Accountancy and Book Keeping MCQs

Accountancy and Statistics

Accountancy and Book Keeping MCQs

Practice the latest Accountancy MCQs with answers and detailed explanations. Explore chapter-wise multiple-choice questions covering important accounting concepts, bookkeeping, financial statements, journal entries, ledger, trial balance, depreciation, ratio analysis, partnership accounts, company accounts, and more. Perfect for Class 11 & 12, B.Com, CA Foundation, CUET, Banking, SSC, JKSSB, JKPSC and competitive exams.

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Total Questions

Practice Questions

Page 55 of 94
Question #1081
'Bills Payable' is shown under:
A. Capital
B. Current liabilities
C. Current assets
D. Non-current liabilities
Discuss
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Correct Answer: Option B

Explanation:
Bills payable are obligations payable on demand or within a year, thus current liabilities.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1082
The 'Accrual System' of accounting records transactions:
A. At the end of year
B. When they become due (earned/incurred)
C. On order placement
D. When cash is received or paid
Discuss
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Correct Answer: Option B

Explanation:
Accrual basis recognises income when earned and expenses when incurred, regardless of cash flow.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1083
Which of the following is not a characteristic of a company?
A. Unlimited liability of members
B. Common seal (now optional)
C. Separate legal entity
D. Perpetual succession
Discuss
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Correct Answer: Option A

Explanation:
Company members have limited liability.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1084
The 'Statement of Affairs' under single entry is similar to:
A. Balance Sheet
B. Profit and Loss Account
C. Trading Account
D. Cash Flow Statement
Discuss
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Correct Answer: Option A

Explanation:
Statement of affairs shows assets and liabilities, akin to a balance sheet.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1085
Under single entry, closing capital is ₹2,00,000; opening capital ₹1,50,000; drawings ₹20,000; additional capital ₹10,000. Profit for the year is:
A. ₹40,000
B. ₹60,000
C. ₹50,000
D. ₹70,000
Discuss
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Correct Answer: Option B

Explanation:
Profit = Closing capital + Drawings - Opening capital - Additional capital = 2,00,000 + 20,000 - 1,50,000 - 10,000 = ₹60,000.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1086
PFMS is an initiative of the Government of India to:
A. Manage corporate taxes
B. Provide loans to farmers
C. Regulate stock exchanges
D. Ensure a robust public financial management system and direct benefit transfers
Discuss
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Correct Answer: Option D

Explanation:
PFMS tracks funds and facilitates DBT for various government schemes.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1087
The 'Government Accounting Standards Advisory Board' (GASAB) was established by:
A. RBI
B. Ministry of Finance
C. Comptroller and Auditor General (CAG) of India
D. ICAI
Discuss
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Correct Answer: Option C

Explanation:
GASAB is under CAG to formulate accounting standards for government.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1088
The 'Tax Deduction at Source' (TDS) certificate for salary is Form:
A. Form 16
B. Form 24Q
C. Form 16A
D. Form 26AS
Discuss
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Correct Answer: Option A

Explanation:
TDS on salary is certified through Form 16.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1089
GST collected on sales is credited to:
A. Purchase Account
B. Input GST Credit Account
C. Sales Account
D. Output GST Liability Account
Discuss
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Correct Answer: Option D

Explanation:
GST collected from customers is a liability to government, recorded as Output GST.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1090
Input Tax Credit under GST is available only if:
A. Payment is made in cash
B. Goods are exempted
C. The supplier has uploaded the invoice in GSTR-1 and it appears in GSTR-2B
D. Goods are purchased from unregistered dealer
Discuss
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Correct Answer: Option C

Explanation:
ITC can be claimed only if the invoice details are reflected in the recipient's GSTR-2B.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1091
The penalty for late filing of GSTR-3B is:
A. ₹50 per day (₹25 CGST + ₹25 SGST)
B. ₹100 per day
C. ₹200 per day
D. ₹500 per day
Discuss
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Correct Answer: Option A

Explanation:
Late fee is ₹50 per day (₹25 CGST + ₹25 SGST) for normal returns.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1092
Which of the following is a method of costing used in the ship-building industry?
A. Contract costing
B. Job costing
C. Batch costing
D. Process costing
Discuss
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Correct Answer: Option A

Explanation:
Ship-building is a long-term contract, so contract costing is appropriate.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1093
The 'Margin of Safety' is calculated as:
A. Profit / Sales
B. Fixed cost / P/V ratio
C. Variable cost - Fixed cost
D. Actual sales - Break-even sales
Discuss
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Correct Answer: Option D

Explanation:
Margin of safety = Actual sales - Break-even sales.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1094
In a manufacturing account, 'Prime Cost' includes:
A. Administration overheads
B. All factory overheads
C. Direct materials, direct labour, direct expenses
D. Selling overheads
Discuss
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Correct Answer: Option C

Explanation:
Prime cost is the sum of all direct costs.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1095
The 'Labour Turnover' rate measures:
A. Absenteeism
B. Rate of change in labour force
C. Overtime
D. Efficiency of workers
Discuss
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Correct Answer: Option B

Explanation:
Labour turnover indicates the frequency of employees leaving and being replaced.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1096
A company uses 'Economic Order Quantity' (EOQ) of 500 units. Annual demand is 5,000 units. Number of orders per year will be:
A. 5
B. 10
C. 500
D. 100
Discuss
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Correct Answer: Option B

Explanation:
Number of orders = Annual demand / EOQ = 5,000 / 500 = 10.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1097
In a flexible budget, the budgeted cost for a given level of activity is based on:
A. Zero base
B. Fixed budget only
C. Previous year actuals only
D. Recognition of cost behaviour patterns (fixed and variable)
Discuss
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Correct Answer: Option D

Explanation:
Flexible budget adjusts for different activity levels by separating fixed and variable costs.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1098
The 'Cost Volume Profit' (CVP) analysis is a tool for:
A. Inventory valuation
B. Understanding relationship between cost, volume, and profit
C. Audit
D. Tax planning
Discuss
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Correct Answer: Option B

Explanation:
CVP analysis helps in profit planning by studying effects of changes in costs and volume.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1099
The 'P/V Ratio' (Profit Volume Ratio) is calculated as:
A. Variable cost / Sales
B. Profit / Sales
C. Contribution / Sales
D. Fixed cost / Sales
Discuss
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Correct Answer: Option C

Explanation:
P/V Ratio = (Contribution / Sales) × 100.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1100
A 'Cost Audit' is mandated for certain companies under:
A. GST Act
B. Companies Act, 2013
C. Income Tax Act
D. SEBI regulations
Discuss
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Correct Answer: Option B

Explanation:
Cost audit is required for specified companies as per Section 148 of Companies Act, 2013.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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