Question # 1

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

An error completely omitted to be entered in the journal

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partial error

error of posting

error of casting

complete error

Which one of the following is appeared in the balance sheet ?

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revenue expenditure

capital expenditure

deferred revenue

both b,c

Preliminary expenses incurred before the commencement of business

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revenue expenditure

capital expenditure

deferred revenue expenditure

capital loss

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

Which account will be created in the presence of suspense account, if sales book is undercast by Rs. 500

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suspense A/c

sales A/c

cash A/c

none of above

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 receipt is revenue receipt because

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the amount is small

it relates to routine activity of business

it is received in the accounting year

both b, c

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

Error of posting effects:

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One account

Two accounts

Three accounts

Four accounts

The revenue profit should be transferred to:

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Balance sheet

Trading account

Profit and loss account

None of these

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

Any difference in trial balance is transferred to

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sales account

nominal account

purchases account

suspense account

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

Receipts which are non-recurring by nature:

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Capital receipts

Revenue receipts

Short term receipts

Capital profit

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