Accounting and Auditing Page-4

31) Acid Test Ratio is calculated as under
(A) Current Assets/Current Liabilities
(B) Fixed Assets/Current Liabilities
(C) Liquid Assets/Current Liabilities
(D) None of these

32) The stage under which transactions are recorded chronologically in the books of accounts is called
(A) Summarizing
(B) Classifying
(C) Recording
(D) None of these

33) Book-keeping is mainly concerned with
(A) Recording of a financial data relating to business transactions
(B) Designing the systems in recording, classifying, summarizing the recorded data
(C) Interpreting the data for internal and external users
(D) None of these

34) The discount account is a
(A) Personal account
(B) Real account
(C) Asset account
(D) Nominal account

35) Those liabilities which arise only on the happening of some event are called
(A) Current liabilities
(B) Outstanding liabilities
(C) Contingent liabilities
(D) Fixed liabilities


36) Marshalling of balance sheet means
(A) The ordering of its assets and liabilities
(B) The totaling of its assets and liabilities
(C) Excess of assets over liabilities
(D) None of these

37) Which one of the following is not considered the permanent part of the accounting record
(A) Journal
(B) Trial Balance
(C) Balance sheet
(D) Final accounts

38) The provision for discount on creditors is often not provided in keeping with the principle of
(A) Materiality
(B) Consistency
(C) Conservatism
(D) Realization

39) The capital receipts are shown in the balance sheet on the
(A) Liability
(B) Asset side
(C) Debit side
(D) None of these

40) Error due to wrong allocation as expenditure between capital and revenue is regarded as
(A) Error of omission
(B) Error of principle
(C) Compensation errors
(D) None of these



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