CBSE Questions for Class 11 Commerce Accountancy Financial Statements 2 Quiz 6 - MCQExams.com

The capital of a sole trader would change as a result of ____________________.
  • A creditor being paid his account by cheque.
  • Raw materials being purchased on credit.
  • Fixed asset being purchased on credit.
  • Wages being paid in cash.
The adjustment to be made for outstanding expenses is ________________________.
  • Add outstanding expenses to respective expenses and show it as asset
  • Deduct outstanding expenses from respective expenses and show it as liability
  • Add outstanding expenses to respective expenses and show it as liability
  • Deduct outstanding expenses from respective expenses and show it as asset
The adjustment to be made for interest on drawing is ___________________.
  • Debit Profit and loss Account and Add Interest to drawings.
  • Credit Profit and loss Account and Add Interest to drawings.
  • Debit Profit and loss Account and Deduct Interest to drawings.
  • Credit Profit and loss Account and Deduct Interest to drawings.
An adjusting entry to accrued wages earned but not yet paid is an example of _______________.
  • Adjusting recorded costs with the appropriate accounting periods
  • Adjusting recorded revenue with the appropriate accounting periods
  • Reflecting unrecorded expenses incurred during the accounting period
  • Reflecting unrecorded revenue earned during the accounting period.
Adjusting entries are essential to the ___________.
  • Matching rule
  • Accrual accounting
  • Aroper determination of net income
  • All of these
If the estimated amount of depreciation on equipment for a period is Rs. 2,000, the adjusting entry to record depreciation would be _______________.
  • Debit depreciation expense Rs. 2,000; credit equipment Rs. 2,000
  • Debit equipment Rs. 2,000; credit depreciation expense Rs.2,000
  • Debit depreciation expense Rs. 2,000; credit accumulated depreciation Rs. 2,000
  • Debit accumulated depreciation Rs. 2,000; credit depreciation expense Rs. 2,000
Which of the following is an example of an adjusting entry?
  • Recording the purchase of goods an account.
  • Recording depreciation of a truck.
  • Recording the billing of customers for services rendered.
  • Recording the payment of wages to employees.
Prepaid insurance has an opening balance of Rs. 2,During the period, insurance of Rs. 1,200 expired. The adjusting entry would contain a credit _____________.
  • to prepaid insurance for Rs. 1,200
  • to insurance expenses for Rs. 1,200
  • to unexpired insurance for Rs. 1,100
  • to insurance expense for Rs. 1,100
The recording of wages earned but not yet paid is an example of an adjustment that _____________.
  • apportions revenues between two or more periods
  • recordings an accrued expense
  • recordings an unrecorded revenue
  • None of the above.
Adjusting entries are essential to _______________.
  • Matching rule
  • Accrual accounting
  • A proper determination of net income
  • All of these
A club paid subscription fees of Rs. 1,400, out of which Rs. 200 is prepaid. In such case _________________.
  • P & L A/c is debited with Rs.1,400
  • P & L A/c is debited with Rs. 1,200
  • Rs. 200 is shown as current asset
  • Both (B) and (C)
  • Both (A) and (C)
Trial Balance contains the following information: Bad debts Rs. 2,000, Provision of Doubtful Debts Rs. 1,It is desired to make a Provision of Doubtful Debts Rs. 2,000 at the end of the year. The amount to be debited to the Profit and Loss Account is __________.
  • Rs. 5,500
  • Rs. 6,000
  • Rs.2,500
  • Rs.4,500
The company maintains provision for bad debts at 5% and its outstanding debtors at the end of the year were Rs. 3,00,During the year, opening balance of provision for bad debt was Rs. 5,000 and bad debt during the year was Rs. 10,The debit to profit and loss account for the year ended in respect of provision for debtors will be __________.
  • Rs. 50,000
  • Rs. 25,000
  • Rs. 20,000
  • Rs. 15000
Opening balance of debtors is Rs. 18,$$5\%$$ provision for bad debt is required to be provided on debtors. If the debtor's balance is increased during the year by Rs. 5,000 and the provision for bad debt has a debit balance of Rs. 350 after transferring bad debts, the charge against the profit and loss account is:
  • Rs. 1950
  • Rs. 1500
  • Rs. 650
  • Rs. 550
If 'Prepaid Wages' is given in Trial Balance, it is shown in _____________.
  • Debit of Trading A/c
  • Debit of Trading A/c and Assets
  • Debit of P&L A/c
  • Assets
The Book of Accounts of Z Ltd. shows that the balance of study debtors is Rs. 50,000 and reserve for doubtful debts is Rs. 2,Later the management of the company realized that debts to the extent of Rs. 1,000 will become bad and hence decided to create a reserve at 5% on debtors. The amount of reserve for doubtful debts to be shown in profit and loss account is_________.
  • Rs. 2,500
  • Rs. 2,350
  • Rs. 2,450
  • Rs. 1,450
A Trial Balance contains the following information :
Bad debtsRs.5,000
Discount allowedRs.4,000
Provision for discount on debtorsRs.2,000
Provision for Doubtful DebtsRs.5,000
Sundry DebtorsRs.50,000
At the end of the year, it is desired to maintain a provision for debts at Rs. 4,000 and provision for discount on debtors at Rs.2,Sundry Debtors (after provision) will appear in the Balance Sheet at a figure of :
  • Rs.44,000
  • Rs.38,000
  • Rs.44,700
  • Rs.32,300
If the manager is entitled to a commission of $$5\%$$ on profits before deducting this commission, he will get a commission of Rs. __________ on a profit of Rs. 8400.
  • 400
  • 442.11
  • 420
  • None of these
If the manager is entitled to a commission of 5% on profits before deducting this commission, he will get a commission of Rs. ________on a profit of Rs. 8,400.
  • 400
  • 442.11
  • 420
  • None of these
A trial Balance provides you the information: bad debts Rs. 800, Provision of Doubtful Debts Rs.3,It is desired to maintain a Provision of Doubtful Debts Rs.1,The accounting treatment of these adjustments is ____________.
  • Rs. 1,800 to be debited to the Profit and Loss Account
  • Rs. 1,200 to be credited to the Profit and Loss Account
  • Rs. 1,200 to be debited to the Profit and Loss Account
  • Rs. 4,800 to be debited to the Profit and Loss Account
The company maintains provision for bad debts at $$5\%$$ and its outstanding debtors at the end of the year was Rs 3,00,During the year, opening balance of provision for bad debt was Rs. 5000 and bad debt during the year was Rs. 10,The debit to profit and loss account for the year ended in respect of provision for debtors will be: 
  • Rs. 50,000
  • Rs. 25,000
  • Rs. 20,000
  • Rs. 15,000
Interest on capital will be paid to the partners if provided for in the agreement but only from following _______________.
  • Profits
  • Reserves
  • Accumulated Profits
  • Goodwill
Which of the following items will be shown on assets side?
  • Income received in advance
  • Bank loan
  • Prepaid insurance premium
  • Reserve for doubtful debts
What is the correct sequence of the following action required for the preparation of Final Accounts?
(1) Preparation of Trial Balance 
(2) Balancing of Accounts
(3) Preparation of Annual Financial Statements 
(4) Marking Adjusting Entries
Select the correct answer from the codes given below:-
  • 4, 2, 1, 3
  • 2, 4, 3, 1
  • 2, 1, 4, 3
  • 4, 2, 3, 1
Which one of the following statements is not correct?
  • The provision for bad debts account is owed to the proprietor
  • Bad debts could exceed the provision for bad debts
  • Bad debts could be less than the provision for bad debts
  • Provision for bad debts appears in the balance sheet
The manager of a firm is entitled to a commission of  $$10$$% on the net profit after his commission. If the profit of the firm before charging commission is  $$ Rs. 3,30,000$$, the amount of manager's commission will be_________. 
  • $$Rs. 33,000$$
  • $$Rs. 30,000$$
  • $$Rs. 27,000$$
  • $$Rs. 36,000$$
Y's trial balance contains the following information:
Bad debtsRs. 5,000
Provision for bad debtsRs. 6,000
Sundry debtorsRs. 50,000
It is desired to create a provision for bad debts at 10 per cent on Sunday debtors at the end of the year. Sundry Debtors will appear in the balance sheet at a figure of ____________.
  • 45,000
  • 42,500
  • 46,000
  • 34,000
The Books of Accounts of Z Ltd. shows that the balance of sundry debtors is. 50,000 and reserve for doubtful debts is 2,Later the management of the company released that debts to the extent of 1,000 will become bad. It was decided to create a reserve at 5% on debtors. The amount of reserve for doubtful debts to be shown in profit and loss account is ________.
  • 2,500
  • 2,350
  • 2,450
  • 2,400
  • 450
A's trial balance contains the following information:
Bad debtsRs. 5,000
Discount allowedRs. 3,000
Provision for discount on debtorsRs. 3,300
Provision for bad debtsRs. 5,500
Sundry debtorsRs. 60,000
At the end of the year, it is desired to maintain a provision for bad debts of Rs.5,000 and provision for discount on debtor at Rs. 3,000.
Sundry debtors will appear in the balance sheet at a figure of __________.
  • Rs. 52,000
  • Rs. 44,000
  • Rs. 52,800
  • Rs. 43,200
Payment received from debtor _______________.
  • decreases the total assets
  • increases the total assets
  • results in no change in the total assets
  • increases the total liabilities
  • decreases the total liabilities
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Practice Class 11 Commerce Accountancy Quiz Questions and Answers