MCQs on Accounting_accounting Equation 9-PDF

7/25/2019 MCQs on Accounting_accounting Equation 9-PDF

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Se lect the corr e ct e qu a ti on

a Own e rs E qui ty= A sse ts + Li a bi lit y

b O w n ers E qui ty + Out s id e li a bilit y=T ot a l As -se ts

c A ss et s + O wne rs E quit y= Out s id e L iabilit y

d Outside Equit y + pr o fit =T otal A ss et s

2 Cash w ithd rawal b y th e pr o p r ie tor wo uld cause-

a Cas h in h a nd to d ec rease

b E x ternal liabilit y to d ecr eas e



c Tota l l iabi lit ies to increase

d Tota l assets re m ai n u nc h a n ge d

3 Purchase of office e quipment for cas h wo uldca u se

a Cas h in ha n d to d ecrease

b Externa l li a bili ty to decrease

c Total lia bi lities to in crease

d Total assets to in c rease



ACCOUNTING

4. Both total assets and own ers capital are increasedby .

a Credit purchases b Retained earnings

c Bank loans

d Drawings

5. Both total assets and owners capital are reducedby

a Credit purchases

b Retained earnings.

c) Bank loans

dDrawings

6. Purchase of RBI bonds for cash would lead to .

a No change in total assets

b Total assets to decrease

c) Total assets to increase

d Total liabilities to increase

7. Loss of stock by fire would lead to

a No change in total assets .

b Total assets to decrease

c Total assets to increased T l d i d



2 question No . 11 the other as se ts of the firm willbe

a Rs .I00000

b R s.120000

c Rs.80,000 d Rs .140,000

3 If total assets of a business ar e Rs . 180,000 andtotal outside liabilities are Rs. 50,000, t h e n e tworth of the firm-wi ll b e

a Rs. 1 30,000

b Rs.230,000

c Rs .1 80,000

d R s.50,000

4 Net worth is the difference between

a Total assets and total liabilitie s

b Total assets and ext e rnal liabi lities

c Tota l liabi liti e s and current assets

d Total a ssets and curr e nt liabiliti e s

5 If a b usiness has negative net worth what does itsignifies

a Tota l assets are more than total liabilities

b Accumulated loss e s are more than ownerscapital

c Huge cash logged up in idle assets

d Outside liabilities exceed s owners capital

6 From the following detai ls calculate the capitalexpendit u re to be capitalized .



18 From the following d etails c alculate th e capitalexpendit ure to b e capit alized.

l Basic pric e of the Machine R s. 170 ,000

· . it Custo ms dut y Rs. 20 ,000

iiz Sea freight R s. 20,000

iv Insur ance Rs. 5000

v Erection ch arges Rs . 5000

vz CENV A T credit t aken Rs. 20 ,000

a Rs.200000 b Rs.175000

c Rs.150000

d Rs.190,000

19 From the followin g deta ils calculate the capital

expenditu re to b e capit alized. l Basic pric e of the Ma chin e Rs. 175,000

iz Excise duty Rs . 20,000

iil Freight R s. 20,000

iv) Insurance Rs. 5000

v Erection charg es Rs. 4000

V l CENV A T credit t aken R s. 20,000

a Rs.204,000

b .Rs. 1 85,000

c Rs.180 ,000



c Rs.75,OOO

d Rs.45,OOO

22. ABC Associates is not maintaining full fledgesaccounts on Double entry system basis . From thefollowing details estimate the profit made by thefirm during 05-06.

Capital as on 1-04-2005 Rs. 90,000

Capital added during the year Rs . 25,000

Drawing during the year Rs. 35,000

Capital as on 31-3-2005 Rs . 125,000

a Rs.50,OOO

b Rs.60,OOO

c Rs. 75,000

d Rs.45,OOO23. XYZ Associates is not maintaining full fledges

accounts on Double entry system basis . From thefollowing d etails estimates the capital of the firmas on 31-03-2006 .

Capital as on 1-04-2005 Rs. 80,000

Capital added during the year Rs . 20,000

Drawing during the year Rs. 35,000

Profit credit to the capital c Rs . 60,000

a Rs. 150,000

b Rs.125,OOOR 175 OOO



b Rs.60,000

c Rs.75,000

d Rs.4 5,000

26. PQR As sociates is not m aintainin g full fledgesaccounts on Doubl e entry sy stem ba sis . From th efoll owing details estim ate the capital of the firm ason 31 -03-2 006 .

Capital as on 1-04-200 5 Rs. 80,000

Capita l added durin g the yea r Rs. 20,000

Draw ing durin g the yea r Rs. 35,000

Prof it du ring the ye ar R s. 25,000

a RS.80,000

b Rs.90,000

c RS.75,000 d RS.45,000

27 From the followin g details ca lculate cred it sales.

Debtors bal ance as onl-04-2006 Rs . 30,000

Collection from d ebto rs during th e year Rs. 70,000

Discount given to debtors Rs. 4,000



Bad debts durin g the yea r Rs. 3,500

Debtors b alance as on 31-03 -2007 Rs . 20,000

a Rs.70,000

b Rs.71,000

c Rs. 68,500

d Rs.67500

8 From the following calculate credit pur chaseduring th e year.

Credito rs as on 1-04-2006 Rs. 3 6,500

Pay ment m ade to c reditors R s. 60,000

Discount given by creditor s for early pa ymentRs.5,500

Creditors as on 31 -03-200 7 Rs. 21,000

a Rs.50 ,000

b Rs.54,000

c Rs.61,250

d Rs.52,800



ACCOUN TING - AN INTRODU CTION

b Rs.60,OOO

e Rs.75,OOO

d Rs.45,OOO

26. PQR A ssocia tes is not m aintainin g full fledgesaccounts o n Double entry sys tem basis . From thefoll owing detail s estimat e the capital of the firm ason 31-0 3-2006.

Capital as on 1-04- 2005 R s. 80,000

Capital added durin g the year Rs. 20,000

Drawing durin g the year Rs. 35,000

Profit during th e yea r Rs. 25,000

a Rs.80,OOO

b Rs. 90,000

c Rs. 75,000

d Rs.45,OOO

27. From th e following details calculate credit sales.

Debto rs balance a s onl-04-2006 R s. 30,000

Collection from debtor s during th e year Rs. 70,000

Discount given to d ebto rs Rs. 4,000

Bad d ebts during the year Rs. 3,500

Debtors ba lance as on 3 1-03-2007 Rs . 20,000

a Rs.70 ,OOO

b Rs.71,OOO

c Rs. 68,500

d Rs.67500

28. F rom the followin g ca lculate credit purchasduring the year.

Credito rs as on 1-04-2006 Rs . 36,500

Payment m ade to creditors Rs. 60,000

Discount g iven by creditors for early paymeRs.5,500

Creditor s as on 31-03-2007 Rs . 21,000

a Rs.50,OOO

b Rs. 54,000

e Rs.61,250

d Rs.52,800

Answers: 1 b , 2 a , 3 a , 4 b , 5 d , 6 a , 7 d , 8 c , 9 b , 1O a , 11 b , 12 a , 13 a , 14 b , 15 b , 16 a , 17 a , 18 a , 1920 b , 21 b , 22 d ,.23 b , 24 b , 25 a , 26 b , 27 d , 28 a

A C C O UNT I NG STANDA RD S

1 . Which of the following is one of the advantages of c To minimi ze tax liabil itiesAccountin g Standards? d All the three

a To elimin ate or reduce variation in ac count- 4 How many Ac countin g S tan d a rd s have beening treatm ents. sued in India so far?

b To facilitate co mparison of Financial state- a 28ments of diff erent comp anies

b 29 c To make financial statements more infor-

mative c 30

d All the three d 27

In India Accountin g Standard s are issued by ....... 5 Which of the followi ng statement is true?

a lCAl a So far 28 Accounting standards have b

issued in India b s t

c ICWA I b Non-Compli ance of accountin g stan dards

a criminal offence d IDB c Accountin g Standard s are issu ed by CB

3 Which of t he following is on e of the objectives of d Account ing Standard B oard ASB) wasAccountin g Stand ard? up in 197 7

a To standardize diverse accounting practices 6 Which o f the following bodi es are not r epresenand po licies in ASB?

b To imp rove f inancial performan ce of Busi- a ICA Iness enterprises

MCQs on Accounting_accounting Equation 9-PDF

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