Question # 1

The concept of conservation will have the effect of:

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Understatement of assets

Under statement of liabilities

Overstatement of assets

None of the above

Accommodation bills are drawn accepted and endorsed

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Without any Consideration

for some Consideration

for Quarter Consideration

none of the above

Which cash is paid or received in an exchange the transaction is called:

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Sale transaction

Cash transaction

Credit transaction

None of the above

Narration is always written:

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Above each entry

Below each entry

Between of each entry

None of these

A bill of exchange is a method of payment on

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Cash Basis

Credit Basis

Reserve Basis

Accommodation Basis

When a bill is discharged the acceptor debits:

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Creditors account

Cash account

Bill payable account

Bill receivable account

A bill of exchange is a / an

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Promise

Unconditional Order

Request

Conditional Order

Any activity undertaken for the purpose of earning profit is called:

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Performance

Dealing

Business

Duties

Bank for collection is a

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Permanent Account

Fixed Account

Current Account

Temporary Account

A bill of exchange is drawn by

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Debtor

Creditor

Endorser

Endorsee

The act of withdrawing a bill of exchange from circulation when it had been paid before the due date

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Renewal of a Bill

Discounting of a Bill

Endorsement of a Bill

Retiring of a Bill

Nominal account are related to:

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Assets and liabilities

Expenses, losses and incomes

Customers, creditors etc

Capital account

At the time of drawing a bill the drawer credits:

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Debtors account

Creditors account

bill receivable account

Suppliers account

When a drawer discounts a bill, he debits

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Bank Account

Interest Account

Drawee Account

Bill Receivable Account

Retiring a bill under rebate means

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Payment of Bill Before Due Date

Payment of Bill After due date

Discounting of a Bill

Dishonouring of a Bill

How many parties are involved in case of Discounting of a bill ?

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Two

Three

Four

None of these

Subsidiary books are called the book of:

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Original entry

Secondary entry

Temporary entry

Basic entry

Interest on renewal of a bill is the expense of

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Drawer

Drawee

Holder

Endorsee

The transaction for which non separate book is maintained are recorded in:

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Journal proper

Bills receivable book

Bills payable book

Cash book

A many buy Rs. 40,000 worth good and sells them for Rs. 50,000. His gross profit is:

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Rs.10,000

Rs.20,000

Rs,30,000

Rs. 40,000

A bill which is both drawn and payable within the geographical boundaries of a country

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Foreign Bill

Local Bill

Municipal Bill

Inland Bill

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Principles of accounting Icom Part 1 English Medium Chapter 3 Online Test MCQs With Answers

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