Q. Ledger is also called
✅ Correct Answer: (A)
Principal book of accounts ;
Financial Accounting MCQs and Notes
Q. The process of balancing of an account involves equalization of both sides of the account. If the debit side of an account exceeds the credit side, the difference is put on the credit side. The said balance is
(i) A Debit balance
(ii) A Credit balance
(iii) An expenditure or an Asset
(iv) An Income or a Liability
(i) A Debit balance
(ii) A Credit balance
(iii) An expenditure or an Asset
(iv) An Income or a Liability
✅ Correct Answer: (C)
Both (i) and (iii) above
Q. Which of the following is not an Asset?
✅ Correct Answer: (C)
Profit and Loss Account (Credit Balance)
Q. Purchase of Raw Material for Cash
✅ Correct Answer: (B)
Leaves total Assets unchanged
Q. Purchase of goods on credit
✅ Correct Answer: (C)
Increases both Assets and Liabilities
Q. XYZ Ltd. Paid wages of ` 8,000 for erection of machinery. The journal entry for the transaction is
✅ Correct Answer: (B)
Debit machinery and credit cash
Q. If the Petty Cash fund is not reimbursed just prior to year end and an appropriate adjusting entry is not made, then
✅ Correct Answer: (C)
Cash is overstated and expenses are understated
Q. The Periodical total of the Sales Return Book is posted to the
✅ Correct Answer: (B)
Debit of Sales Return Account
Q. Trade discount allowed at the time of Sale of goods.
✅ Correct Answer: (D)
Is not recorded in Books of Accounts
Q. Which of the following statements is/are true?
(i) Cash Book records all cash receipts and cash payments
(ii) Cash Book records all sale and purchase transactions of goods both in cash and on credit
(iii) Cash Book records discount on Cash Payments
(i) Cash Book records all cash receipts and cash payments
(ii) Cash Book records all sale and purchase transactions of goods both in cash and on credit
(iii) Cash Book records discount on Cash Payments
✅ Correct Answer: (D)
Both (i) and (iii) above