📒Accounting MCQs
Accounting MCQs
397 MCQs261
Prepaid expenses are valued on the Balance Sheet at
AReplacement cost
BCurrent cost
CCost to acquire less accumulated amortization
DCost less expired portion Prepaid expenses are the expenses which relate to the unexpired portion of the benefit of the expense. Hence, these are valued on the Balance Sheet at the cost less expired portion
262
Goods in stock worth 800 are destroyed by fire and the Insurance Co. is accepted the claim for 600. Adjustment would involve
ADebit of 800 to Trading Account and credit of 600 and 200 to insurance company and Profit and Loss Account respectively
BDeduct the 800 from closing stock in the Trading Account
CCredit insurance company for 600
DDebit of 600 and 200 to insurance company and Profit and Loss Account respectively and credit of 800 to Trading Account
263
Sundry debtors as per Trial Balance is 43,000 which includes 2,200 due from ‗H in respect of goods sent to him on approval basis, the cost price of which is 1,800. Rectification would involve:
AAdding 2,200 to closing stock
BDeducting 1,800 from closing stock and deducting 2,200 each from debtors and sales
CAdding 1,800 to closing stock and deducting 2,200 each from debtors and sales
DDeducting 1,800 from debtors
264
Which of the following is not a financial statement?
A; Balance Sheet
Band Funds Flow statement
Care the financial statements prepared by a business entity. Funds flow statement though categorized as one of the financial statements, its preparation is not mandatory. Thus
Dis the correct answer
265
Which of the following will not appear in Profit and Loss Account of a business?
Ais the correct answer.
BBad debts
CAccrued expenses
DReserve for discount on Sundry Creditors Profit and Loss Account is an income statement which depicts all incomes/gains and expenses/losses during an accounting period. Drawings are neither an income nor an expense to be recorded in Profit and Loss Account. Thus
266
The Profit and Loss Account shows the:
AFinancial results of the concern for a period
BFinancial position of the concern on a particular date
CFinancial results of the concern on a particular date
DCost of goods sold during the period A profit and Loss Account is prepared for the period ending which shows the financial or operating results of the concern for a period.
267
Which of the following is not true with regard to preparation of Profit & Loss Account?
AProfit & Loss Account is prepared for a certain period and hence it is an interim statement
BProfit & Loss Account does not disclose the effect of non-financial items
CNet Profits are ascertained on the basis of current costs
DNet Profits as disclosed by P&L Account is not absolute
268
Which of the following equations is correct?
AGross Profit+ Sales+ Direct expenses+ Purchases+ Closing stock = Opening stock
BGross Profit+ Sales+ Direct expenses+ Purchases- Closing stock = Opening Stock
CGross Profit + Opening Stock + Direct expenses + Purchases- Closing stock = Sales
DGross Profit – Opening Stock + Direct expenses + Purchases +Closing stock = Sales
269
Which of the following shall not be deducted from net profit while calculating managerial remuneration?
ALoss on sale of undertaking
BDebts considered bad and written off
CLiability arising from a breach of contract
DDirector‘s remuneration Director‘s remuneration shall not be deducted from net profit while calculating managerial remuneration
270
The Balance Sheet gives information regarding the____________?
AResults of operations for a particular period
BFinancial position during a particular period
CProfit earning capacity for a particular period
DFinancial position as on a particular date