Question # 1

When an acceptor refuses to pay the amount of bill to the holder on its maturity date it is called

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Honoured Bill

Retired Bill

Dishonoured Bill

Endorsed Bill

A bill of exchange is a / an

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Promise

Unconditional Order

Request

Conditional Order

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

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

The person to whom bill is transferred will become

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Endorser

Creditor

Debtor

Endorsee

All those expenses which are incurred to convert raw-materials into finished goods are called:

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Direct expenses

Indirect expenses

Administrative expenses

Sales expenses

A bill of exchange is a method of payment on

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Cash Basis

Credit Basis

Reserve Basis

Accommodation Basis

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

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 bank reconciliation statement is prepared by:

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banker

Accountant of the business

Statutory auditors

Rigistar

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

A bill of exchange is drawn by

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Debtor

Creditor

Endorser

Endorsee

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

When a bill is discharged the acceptor debits:

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Creditors account

Cash account

Bill payable account

Bill receivable account

A Journal is generally kept on:

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A columnar basis

A row basis

A single line basis

Vertical basis

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

When a bill is transferred by the drawer to his creditor, for settlement of his debts, it is called

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Retirement of Bill

Endorsement of a Bill

Discounting of a Bill

Settlement of a Bill

When bank column of a cash book shows a credit balance, it means:

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Cash balance

Bank balance

Under draft

Over draft

The Legal tenor of a bill is

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Sixty Days

One Month

Eighty Days

Ninety Days

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

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