Accounting Mcqs – (Management Sciences) MCQs Latest For FPSC, PPSC, NTS, KPPSC, SPSC & Other Tests
“ Accounting Mcqs “. Tab this page to check “Latest Accounting MCQs” for the preparation of competitive mcqs, FPSC mcqs, PPSC mcqs, SPSC mcqs, KPPSC mcqs, AJKPSC mcqs, BPSC mcqs, NTS mcqs, PTS mcqs, OTS mcqs, Atomic Energy mcqs, Pak Army mcqs, Pak Navy mcqs, CTS mcqs, ETEA mcqs and others. The most occurred mcqs of Accounting in past papers. Past papers of Accounting mcqs. Past papers of Accounting MCQs. Accounting Mcqs are the necessary part of any competitive / job related exams. The Accounting mcqs having specific numbers in any written test. It is therefore everyone have to learn / remember the related Accounting mcqs. The Important series of Accounting Mcqs are given below:
A systematic way to maintain the books of accounts is called_________?
A. Economics
B. Accountancy
C. Book Keeping
D. Auditing
An Art of reading, classifying & Summarizing of accounts in a systematic way is called__________?
A. Accounting
B. Auditing
C. Accountancy
D. Book Keeping
The maintenance of accounts in a systematic way is called__________?
A. Reading
B. Accounting
C. Book Keeping
D. Auditing
Goods Return by the customer are termed as :
A. Customer return
B. Purchase return
C. Sales return
D. Inventory return
Modern system of book keeping is called______________?
A. Double entry system
B. Single entry system
C. American system
D. Italic system
The person to whom goods are sold on credit is called___________?
A. Seller
B. Buyer
C. Debtor
D. Creditor
Double entry means______________?
A. Entry at two ends
B. Entry in two sets of books
C. Entry at two dates
D. Entry for two aspects of the transaction
Discount received is a/an:
A. Expense
B. Asset
C. Liability
D. Revenue
Obligation of the Business are known as___________?
A. Liabilities
B. Expenses
C. Revenues
D. Assets
The amount invested by the proprietor to start the business is called:
A. Capital
B. Drawings
C. Business
D. All of them
Cash discount is provided on _______________?
A. Sales
B. Prompt payment
C. Purchases
D. Sales return
Goods return to supplier are known as:__________?
A. Return inwards
B. Purchase return
C. Merchandise return
D. Sales return
The excess of current assets over current liabilities is called:
A. Working Capital
B. Fixed capital
C. Circulating capital
D. Trading capital
When goods, in which business deals are sold, it is called___________?
A. Return inward
B. Purchases
C. Sales
D. Return outwards
Sales return is also known as____________?
A. Return Payed
B. Return received
C. Return inward
D. Return outward
reduction in price is called:
A. Invoice price
B. Paid price
C. Book price
D. Discount
Cash brought by the owner to start business is called__________?
A. Capital
B. Drawing
C. Loan
D. None of these
The concession received on the price of defective goods is called:
A. Cash discount
B. Discount
C. Allowance
D. Trading discount
In support of business transaction, any written evidence is called ___________?
A. Allowance
B. Voucher
C. Discount
D. Price
Building and furniture are called ____________?
A. Fictitious asset
B. Current asset
C. Tangible asset
D. Fixed assets
For the business, capital is ____________?
A. Assets
B. Liability
C. Expense
D. All of them
When owner withdraw cash for its private use, it is called ___________?
A. Income
B. Profit
C. Expense
D. Drawing
Assets having physical existence are called ___________?
A. intangible asset
B. Current asset
C. Tangible asset
D. Liquid asset
The assets which have some market value are called ____________?
A. Quick asset
B. Fixed asset
C. Fictitious assets
D. Real assets
The assets which come into existence upon the happening of a certain event are called__________?
A. Contingent assets
B. Fictitious assets
C. Fixed assets
D. Quick assets
Income earned but not received is called ____________?
A. Quick asset
B. Fictitious assets
C. Real asset
D. Outstanding asset
Debts which are payable in the course of a month are called _____________?
A. Fixed liabilities
B. External liabilities
C. Current liabilities
D. Liquid Liabilities
The unsold goods are ______________?
A. Sale return
B. Equity
C. Inventory
D. Purchases
The systems of accounting are _____________?
A. Two
B. Five
C. Three
D. Six
A sale of Rs. 50.000 to A was entered as a sale to B. This is an example of____________?
A. Compensating error
B. Error of commission
C. Error of omission
D. Error of principle
Goods sent on approval basis’ have been recorded as ‘Credit sales’. This is an example of____________?
A. Error of principle
B. Error of omission
C. Error of commission
D. Error of duplication
Institute of Chartered Accountants of Pakistan was established in____________?
A. 1956
B. 1949
C. 1961
D. 1972
Trial balance is prepared to check accuracy of_______________?
A. Ledger accounts balances
B. Income statement balances
C. Balance sheet balances
D. Cash flow statement balances
If a transaction is completely omitted from the books of accounts, will it affect the agreement of a trial balance?
A. Transactions can’t be omitted
B. No
C. Yes
D. none of these
________ is the common base for preparing a trial balance?
A. Ledger accounts
B. Specialized journals
C. General Journal
D. Balance sheet
Which of the following is true about a trial balance?
A. It lists down the balances of accounts
B. It is a kind of financial statement
C. It lists down the balances of a balance sheet
D. It is not a part of accounting cycle
Debit balance = Credit balance in a trial balance indicates that:
A. Account balances are correct
B. No error in posting entries to ledger accounts
C. No error in recording transactions
D. Mathematically Capital+Liabilities=Assets
Trial balance is commonly prepared?
A. At the end of a month
B. At the end of an accounting period
C. Frequently during the year
D. At the end of a year
Which of the following will affect the agreement of a trial balance?
A. Error of principle
B. Partial omission of a transaction
C. Complete omission of a transaction
D. Compensating errors
If debit balances = credit balances, trial balance only shows or check the ____________ and it does not indicate that no errors were made during recording and posting.
A. Arithmetic accuracy
B. Omissions of economic events
C. Errors of commission
D. Understatements of balances
Which of the following account with normal balance is shown at the debit side of a trial balance?
A. Creditors account
B. Rent income account
C. Unearned income account
D. Cash account
Which of the following account with normal balance is shown at the credit side of a trial balance?
A. Bank account
B. Cash account
C. Equipment account
D. Accrued expenses account
Which of the following specialized journals records “goods returned by customers”?
A. Sales journal
B. Purchase journal
C. Purchases return journal
D. Sales return journal
Sales on credit is recorded in which of the following journal?
A. Sales return journal
B. Sales journal
C. Purchases return journal
D. Purchase journal
Transactions that a BUSINESS doesn’t record in any specialised journal are recorded in which of the following journals or day books?
A. Cash receipts journal
B. Cash payments journal
C. Purchases return journal
D. General journal
Another name of journal is_____________?
A. Cash book
B. Day book
C. Specialized journal
D. Record book
Which of the following specialised journals will record “goods returned by the BUSINESS “?
A. Sales journal
B. Purchase journal
C. Purchases return journal
D. Sales return journal
Sales and purchase journal don’t record__________?
A. Credit purchases
B. Credit sales
C. Credit sales and purchases
D. Cash sales and purchases
Cash received from debtor is recorded in which of the following SPECIALIZED journals?
A. Sales journal
B. Purchase journal
C. Cash receipts
D. Cash payments journal
Which of the following is a type of cash receipt journal + cash payment journal?
A. Statement of cash flow
B. Bank statement
C. Cash book
D. Cash documents
Cash purchases is recorded in which of the following specialized journals?
A. Sales journal
B. Purchase journal
C. Purchases return journal
D. Cash payments journal
A brief explanation recorded below every entry in general journal is commonly known as__________?
A. Narration
B. Summary
C. Explanation
D. Other information
Credit purchase of plant and machinery is recorded in which of the following journals?
A. General journal
B. Purchase journal
C. Cash journal
D. Purchase return journal
Debit note is the basis for recording a transaction in which of the following journals?
A. Cash journal
B. General journal
C. Purchase journal
D. Purchase return journal
SALE of old furniture” will be recorded in which of the following specialised journals?
A. Sales journal
B. Purchase journal
C. General journal
D. Cash receipt journal
Credit note is the basis for recording a transaction in which of the following SPECIALIZED journals?
A. General journal
B. Sales return journal
C. Purchase journal
D. Cash receipt journal
Specialized journals are more adequate for which TYPE OF BUSINESSES?
A. Sole proprietorship
B. Big businesses
C. Small businesses
D. Partnership
Which of the following is known as an evidence that a transaction took place?
A. General journal
B. Cash receipts journal
C. Source document
D. Cash book
BUSINESS paid rent amounting to $100″ which of the following specialized journals records this transaction?
A. Sales journal
B. Cash payments journal
C. Cash receipts journal
D. Purchase journal
Credit memo or credit note No. is entered in which of the following journal?
A. Cash journal
B. General journal
C. Purchase journal
D. Sales return day book
In accounting an Economic event is referred to as:
A. Bank statement
B. Cash
C. Transaction
D. Exchange of money
Identify the correct sequence of accounting process
A. Recording→Communicating→Identifying
B. Communicating→Recording→Identifying
C. Identifying→communicating→recording
D. Identifying→recording→communicating
Bookkeeping mainly concerns with which part of accounting process?
A. Preparing financial statements
B. Analyzing
C. Recording financial information
D. Auditing the books of accounts
Financial accounting provides financial information to all of the following external users except:
A. investors
B. Government agencies
C. Creditors
D. Managers
For which step of accounting process the accountants of business entity prepare financial statements?
A. Recording financial information
B. Communication of financial information
C. Identification of economic event
D. Making decisions about business
Keeping the log of financial information in books of original entries is called__________?
A. Recording
B. Grouping
C. summarizing
D. Processing
Auditing is what?
A. Preparation financial statements
B. Examination of financial statements
C. Reporting the financial information
D. maintaining the ledger records
Which of the following is the external user of financial statements?
A. CEO of the business
B. Manager of the business
C. Creditor of the business
D. Controller of the business
Which of the following is the internal user of financial statements?
A. Government agency
B. Creditor of the business
C. Shareholder of the business
D. Manager of the business
_________ is the first phase of accounting cycle?
A. Identifying an economic event or transaction
B. Posting entries to ledger accounts
C. Preparing journals
D. Making decisions about business
Financial statements differ from management account because
A. They are mainly prepared for external users of financial information
B. The are the summary of accounting data
C. They are more complex and hard to prepare
D. The are prepared on basis of actual concept
________ is a separate legal entity that Total capital can be divided in many shares.
A. Sole proprietorship
B. Partnership
C. Company
D. Non-profit organization
An asset posses which of the following?
A. Future economic benefits for the business
B. Expenses for the business
C. All kind of benefits for the business
D. Merits and Demerits for the business
Liabilities are which of the following?
A. Future benefits
B. Obligations
C. Resources
D. Expenses
________ is the gross inflow of economic benefits?
A. Liabilities
B. Assets
C. Income
D. Expenses
The gross decrease in economic benefits for the business are what?
A. Expenses
B. Creditors
C. Obligations
D. Income or gain
An asset must be _______ by the business to be shown as an asset in its “balance sheet”
A. Owned
B. Possessed
C. Controlled
D. Used
Liability are arisen from which of the following events?
A. Future event
B. Present event
C. Past event
D. None of them
Which of the following can be considered as the most important phase of accounting cycle and it is the primarily objective of financial accounting?
A. Preparing “T Accounts”
B. Identifying transactions
C. Preparing financial statements
D. Preparing trial balances
Which is the most important characteristic that all assets of a business have?
A. Value of assets
B. Long life of assets
C. Intangible nature of assets
D. Future economic benefits
What is the basic accounting equation?
A. Capital+Liabilities=Assets
B. Capital+assets=liabilities
C. Assets+ liabilities =Capital
D. Liabilities+Capital
Which of the following is a liability?
A. Equipment
B. Cash
C. Debtors
D. Creditors
What is equity?
A. liability of a business
B. Cash from the business
C. Owner’s claim on total assets
D. Owner’s claim on total liabilities
Identify the asset from the following:
A. Cash and cash equivalent
B. Notes payable
C. Creditors
D. Bank loan
_______ the withdrawal of cash and goods by the owner of the busienss for his/her personal use?
A. Outflow of cash
B. Drawings
C. Depreciation
D. Appreciation
Net loss occurs when______________?
A. Expenses are greater than Income
B. Expenses=Income
C. Expenses are less than Income
D. Liabilities are greater than income
Double entry implies that
A. Recording entries in Ledger account
B. Recording entries in journal
C. Recording two aspects of every transaction
D. Recording every transaction in books
Identify the nominal account
A. Building account
B. Machinery account
C. Creditors account
D. Rent expenses account
Which of the following accounts can be classified as a real account?
A. Rent income account
B. Rent expenses account
C. insurance expenses account
D. Cash account
Transferring entries from journal to ledger account is commonly known as____________?
A. Transferring
B. Recording
C. Posting
D. Entry making
An account records the ___________ in the balance of an item?
A. Increase
B. Decrease Increase
C. Increase or decrease
D. Appreciation
If credit side of a bank account is greater than the debit side, it indicates which of the following?
A. Bank overdraft
B. Bank balance
C. Cash at bank
D. Current Asset
If debit side of a bank account is greater than credit side it indicates which of the following?
A. Cash at bank
B. Bank overdraft
C. Bank understatement
D. Balance overstatement
_________ will be credited if goods are given as charity?
A. Charity
B. Cash
C. Purchases
D. Sales
Which of the following is known as the base for preparing trial balance?
A. Cash account
B. Journal
C. Ledger account
D. Balance sheet
If debit balance is greater than creadit balance then the account blance will be__________?
A. Cash balance
B. Debit and credit balance
C. Credit balance
D. Debit balance
The normal balance of capital account is_____________?
A. Credit balance
B. Cash balance
C. Debit balance
D. Neither debit nor credit balance
The normal balance of asset account is____________?
A. Cash balance
B. Debit balance
C. Credit balance
D. Neither debit nor credit balance
The normal balance of liability account is____________?
A. Cash balance
B. Credit balance
C. Debit balance
D. Neither debit nor credit balance
Which of the following statements is incorrect regarding capital account?
A. Debit increases the capital account balance
B. Fresh capital increases the capital account balance
C. Credit increases the capital account balance
D. Net income increases the capital account balance