Examining documentary evidence to ascertain the accuracy and authenticity of transactions is called: MCQ with Answer and Explanation

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Examining documentary evidence to ascertain the accuracy and authenticity of transactions is called:

A. Valuation

B. Internal checking

C. Verification

D. Vouching

Answer: Option D

Solution (By JKSSB Mock Tests)

Vouching is the practice of checking the entries in the books of accounts with supporting documents (vouchers) to prove their accuracy.

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

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Question #1

Adjusted Purchases is calculated as:

A. Net Purchases - Closing Stock

B. Opening Stock + Net Purchases - Closing Stock

C. Opening Stock + Net Purchases

D. Opening Stock + Net Purchases + Direct Expenses

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Correct Answer: Option B

Explanation:
Adjusted purchases represent the cost of materials actually consumed during the year, removing the stock left unsold.

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

Question #2

In cost accounting, marginal cost is equal to:

A. Fixed cost + Variable cost

B. Total cost - Fixed cost

C. Prime cost + Variable overheads

D. Total cost - Profit

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Correct Answer: Option C

Explanation:
Marginal cost represents the total variable cost of production, which is the sum of prime cost (direct material, labor, expenses) and variable overheads.

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Question #3

Which of the following is a feature of a joint stock company?

A. No perpetual succession

B. Unlimited liability

C. Separate legal entity

D. Managed by partners

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Correct Answer: Option C

Explanation:
A joint stock company is a separate legal entity distinct from its shareholders, with perpetual succession and limited liability.

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

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