Online Test

Question # 1

Treble column cash book has three columns of:

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Cash, bank and discount

Income, expense and bank

Cash, bank and profit or loss

None

Material are charged to production at actual cost under

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Weighted average method

FIFO method

LIFO method

Both ii & iii

Cost goods sold is Rs. 1650, gross profit ratio is 17.5% then sales is

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1800

1900

2000

2200

A person is said to be insolvent when his

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Assets are sufficient

Assets are enough to pay his liabilities

Assets are not enough to pay his liabilities

None

Rebate is the --------- in the amount of bill paid

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Premium

Increase

Expense

Concession

What is negotiable instrument?

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A document which is not transferable

A document which is transferable

A document which is accepted

None

The cost flow must match the

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Output

Outflow

Inflow

Workflow

In bill of exchange, the party who accepts a bill is known as:

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Drawer

Drawee

Payee

Third party

Offsetting expenses against revenue is the concept of:

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Realization

Dual aspect

Matching

Conventions

Compound entry is an entry in which:

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More than one account is debited

More than one account is credited

Both a and b are correct

None of the above

Which one is not a classification according to the accounting period?

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Capital expenditure

Revenue expenditure

Product cost

Administrative cost

The cost of holding the stock in storage is called

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Ordering cost

Material cost

Caring cost

All of the above

Statement of a affairs is a sort of -----------

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Profit and loss statement

Nominal account

Statement of changes in equity

Balance sheet

Lead time is the time between the time on item reaches --------------- and ---------- of

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Order level, dispatch of material

Order level, maximum level

Maximum level, minimum level

Order level, actual receipt

Any written evidence of a business transaction is known as

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Voucher

Pay-in-slip

Debit note

Credit note

Doubtful debt are:

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Definite loss to the business

Definite profit to the business

Expected loss to the business

Expected profit to the business

In operating expense includes

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Marketing expense

Admin expense

Selling expense

All of the above

Depreciation expenditure is a

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Fixed cost

Variable cost

Semi-variable cost

Step fixed cost

Good received note is prepared by

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Purchase department

Sales department

Receiving department

All of the above

Quick assets are

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Cash in hand

Cash at bank

Debtors

All of the above

Under perpetual inventory system stock taking is under taken at the

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Start of the accounting year

End of the accounting

Regular bases

None of above

Spoiled goods cannot be

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Sold without repairing

Repair and sold as damaged goods

Both A and B

None of above

If applied factory overhead is less than actual factory overhead, it is called

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Applied F.o.H

Over applied F.o.H

Under-applied F.o.H

None of above

Doubtful debts are shown on:

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Profit side of statement of profit and loss

Liabilities side of balance sheet

Asset side of balance sheet

Not shown anywhere

What is accumulated depreciation?

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Depreciation expense of the current year

Sum of all depreciations in different accounting year

Depreciations of previous accounting year

None

Work in process opening and closing inventory includes:-

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Arterial in process

Labour in process

F.o.H in process

All of the above

Which one is not accounting convention?

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Materiality

Full disclosure

Consistency

Going concern

Realisation concept is the concept in which revenue is ------------ at the time when goods are sold or services rendered.

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Recognized

Not recognized

Paid

Received

Debentures are

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Fixed assets

Fixed liabilities

Capital

Prepaid expenses

Hypothetical cost which are specially computed outside the accounting system for the purpose of decision making is called

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Future cost

Replacement cost

Imputed cost

Sunk cost

Costs whose consumption may be identified with specific production units in called

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Direct labour cost

Indirect labour cost

Direct material cost

Indirect material cost

From the following statements which one is not true about over applied F.o.H

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Less from cost of goods sold at normal

Less from entire production if required

Add in gross profit if required

Less from Net profit.

A--------------- is an account in which those transaction are entered which cannot be placed to their accounts

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Nominal account

Suspense account

Personal account

Debtor account

The stages of accounting cycle are

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Transaction-ledger-journal-trial balance-final accounts

Transaction-journal-ledger-trial balance-final accounts

Transaction-journal-trial balance-ledger-final accounts

Transaction-journal-ledger-final accounts-trial balance

What are accrued expenses?

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The expenses that have been incurred during current year and paid till the end of current year

The expenses that have been incurred previous year and paid in the current year

The expenses that have been incurred during current year and not paid till the end of current year

The expenses that have been incurred previous year and not paid till the end of current year

Accounting is the

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Art

Science

Both

None

Provision of doubtful debts are also known as:

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Allowances for uncollectable

Allowances for collectable

Bad debts

None

Deferred liabilities are debts which are repayable less than ----------

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One month

Six month

One year

None

The objective of financial accounting is to ascertain:

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True results of profit

True results of loss

True results of profit or loss

None

Outstanding expenses are also known as

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Prepared expenses

Accrued expenses

Un-earned income

None

Goodwill is ----------- for company.

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Intangible asset

Fixed asset

Current asset

Quick asset

In payroll include the remunerations of

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Direct labour

Indirect labour

Both a & b

None of the above

The price at which assets will be sold at the end of its useful life is known as:

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Scrap value

Residual value

Written down value

All of the above

Trading account shows ----------- result.

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Net

Gross

Profit

Loss

The cost flow must watch the

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Output

Outflow

Inflow

Workflow

During period of rising material prices, ----------- method results in profit inflation

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LIFO

FIFO

Weighted average

All of the above

Tenor is the period of time ------------ which a bill becomes payable

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Before

After

Both a and b

None

Per Unit cost is calculated by dividing the cost of goods sold by

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The number of units sold

The number of units purchase

The number of units manufactured

All of the above

How many types of bank accounts are there?

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4

3

5

6

If spoiled good are considered as abnormal part of production process then debited to

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Work in process

General expense

F-o-H control

None of above

Which ratio tells how many times in a year stock is used up and replaced?

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Gross profit ratio

Net profit ratio

Cost ratio

None of these

A cost whose magnitude will be affected by decision being made is called

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Historical cost

Relevant cost

Irrelevant cost

Sunk cost

Cost which cannot be conveniently identified with individual cost unit is called

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Direct material cost

Indirect material cost

Indirect labour cost

Caring cost

What are bad debts?

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Debts which are irrecoverable from the debtors

Debts which are recoverable from the debtors

Debts which are irrecoverable from the creditors

Debts which are recoverable from the creditors

According to possible for an event or transaction which is not measurable in terms of money

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True

False

May be

None

If spoiled goods are considered a normal part of production process than debit to

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Work in process

General expense

F.o.H control

None of above

Sales prices is calculated as follow:-

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Cost + operating expense

Direct material + Direct labour + F.o.H

Cost + operating expenses + profit

None of above

The primary objective of cost accounting is to

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Control cost

Calculate profit

Avoid cost

All of above

Excess of assets over liabilities is known as:

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Capital fund

Accumulated fund

Surplus fund

All options are correct

Cash or goods taken away by owner for personal use from business are known as:

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Capital

Drawings

Revenue

Expense

Which one is non-manufacturing costs?

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Direct material cost

Labour cost

Research and development cost

All of above

Manufacturing concern cycle is ---------- than trading concern cycle:

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Shorter

Greater

Medium

None of above

The technique and process of ascertaining cost is termed as

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Costing

Cost accounting

Calculation of cost

Controlling cost

What is amortization?

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Decrease in the value of fixed assets

Decrease in the value of intangible assets

Increase in the value of fixed assets

Increase in the value of intangible assets

Petty cash book is a book which record

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Assets

Liabilities

Large payments

Small payments

Variable cost and fixed cost have been treated as product cost in

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Absorption costing

Direct costing

Full costing

All of above

Purchase Requisition is sent to

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Accounts department

Purchase department

Finance department

None of above

The primary object of non-profit organizations is

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Not to earn profit

Work for the welfare of society

Buy/sell goods

A and B but not C

A property which is received by virtue of a will of a person after his death is known as

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Legacy

Donation

Subscription

Gift

Section of the business to which cost can be charged is termed as

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Cost driver

Cost center

Cost unit

All of above

Cost which is calculated before manufacture operation is called

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Sunk cost

Mixed cost

Standard cost

None of above

Difference in cost of alternative choices is called

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Total costing

Differential costing

Full costing

Variable costing

Assets which have to no market value are called

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Fictitious assets

Liquid assets

Intangible assets

Real assets

In job order costing system, each job is assigned a job cost

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Unit

Center

Driver

Sheet

Depreciation is a loss due to wear and tear of an asset.

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Correct

Incorrent

May be

None

The ------------- includes a control account entitled general ledger that shows is equity of the general office in the factory.

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General ledger

Head office ledger

Factory ledger

None of these

How many types of inventories are in cost of goods sold statement?

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1

2

3

4

Which one is not a functional classification?

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Manufacturing cost

Marketing cost

Finance cost

Mixed cost

Loss which arises due to ----------- is known as abnormal loss

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Breakage of goods

Leakage

Fire

Shrinkage

Name the main accounts which are prepared in accounting?

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Assets, liabilities, income and expenses

Assets, liabilities, income and revenue

Assets, owner's equity, income and expenses

Assets, liabilities and expenses

How many of grace are given?

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5

4

3

2

A credit purchases are:

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If goods purchased and payment made at the same time

If goods purchased and payment not made at the same time

If goods sold and payment receive at the same time

If goods sold and payment not receive at the same time

Dishonor of the bill occurs when:

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The drawer refuse to pay

The acceptor refuses to meet the bill on due date

The endorsee accepts to meet the bill

None

The bills which are drawn and accepted against the sale and purchase of goods on credits are called

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Trade bills

Bill of exchange

In-land bills

Foreign bills

How many branches are there in accounting?

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1

3

2

4

Profit will be lower where prices are rising under

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FIFO method

LIFO method

Weighted average method

All of the above

Accounts which are related with properties are known as

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Real accounts

Nominal accounts

Property accounts

A and C are correct Accounting principles:

What is accounting period?

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It is a time for which business prepares its financial statements

It is time for which business prepares its profit and loss statement

It is a time for which business prepares its balance sheet

None

Which one is not include in factory overhead?

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Power hear & light

Indirect labour cost

Depreciation of plant

Salary of accountant

Historical cost which is irrecoverable in a given situation is called

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Imputed cost

Standard cost

Opportunity cost

Sunk cost

Endorsement is made:

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For settlement of debts

For settlement of income

For settlement of profit

None

Which one of the following is not a negotiable instrument?

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Cheque

Promissory note

Bill of exchange

None of the above

Office salaries are include in

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Direct material cost

Indirect material cost

Factory overhead cost

Total payroll

Bin card is maintained by

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Purchase manager

Sales manager

Store keeper

Finance manager