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

71.
A machine was purchased on 1^st January 1992 for Rs. 5,00,000. A further sum of Rs. 5,000 for railway freight, Rs. 500 for local carriage and Rs. 5,000 on installation was spent on it. Depreciation is to be charged at 10% per annum on the written-down value method. On 31^st December 1994 the book-value of the machinery will be:

A. Rs. 3,64,500.00

B. Rs. 3,68,145.00

C. Rs. 3,72,154.00

D. Rs. 3,50,000.00

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72.
How are all adjustments made when capital accounts are fixed?

A. Partner's current account

B. Partner's capital account

C. Partner's fixed account

D. Partner's nominal account

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73.
Match both the lists and select the correct answer:

List-I List-II

a. Liquidity test 1. $$\frac{{{\text{All business creditors}}}}{{{\text{Average per day credit purchase}}}}$$

b. Functional ratio 2. $$\frac{{{\text{Subscribers fund}}}}{{{\text{Total assets}}}}$$

c. Prosperity 3. $$\frac{{{\text{Gross profit}}}}{{{\text{Net sales}}}} \times 100$$

d. General profitability 4. $$\frac{{{\text{Current assets}}}}{{{\text{Current liabilities}}}}$$

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

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

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

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

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74.
A, B and C enter into a partnership investing Rs. 35,000, Rs. 45,000 and Rs. 55,000 respectively. Find their respective shares in annual profit of Rs. 40,500.

A. Rs. 10,500, Rs. 13,500, Rs. 19,500

B. Rs. 10,500, Rs. 10,500, Rs. 21,500

C. Rs. 10,500, Rs. 13,500, Rs. 17,500

D. Rs. 10,500, Rs. 13,500, Rs. 16,500

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75.
Which of the following statement is incorrect?

A. Calls-in-arrear do not form part of paid-up capital

B. Preference shareholders get dividend at flexible rate

C. Share application account is a personal account

D. None of the above

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76.
In case of a company limited by shares the liability of a member is limited to the extent of:

A. Unpaid amount of shares held by him

B. Paid amount of shares held by him

C. Total amount of shares held by him

D. None of the above

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77.
For calculation of interest on drawing by a partner the following method can be used:

A. Cost Method

B. Supply Method

C. Product Method

D. None of the above

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78.
Which of the following transactions involve flow of fund:

A. Issue of shares for cash

B. Payment of bonus in shares

C. Cash paid to creditors

D. Purchase of building in exchange of land

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79.
A company may adopt policy to ''window dressing'' by manipulating the data such as
1. inventory valuation
2. omission of liability for goods purchased
3. treating short-term liability as long term debt
4. recording in advance cash receipts applicable to next accounting period
Select the correct answer:

A. 1

B. 1 and 2

C. 1, 2 and 3

D. 1, 2, 3 and 4

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80.
When the purchasing company makes payment of the purchase consideration, it debits

A. Business Purchase A/c

B. Assets A/c

C. Cash A/c

D. Vendor Company's A/c

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1 2 3 4 5 6 7 8 9 10

List-I	List-II
a. Liquidity test	1. $$\frac{{{\text{All business creditors}}}}{{{\text{Average per day credit purchase}}}}$$
b. Functional ratio	2. $$\frac{{{\text{Subscribers fund}}}}{{{\text{Total assets}}}}$$
c. Prosperity	3. $$\frac{{{\text{Gross profit}}}}{{{\text{Net sales}}}} \times 100$$
d. General profitability	4. $$\frac{{{\text{Current assets}}}}{{{\text{Current liabilities}}}}$$

Accounting MCQ Questions and Solutions with Explanations | Commerce

Answer & Solution

72. How are all adjustments made when capital accounts are fixed?

Answer & Solution

Answer & Solution

74. A, B and C enter into a partnership investing Rs. 35,000, Rs. 45,000 and Rs. 55,000 respectively. Find their respective shares in annual profit of Rs. 40,500.

Answer & Solution

75. Which of the following statement is incorrect?

Answer & Solution

76. In case of a company limited by shares the liability of a member is limited to the extent of:

Answer & Solution

77. For calculation of interest on drawing by a partner the following method can be used:

Answer & Solution

78. Which of the following transactions involve flow of fund:

Answer & Solution

Answer & Solution

80. When the purchasing company makes payment of the purchase consideration, it debits

Answer & Solution

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72.
How are all adjustments made when capital accounts are fixed?

74.
A, B and C enter into a partnership investing Rs. 35,000, Rs. 45,000 and Rs. 55,000 respectively. Find their respective shares in annual profit of Rs. 40,500.

75.
Which of the following statement is incorrect?

76.
In case of a company limited by shares the liability of a member is limited to the extent of:

77.
For calculation of interest on drawing by a partner the following method can be used:

78.
Which of the following transactions involve flow of fund:

80.
When the purchasing company makes payment of the purchase consideration, it debits