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

81.
Which of the following items is not taken in profit and loss appropriation account?

A. Transfer to dividend equalisation reserve

B. Transfer to general reserve

C. Provision for taxation

D. Proposed dividend

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82.
If the current ratio of a company is 2 : 1, which of the following transactions would improve the ratio?

A. Issue of bonus shares

B. Issue of warrant

C. Purchase of stock of goods for cash

D. Payment of current liabilities

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83.
An expenditure is capital expenditure because

A. the amount is paid in lump-sum

B. the amount is large

C. it is related to the benefit of current year

D. it is related to the benefit of future

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84.
Which of the following acid test ratio can be said to be satisfactory:

A. 2 : 1

B. 1 : 2

C. 1 : 1

D. None of the above

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85.
Match List-I with List-II and choose the correct option:

List-I List-II

a. Surrender Value 1. Stock

b. Share holder becoming insane 2. Insurance policy

c. Share warrant 3. Transfer of shares

d. Fully-paid shares 4. Negotiable Document

A. a-1, b-2, c-3, d-4

B. a-4, b-2, c-3, d-1

C. a-2, b-3, c-4, d-1

D. a-4, b-2, c-1, d-3

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86.
'Proposed dividend' is shown under which head in company's balance sheet?

A. Current liabilities

B. Provision

C. Relevant

D. Reserve and surplus

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87.
Paid-up current ratio = 2.8
Acid test ratio = 1.5
Working capital = Rs. 1,62,000
What will be liquid asset?

A. Rs. 2,52,000

B. Rs. 1,35,000

C. Rs. 90,000

D. Rs. 2,43,000

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88.
Under which of the following method of depreciation the amount of asset is never reduced to zero?

A. Fixed Installation method

B. Diminishing balance method

C. Annuity method

D. The sum of year digit method

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89.
'Contingent liability' is a liability

A. Which does not exist in present, but will arise in future

B. Which will be paid by another person

C. Which existence or non-existence depends on happening of a certain event

D. Which is not paid in previous years

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90.
A machine was bought on 1^st January, 1994 for Rs. 10,000. Its working life was estimated to be four years. The method of depreciation used is the 'sum of the year digit'. The machine was discarded and sold on 30^th June, 1996 for Rs. 1,000. The profit/loss on sale of the discarded machine was:

A. Rs. 1,120 loss

B. Rs. 2,250 loss

C. Rs. 1,500 loss

D. Rs. 1,000 loss

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1 2 3 4 5 6 7 8 9 10

List-I	List-II
a. Surrender Value	1. Stock
b. Share holder becoming insane	2. Insurance policy
c. Share warrant	3. Transfer of shares
d. Fully-paid shares	4. Negotiable Document

Accounting MCQ Questions and Solutions with Explanations | Commerce

81. Which of the following items is not taken in profit and loss appropriation account?

Answer & Solution

82. If the current ratio of a company is 2 : 1, which of the following transactions would improve the ratio?

Answer & Solution

83. An expenditure is capital expenditure because

Answer & Solution

84. Which of the following acid test ratio can be said to be satisfactory:

Answer & Solution

85. Match List-I with List-II and choose the correct option: List-I List-II a. Surrender Value 1. Stock b. Share holder becoming insane 2. Insurance policy c. Share warrant 3. Transfer of shares d. Fully-paid shares 4. Negotiable Document

Answer & Solution

86. 'Proposed dividend' is shown under which head in company's balance sheet?

Answer & Solution

87. Paid-up current ratio = 2.8 Acid test ratio = 1.5 Working capital = Rs. 1,62,000 What will be liquid asset?

Answer & Solution

88. Under which of the following method of depreciation the amount of asset is never reduced to zero?

Answer & Solution

89. 'Contingent liability' is a liability

Answer & Solution

90. A machine was bought on 1st January, 1994 for Rs. 10,000. Its working life was estimated to be four years. The method of depreciation used is the 'sum of the year digit'. The machine was discarded and sold on 30th June, 1996 for Rs. 1,000. The profit/loss on sale of the discarded machine was:

Answer & Solution

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81.
Which of the following items is not taken in profit and loss appropriation account?

82.
If the current ratio of a company is 2 : 1, which of the following transactions would improve the ratio?

83.
An expenditure is capital expenditure because

84.
Which of the following acid test ratio can be said to be satisfactory:

85.
Match List-I with List-II and choose the correct option:

List-I List-II

a. Surrender Value 1. Stock

b. Share holder becoming insane 2. Insurance policy

c. Share warrant 3. Transfer of shares

d. Fully-paid shares 4. Negotiable Document

86.
'Proposed dividend' is shown under which head in company's balance sheet?

87.
Paid-up current ratio = 2.8
Acid test ratio = 1.5
Working capital = Rs. 1,62,000
What will be liquid asset?

88.
Under which of the following method of depreciation the amount of asset is never reduced to zero?

89.
'Contingent liability' is a liability

90.
A machine was bought on 1^st January, 1994 for Rs. 10,000. Its working life was estimated to be four years. The method of depreciation used is the 'sum of the year digit'. The machine was discarded and sold on 30^th June, 1996 for Rs. 1,000. The profit/loss on sale of the discarded machine was: