The 'Suspense Account' is opened when: MCQ with Answer and Explanation

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The 'Suspense Account' is opened when:

A. An asset is sold

B. Final accounts are prepared

C. A fraud is detected

D. Trial balance does not agree

Answer: Option D

Solution (By JKSSB Mock Tests)

It holds the difference in trial balance until errors are located.

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

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Question #1

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If an asset is purchased and a post-dated cheque is given, the transaction is immediately recorded in:

A. Sales Book

B. Cash Book

C. Journal Proper

D. Purchase Book

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Correct Answer: Option C

Explanation:
Until the post-dated cheque becomes currently payable, the transaction is treated as credit and recorded in the Journal Proper.

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

Question #2

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On dissolution of a firm, the balance in the partners' capital accounts after all adjustments is transferred to:

A. Revaluation account

B. Realisation account

C. Profit & Loss account

D. Cash/Bank account

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Correct Answer: Option D

Explanation:
Finally, the capital account balances are paid off in cash or bank, and accounts are closed.

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

Question #3

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In Balance Sheet, 'Bills Receivable' is a:

A. Current asset

B. Intangible asset

C. Current liability

D. Fixed asset

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Correct Answer: Option A

Explanation:
Bills receivable are amounts due from debtors within a short period, hence current assets.

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

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