Accounting — Mixed Practice — Part 2: 40 MCQs with Explanations

Standing orders are Credited in the cash book.

Uncollected checks also referred as Uncredited checks .

Outstanding checks are checks that are issued by the business but not yet presented to bank.

$500 will be credited is the correct answer to “Bank sent debit advice of $500 to company being interest on overdraft. It wasnt entered in cash book. Identify the correct adjustment in cash book.”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Added to bank balance is the correct answer to “In the Bank reconciliation statement œDeposit in transit is usually:”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Negotiable Instrument Act was enacted in 1881 .

Amount to be paid in foreign currency is the correct answer to “Which of these is not an essential feature of a bill of exchange”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

A foreign bill of exchange is generally drawn up in Triplicate .

Acceptance is the correct answer to “Which of these are not required in a promissory note”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

X draws a Bill of Exchange on Y for 10,000 on 1-1-2013 for 3 months. The due date of the bill will be 4/4/2013 .

For mutual financial accommodation is the correct answer to “Accommodation bills are generally for”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

A cash deposit made by business appears on the bank statement as Credit balance.

There are not sufficient funds in your account is the correct answer to “A check returned by bank marked œNSF means that:”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Bank reconciliation statement is prepared by Accountant of the business .

Bank charges will be credited in cash book is the correct answer to “Bank charges amounting to $5000 was not entered in the cash book. Identify the correct adjustment in cash book”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Debit balance of cash book is the correct answer to “Favorable balance of cash book implies that”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Bank reconciliation statement is the comparison of a bank statement (sent by bank) with the Cash book (prepared by business).

3 is the correct answer to “How many parties are generally found in a Bill of Exchange”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Remitting or receiving the amount is the correct answer to “The drawer of a trade bill passes relevant entries with regard to the transaction involved in it. But, in case of an accommodation bill, he passes an entry in addition to the usual entries. The additional entry so passed is with respect to”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

It is payable to the bearer is the correct answer to “Which of the following is not a feature of a promissory note”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Acceptors Account is debited in the books of drawer is the correct answer to “When bill discounted with the bank is dishonored”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

The person responsible for dishonour is the correct answer to “The noting charges levied on dishonour of an endorsed bill by the Notary Public are to be borne by”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

At the time of closing the accounts is the correct answer to “Closing entries are generally passed:”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Carriage on goods purchased is shown in: Trading A/c .

Interest on FDs is the correct answer to “Which of these is not an operating income”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

A Bill of Exchange is drawn on 1st April, 2018 payable after 3 months. The due date of the bill is 4th July,2018.

Debts included in Sundry Debtors which are doubtful in nature is the correct answer to “Which of the following is not a contingent liability”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Accounts Receivable is the correct answer to “Which of the following is not an intangible asset”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Gross Profit + Opening Stock + Direct expenses + Purchases- Closing stock = Sales is the correct answer to “Which of the following equations is correct”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Credited to P&L A/c is the correct answer to “Bad debts recovered is:”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

The adjustment to be made for prepaid expenses is Deduct prepaid expenses from respective expenses and show it as an asset .

Debit Reserve for Discount on Accounts Payable A/c and Credit P&L A/c is the correct answer to “Which of the following entries is correct in respect of reserve for discounts on accounts payable”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Debit of 600 and 200 to insurance company and Profit and Loss Account respectively and credit of 800 to Trading Account is the correct answer to “Goods in stock worth 800 are destroyed by fire and the Insurance Co. is accepted the claim for 600. Adjustment would involve”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Insurance prepaid is shown as: Current Asset .

LIFO stands for Last in, First Out .

Current Assets is the correct answer to “Short term Assets expected to be converted into cash within 1 year or less than”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Return inwards is the correct answer to “Net sales equals, sales minus:”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Sole-proprietorship is the correct answer to “Which of the following form of business organization is least regulated”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Written down to zero or its scrap value is the correct answer to “Recent developments have made much of a companys inventory obsolete. This obsolete inventory should be”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.

Advance payments made to suppliers for raw materials is the correct answer to “Which of the following is not classified as inventory in the financial statements”. Items of this type are drawn from the Accounting — Mixed Practice — Part 2 syllabus of Pakistani competitive exams, where the fact is tested verbatim.