Securities Premium Account is shown on the liabilities side of the Balance Sheet under the heading: MCQ with Answer and Explanation

Question

Share Report Error

Securities Premium Account is shown on the liabilities side of the Balance Sheet under the heading:

A. Reserves and Surplus

B. Current Liabilities

C. Share Capital

D. Long-term Provisions

Answer: Option A

Solution (By JKSSB Mock Tests)

Securities premium is a capital profit and is classified under 'Reserves and Surplus' in the balance sheet.

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

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Question #1

A ledger is primarily a book of:

A. Original entry

B. Memorandum entry

C. Secondary entry

D. Final entry only

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Correct Answer: Option C

Explanation:
Ledger is a book of secondary entry where transactions are posted from journal or subsidiary books.

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

Question #2

The 'Other Matter' paragraph refers to:

A. Qualification

B. Matters already disclosed in financial statements

C. Adverse opinion

D. Matters other than those presented or disclosed in the financial statements that are relevant to understanding the audit, auditor's responsibilities, or report

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Correct Answer: Option D

Explanation:
Other Matter deals with matters not in the financial statements.

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Question #3

The 'P/V Ratio' (Profit Volume Ratio) is calculated as:

A. Fixed cost / Sales

B. Contribution / Sales

C. Variable cost / Sales

D. Profit / Sales

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Correct Answer: Option B

Explanation:
P/V Ratio = (Contribution / Sales) × 100.

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

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