Which document serves as the basis for recording transactions in the books of accounts? MCQ with Answer and Explanation

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Which document serves as the basis for recording transactions in the books of accounts?

A. Financial Statement

B. Trial Balance

C. Source Document

D. Ledger Account

Answer: Option C

Solution (By JKSSB Mock Tests)

Source documents (like invoices, receipts) provide the objective evidence and basic data for preparing accounting vouchers.

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

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Question #1

The 'Variable Lease Payments' that depend on an index or rate:

A. Are included in the lease liability initially measured using the index/rate at commencement date

B. Are always expensed

C. Are capitalised only if fixed

D. Are excluded from lease liability

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Correct Answer: Option A

Explanation:
Variable payments based on index/rate are included; those based on performance/usage are excluded.

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

Question #2

Which budget forms the basis of all other budgets?

A. Cash Budget

B. Sales Budget

C. Production Budget

D. Master Budget

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Correct Answer: Option B

Explanation:
The Sales Budget is typically the starting point (key factor) because production and cash needs depend directly on expected sales volume.

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Question #3

Which of the following is a feature of a joint venture?

A. It is governed by the Companies Act

B. It has perpetual succession

C. It is formed for a specific, short-term project

D. It has a separate legal entity

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Correct Answer: Option C

Explanation:
A joint venture is a temporary partnership formed for a specific venture or project, and it ceases to exist once the project is completed.

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

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