Question # 1

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

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revenue expenditure

capital expenditure

deferred revenue

both b,c

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

Errors which affect one account can be

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errors of principle

errors of posting

errors of omission

none of these

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

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

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Revenue loss

Revenue expenditure

capital expenditure

capital loss

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

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posting

casting

compensating

recording

An error completely omitted to be entered in the journal

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partial error

error of posting

error of casting

complete error

Error of posting effects:

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One account

Two accounts

Three accounts

Four accounts

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

Any difference in trial balance is transferred to

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sales account

nominal account

purchases account

suspense account

Any expenditure incurred to increase the earning capacity of a business

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capital expenditure

capital loss

revenue loss

revenue expenditure

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

Raw material destroyed in fire represents

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capital loss

revenue loss

normal loss

both b, c

Suspense means

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certainty

uncertainty

surly

none of these

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

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

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 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

The revenue profit should be transferred to:

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Balance sheet

Trading account

Profit and loss account

None of these

Capital contributed by the partners is a:

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Revenue receipt

Capital receipt

Current receipt

Deferred receipt

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