MCQ on Indian Railways Administration and Finance An introduction
(Accounting Process)-PC-11
1) Following
are the users of accounting information.
A) Creditors
B) Lenders
C) Customers
D) All the
above.
2)
‘For each and Every Debit there must be a
corresponding Credit’ is the principal of____
A) Going
Concern
B) Real
Account.
C) Book-Keeping
D) Double
Entry
3) The
balance of the petty cash is
(A) An expense
(B) An income
(C) An asset
(D) A liability
4) Fixed
Assets are
(A) Kept in
the business for use over long time for earning income
(B) Meant
for resale
(C) Meant
for conversion
(D) All of
the above
5) The
term ‘Debtor’ means
A) A person
who owes something to the business
B) A person
to whom something is owing by the business
C) Both of
the above.
D) None of
the above.
6) A
trial balance will not balance if
(A) Correct
Journal entry is posted twice
(B) The
purchase on credit basis is debited to purchases and credited to cash
(C)
Rs.1,000 cash payment to creditors is debited to
creditors for Rs.100 and credited to cash Rs.1,000.
(D) None of
the above.
7) After
the preparation of ledgers , the next step is preparation of
(A) Trading Account
(B) Trial Balance
(C) Profit and Loss account
(D) Balance Sheet
8)
After preparing the trial balance the accountant
finds that the total of debit side is short by Rs.3,000. The difference will be
(A) Credited
to suspense account
(B) Debited
to suspense account
(C) Adjusted
to any of the debit balance account
(D) Adjusted
to any of the credit balance.
9) Rs.20,000 paid as wages for erecting a
machine should debited to
A)
Repair account
B)
Capital account
C)
Machine account
D)
Furniture account.
10) Sales of office furniture should be credited
to
A)
Sales account
B)
Furniture Account
C)
Purchases account
D)
Cash account
11) Rent paid to landlord is credited to
A)
Landlord’s a/c
B)
Bad debts a/c
C)
Cash a/c
D)
None
12) Which of the following statements is true?
A)
The term “ financial Statements includes both
analysis and Interpretation”
B)
On the basis of modus operandi, financial
analysis can be classified as external analysis and internal analysis.
C)
Vertical analysis refers to the comparison of
financial data of a company for several years.
D)
Horizontal analysis is also known as “static
analysis”
13) Accounting provides information on
A)
Cost and income for managers
B)
Company’s tax liability for a particular year
C)
Financial conditions of an institution
D)
All of the above.
14)
If the assets of a business are Rs.3,00,000 and
its capital Rs.1,00,000, the liabilities of this business are
A)
4,00,000
B)
2,00,000
C)
1,00,000
D)
3,00,000
15)
Effect of machinery purchased for cash
A)
Decrease in total assets
B)
Increase in total assets.
C)
No change in the total assets.
D)
Decrease in total liabilities.
16)
Recording of outstanding salary is based on
A)
Accrual concept
B)
Going concern concept
C)
Cost concept
D)
Business entity concept
17) Goodwill Account is a
A)
Nominal Account
B)
Personal Account
C)
Real Account
D)
None
18)
A withdrawal of goods from business by the
proprietor should be credited to which Account.
A)
Cash Account
B)
Proprietor Account
C)
Capital Account
D)
Purchases Account
19) What checks the arithmetical accuracy of
ledger accounts?
A)
Ledger
B)
Account
C)
Trial Balance
D)
Final Accounts.
20)
The process of transferring debit and credit
items from a journal to their respective Accounts in the ledger is termed as
A)
Ledger Posting
B)
Journalising
C)
Balancing
D)
Accounting.
21)
Cash book is journal as well as
A)
Cash Account
B)
Ledger
C)
Journal
D)
Both cash and journal.
22)
Financial position of a business is ascertained
on the basis of:
A)
Records prepared under book-keeping process.
B)
Trial Balance
C)
Accounting reports
D)
None of the above
23)
If the Assets of a business on 31St March 2020 are worth Rs.5,00,000 and its
Capital Rs.3,50,000, its Liabilities on that date shall be
A)
Rs.8,50,000
B)
Rs.1,50,000
C)
Rs.3,50,000
D)
Rs.5,00,000
24)
Classify the money spent of Rs.1,00,000 as
travelling expenses of the Member
Mechanical on trips abroad
for purchase of capital asset is
(A)
Capital expenditure
(B)
Revenue expenditure
(C)
Deferred Revenue Expenditure
(D)
None of the above
25) If an
individual asset is increased, there will be a corresponding
(A) Increase of another asset or increase of capital
(B) Decrease of another asset or increase of liability
(C) Decrease of specific liability or decrease of capital
(D) Increase in drawings and liability
26)
Contingent Asset usually arises from unplanned
or unexpected events that give rise to:
(A) The
possibility of an inflow of economic benefits to the business entity
(B) The
possibility of an outflow of economic benefits to the business entity
(C) Either
a) or b)
(D) None of
the above
27) Balance of indirect expenses accounts are transferred to
A) Trading
Account
B) Profit
& Loss account
C) Balance
Sheet
D) Trial
Balance.
28) The
capital of a sole trader would change as a result of
(A) A creditor being paid his account by cheque
(B) Raw materials being purchased on credit
(C) Fixed assets being purchased on credit
(D) Wages being paid in cash
29) A
decrease in the provision for doubtful debts would result in:
(A) An increase in liabilities
(B) A decrease in working capital
(C) A decrease in net profits
(D) An increase in Net profits
30) The
Debts written off as bad, if recovered subsequently are
A) Credited
to Bad Debts recovered account
B) Credited
to Debtors Account
C) Debited
to Profit and Loss Account
D) None of
the above
31) Provision for Bad and Doubtful Debts is treated in the balance sheet
as
A) Added to
Debtors
B) Deducted
from Creditors
C) Added to
Creditors
D) Deducted
from Debtors
32) Identified and measured economic events should be recorded in
A) chronological
order
B) Alphabetical
order
C) Both
D) None .
33) A Suspense Account balance is
A) Debit
B) Credit
C) Debit or
credit
D) None of
them
34) When a debtor pays her dues
A) Assets
side of Balance sheet will increase
B) Assets
side of Balance Sheet will decrease
C) Liabilities
side of Balance Sheet will increase
D) There
will be no change in total assets or total liabilities
35) Claim admitted in respect of stock destroyed by fire will be
credited to
A) Profit
and Loss Account
B) Purchases
Account
C) Loss
Account due to fire
D) Balance
sheet.
36) Patents, Copyrights and Trademarks are
A) Current
assets
B) Fixed
assets
C) Intangible
assets
D) Investments.
37) Balance sheets are prepared
A) Daily
B) Weekly
C) Monthly
D) Annually.
38) Book-Keeping is mainly concerned with
A) recording
of financial data.
B) Designing
the systems of classifying and summarising the recorded data.
C) Interpreting
the data for internal and external users.
D) All of
the above.
39) Preparation
of a Trial balance is for:
(A) Locating Errors
(B) Locating errors of principles
(C) The trial balance to agree.
(D) None of the above
40) Cash
Book which is maintained to record small expenses is called.
(A) Simple Cash book
(B) petty cash book.
(C) Two column Cash Book.
(D) Triple Column Cash Book.
41) What is
that maintained for known liabilities
(A) Provision
(B) Reserve
(C) Capital
Reserve
(D) Reserve
Fund
42)
Closing, Rectification and Adjustment entries
are made in which subsidiary Book.
(A) Cash
Book
(B) Adjustment
Book
(C) Journal
Proper
(D) Ledger.
43) Journal
Proper records
(A) All transactions
(B) All cash Transactions
(C) All transactions not recorded in any subsidiary books
(D) All credit Transactions
44) Real
Account records
(A) Dealings
with creditors or debtors
(B) Dealings
in commodities
(C) Gains
and losses
(D) All of
the above.
45)
The following is a statement showing the
financial status of the company at any given time
(A) Trading
account
(B) Profit
and Loss statements
(C) Balance
sheet
(D) Cash
book.
46) Which of
the following statements is correct?
(A) Goodwill is a fictitious asset
(B) Patents are tangible asset
(C) Debtors are current liability
(D) Land is a Current asset.
47)
After sale of goods worth Rs.20,000 on
March31,2020, a proprietor is left with closing stock of Rs. 10,000. This is
(A) An event
(B) A
transaction
(C) A
transaction as well as event
(D) neither
a transaction or Event.
48) Assets
are held in business for the purpose of
(A) Resale
(B) Conversion into cash
(C) Earning revenue
(D) None of them.
49) General
Reserve is treated in Balance sheet as
(A) Asset
(B) Liability
(C) Outstanding Income
(D) Both as an Asset and a Liability.
50) Identified
& Measured economic events should be recorded in
(A) Chronological order
(B) Alphabetical order
(C) Both
(D) None .
51) A
Suspense Accounts shows this balance
(A) Debit
(B) Credit
(C) Debit or credit
(D) None of them
52) A Profit
on the disposal of a fixed asset can also be described as an
(A) Over provision for depreciation on the asset
(B) Increase in Fixed Assets on the Balance Sheet
(C) Under provision for depreciation on the asset
(D) None of the above
53) Capital
is the difference between
(A) Income
and expenses
(B) Sales
and cost of goods sold
(C) Assets
and Liabilities
(D) None of
the above
54) The
following is not shown in the Balance Sheet
(A) Fixed deposit
(B) Opening stock
(C) Mortgage on land
(D) Bank overdraft.
55) Disagreement
of a trial balance indicates the following error
(A) Error of Omission
(B) Error of Commission
(C) Duplicating error
(D) One sided Error.
56) Which of
the following Statements is false
(A) Assets
will be equal to capital, if there are no liabilities
(B) Basic
Concepts bring uniformity in Accounting
(C) Income =
Revenue- Expenses
(D) According
to business entity concept the existence of business and proprietors is one and
the same.
57) Which of the following Statements is false
(A) Assets will be equal to capital, if there are no liabilities
(B) Basic Concepts bring uniformity in Accounting
(C) Income = Revenue- Expenses
(D) According to business entity concept the
existence of business and proprietors is one and the same.
Answer key
Accounting process
|
1D |
2D |
3C |
4A |
5A |
6C |
7B |
8B |
9C |
10B |
11C |
12A |
|
13D |
14B |
15C |
16A |
17C |
18D |
19C |
20A |
21B |
22C |
23B |
24A |
|
25B |
26A |
27B |
28D |
29D |
30A |
31D |
32A |
33C |
34D |
35B |
36C |
|
37D |
38A |
39C |
40B |
41A |
42C |
43C |
44B |
45C |
46A |
47A |
48C |
|
49B |
50A |
51C |
52A |
53C |
55B |
56D |
57D |
|
|
|
|
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