An auditor checking the arithmetical accuracy of the books performs what kind of check? MCQ with Answer and Explanation

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An auditor checking the arithmetical accuracy of the books performs what kind of check?

A. Compliance testing

B. Analytical review

C. Routine checking

D. Substantive testing

Answer: Option C

Solution (By JKSSB Mock Tests)

Routine checking involves casting (totalling), carry-forwards, and ledger posting verifications to ensure basic mathematical accuracy.

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

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Question #1

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In a bank reconciliation, a 'Dishonoured cheque' recorded in passbook but not in cash book will: (starting with cash book Dr.)

A. Be deducted

B. Be added

C. No effect

D. Double entry

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Correct Answer: Option A

Explanation:
Dishonoured cheque reduces bank balance as per passbook, so to reconcile from cash book to passbook, deduct.

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

Question #2

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A and B share profits 3:2. They admit C with 1/5th share. C brings ₹30,000 as capital and ₹10,000 as goodwill. The total goodwill of the firm is:

A. Cannot determine

B. ₹10,000

C. ₹2,00,000

D. ₹50,000

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Correct Answer: Option D

Explanation:
C's share of goodwill = 1/5 = ₹10,000. So total goodwill = 10,000 × 5/1 = ₹50,000.

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Question #3

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S1: A Cash Book is a subsidiary book. S2: A Cash Book also acts as a ledger account. Which statement(s) is/are correct?

A. Neither S1 nor S2

B. S1 only

C. S2 only

D. Both S1 and S2

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Correct Answer: Option D

Explanation:
The Cash Book is a subsidiary book (book of original entry) for cash transactions. It also serves as the Cash and Bank accounts in the ledger, eliminating the need to post them separately. Both statements are correct.

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

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