The 'Voucher' approach in accounting helps to: MCQ with Answer and Explanation

Question
The 'Voucher' approach in accounting helps to:
A. Prepare trial balance
B. Compute tax
C. Ensure documentation and authorisation of transactions
D. Simplify journal entries
Answer: Option C
Solution (By JKSSB Mock Tests)
Voucher system ensures that every transaction is supported by documentary evidence and approval.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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Practice More Accountancy and Book Keeping Questions

Question #1
What is the primary scope of a 'Tax Audit' under Section 44AB of the Income Tax Act?
A. To ensure books are maintained per tax laws and compute taxable income correctly
B. To value the shares of the company
C. To assess social impact
D. To find accounting errors
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Correct Answer: Option A

Explanation:
A tax audit ensures compliance with the Income Tax Act, preventing tax evasion by verifying deductions and income reporting.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #2
The 'Return on Equity' (ROE) is computed as:
A. Gross profit / Equity
B. Net profit / Shareholders' equity
C. EBIT / Equity
D. Net profit / Total assets
Discuss
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Correct Answer: Option B

Explanation:
ROE measures return to equity shareholders.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #3
After reissue of forfeited shares, the balance in 'Shares Forfeited Account' is transferred to:
A. General Reserve
B. Capital Reserve
C. Securities Premium
D. Profit & Loss
Discuss
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Correct Answer: Option B

Explanation:
Any profit on reissue (excess of forfeited amount over reissue loss) is transferred to Capital Reserve.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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