Question # 1

The effect of drawing on accounting equation is

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decrease in assets and decrease in liabilities

increase in both assets & liabilities

decrease in assets and increase in capital

none of these

Allowance for discount on account receivable is calculated on the amount of account receivable

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Before deducting the allowance for doubtful debts

Left after deducting the allowance for doubtful debts

Before deducting the actual bad debts

None of these

Which account is a summary of direct expenses and direct revenues

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Trading and profit or loss account

Profit or loss account

Balance sheet

Trading account

The body of worksheet contains

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Two pairs of money column

Three pairs of money column

Four pairs of money column

Five pairs of money column

Stock is trade is a

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Current asset

Non-current asset

Quick asset

Intangible asset

The const concept applied only to the assets and not to:

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Expenses

Liabilities

Incomes

None of these

A bill of exchange is drawn by:

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A debtor

A creditor

A holder

Endorsee

When is a drawee is declared insolvent which account is to be debited in the books of drawer

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Deficiency a/c

Bad Debts a/c

Solvency a/c

None of these

For every debit, there is a credit

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going concern concept

dual aspect concept

matching concept

cost concept

The amount of assets, liabilities, capital and drawings are extended form adjusted trail balance to the

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Balance sheet columns

Income statement columns

Cash columns

Bank columns

Error due to wrong allocation as expenditure between capital and revenue is regarded as:

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Error of omission

Error of principle

Compensating errors

Error of Commission

In journalizing the page numbers of the ledgers are written in:

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The first column of journal

The second column of journal

The third column of journal

The fourth column of journal

Journal means

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Weekly

Monthly

Yearly

Daily

An expenditure, which is completely exhausted with in the current accounting period is known as

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Deferred expenditure

Revenue expenditure

Future expenditure

Non-recurring expenditure

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

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Performance

Dealing

Business

Duties

Deprecation is

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A Liability

A loss

An expense

Both b & c

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