1870+ Financial Accounting Solved MCQs

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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151.	Lessor is the ………… Sol:
A.	Qwner
B.	User
C.	None
D.	Both
Answer» A. Qwner

152.	Lessee is the………… Sol:
A.	Owner
B.	User
C.	None
D.	Both
Answer» B. User

153.	What is minimum Rent? Sol:
A.	Payment for use of land which is fixed
B.	Payment for the use of land on the basis of output
C.	A payment made to owner
D.	None of the above
Answer» A. Payment for use of land which is fixed

154.	Minimum Rent is also called Sol:
A.	Dead Rent
B.	Rock Rent
C.	Fixed rent
D.	All of the above
Answer» D. All of the above

155.	Short working = …………………- Royalty Payable Sol:
A.	Minimum rent
B.	Capital
C.	Cash
D.	None
Answer» A. Minimum rent

156.	The minimum rent can ……………………….be proportionately, if there is a stoppage due to strike. Sol:
A.	Increase
B.	Decrease
C.	No change
D.	all
Answer» B. Decrease

157.	Royalty is a revenue expenditure to lessor Sol:
A.	True
B.	False
C.	none
D.	all
Answer» B. False

158.	minimum rent is also term as dead rent Sol:
A.	True
B.	False
C.	none
D.	all
Answer» A. True

159.	Royalty Account is …… Sol:
A.	Nominal account
B.	Real account
C.	Personal Account
D.	None of the above
Answer» A. Nominal account

160.	Short working is …………. Sol:
A.	Excess of minimum rent over the actual royalty
B.	Excess of actual royalty over minimum rent
C.	Excess of standard output over Actual output
D.	None of the above
Answer» A. Excess of minimum rent over the actual royalty

161.	Surplus is……………. Sol:
A.	Excess of minimum rent over the actual royalty
B.	Excess of actual royalty over minimum rent
C.	Excess of actual royalty over minimum rent
D.	None of the above
Answer» B. Excess of actual royalty over minimum rent

162.	When the royalty are less than the minimum rent ? Sol:
A.	Royalties account is debited with the actual amount of royalties earned
B.	Royalties account is debited with minimum rent
C.	Royalties account is debited with the amount paid to landlord
D.	Royalties account is debited with the excess of minimum rent over actual rent
Answer» A. Royalties account is debited with the actual amount of royalties earned

163.	Which of the following statement is false? Sol:
A.	Recoupable short working is a current assets
B.	Lapsed short working is a real account
C.	Short working is the part of minimum rent not represent by the use of right
D.	Both A and B
Answer» B. Lapsed short working is a real account

164.	Which of the following statement is false Sol:
A.	If a lessee leases a part of the leased property to another person , it is called sublease
B.	Royalty receivable account is opened in the books of Lessor
C.	Recoupable short working is a current assets
D.	None of the above
Answer» B. Royalty receivable account is opened in the books of Lessor

167.	In case f recoupment of shortworking, the lessee: Sol:
A.	Debits Shortworking Account
B.	Credit Profit and loss account
C.	Credit short working Account
D.	None of the above
Answer» C. Credit short working Account

165.	In the books of Lessee , short working recovered amount is debited to Sol:
A.	Profit and loss account
B.	Minimum rent Account
C.	Royalty Account
D.	Landlord’s Account
Answer» A. Profit and loss account

166.	If the royalty is less than minimum rent , the balance of royalty account at the end of the year has to be transfer to Sol:
A.	Capital reserve account.
B.	Reserve capita account
C.	Profit and loss account
D.	None of the above
Answer» C. Profit and loss account

168.	Shortworking means…… Sol:
A.	Excess of Minimum rent over royalty
B.	Excess of royalty over minimum rent
C.	None of the above
D.	all
Answer» A. Excess of Minimum rent over royalty

169.	Royalties are connected with the following types of business Sol:
A.	Mining
B.	Construction
C.	Textile
D.	All of the above
Answer» A. Mining

170.	royalty is an agreement between the following person Sol:
A.	Seller and buyer
B.	Banker and customer
C.	Among all partners
D.	Lessor and lessee
Answer» D. Lessor and lessee

171.	Dead rent is also called ………… Sol:
A.	Outstanding rent
B.	Minimum rent
C.	Prepaid rent
D.	All of the above
Answer» B. Minimum rent

172.	The objectives od fixing dead rent is ……….. Sol:
A.	Landlord should not get more than a certain amount per year
B.	Landlord must receive a minimum amount in case of low output or sales
C.	Both A and B
D.	None of the above
Answer» B. Landlord must receive a minimum amount in case of low output or sales

173.	Shortworking can be recouped only out of ……………….. Sol:
A.	Surplus
B.	Loss
C.	Extra Income
D.	Taxes
Answer» A. Surplus

174.	Royalties is calculated either on the basis of ……………….. Sol:
A.	Production
B.	Sales
C.	Output
D.	Both A and B
Answer» D. Both A and B

175.	Shortworking not recouped is debited to P/L Account Sol:
A.	True
B.	False
C.	none
D.	all
Answer» A. True

1870+ Financial Accounting Solved MCQs

Lessor is the ………… Sol:

Lessee is the………… Sol:

What is minimum Rent? Sol:

Minimum Rent is also called Sol:

Short working = …………………- Royalty Payable Sol:

The minimum rent can ……………………….be proportionately, if there is a stoppage due to strike. Sol:

Royalty is a revenue expenditure to lessor Sol:

minimum rent is also term as dead rent Sol:

Royalty Account is …… Sol:

Short working is …………. Sol:

Surplus is……………. Sol:

When the royalty are less than the minimum rent ? Sol:

Which of the following statement is false? Sol:

Which of the following statement is false Sol:

In the books of Lessee , short working recovered amount is debited to Sol:

If the royalty is less than minimum rent , the balance of royalty account at the end of the year has to be transfer to Sol:

In case f recoupment of shortworking, the lessee: Sol:

Shortworking means…… Sol:

Royalties are connected with the following types of business Sol:

royalty is an agreement between the following person Sol:

Dead rent is also called ………… Sol:

The objectives od fixing dead rent is ……….. Sol:

Shortworking can be recouped only out of ……………….. Sol:

Royalties is calculated either on the basis of ……………….. Sol:

Shortworking not recouped is debited to P/L Account Sol:

Recoupment of shortworking can be restricted or unrestricted Sol:

Calculate units manufactured during the year; Units Sold – 500, Opening stock – 100; Closing stock – 200 Sol:

Minimum Rent in the first year Rs 1,00,000 and will be increased by Rs 10,000 p.a. for three years and then after by 10% per year. What is the amount at the end of 6th year?

Royalty is Rs 64,000, Minimum rent Rs 80,000. Strike is for 3 months with no work done, Minimum rent to be reduced in proportion of time, find the amount paid to Landlord.

What is the example of wasting assets

Who is the person take the property on the lessee agreement

Royalty is an ………………….to lessee

When the lessor receives payment, the credits—

The balance of royalty‟s receivable account is transferred to — Sol:

The balance of royalty payable account is transferred to— Sol:

Under the average clause, the loss is suffered by both insurer and insured in the ratio of risk covered Sol:

………………..account is credited when lessor receive an amount Sol:

Royalty is an income to lessee Sol:

Fixed payment made for the used of an assets is called Financial Lease Sol:

Patent Royalty is based in Sales of a Product Sol:

Shortworking is Excess of Minimum Rent over Actual Production Sol:

Royalty is Rs 44,000, Minimum rent Rs 50,000. Strike is for 2 months with no work done, Minimum rent to be reduced in proportion of time, find the amount paid to Landlord.

Short working is a type of taxes paid by the lessee Sol:

Recoupment is always necessary in royalties Sol:

A person who take property on lease is called customer Sol:

Royalty accounting is covered under Companies Act 1956 Sol:

Partnership firm is constituted under the….

The maximum number of Partners which can be allowed as partners in a firm are…

The limit on the number of partners is indirectly placed by…

In peicemeal distribution of cash, the first external liabilities to be paid are…

The minimum rent can ……………………….be proportionately, if there is a stoppage
due to strike.
Sol:

If the royalty is less than minimum rent , the balance of royalty account at the end of the
year has to be transfer to
Sol:

Calculate units manufactured during the year; Units Sold – 500, Opening stock – 100;
Closing stock – 200
Sol:

Under the average clause, the loss is suffered by both insurer and insured in the ratio of
risk covered
Sol:

176.	Recoupment of shortworking can be restricted or unrestricted Sol:
A.	True
B.	False
C.	none
D.	all
Answer» A. True

177.	Calculate units manufactured during the year; Units Sold – 500, Opening stock – 100; Closing stock – 200 Sol:
A.	500
B.	700
C.	550
D.	600
Answer» D. 600

178.	Minimum Rent in the first year Rs 1,00,000 and will be increased by Rs 10,000 p.a. for three years and then after by 10% per year. What is the amount at the end of 6th year?
A.	Rs 100000
B.	Rs 157300
C.	Rs 168000
D.	Rs 200000
Answer» B. Rs 157300

179.	Royalty is Rs 64,000, Minimum rent Rs 80,000. Strike is for 3 months with no work done, Minimum rent to be reduced in proportion of time, find the amount paid to Landlord.
A.	Rs 60000
B.	Rs 80000
C.	Rs 64000
D.	Rs 100000
Answer» B. Rs 80000

180.	What is the example of wasting assets
A.	Land
B.	Mine
C.	Stock
D.	Fixed Assets
Answer» B. Mine

181.	Who is the person take the property on the lessee agreement
A.	Lessor
B.	Lessee
C.	Payee
D.	None of these
Answer» B. Lessee

182.	Royalty is an ………………….to lessee
A.	Income
B.	Expense
C.	Both
D.	None
Answer» B. Expense

183.	When the lessor receives payment, the credits—
A.	Lessee account
B.	Royalty account
C.	Short workings account.
D.	all
Answer» A. Lessee account

184.	The balance of royalty‟s receivable account is transferred to — Sol:
A.	Profit and loss account
B.	Royalties suspense account
C.	Production account.
D.	all
Answer» A. Profit and loss account

185.	The balance of royalty payable account is transferred to— Sol:
A.	Profit and loss account
B.	Royalties suspense account
C.	Production account
D.	all
Answer» C. Production account