Amortisation is related to: MCQ with Answer and Explanation

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Amortisation is related to:

A. Fictitious assets only

B. Tangible assets

C. Intangible assets

D. Current assets

Answer: Option C

Solution (By JKSSB Mock Tests)

Amortisation is the systematic write-off of intangible assets like patents, copyrights.

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

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Question #1

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When a firm adopts 'Lean Accounting', it primarily tries to:

A. Under-report profits to save tax

B. Eliminate waste and align accounting processes with lean manufacturing principles

C. Reduce the number of accountants

D. Stop issuing balance sheets

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Correct Answer: Option B

Explanation:
Lean accounting supports lean manufacturing by eliminating complex, non-value-adding accounting transactions and focusing on value stream costing.

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Question #2

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Marginal cost is the cost of:

A. Fixed costs

B. Producing one unit

C. Total cost divided by units

D. Producing one additional unit

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Correct Answer: Option D

Explanation:
Marginal cost is the change in total cost due to producing one additional unit.

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

Question #3

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S1: In the Single Entry System, the Statement of Affairs is prepared to ascertain the profit or loss for the year. S2: The difference between the closing and opening capital in a Statement of Affairs represents the profit or loss, adjusted for drawings and additional capital. Which statement(s) is/are correct?

A. S1 only

B. Both S1 and S2

C. Neither S1 nor S2

D. S2 only

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Correct Answer: Option D

Explanation:
S1 is incorrect because the Statement of Affairs ascertains capital, not profit/loss directly. S2 is correct; profit/loss is derived by comparing closing and opening capital, adjusting for drawings and fresh capital introduced.

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