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

21.
The strongest letter of credit is

A. Confirmed and irrecoverable

B. Cancelable

C. Irrecoverable

D. Confirmed

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22.
Profit earned before acquisition of share is treated as

A. capital profit

B. revenue profit

C. general reserve

D. revaluation loss

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23.
Arrange the following steps of preparation of consolidated balance sheet correctly.
1. Calculation of pre-acquisition profits
2. Calculation of minority interest
3. Calculation of post-acquisition profits
4. Calculation of cost of capital

A. 4, 3, 2, 1

B. 2, 4, 1, 3

C. 3, 1, 4, 2

D. 3, 4, 1, 2

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24.
Match the following:

List-I List-II

a. Interest on partner's capital is chargeable to the extent of available . . . . . . . . 1. competing

b. The amount due to the retiring partner can be made by . . . . . . . . payment method. 2. mutual

c. A partner must not carry on a . . . . . . . . business. 3. profit

d. Partners are . . . . . . . . for each other. 4. lumpsum

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

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

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

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

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25.
In the case of retirement of a partner, the total amount of goodwill is credited to the account of:

A. retiring partners only

B. the remaining partners only

C. all partners

D. none of the above

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26.
An asset is purchased for Rs. 50,000 on which depreciation is charged according to straight line method. The useful life of asset is 10 years and its residual value is Rs. 10,000. The rate of depreciation will be

A. 20%

B. 18%

C. 10%

D. 8%

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27.
Income and Expenditure accounts shows-

A. Gross profit

B. Net profit

C. Financial condition

D. None of the above

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28.
Match the items of the following two lists

List-I List-II

a. Zero-base budgeting 1. Internal reconstruction

b. Goodwill or capital reserve 2. Earnings per share

c. Reduction of capital 3. Control of expenditure

d. Basic and diluted 4. Business combination

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

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

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

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

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29.
Match List-I with List-II and select the correct answer:

List-I List-II

a. Cost of pulling down an old structure preparatory to construct a new one 1. Capital loss

b. Purchase of a new spark plug for an old car 2. Revenue loss

c. Expenditure incurred on Research and Development 3. Capital expenditure

d. Theft by cashier during business hours 4. Revenue expenditure

e. Motor car burnt during a riot 5. Deferred revenue expenditure

A. a-4, b-3, c-5, d-1, e-2

B. a-3, b-4, c-5, d-2, e-1

C. a-2, b-5, c-3, d-1, e-4

D. a-5, b-4, c-3, d-2, e-1

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30.
Shares are of following types

A. 4

B. 3

C. 2

D. 5

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1 2 3 4 5 6 7 8 9 10

List-I	List-II
a. Interest on partner's capital is chargeable to the extent of available . . . . . . . .	1. competing
b. The amount due to the retiring partner can be made by . . . . . . . . payment method.	2. mutual
c. A partner must not carry on a . . . . . . . . business.	3. profit
d. Partners are . . . . . . . . for each other.	4. lumpsum

List-I	List-II
a. Zero-base budgeting	1. Internal reconstruction
b. Goodwill or capital reserve	2. Earnings per share
c. Reduction of capital	3. Control of expenditure
d. Basic and diluted	4. Business combination

List-I	List-II
a. Cost of pulling down an old structure preparatory to construct a new one	1. Capital loss
b. Purchase of a new spark plug for an old car	2. Revenue loss
c. Expenditure incurred on Research and Development	3. Capital expenditure
d. Theft by cashier during business hours	4. Revenue expenditure
e. Motor car burnt during a riot	5. Deferred revenue expenditure

Accounting MCQ Questions and Solutions with Explanations | Commerce

21. The strongest letter of credit is

Answer & Solution

22. Profit earned before acquisition of share is treated as

Answer & Solution

23. Arrange the following steps of preparation of consolidated balance sheet correctly. 1. Calculation of pre-acquisition profits 2. Calculation of minority interest 3. Calculation of post-acquisition profits 4. Calculation of cost of capital

Answer & Solution

Answer & Solution

25. In the case of retirement of a partner, the total amount of goodwill is credited to the account of:

Answer & Solution

26. An asset is purchased for Rs. 50,000 on which depreciation is charged according to straight line method. The useful life of asset is 10 years and its residual value is Rs. 10,000. The rate of depreciation will be

Answer & Solution

27. Income and Expenditure accounts shows-

Answer & Solution

28. Match the items of the following two lists List-I List-II a. Zero-base budgeting 1. Internal reconstruction b. Goodwill or capital reserve 2. Earnings per share c. Reduction of capital 3. Control of expenditure d. Basic and diluted 4. Business combination

Answer & Solution

Answer & Solution

30. Shares are of following types

Answer & Solution

Read More Section(Accounting)

21.
The strongest letter of credit is

22.
Profit earned before acquisition of share is treated as

23.
Arrange the following steps of preparation of consolidated balance sheet correctly.
1. Calculation of pre-acquisition profits
2. Calculation of minority interest
3. Calculation of post-acquisition profits
4. Calculation of cost of capital

25.
In the case of retirement of a partner, the total amount of goodwill is credited to the account of:

26.
An asset is purchased for Rs. 50,000 on which depreciation is charged according to straight line method. The useful life of asset is 10 years and its residual value is Rs. 10,000. The rate of depreciation will be

27.
Income and Expenditure accounts shows-

28.
Match the items of the following two lists

List-I List-II

a. Zero-base budgeting 1. Internal reconstruction

b. Goodwill or capital reserve 2. Earnings per share

c. Reduction of capital 3. Control of expenditure

d. Basic and diluted 4. Business combination

30.
Shares are of following types