Accounting MCQ Questions and Solutions with Explanations

Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7 Section 8 Section 9 Section 10 Section 11 Section 12 Section 13 Section 14 Section 15 Section 16 Section 17 Section 18 Section 19 Section 20 Section 21 Section 22 Section 23 Section 24 Section 25 Section 26 Section 27 Section 28 Section 29 Section 30

1.
Fixed assets are reported in the Balance Sheet at historical cost basis. This is done in order to comply with the accounting principle of:

A. Going concern principle

B. Conservatism principle

C. Constant money value principle

D. Realisation principle

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2.
Issue of debenture is a-

A. Use of cash

B. Source of cash

C. Profit from operation

D. None of the above

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3.
Arrange the following categories of share capital of a company in the correct order.
1. Paid-up capital
2. Issued capital
3. Called-up capital
4. Subscribed share capital

A. 2, 4, 3, 1

B. 1, 2, 3, 4

C. 3, 2, 4, 1

D. 3, 2, 1, 4

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4.
The term 'risk capital' denotes:

A. Equity capital

B. Debt capital

C. Preference share capital

D. Long term liabilities

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5.
Bonus Shares can be issued out of:

A. Balance of Profit and Loss Account

B. Share premium Account

C. Capital Reserve

D. All of the above

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6.
The source of cash inflow in cash flow statement is:

A. Non-trading payment

B. Increase in current assets

C. Decrease in liabilities

D. None of the above

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7.
If the average stock of a firm is Rs. 40,000 and its opening stock is Rs. 5,000 less than the closing stock, what would be the value of Opening Stock?

A. Rs. 42,000

B. Rs. 40,000

C. Rs. 35,000

D. Rs. 37,500

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8.
Capital account is opened in case of:

A. Merger

B. Partnership of business

C. Purchase of business

D. Trading

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9.
According to Section 80 of the Companies Act, 1956, a company cannot redeem its Preference shares out of:

A. Revenue Profits

B. Net proceeds of fresh issue

C. Partly out of Revenue Profit and partly out of net proceeds of fresh issue

D. Out of sale proceeds of fixed assets

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10.
A person starts a business with a capital of Rs. 45,000. He purchased goods on credit worth Rs. 5,000. These transactions can be expressed in an accounting equation as-

A. Rs. 50,000 = Rs. 50,000 - Rs. 45,000

B. Rs. 50,000 = Rs. 50,000 + 0

C. Rs. 50,000 = Rs. 45,000 + Rs. 5,000

D. Rs. 45, 000 = Rs. 50,000 - Rs. 5,000

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Accounting MCQ Questions and Solutions with Explanations | Commerce

1. Fixed assets are reported in the Balance Sheet at historical cost basis. This is done in order to comply with the accounting principle of:

Answer & Solution

2. Issue of debenture is a-

Answer & Solution

3. Arrange the following categories of share capital of a company in the correct order. 1. Paid-up capital 2. Issued capital 3. Called-up capital 4. Subscribed share capital

Answer & Solution

4. The term 'risk capital' denotes:

Answer & Solution

5. Bonus Shares can be issued out of:

Answer & Solution

6. The source of cash inflow in cash flow statement is:

Answer & Solution

7. If the average stock of a firm is Rs. 40,000 and its opening stock is Rs. 5,000 less than the closing stock, what would be the value of Opening Stock?

Answer & Solution

8. Capital account is opened in case of:

Answer & Solution

9. According to Section 80 of the Companies Act, 1956, a company cannot redeem its Preference shares out of:

Answer & Solution

10. A person starts a business with a capital of Rs. 45,000. He purchased goods on credit worth Rs. 5,000. These transactions can be expressed in an accounting equation as-

Answer & Solution

Read More Section(Accounting)

1.
Fixed assets are reported in the Balance Sheet at historical cost basis. This is done in order to comply with the accounting principle of:

2.
Issue of debenture is a-

3.
Arrange the following categories of share capital of a company in the correct order.
1. Paid-up capital
2. Issued capital
3. Called-up capital
4. Subscribed share capital

4.
The term 'risk capital' denotes:

5.
Bonus Shares can be issued out of:

6.
The source of cash inflow in cash flow statement is:

7.
If the average stock of a firm is Rs. 40,000 and its opening stock is Rs. 5,000 less than the closing stock, what would be the value of Opening Stock?

8.
Capital account is opened in case of:

9.
According to Section 80 of the Companies Act, 1956, a company cannot redeem its Preference shares out of:

10.
A person starts a business with a capital of Rs. 45,000. He purchased goods on credit worth Rs. 5,000. These transactions can be expressed in an accounting equation as-