Question # 1

The profit which is earned during the ordinary course of business is regarded as:

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Capital profit

Revenue profit

Revenue loss

Long term profit

The capital profit should be transferred to:

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Profit and loss account

Trading account

Balance Sheet

Both Trading and profit and loss account and balance sheet

If sales return for Rs. 3,000 were incorrectly included in sales book, gross profit will be

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overstated by Rs. 3,000

understated by Rs. 6,000

understated by Rs. 3,000

overstated by Rs. 6,000

An expenditure incurred in increasing the efficiency of a fixed asset is called:

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Revenue expenditure

Capital expenditure

Current expenditure

None of these

Preliminary expenses incurred before the commencement of business

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revenue expenditure

capital expenditure

deferred revenue expenditure

capital loss

Suspense means

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certainty

uncertainty

surly

none of these

Errors which affect one account can be

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errors of principle

errors of posting

errors of omission

none of these

Error of posting effects:

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One account

Two accounts

Three accounts

Four accounts

If the error committed in the capital account, it will affect

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trading account

profit & loss account

trading and profit & loss account

balance sheet

Capital contributed by the partners is a:

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Revenue receipt

Capital receipt

Current receipt

Deferred receipt

A transaction has been journalized but posted wrongly in the ledger account, it is an:

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Error of positing

Error of principle

Error of omission

Error of commission

Unearned income are known as:

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Incomes

Expenses

Liabilities

Assets

Wrong allocation of capital and revenue items of expenses represents

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error of casting

error of principle

compensation error

error of commission

Capitalized expenditures are shown in

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trading A/c

profit & loss A/c

income statement

balance sheet

Receipts which are non-recurring by nature:

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Capital receipts

Revenue receipts

Short term receipts

Capital profit

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Principles of accounting Icom Part 1 English Medium Chapter 6 Online Test MCQs With Answers

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