S1: Cheques issued but not presented for payment increase the bank balance as per the pass book. S2: Direct deposit by a customer into the bank account decreases the cash book balance. Which statement(s) is/are correct? MCQ with Answer and Explanation

S1: Cheques issued but not presented for payment increase the bank balance as per the pass book. S2: Direct deposit by a customer into the bank account decreases the cash book balance. Which statement(s) is/are correct?
A. S2 only
B. S1 only
C. Neither S1 nor S2
D. Both S1 and S2
Answer: Option C
Solution (By JKSSB Mock Tests)
Cheques issued but not presented decrease the pass book balance, not increase it. Direct deposit by a customer increases the pass book balance but has no immediate effect on the cash book until intimated. Both are incorrect.

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Practice More Accountancy and Book Keeping Questions

Question #1
Which tax reform introduced the concept of 'One Nation, One Tax'?
A. Wealth Tax Abolition
B. Value Added Tax (VAT)
C. Goods and Services Tax (GST)
D. Fringe Benefit Tax

Correct Answer: Option C


Explanation:
GST integrated multiple indirect taxes across India into a single unified tax structure.

Question #2
PFMS stands for:
A. Public Fund Monitoring System
B. Public Finance and Monetary System
C. Private Financial Management Scheme
D. Public Financial Management System

Correct Answer: Option D


Explanation:
PFMS is the Public Financial Management System administered by the Department of Expenditure, Ministry of Finance, Government of India.

Question #3
The term 'Prepaid Expense' is treated as:
A. A liability
B. A loss
C. An asset
D. An expense

Correct Answer: Option C


Explanation:
Prepaid expenses are treated as current assets because they represent future economic benefits for which payment has already been made.