A trade discount is: MCQ with Answer and Explanation

Question
A trade discount is:
A. Recorded separately in the books of accounts
B. Given for prompt payment
C. Deducted from the list price and not recorded in the books
D. Treated as a non-operating expense
Answer: Option C
Solution (By JKSSB Mock Tests)
Trade discount is a reduction from the catalogue price given for bulk purchases and is not recorded in the accounting books.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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Practice More Accountancy and Book Keeping Questions

Question #1
S1: PFMS is a platform for all direct benefit transfers. S2: PFMS is integrated with the Core Banking System of banks. Which statement(s) is/are correct?
A. S1 only
B. Both S1 and S2
C. S2 only
D. Neither S1 nor S2
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Correct Answer: Option B

Explanation:
PFMS is the primary platform for Direct Benefit Transfers (DBT) under various government schemes. It is integrated with the Core Banking Systems (CBS) of all banks to ensure seamless and direct credit to beneficiaries' accounts. Both are correct.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #2
Which of the following is a capital receipt?
A. Dividend received
B. Sale of old machinery at profit (excess over WDV)
C. Interest on investment
D. Commission earned
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Correct Answer: Option B

Explanation:
Sale of fixed asset, even if profit, is a capital receipt; the profit portion may be revenue, but the sale proceeds are capital.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #3
The 'Goods and Services Tax Network' (GSTN) is structured as:
A. Section 8 (not-for-profit) company
B. Private limited company
C. Government department
D. Public sector undertaking
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Correct Answer: Option A

Explanation:
GSTN is a not-for-profit company under Section 8 of Companies Act.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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