Accounting MCQ Questions and Solutions with Explanations

Accounting MCQ Questions and Solutions with Explanations | Commerce

Accounting MCQ Questions and answers with easy and logical explanations. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Accounting MCQ is important for exams like B.COM, M.COM, BBA, BBM, CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other commerce department exam. Page-2 section-8

At the time of retirement of a partner, the existing profit and loss balance is transferred to which account?

A) Realisation B) Revaluation C) Goodwill D) Existing partners capital

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Answer & Solution

Answer: Option D

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According to which of the following accounting concepts, the owner of the business is also considered a creditor to the extent of the capital?

A) Money measurement concept B) Cost concept C) Dual aspect concept D) Business entity concept

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Answer & Solution

Answer: Option D

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Which of the following will result in flow of funds:

A) Appreciation in value of buildings B) Depreciation of assets C) Purchase of furniture D) Writing off goodwill

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Answer & Solution

Answer: Option C

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Which is the best depreciation method in case of mineral deposit?

A) Depletion method B) Revaluation method C) Annuity method D) None of the above

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Answer & Solution

Answer: Option A

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There is decrease in the ownership of the owners by-

A) Issue of bonus share B) Redemption of debentures C) Redemption of preference share D) Purchase of building

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Answer & Solution

Answer: Option A

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Which of them are current liabilities?
1. Debentures
2. Prepaid rent
3. Interest accrued
4. Bank overdraft
Select the correct answer:

A) 1, 2, 3 and 4 B) Only 4 C) 2, 3 and 4 D) 1, 2 and 3

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Answer & Solution

Answer: Option B

Solution:

Current liabilities are obligations that a company needs to settle within a year.

1. Debentures are long-term liabilities, not current liabilities.

2. Prepaid rent is considered an asset, not a liability.

3. Interest accrued is a current liability as it represents interest that is owed but not yet paid.

4. Bank overdraft is a current liability because it is a short-term borrowing from a bank.

Therefore, the only correct current liability among the options is the bank overdraft.

Responsibility accounting aims to

A) ensure that a manager is punished if things go wrong B) ensure that costs become the responsibility of a specific manager C) allocate costs to all areas of a business D) reduce the costs that a department incurs

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Answer & Solution

Answer: Option B

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A firm stands dissolve in the following cases
1. the partners agree that the firm should be dissolved.
2. the business becomes legal.
3. in case of partnership at will, a partner gives notice of dissolution.
4. the court orders dissolution.
Select the correct answer:

A) 1, 2 and 4 B) Only 3 C) Both 2 and 3 D) Only 2

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Answer & Solution

Answer: Option D

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Kinds of share capital is:

A) Bond B) Mutual fund C) Equity share capital D) All of these

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Answer & Solution

Answer: Option C

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Which of the following item will have credit balance?

A) Deferred revenue income B) Income earned but not received C) Declared but unpaid dividend D) Deduction on issue of debentures

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Answer & Solution

Answer: Option C

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