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1680+ more mcqs Solved MCQs

in Financial Accounting

These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Business Administration in Computer Applications (BBA [CA]) , Bachelor of Business Administration (BBA) , Bachelor of Accounting and Finance (BAF) , Bachelor of Commerce (B Com) , Cost Accounting .

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251.	Profit and Loss Account of General Insurance Companies are prepared in …………
A.	Form A‐PL
B.	Form B‐RA
C.	Form B‐PL
D.	Form B‐BS
Answer» C. Form B‐PL

252.	The principle of subrogation is applicable to……………
A.	Fire Insurance
B.	Marine Insurance
C.	Burglary Insurance
D.	All of these
Answer» D. All of these

253.	Opening capital is ascertained by preparing:
A.	Cash book
B.	Creditors A/c
C.	Debtors A/c
D.	Opening statement of affairs.
Answer» D. Opening statement of affairs.

254.	A Single entry system it:
A.	Complete and scientific system
B.	Incomplete and unscientific
C.	Incomplete and scientific
D.	Complete and unscientific
Answer» B. Incomplete and unscientific

255.	Single Entry system has effect:
A.	One effect
B.	Tow effect
C.	Three effect
D.	None of the above
Answer» A. One effect

256.	In Single entry system, it is not possible to prepare:
A.	Receipts and payments A/c
B.	Trial balance
C.	Balance sheet
D.	Account sales
Answer» B. Trial balance

257.	A Single entry system is usually adopted by:
A.	Company
B.	Partnership
C.	Government
D.	None of above
Answer» C. Government

258.	Single Entry system is must suited where:
A.	Cash transactions are many
B.	Credit transactions are many.
C.	Cash & credit transactions are more
D.	None of the above
Answer» A. Cash transactions are many

259.	Capital can be obtained by preparing:
A.	Cash book
B.	Statement of affairs
C.	Debtors A/c
D.	Creditors A/c
Answer» B. Statement of affairs

260.	Credit sale can be obtained by preparing:
A.	Cash book
B.	Statement of affairs
C.	Debtors A/c
D.	Creditors A/c
Answer» C. Debtors A/c

261.	Credit Purchase can be calculated by preparing:
A.	Cash book
B.	Statement of affairs
C.	Debtors A/c
D.	Creditors A/c
Answer» D. Creditors A/c

262.	In single entry system profit is calculated as follows:
A.	Opening Capital + Drawing + Fresh Capital- Ending capital
B.	Capital at the end – Drawing – Fresh capital - Opening capital
C.	Capital at the end + Drawing – Fresh capital -Opening capital
D.	None of the above
Answer» C. Capital at the end + Drawing – Fresh capital -Opening capital

263.	In single entry system only accounts are opened:
A.	Personal A/c
B.	Real A/c
C.	Nominal A/c
D.	Real & Nominal A/c
Answer» A. Personal A/c

264.	Single entry system cannot be a maintained by:
A.	Joint stock company
B.	Partnership A/c
C.	Sole-tradership A/c
D.	All of these
Answer» A. Joint stock company

265.	Single entry system of book – keeping is generally followed by:
A.	Small business
B.	Non – trading
C.	Large business
D.	None
Answer» A. Small business

266.	A Statement of assets and liabilities prepared under the single entry system is called:
A.	Balance sheet
B.	Financial statement
C.	Cash statement
D.	Statement of affairs
Answer» D. Statement of affairs

267.	Net worth of an organization means the excess of its total assets over total:
A.	Expenses
B.	Incomes
C.	Liabilities
D.	Both (a) and (b)
Answer» C. Liabilities

268.	Which one of is most likely to have the lowest rate of stock turn:
A.	Jeweler
B.	Green grocer
C.	Super market
D.	News agent
Answer» A. Jeweler

269.	If a store’s mark up is 25% the margin must be:
A.	5%
B.	15%
C.	10%
D.	20%
Answer» D. 20%

270.	If the rate of G.P on sale is 20% and cost of goods, sold is Rs. 100,000, then amount of G.P will be equal to:
A.	Rs. 20,000
B.	Rs.25,000
C.	Rs.35,000
D.	Rs.15,000
Answer» B. Rs.25,000

271.	Bad -debts written off always affect the:
A.	Debtors A/c
B.	Creditor A/c
C.	Cash A/c
D.	None of these
Answer» A. Debtors A/c

272.	Company has ……………
A.	Separate Legal Entity
B.	Perpetual Existence
C.	Limited Liability
D.	All of the Above
Answer» D. All of the Above

273.	Shareholders are :
A.	Customers of the Company
B.	Owners of the Company
C.	Creditors of the Company
D.	None of these
Answer» B. Owners of the Company

274.	Who are the real owners of a company?
A.	Government
B.	Board of Directors
C.	Equity shareholders
D.	Debentureholders
Answer» C. Equity shareholders

275.	A Company is created by :
A.	Special act of the Parliament
B.	Companies Act
C.	Investors
D.	Members
Answer» B. Companies Act

1680+ more mcqs Solved MCQs

Profit and Loss Account of General Insurance Companies are prepared in …………

The principle of subrogation is applicable to……………

Opening capital is ascertained by preparing:

A Single entry system it:

Single Entry system has effect:

In Single entry system, it is not possible to prepare:

A Single entry system is usually adopted by:

Single Entry system is must suited where:

Capital can be obtained by preparing:

Credit sale can be obtained by preparing:

Credit Purchase can be calculated by preparing:

In single entry system profit is calculated as follows:

In single entry system only accounts are opened:

Single entry system cannot be a maintained by:

Single entry system of book – keeping is generally followed by:

A Statement of assets and liabilities prepared under the single entry system is called:

Net worth of an organization means the excess of its total assets over total:

Which one of is most likely to have the lowest rate of stock turn:

If a store’s mark up is 25% the margin must be:

If the rate of G.P on sale is 20% and cost of goods, sold is Rs. 100,000, then amount of G.P will be equal to:

Bad -debts written off always affect the:

Company has ……………

Shareholders are :

Who are the real owners of a company?

A Company is created by :

Equity shares cannot be issued for the purpose of:

The shares on which there is no any pre-fixed rate of dividend is decided, but the rate of dividend is fluctuating every year according to the availability of profits, such share are called :

Preference shares, in case the holders of these have a right to convert their preference shares into equity shares at their option according to the terms of issue, such shares are called :

Which shareholders have a right to receive the arrears of dividend from future profits :

Which shareholders are returned their capital after some specified time :

The following statements apply to equity/preference shareholders. Which one of them applies only to preference shareholders?

Unless otherwise stated, a preference share is always deemed to be :

The portion of the capital which can be called-up only on the winding up of the Company is called

Capital included in the Total of Balance Sheet of a Company is called :

Reserve Capital is also known by :

In the Balance Sheet of a company, under the heading share capital, at the last is shown :

Reserve Capital is a part of:

Which of the following statements is true? (C.S. Foundation, Dec. 2012)

In case of private placement of shares, to raise the amount of capital a company :

Shares issued by a company to its employees or directors in consideration of ‘Intellectual Property Rights’ are called :

Public subscription of shares include :

Issue of shares at a price lower than its face value is called :

Persons who start a company are called ……………….

Share Application Account is in the nature of:

If vendors are issued fully paid shares of 1,25,000 in consideration of net assets of ?1,50,000, the balance of 25,000 will be credited to :

Premium on the issue of shares should be shown :

From which account, expenses on issue of shares will be written off first of all:

Pro-rata allotment of shares is made when there is :

If applicants for 80,000 shares were allotted 60,000 shares on prorata basis, the shareholder who was allotted 1,200 shares must have applied for :

If 500 shares of 10 issued at a premium of 1 on which 9 (including premium) have been called and 7 including premium have been paid are forfeited, the forfeiture account should be credited by :

276.	Equity shares cannot be issued for the purpose of:
A.	Cash Receipts
B.	Purchase of assets
C.	Redemption of debentures
D.	Distribution of dividend
Answer» D. Distribution of dividend

277.	The shares on which there is no any pre-fixed rate of dividend is decided, but the rate of dividend is fluctuating every year according to the availability of profits, such share are called :
A.	Equity Share
B.	Non-cumulative preference share
C.	Non-convertible preference share
D.	Non-guaranteed preference share
Answer» A. Equity Share

278.	Preference shares, in case the holders of these have a right to convert their preference shares into equity shares at their option according to the terms of issue, such shares are called :
A.	Cumulative Preference Share
B.	Non-cumulative Preference Share
C.	Convertible Preference Share
D.	Non-convertible Preference Share
Answer» C. Convertible Preference Share

279.	Which shareholders have a right to receive the arrears of dividend from future profits :
A.	Redeemable Preference Shares
B.	Participating Preference Shares
C.	Cumulative Preference Shares
D.	Non-Cumulative Preference Shares
Answer» C. Cumulative Preference Shares

280.	Which shareholders are returned their capital after some specified time :
A.	Redeemable Preference Shares
B.	Irredeemable Preference Shares
C.	Cumulative Preference Shares
D.	Participating Preference Shares
Answer» A. Redeemable Preference Shares

281.	The following statements apply to equity/preference shareholders. Which one of them applies only to preference shareholders?
A.	Shareholders risk the loss of investment
B.	Shareholders bear the risk of no dividends in the event of losses
C.	Shareholders usually have the right to vote
D.	Dividends are usually given at a set amount in every’ financial year.
Answer» D. Dividends are usually given at a set amount in every’ financial year.

282.	Unless otherwise stated, a preference share is always deemed to be :
A.	Cumulative, participating and non-convertible
B.	Non-cumulative, non-participating and non-convertible
C.	Cumulative, non-participating and non-convertible
D.	Non-cumulative, participating and non-convertible
Answer» C. Cumulative, non-participating and non-convertible

283.	The portion of the capital which can be called-up only on the winding up of the Company is called
A.	Authorised Capital
B.	Called up Capital
C.	Uncalled Capital
D.	Reserve Capital
Answer» D. Reserve Capital

284.	Capital included in the Total of Balance Sheet of a Company is called :
A.	Issued Capital
B.	Subscribed Capital
C.	Called up Capital
D.	Authorised Capital
Answer» B. Subscribed Capital

285.	Reserve Capital is also known by :
A.	Capital Reserve
B.	Called up Capital
C.	Subscribed Capital
D.	None of the above
Answer» D. None of the above