If goods worth Rs 2,000 returned to a supplier are not recorded at all, this error is called: MCQ with Answer and Explanation

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If goods worth Rs 2,000 returned to a supplier are not recorded at all, this error is called:

A. Error of Commission

B. Error of Omission

C. Error of Principle

D. Compensating Error

Answer: Option B

Solution (By JKSSB Mock Tests)

A complete failure to record a transaction in the books of original entry is an error of complete omission.

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

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Question #1

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Under 'Finance Lease', the lessee records the leased asset in his books as per:

A. AS 2

B. AS 6

C. AS 10

D. AS 19

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Correct Answer: Option D

Explanation:
AS 19 Leases requires lessee to capitalize finance lease.

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Question #2

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Under Activity Based Costing (ABC), costs are allocated based on:

A. Machine Hours

B. Cost Drivers

C. Volume of Production only

D. Direct Labor Hours

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Correct Answer: Option B

Explanation:
ABC traces overheads to specific activities and allocates them to products based on the consumption of 'cost drivers'.

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Question #3

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A 'Flexible Budget' is most useful because it:

A. Shows expected costs at various levels of actual production

B. Can be changed by managers without approval

C. Assumes all costs are fixed

D. Only targets cash flows

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Correct Answer: Option A

Explanation:
Unlike a static budget, a flexible budget adjusts based on the actual activity level, providing a realistic benchmark for variance analysis.

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

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