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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Question #1521
Under 'Ind AS 116', a lease is classified as a finance lease if:
A. It transfers substantially all the risks and rewards incidental to ownership
B. All leases are finance leases
C. The lessee has an option to purchase
D. The lease term is for more than one year
Discuss
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Correct Answer: Option B

Explanation:
Under Ind AS 116, there is no classification for lessees; all leases are treated as finance leases (right-of-use asset and lease liability). For lessors, classification remains.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1522
The 'Expected Credit Loss' model (Ind AS 109) requires recognition of impairment on:
A. Only when default occurs
B. Only incurred losses
C. No provision
D. 12-month expected credit losses or lifetime expected credit losses depending on credit risk
Discuss
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Correct Answer: Option D

Explanation:
ECL model recognises either 12-month ECL (Stage 1) or lifetime ECL (Stage 2/3) based on deterioration in credit risk.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1523
Which of the following is not a component of 'Other Comprehensive Income' (OCI) under Ind AS?
A. Revaluation surplus on property, plant, and equipment
B. Dividend income
C. Exchange differences on translating foreign operations
D. Actuarial gains and losses on defined benefit plans
Discuss
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Correct Answer: Option B

Explanation:
Dividend income is reported in profit or loss, not OCI.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1524
The 'Statement of Changes in Equity' as per Ind AS 1 includes:
A. Total comprehensive income, transactions with owners, and reconciliation of equity components
B. Only reserves
C. Only share capital
D. Only dividends
Discuss
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Correct Answer: Option A

Explanation:
It shows all changes in equity, including profit/loss, OCI, capital transactions, dividends.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1525
Under 'Ind AS 21', foreign currency monetary items are translated at:
A. Historical rate
B. Opening rate
C. Closing rate
D. Average rate
Discuss
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Correct Answer: Option C

Explanation:
Monetary items are translated at the closing rate at the reporting date.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1526
The 'Concept of Prudence' under Ind AS is:
A. An overriding principle
B. A fundamental accounting assumption
C. Not specifically identified as a separate concept; neutrality overrides prudence
D. Always applied
Discuss
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Correct Answer: Option C

Explanation:
The Conceptual Framework under Ind AS/IFRS does not include prudence as a separate qualitative characteristic; it emphasises neutrality.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1527
The 'Fair Value Hierarchy' under Ind AS 113 categorises inputs into:
A. Direct and Indirect
B. Market and Cost
C. Level 1, Level 2, Level 3
D. Primary and Secondary
Discuss
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Correct Answer: Option C

Explanation:
Level 1: quoted prices; Level 2: observable inputs other than quoted prices; Level 3: unobservable inputs.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1528
The 'Ind AS 24' on Related Party Disclosures requires disclosure of:
A. Relationships, transactions, and outstanding balances with related parties
B. Only transactions with key management personnel
C. Only compensation of key management personnel
D. Only parent-subsidiary relationships
Discuss
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Correct Answer: Option A

Explanation:
Ind AS 24 requires disclosure of related party relationships, transactions, and balances.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1529
The 'Segment Information' under Ind AS 108 is based on:
A. The management approach (as reported internally to the chief operating decision maker)
B. Legal entities
C. Geographical areas only
D. Product lines only
Discuss
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Correct Answer: Option A

Explanation:
Ind AS 108 adopts a 'management approach' to identify operating segments.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1530
The 'Earnings Per Share' (Ind AS 33) requires disclosure of:
A. Cash EPS
B. Basic and diluted EPS
C. Diluted EPS only
D. Basic EPS only
Discuss
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Correct Answer: Option B

Explanation:
Ind AS 33 mandates both basic and diluted EPS for entities whose shares are publicly traded.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1531
The 'Interim Financial Reporting' (Ind AS 34) suggests that the same accounting policies should be applied as in annual statements. This is an application of:
A. Consistency
B. Accrual
C. Going concern
D. Materiality
Discuss
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Correct Answer: Option A

Explanation:
Applying same policies ensures consistency.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1532
The 'Impairment of Assets' (Ind AS 36) applies to:
A. Only intangible assets
B. All assets except inventories, deferred tax assets, assets arising from employee benefits, financial assets, investment property measured at fair value, and certain others
C. All assets
D. Only fixed assets
Discuss
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Correct Answer: Option B

Explanation:
Ind AS 36 has a specific scope excluding certain assets covered by other standards.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1533
The 'Recoverable Amount' of a cash-generating unit (CGU) is:
A. Replacement cost
B. Lower of cost and net realisable value
C. Current market price
D. Higher of fair value less costs of disposal and value in use
Discuss
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Correct Answer: Option D

Explanation:
As per Ind AS 36, recoverable amount is the higher of FVLCD and VIU.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1534
Under 'Ind AS 37', a provision is recognised for:
A. A present obligation from a past event, where outflow of resources is probable and can be reliably estimated
B. Repairs and maintenance
C. Self-insurance
D. All future operating losses
Discuss
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Correct Answer: Option A

Explanation:
Provision recognition criteria: present obligation, probable outflow, reliable estimate.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1535
The 'Statement of Cash Flows' under Ind AS 7 classifies interest and dividend received by a financial institution as:
A. Operating activities
B. Investing activities
C. Any of these
D. Financing activities
Discuss
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Correct Answer: Option A

Explanation:
For financial institutions, interest and dividend received are operating activities. For others, they are investing.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1536
In the 'Finance Act, 2023', which change was introduced for the new income tax regime?
A. Increased tax rates
B. Made default tax regime with more exemptions
C. No change
D. Abolished the new regime
Discuss
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Correct Answer: Option B

Explanation:
The new regime was made the default regime from FY 2023-24, with certain reliefs.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1537
Which of the following deductions is not allowed under the new income tax regime (default)?
A. Section 80CCD(2) (employer contribution to NPS)
B. Section 80C (PPF, LIC, etc.)
C. Section 24(b) interest on housing loan (let-out property)
D. Standard deduction on salary
Discuss
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Correct Answer: Option B

Explanation:
Under the new regime, Section 80C deductions are not allowed.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1538
The 'Standard Deduction' for family pension under the new tax regime is:
A. ₹15,000 or one-third of pension, whichever is less
B. ₹50,000
C. Not allowed
D. ₹25,000
Discuss
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Correct Answer: Option A

Explanation:
Family pension deduction is available under both regimes at ₹15,000 or 1/3rd of pension, whichever is less.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1539
TDS on rent under Section 194I is deducted at:
A. 1%
B. 2%
C. 10% for land/building, 2% for plant/machinery
D. 5% for all
Discuss
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Correct Answer: Option C

Explanation:
Section 194I: rent for plant/machinery 2%, for land/building/furniture 10%.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #1540
The 'Tax Collected at Source' (TCS) on foreign remittance under Liberalised Remittance Scheme (LRS) is:
A. 10%
B. 1%
C. No TCS
D. 5% on amount exceeding ₹7 lakh, except for education/medical
Discuss
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Correct Answer: Option D

Explanation:
TCS on LRS is 5% (now increased to 20% for certain purposes) on amount exceeding ₹7 lakh. As per current rules, 5% on amounts exceeding ₹7 lakh for purposes other than education/medical. The rate has changed recently to 20% for overseas tour packages, etc., but standard rate is 5% for others. I'll use 5% as the base rate for general remittance exceeding ₹7 lakh.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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