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

21.
Those preference shares which do not carry the right of share in excess profits are known as . . . . . . . . preference shares.

A. irredeemable

B. non-cumulative

C. non-convertible

D. non-participating

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22.
. . . . . . . . is given to promote sales.

A. Cash discount

B. Trade discount

C. Quantity discount

D. Price discount

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23.
Accounting does not record non-financial transactions because of:

A. Entity concept

B. Accrual concept

C. Measurement concept

D. Double entry concept

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24.
Which of the following are applicable to sinking fund method of depreciation?
I. Periodic depreciation is smaller than the assets, actual annual depreciable cost
II. Amount of interest constantly declines due to assets, reducing balances
III. Annual net incidence on profit and loss account remains constant due to incorporation of only fixed depreciation
IV. Periodic depreciation is recorded through the assets account
Select the correect answer using the options given below:

A. II and IV

B. I and III

C. I, II and III

D. II, III and IV

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25.
Dividend is paid on . . . . . . . . capital.

A. called

B. paid up

C. issued

D. None of these

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26.
Which of the following are current assets?

A. Bank loan for three years

B. Account receivable

C. Long-term investments

D. Debentures sinking fund investments

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27.
Accounting principles are generally based on:

A. practicability

B. subjectivity

C. convenience in recording

D. applicability

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28.
In stock valuation, appilcation of the principle 'at cost price or market price whichever is lower' will result in the valuation of stock sometimes at cost price and at other times at market price. This is an application of the principle of:

A. Consistency

B. Materiality

C. Conservatism

D. Disclosure

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29.
The purpose of depreciation is to:

A. reduce fixed assets to market value each year

B. save income tax and wealth tax

C. reduce fixed assets to nil as soon as possible assets top expense over their working lives

D. allocate the cost of fixed

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30.
Under purchase method of amalgamation, . . . . . . . . of the transferor company continues to appear in the balance sheet of the transferee company.

A. capital reserve

B. general reserve

C. statutory reserve

D. specific reserve

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Accounting MCQ Questions and Solutions with Explanations | Commerce

21. Those preference shares which do not carry the right of share in excess profits are known as . . . . . . . . preference shares.

Answer & Solution

22. . . . . . . . . is given to promote sales.

Answer & Solution

23. Accounting does not record non-financial transactions because of:

Answer & Solution

Answer & Solution

25. Dividend is paid on . . . . . . . . capital.

Answer & Solution

26. Which of the following are current assets?

Answer & Solution

27. Accounting principles are generally based on:

Answer & Solution

28. In stock valuation, appilcation of the principle 'at cost price or market price whichever is lower' will result in the valuation of stock sometimes at cost price and at other times at market price. This is an application of the principle of:

Answer & Solution

29. The purpose of depreciation is to:

Answer & Solution

30. Under purchase method of amalgamation, . . . . . . . . of the transferor company continues to appear in the balance sheet of the transferee company.

Answer & Solution

Read More Section(Accounting)

21.
Those preference shares which do not carry the right of share in excess profits are known as . . . . . . . . preference shares.

22.
. . . . . . . . is given to promote sales.

23.
Accounting does not record non-financial transactions because of:

25.
Dividend is paid on . . . . . . . . capital.

26.
Which of the following are current assets?

27.
Accounting principles are generally based on:

28.
In stock valuation, appilcation of the principle 'at cost price or market price whichever is lower' will result in the valuation of stock sometimes at cost price and at other times at market price. This is an application of the principle of:

29.
The purpose of depreciation is to:

30.
Under purchase method of amalgamation, . . . . . . . . of the transferor company continues to appear in the balance sheet of the transferee company.