C. Return inward
D. Return outward
Right Answer: Return inward
Tell us how can we improve this Mcqs?
BUSINESS paid rent amounting to $100″ which of the following specialized journals records this transaction?
A. Cash receipts journal
B. Cash payments journal
C. Sales journal
D. Purchase journal
Right Answer: Cash payments journal
Tell us how can we improve this Mcqs?
The maintenance of accounts in a systematic way is called?
A. Accounting
B. Reading
C. Book Keeping
D. Auditing
Right Answer: Book Keeping
Tell us how can we improve this Mcqs?
___________ helps business to classify transactions according to their nature?
A. General journal
B. Real accounts
C. Ledger accounts
D. Cash accounts
Right Answer: Ledger accounts
Tell us how can we improve this Mcqs?
_______ the withdrawal of cash and goods by the owner of the busienss for his/her personal use?
A. Depreciation
B. Drawings
C. Outflow of cash
D. Appreciation
Right Answer: Drawings
Tell us how can we improve this Mcqs?
Obligation of the Business are known as?
A. Liabilities
B. Revenues
C. Expenses
D. Assets
Right Answer: Liabilities
Tell us how can we improve this Mcqs?
Cash received from debtors would be deemed as___________of funds?
A. No flow
B. Sources
C. Uses
D. Gain
Right Answer: No flow
Tell us how can we improve this Mcqs?
A book wherein various accounts are opened is called?
A. Subsidiary books
B. Journal
C. Ledger
D. Trial Balance
Right Answer: Ledger
Tell us how can we improve this Mcqs?
The periodic total of purchase day book is posted to?
A. Purchase register
B. Purchase A/c
C. Cash purchase A/c
D. Credit purchase A/c
Right Answer: Purchase A/c
Tell us how can we improve this Mcqs?
The portion of the acquisition cost of the asset yet to be allocated is known as?
A. Written down value
B. Accumulated value
C. Salvage value
D. Residual Value
Right Answer: Written down value
Tell us how can we improve this Mcqs?
Generally the term fund is used to mean the difference between?
A. Current assets and current liabilities
B. Profit and loss A/C and Balance sheet
C. Current assets and non-current liabilities
D. Current liabilities and non-current liabilities
Right Answer: Current assets and current liabilities
Tell us how can we improve this Mcqs?
Expenses of the following nature are treated as a Revenue expenses except?
A. Expenses for day to day running of the business
B. Putting the new asset in working condition
C. Depreciation
D. Purchase of raw material
Right Answer: Putting the new asset in working condition
Tell us how can we improve this Mcqs?
Depreciation is calculated on the?
A. Cost price of asset
B. Market price
C. Cost+ Transport+ Installation expenses
D. Cost or market values whichever is less
Right Answer: Cost+ Transport+ Installation expenses
Tell us how can we improve this Mcqs?
For which step of accounting process the accountants of business entity prepare financial statements?
A. Identification of economic event
B. Communication of financial information
C. Recording financial information
D. Making decisions about business
Right Answer: Communication of financial information
Tell us how can we improve this Mcqs?
Assets having physical existence are called?
A. Current asset
B. intangible asset
C. Tangible asset
D. Liquid asset
Right Answer: Tangible asset
Tell us how can we improve this Mcqs?
If a company has contingent liabilities, they appear in the?
A. Balance Sheet
B. Directors‘ report
C. Notes on account to Balance Sheet
D. Chairman‘s report
Right Answer: Notes on account to Balance Sheet
Tell us how can we improve this Mcqs?
Bank reconciliation statement is a part of?
A. Cash book
B. Trial balance
C. Auditors report
D. None of these
Right Answer: Cash book
Tell us how can we improve this Mcqs?
In a three column cash book_______________does not exist?
A. Cash column
B. Bank column
C. Petty cash column
D. Discount column
Right Answer: Petty cash column
Tell us how can we improve this Mcqs?
Bookkeeping mainly concerns with which part of accounting process?
A. Analyzing
B. Preparing financial statements
C. Recording financial information
D. Auditing the books of accounts
Right Answer: Recording financial information
Tell us how can we improve this Mcqs?
The normal balance of capital account is?
A. Credit balance
B. Debit balance
C. Cash balance
D. Neither debit nor credit balance
Right Answer: Credit balance
Tell us how can we improve this Mcqs?
Investment in own share A/c appears in?
A. Asset side
B. Liability side
C. Netted from Capital
D. Profit & Loss A/c
Right Answer: Asset side
Tell us how can we improve this Mcqs?
Any gain on the sale of non-current assets should be _________ from the net profit and the loss must be _________to the net profit in determining fund from operation?
A. Added, Reduced
B. Added, Added
C. Deducted, Added
D. Deducted, Deducted
Right Answer: Deducted, Added
Tell us how can we improve this Mcqs?
Which of these errors affect two or more accounts?
A. Errors of complete omission
B. Errors of principle
C. Errors of posting to wrong account
D. All the three
Right Answer: All the three
Tell us how can we improve this Mcqs?
Buildings account is debited with an amount towards repairs. This is an example of?
A. Error of commission
B. Error of principle
C. Error of omission
D. Compensating error
Right Answer: Error of principle
Tell us how can we improve this Mcqs?
Which of the following is an one sided error?
A. 500 purchase of old equipment not recorded in the books of A/c at all
B. 500 being expense on travelling expense credited to travelling expenses
C. Both
D. None
Right Answer: 500 being expense on travelling expense credited to travelling expenses
Tell us how can we improve this Mcqs?
Bank reconciliation is a statement prepared to reconcile?
A. Trial balance
B. Cash book
C. Bank A/c
D. Cash as per cash book with bank balance as per bank pass book
Right Answer: Cash as per cash book with bank balance as per bank pass book
Tell us how can we improve this Mcqs?
Liability are arisen from which of the following events?
A. Present event
B. Future event
C. Past event
D. None of them
Right Answer: Past event
Tell us how can we improve this Mcqs?
Benefits of preparing Bank Reconciliation Statement includes?
A. It bring out any errors committed in preparation of Cash book / Bank Pass Book
B. Highlights under delay in clearance of cheques deposited but not credited
C. Help know actual bank balance
D. All the three
Right Answer: All the three
Tell us how can we improve this Mcqs?
The real accounts are accounts of Assets, liabilities and?
A. Expenses
B. Revenues
C. Capital
D. Drawing
Right Answer: Capital
Tell us how can we improve this Mcqs?
Which of the following is a real account?
A. Office equipment
B. Rent expenses
C. Rent income
D. Insurance expense
Right Answer: Office equipment
Tell us how can we improve this Mcqs?
Sales and purchase journal don’t record?
A. Credit sales
B. Credit purchases
C. Credit sales and purchases
D. Cash sales and purchases
Right Answer: Cash sales and purchases
Tell us how can we improve this Mcqs?
Debit balance = Credit balance in a trial balance indicates that?
A. No error in recording transactions
B. No error in posting entries to ledger accounts
C. Account balances are correct
D. Mathematically Capital+Liabilities=Assets
Right Answer: Mathematically Capital+Liabilities=Assets
Tell us how can we improve this Mcqs?
The assets which come into existence upon the happening of a certain event are called?
A. Contingent assets
B. Fixed assets
C. Fictitious assets
D. Quick assets
Right Answer: Contingent assets
Tell us how can we improve this Mcqs?
An asset posses which of the following?
A. Future economic benefits for the business
B. All kind of benefits for the business
C. Expenses for the business
D. Merits and Demerits for the business
Right Answer: Future economic benefits for the business
Tell us how can we improve this Mcqs?
Modern system of book keeping is called?
A. Double entry system
B. American system
C. Single entry system
D. Italic system
Right Answer: Double entry system
Tell us how can we improve this Mcqs?
The normal balance of liability account is?
A. Debit balance
B. Credit balance
C. Cash balance
D. Neither debit nor credit balance
Right Answer: Credit balance
Tell us how can we improve this Mcqs?
__ is the first phase of accounting cycle?
A. Identifying an economic event or transaction
B. Preparing journals
C. Posting entries to ledger accounts
D. Making decisions about business
Right Answer: Identifying an economic event or transaction
Tell us how can we improve this Mcqs?
Identify the nominal account?
A. Machinery account
B. Building account
C. Creditors account
D. Rent expenses account
Right Answer: Rent expenses account
Tell us how can we improve this Mcqs?
Cost of goods sold excludes?
A. Opening Stock
B. Carriage inward
C. Wages & Salary
D. Postage & Stamps
Right Answer: Postage & Stamps
Tell us how can we improve this Mcqs?
Which of the following factors are primarily considered to determine the economic life of an asset?
A. Passage of time, asset usage, and obsolescence
B. Tax regulations and SEBI guidelines
C. Tax regulations and asset usage
D. SEBI guidelines and Asset usage
Right Answer: Passage of time, asset usage, and obsolescence
Tell us how can we improve this Mcqs?
In which of the following methods, the cost of the asset is spread over in equal proportion during its useful economic life?
A. Straight-line method
B. Written down value method
C. Units-of-production method
D. Sum-of-the years‘-digits method
Right Answer: Straight-line method
Tell us how can we improve this Mcqs?
Which of the following statements is incorrect regarding capital account?
A. Debit increases the capital account balance
B. Credit increases the capital account balance
C. Fresh capital increases the capital account balance
D. Net income increases the capital account balance
Right Answer: Debit increases the capital account balance
Tell us how can we improve this Mcqs?
_is also known as Appraisal system of depreciation?
A. Inventory system
B. Survey system
C. Annuity system
D. Insurance
Right Answer: Inventory system
Tell us how can we improve this Mcqs?
Goods Return by the customer are termed as ?
A. Purchase return
B. Customer return
C. Sales return
D. Inventory return
Right Answer: Sales return
Tell us how can we improve this Mcqs?
Building and furniture are called?
A. Current asset
B. Fictitious asset
C. Tangible asset
D. Fixed assets
Right Answer: Fixed assets
Tell us how can we improve this Mcqs?
________ is the gross inflow of economic benefits?
A. Assets
B. Liabilities
C. Income
D. Expenses
Right Answer: Income
Tell us how can we improve this Mcqs?
Which of the following specialised journals will record “goods returned by the BUSINESS “?
A. Purchase journal
B. Sales journal
C. Purchases return journal
D. Sales return journal
Right Answer: Purchases return journal
Tell us how can we improve this Mcqs?
In support of business transaction, any written evidence is called?
A. Discount
B. Voucher
C. Allowance
D. Price
Right Answer: Voucher
Tell us how can we improve this Mcqs?
Which of the following errors is an error of omission?
A. Sale of ` 100 was recorded in the Purchases Journal
B. Wages paid to Mohan have been debited to his account
C. The total of the sales journal has not been posted to the Sales Account
D. Repairs to buildings have been debited to buildings account
Right Answer: The total of the sales journal has not been posted to the Sales Account
Tell us how can we improve this Mcqs?
The concept of conservatism will have the effect of?
A. Overstatement of Assets
B. Understatement of Assets
C. Overstatement of Liabilities
D. Understatement of Liabilities
Right Answer: Understatement of Assets
Tell us how can we improve this Mcqs?
The excess of current assets over current liabilities is called?
A. Working Capital
B. Circulating capital
C. Fixed capital
D. Trading capital
Right Answer: Working Capital
Tell us how can we improve this Mcqs?
The periodic total of purchase day book is posted to?
A. Creditors A/c
B. Debtors A/c
C. Purchase A/c
D. None
Right Answer: Creditors A/c
Tell us how can we improve this Mcqs?
Which one of the following should be considered a revenue expenditure?
A. 1000 paid for the execution of a new plant
B. Loss of 10,000 incurred in increasing the sitting accommodation of a hotel
C. Damage paid on account of breach of a contract to supply certain goods
D. Repair to machinery purchased, second hand.
Right Answer: Damage paid on account of breach of a contract to supply certain goods
Tell us how can we improve this Mcqs?
Cash received from debtor is recorded in which of the following SPECIALIZED journals?
A. Purchase journal
B. Sales journal
C. Cash receipts
D. Cash payments journal
Right Answer: Cash receipts
Tell us how can we improve this Mcqs?
Which of the following is a Real A/c?
A. Salary A/c
B. Bank A/c
C. Building A/c
D. Goodwill A/c
Right Answer: Building A/c
Tell us how can we improve this Mcqs?
What is equity?
A. Cash from the business
B. liability of a business
C. Owner’s claim on total assets
D. Owner’s claim on total liabilities
Right Answer: Owner’s claim on total assets
Tell us how can we improve this Mcqs?
Cash book records?
A. Only cash sales
B. All types of cash receipts and payments
C. Only revenue receipts
D. Only capital receipts
Right Answer: All types of cash receipts and payments
Tell us how can we improve this Mcqs?
Debit note is the basis for recording a transaction in which of the following journals?
A. General journal
B. Cash journal
C. Purchase journal
D. Purchase return journal
Right Answer: General journal
Tell us how can we improve this Mcqs?
Which of these documents is not required for Bank Reconciliation?
A. Bank column of Cash Book
B. Bank Pass Book
C. Bank Statement
D. Trial Balance
Right Answer: Trial Balance
Tell us how can we improve this Mcqs?
Institute of Chartered Accountants of Pakistan was established in?
A. 1949
B. 1956
C. 1961
D. 1972
Right Answer: 1961
Tell us how can we improve this Mcqs?
The normal balance of asset account is?
A. Credit balance
B. Debit balance
C. Cash balance
D. Neither debit nor credit balance
Right Answer: Debit balance
Tell us how can we improve this Mcqs?
Which of the following is an item of capital expenditure?
A. Research and development costs during the year
B. Interest on borrowed fund utilized for acquisition of Office Furniture
C. Installation charges paid in conjunction with the purchase of Office Equipment
D. Monthly rent of a machinery used in the business
Right Answer: Installation charges paid in conjunction with the purchase of Office Equipment
Tell us how can we improve this Mcqs?
Which of these errors affect only one account?
A. Errors of casting
B. Errors of carry forward
C. Errors of posting
D. All the three
Right Answer: All the three
Tell us how can we improve this Mcqs?
Which of these is not a special purpose journal?
A. Cash journal
B. Purchase journal
C. Debtors journal
D. Sales journal
Right Answer: Debtors journal
Tell us how can we improve this Mcqs?
Any donation received for a specific purpose is a?
A. Liability
B. Assets
C. Revenue receipts
D. Capital receipts
Right Answer: Capital receipts
Tell us how can we improve this Mcqs?
Which of these is a Part of cash in hand?
A. Postage stamps
B. B/R
C. Cheque Deposited with Bank
D. B/R endorsed
Right Answer: Postage stamps
Tell us how can we improve this Mcqs?
Tax deducted at source A/c appears in?
A. Assets side
B. Liability side
C. Profit & Loss A/c
D. Debited to Capital A/c
Right Answer: Assets side
Tell us how can we improve this Mcqs?
Which one of the following is a capital expenditure?
A. Compensation paid to Directors on termination of their services
B. Expenditure incurred in connection with the renewal of a Trade Mark.
C. Gratuities paid to Directors on termination of their services.
D. Royalty paid in installments for the purchase of rights to manufacture and sell patient medicines.
Right Answer: Compensation paid to Directors on termination of their services
Tell us how can we improve this Mcqs?
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
Right Answer: They must be made after the adjusting entries but before the reversing entries
Tell us how can we improve this Mcqs?
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.
Right Answer: Inventories
Tell us how can we improve this Mcqs?
The concession received on the price of defective goods is called?
A. Discount
B. Cash discount
C. Allowance
D. Trading discount
Right Answer: Allowance
Tell us how can we improve this Mcqs?
Double entry means?
A. Entry in two sets of books
B. Entry at two ends
C. Entry at two dates
D. Entry for two aspects of the transaction
Right Answer: Entry for two aspects of the transaction
Tell us how can we improve this Mcqs?
________ is a separate legal entity that Total capital can be divided in many shares?
A. Partnership
B. Sole proprietorship
C. Company
D. Non-profit organization
Right Answer: Company
Tell us how can we improve this Mcqs?
Please Refresh the Page for more and new Accounting Mcqs. Every time when you refresh the page you have new Mcqs for preparation.
