A firm's 'Capital' is equal to: MCQ with Answer and Explanation

A firm's 'Capital' is equal to:
A. Fixed assets
B. Total liabilities
C. Net assets (Total assets - Outside liabilities)
D. Total assets
Answer: Option C
Solution (By JKSSB Mock Tests)
Capital (owner's equity) = Total assets - Outside liabilities.

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Practice More Accountancy and Book Keeping Questions

Question #1
S1: Standard costing is a technique of cost ascertainment. S2: Standard costing is a technique of cost control. Which statement(s) is/are correct?
A. Both S1 and S2
B. S2 only
C. Neither S1 nor S2
D. S1 only

Correct Answer: Option B


Explanation:
Standard costing is primarily a technique of cost control and performance evaluation, not just cost ascertainment. While it involves setting standards, its main purpose is to compare actuals with standards to find variances. S1 is incorrect, S2 is correct.

Question #2
Which of the following is not a part of the Balance Sheet?
A. Gross Profit
B. Current Liabilities
C. Share Capital
D. Fixed Assets

Correct Answer: Option A


Explanation:
Gross profit is shown in Trading/Profit & Loss Account, not in the Balance Sheet.

Question #3
The 'Country-by-Country Report' (CbCR) filing in India is required for MNE groups with consolidated revenue exceeding:
A. ₹5,500 crore (€750 million)
B. ₹1,000 crore
C. No threshold
D. ₹500 crore

Correct Answer: Option A


Explanation:
The threshold is aligned with BEPS Action 13, i.e., €750 million.