Question # 1

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

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

Suspense means

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certainty

uncertainty

surly

none of these

A copy of the customer's account in the bank's ledger is called:

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Deposit statement

Balance statement

Bank statement

Customer

Net Profit is transferred to

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Trading Account

Balance Sheet

Capital a/c

Trial Balance

When saleable goods are bought in a business are called:

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Sales

Purchase

Assets

Goods

Any difference in trial balance is transferred to

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sales account

nominal account

purchases account

suspense account

Provision for the doubtful debts is debited to

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Debtors a/c

Provision for bad debts a/c

Profit or loss a/c

Bad debts recovered a/c

According to accounting equation, capital is equal to

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assets + liabilities

expenses-incomes

liabilities - assets

assets - liabilities

The accounting system in which accounting entries are made on the basis of amount having become due for payment or receipt, is called

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Cash system

Accrual or mercantile system

Outstanding system

None of these

Our cheque to Ali & Bros, returned dishonored should be credited to

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Cheque account

Cash account

Bank account

Ali & Bros account

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

Position statement is similar to a

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Trial balance

Balance sheet

Financial statement

Bank reconciliation statement

The book in which all cash transactions are primarily recorded is called

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Cheque Book

Pass Book

Cash Book

Finance Book

In adjusting the cash balance one of the following is not taken into account:

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Mistakes in the cash book

Mistake in the bank statement

Interest and dividends credited in the bank statement

None of the abvove

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