Question # 1

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

Error of posting effects:

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One account

Two accounts

Three accounts

Four accounts

Bad debts are

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deferred expenditure

revenue expenditure

capital expenditure

none of these

The revenue profit should be transferred to:

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Balance sheet

Trading account

Profit and loss account

None of these

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

Goods sold to Ali for Rs. 50,000 recorded in purchases day book will affect

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purchases A/c

sales account

purchases, sales & Ali account

purchases & sales account

Capital contributed by the partners is a:

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Revenue receipt

Capital receipt

Current receipt

Deferred receipt

A receipt is revenue in nature, if it relates to:

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Balance sheet

The receipt of accounting year

Small amount

Routine activity of the business

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

Preliminary expenses incurred before the commencement of business

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revenue expenditure

capital expenditure

deferred revenue expenditure

capital loss

Errors which affect one account can be

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errors of principle

errors of posting

errors of omission

none of these

Premium on issue of shares of a company represents

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capital loss

capital profit

capital payment

none of these

Some expenses are incurred at the time of the sate of an asset. The Amount will be debited to:

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Assets account

Expenses account

Cash account

Purchases account

Acceptance to Mr. A was posted to the debit of B's account. The rectification of the entry will.

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Increase the net profit

Decrease the net profit

Have double effect on net profit

Have no effect on net profit

Error of principle involves an incorrect allocation of expenditure or receipt between.

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Capital and revenue

Capital and capitalized

Revenue and deferred revenue

Revenue and revenue

A credit sale was wrongly passed through purchases book, the rectification of the entry will:

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Increase the net profit by, double amount

Decrease the net profit

Decrease the net profit by double amount

Have no effect on the net profit

The outflow of funds to meet the running expenses of a business

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Revenue loss

Revenue expenditure

capital expenditure

capital loss

Goods purchased from Robin have been posted to Rahim account, it is an:

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Error of omission

Error of casting

Error of posting

Error of commission

Any expenditure incurred to increase the earning capacity of a business

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capital expenditure

capital loss

revenue loss

revenue expenditure

The process of totaling the data at the end of the period is called

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posting

casting

compensating

recording

Receipts which are non-recurring by nature:

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Capital receipts

Revenue receipts

Short term receipts

Capital profit

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