A Cash Book serves the purpose of: MCQ with Answer and Explanation

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A Cash Book serves the purpose of:

A. A Trial Balance

B. A Ledger only

C. A Journal only

D. Both Journal and Ledger

Answer: Option D

Solution (By JKSSB Mock Tests)

The cash book acts as a journal because transactions are recorded chronologically, and as a ledger because it contains the cash account balance.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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'Capital Work-in-Progress' is shown in the Balance Sheet as:

A. Fixed asset under construction

B. Current asset

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D. Intangible asset

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Correct Answer: Option A

Explanation:
It represents assets not yet ready for use, part of fixed assets.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2

Under the Partnership Act, if a partner is expelled, what happens to his liability for acts of the firm done before his expulsion?

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D. He is completely released from all liabilities

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Correct Answer: Option C

Explanation:
Under Section 36 of the Indian Partnership Act, an expelled partner remains liable to third parties for acts of the firm up to the date of his expulsion, until a public notice of his expulsion is given.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #3

Bank charges debited by the bank will be ________ when starting with an overdraft balance as per Pass Book.

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Correct Answer: Option B

Explanation:
Bank charges increase the overdraft in the pass book. To arrive at the cash book overdraft (which is lower since it missed the charge), it must be deducted.

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