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MCQs 1: Which of the following shall not be deducted from net profit while calculating managerial remuneration?

Loss on sale of undertaking Debts considered bad and written off Liability arising from a breach of contract Director‘s remuneration
Answer Explanation

MCQs 2: Which of the following equations is correct?

Gross Profit+ Sales+ Direct expenses+ Purchases+ Closing stock = Opening stock Gross Profit+ Sales+ Direct expenses+ Purchases- Closing stock = Opening Stock Gross Profit + Opening Stock + Direct expenses + Purchases- Closing stock = Sales Gross Profit – Opening Stock + Direct expenses + Purchases +Closing stock = Sales
Answer Explanation

MCQs 3: Which of the following is not true with regard to preparation of Profit & Loss Account?

Profit & Loss Account is prepared for a certain period and hence it is an interim statement Profit & Loss Account does not disclose the effect of non-financial items Net Profits are ascertained on the basis of current costs Net Profits as disclosed by P&L Account is not absolute
Answer Explanation

MCQs 4: The Profit and Loss Account shows the:

Financial results of the concern for a period Financial position of the concern on a particular date Financial results of the concern on a particular date Cost of goods sold during the period
Answer Explanation

MCQs 5: Which of the following will not appear in Profit and Loss Account of a business?

Drawings Bad debts Accrued expenses Reserve for discount on Sundry Creditors
Answer Explanation

MCQs 6: Which of the following is not a financial statement?

Profit and Loss Account Balance Sheet Funds Flow Statement Trial Balance
Answer Explanation

MCQs 7: If unexpired insurance appears in the Trial Balance, it should be:

Credited to the Profit & Loss Account Debited to the Profit & Loss Account Shown on the liabilities side of the Balance Sheet Shown on the assets side of the Balance Sheet
Answer Explanation

MCQs 8: Which of the following are/is not a fixed asset?

Stock Vehicle Fixed deposit in bank Both A. and C. above
Answer Explanation

MCQs 9: Which of the following are/is a current asset?

Sundry Debtors Stock Prepaid insurance All of A. B. and C. above
Answer Explanation

MCQs 10: Tax deducted at source appears in the Balance Sheet

On the assets side under current assets On the assets side under loans and advances On the liabilities side under current liabilities On the liabilities side under provisions
Answer Explanation

MCQs 11: Which of the following statements is false ? select the false from below options

Balance Sheet discloses financial position of the business A person who owes to the business is called Debtor Decrease in the value of the asset could decrease the value of a liability Assets are to be shown in the Balance Sheet at the realizable value
Answer Explanation

MCQs 12: The Balance Sheet gives information regarding the____________?

Results of operations for a particular period Financial position during a particular period Profit earning capacity for a particular period Financial position as on a particular date
Answer Explanation

MCQs 13: Which of the following accounts appear(s) in the Balance Sheet of a business?
i. Stock at the end of the financial year
ii. Stock at the beginning of the financial year
iii. Drawings
iv. Prepaid Rent
v. Interest received but not yet earned

Only (i) above Only (iii) above Both (i)and (iii) above (i), (iii), (iv) and (v) above
Answer Explanation

MCQs 14: Computers taken on hire by a business for a period of twelve months should be classified as:___________?

Current assets Intangible assets Deferred revenue expenditure Not an asset
Answer Explanation

MCQs 15: Which of the following is not an intangible asset?

Trade mark Franchise Accounts Receivable Secret Profit
Answer Explanation

MCQs 16: Which of the following is a current liability?

Prepaid expenses Trademark Discount on issue of shares Outstanding Salaries
Answer Explanation

MCQs 17: Based on which of the following concepts, is Share Capital Account shown on the liabilities side of a Balance Sheet?

Business entity concept Money measurement concept Going concern concept Matching concept
Answer Explanation

MCQs 18: Which of the following is not a contingent liability?

Debts included in Sundry Debtors which are doubtful in nature Uncalled liability on partly paid shares Claims against the company not acknowledged as debts Arrears of fixed cumulative dividend
Answer Explanation

MCQs 19: Which of the following are current assets of a business?
i. Income received in advance
ii. Stock
iii. Debtors
iv. Pre-paid expenses
v. Accrued income

Both (i) and (iv) above Both (ii) and (iii) above (i),(ii) and (iii) above (ii),(iii),(iv) and (v) above
Answer Explanation

MCQs 20: Closing entries are generally passed:

At the time of opening new books of account At the time of closing the accounts During the course of accounting period any time After certification of accounts
Answer Explanation

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