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CBSE Questions for Class 9 Elements Of Book Keeping And Accountancy Nature Of Accounts And Rules Of Debit And Credit Quiz 4 - MCQExams.com
CBSE
Class 9 Elements Of Book Keeping And Accountancy
Nature Of Accounts And Rules Of Debit And Credit
Quiz 4
When a liability is discharged _____ is debited.
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creditor a/c
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cash account
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profit and loss a/c
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miscellaneous expenses a/c
Explanation
A creditor is an entity (person or institution) that extends credit by giving another entity permission to borrow money intended to be repaid in the future. Hence when the liability is cleared or discharged creditor account is debited.
Personal A/c can have _______.
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Debit balance only
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Credit balance only
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No balance
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All the three are possible
Explanation
There are mainly three types of accounts: Real, Personal and Nominal accounts.
Personal accounts are related to individuals, firms, companies, etc. A few examples of personal accounts include debtors, creditors, banks, outstanding/prepaid accounts, accounts of good suppliers, accounts of credit customers, capital, drawings, etc. Personal a/c can have debit balance only, credit balance only and no balance. The debit balance of a personal account indicates debts owing by the person and credit balance indicates owing to the person concerned, For the business, the first one is accounts receivable or asset, while the second is accounts payable or liability.
The debit balance of all personal accounts on a certain date put together will make sundry debtors and the credit balance of all personal accounts put together will make sundry creditors.
The balance of personal account shows ______.
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Cash Balance
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Profit and Loss
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Amount due to or due from other persons, organization
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Liquidity Position
Explanation
There are mainly three types of account: Real, Personal and Nominal accounts. Personal accounts are classified into three subcategories: Artificial, Natural and Representative.
Personal accounts are related to individuals, firms, companies, etc. A few examples of personal accounts include debtors, creditors, outstanding/prepaid accounts, banks, accounts of credit customers, accounts of good suppliers, capital, drawings, etc. Natural personal accounts is the simplest to understand out of all and includes God's creations who have ability to deal, who, in most cases, are people. Artificial personal accounts are created artificially by law, such as corporate bodies and institutions. Representative personal accounts represent a certain person or a group directly or indirectly. The balance of personal account shows amount due to or due from other persons, organizations.
In an account prepared under a double-entry system, ________ prefix suggests that the concerned account is debited.
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To
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By
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Balance cd
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Balance bd
Explanation
Posting is a process of transferring debit and credit aspects of the entries appearing in the journal and other books of original entry to the and credit sides of the relevant accounts in the ledger. Posting are made using the word "To" and "By" as a prefix. For debit side entry "To" prefix is used and for credit side "By" prefix is used.
Rent receivable is a ________.
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Nominal A/c
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Real A/c
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Personal A/c
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Representative personal A/c
Explanation
Representative personal accounts are those which represent a certain person or a group directly or indirectly. E.g. Let's say that wages paid in advance to an employee-a wage prepaid account will be opened in the books of accounts. This wages prepaid account is a representative personal account indirectly linked to the person. Representative personal accounts include outstanding salaries, rent receivable, prepaid rent, etc.
Proprietor's A/c is a _______ account.
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Personal
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Real
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Nominal
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None of the above
Explanation
Personal accounts are related to individuals, firms, companies, etc.
A few examples of personal accounts include debtors, creditors, banks, outstanding/prepaid accounts, accounts of credit customers, accounts of good suppliers, capital, drawings, etc.
There are three types of personal accounts:Natural, Artificial and Representative.
Natural personal accounts are the simplest of all and includes all God's creations who have ability to deal, who, in most cases, are people.
E.g. Kumar's A/c, Proprietor's A/c, Adam's A/c etc.
Which side represents debit ?
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Left side
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Right side
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Side having shorter total
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Side having larger total
Explanation
Accounting is based on a unique concept i.e double entry system which means for every transaction there will be a debit and credit too. While preparing the financial statement, debits are shown in the left side and credits are shown on the right side.
_______ accounts relates to expenses, losses, income,
gain, revenue etc.
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Personal a/c
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Real a/c
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Nominal a/c
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Impersonal a/c
Explanation
Accounts are classified in to three categories:
1) Personal Account i.e. Account of any person
2) Real Account i.e. Account of assets or things
3) Nominal Account i.e. Account of expenses, losses, income gain
For each nominal account, a separate account will be opened in the ledger.
_______ is an artificial personal A/c.
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ICICI Bank A/c
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Goodwill A/c
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Mohan A/c
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Building A/c
Explanation
There are mainly three types of accounts: Real, Personal and Nominal accounts. Personal accounts are classified into three subcategories: Artificial, Natural and Representative. Personal accounts are related to individuals, firms, companies, etc. A few examples of personal accounts include debtors, creditors, bank, outstanding/prepaid accounts, accounts of credit customers, accounts of good suppliers, capital, drawings, etc. Personal accounts are personal accounts which are created artificially by law, such as corporate bodies and institutions, are called Artificial personal accounts. E.g. Pvt Ltd companies, LLCs, LLPs, clubs, schools, etc. ICICI Bank A/s is an artificial personal A/c.
Purchase of office equipment for cash would cause __________.
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Cash in hand to decrease
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External liability to decrease
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Total liabilities to increase
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Total assets to increase
Explanation
Cash exists as a company's most liquid asset. Purchasing office equipment for cash will reduce a company's assets (i.e. reduction in cash in hand). Since owner's equity equals assets minus liabilities, owner's equity will be reduced as a result of buying office equipment with cash.
Accrued wages is a ____________.
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Personal A/c
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Suspense A/c
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Real A/c
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Representative personal A/c
Explanation
Wages is classified as nominal account while the person to whom the wages is due is a personal account. Hence accrued wages is considered as representative personal account.
In the particulars account the name of the account to be credited is entered at ______ place with a prefix 'To' _____________________.
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in confirmation of the name of the account to be debited
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next line to the account name that is to debited
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any where in the journal
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none of the above
Which of the following is a Real A/c?
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Building A/c
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Preliminary Expenses
0%
Discount received A/c
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Ram Mohan A/c
Explanation
There are mainly three types of accounts: Real, Personal and Nominal accounts. All assets of a firm, which are tangible or intangible, fall under the category "Real accounts". Tangible real accounts are related to those things that can be touched and physically felt. Few examples of tangible real accounts are buildings, machinery, stock, land, etc. Intangible real accounts are those which can't be touched and physically felt. Few examples of intangible real accounts are trademarks, patents, goodwill, etc.
Cash withdrawn from bank for business purpose would cause ____________.
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Increase in current assets
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No change in assets and liabilities
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Increase in owner's equity
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Increase in new working capital
Explanation
When cash withdrawn from bank then the amount is deducted from bank account and added in the cash account of business hence, there is no effect of this transaction on asset or liability side of balance sheet i.e. the effect of transaction is nullified.
Purchase of RBI bonds for cash would lead to ____________.
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No change in total assets
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Total assets to decrease
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Total assets to increase
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Total liabilities to increase
Explanation
Bonds are considered to be an investment and part of assets, similarly cash is also an asset. If RBI bonds are purchased that will increase the assets against the cash which is going to be reduced. Hence there will be no change in assets.
Bank A/c is a __________.
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Real a/c
0%
Nominal a/c
0%
Personal a/c
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Dummy a/c
Explanation
Accounts recording transactions with a person or group of persons are known as personal accounts. These accounts are necessary, in particular, to record credit transactions. Personal accounts are of the following types:
1. Natural persons': An account recording transactions with an individual is termed as a natural persons' personal account.
2. Artificial or legal persons': An account recording financial transactions with an artificial person created by law or otherwise is termed as an artificial persons' personal account.
3. Representative personal account: An account indirectly representing a person or persons is known as representative personal account. When accounts are of similar nature and their number is large, it is better to group them under one head and open a representative personal account.
Bank account is a personal account as it is related to a banking firm, which is an artificial person. All those accounts which are related to a person, whether, artificial or natural, are termed as personal accounts.
Real a/c can have a _______ balance only.
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credit
0%
debit
0%
both
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None
Explanation
There are mainly three types of accounts: Real, Personal and Nominal accounts. All assets of a firm, which are tangible or intangible, fall under the category "Real accounts". Tangible real accounts are related to things that can be touched or physically felt, whereas intangible real accounts are those that can't be touched and physically felt. Real accounts relate to assets. When assets are received in the business the particular asset accounts are debited. When assets are sold or otherwise disposed of, the particular asset accounts are credited. So, if an asset account has a balance it must be a debit balance. It indicates the value of asset in the possession of the business.
Sales proceed of own flat put in business by proprietor would cause ____________.
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Cash in hand and owners capital to increase
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External liability to decrease
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Total liabilities to increase
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Total assets remain unchanged
Explanation
The owner's capital is the part of the accounting equation that represents the liquid cash that the company has earned, which it has on hand for daily operations as well as capital investments. Sales proceed of own flat put in business will increase cash in hand of business (as it is capital investment) and ultimately increases owners capital as it is the addition to the existing cash balance of business.
Rs. 2100 received from Mr. David which was earlier written off as bad debt will be credited to ___________.
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David A/c
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Debtors A/c
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Bad debts recovered A/c
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profit and loss A/c
Explanation
The amount which are not recoverable from the customers to whom goods were sold on credit, considered as loss to the business. These are called bad debts and to be debited to bad debts written off a/c.
If the same amount is recovered later on, this will be treated as income and to be credited to "Bad debts recovered a/c."
In Real A/c credit means _______.
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what comes in
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what goes out
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income
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losses
Explanation
Golden rule of accounting for real account is.
Debit what comes in i.e. addition
Credit what goes out i.e. reduction
In Real A/c debit means __________.
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what comes in
0%
what goes out
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income
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losses
Explanation
Golden rule of accounting for real account is:
Debit what comes in i.e. addition
Credit what goes out i.e. reduction
A journal is also known by_____.
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Account current
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Book of original entry
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Purchase day book
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Current Account
Explanation
Every business transaction must first be recorded in journal. Hence all original entries are found in journal itself which is a subsidiary books.
Subsidiary books of accounts are also called book of original entry as all the transactions are recorded originally or at the first instance in these books.
In Nominal a/c credit means ____________.
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what comes in
0%
what goes out
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income/gains
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losses
Explanation
Golden rule for Nominal accounts says that:
Debit all the expenses and losses.
Credit all the revenue and gains.
When a entry involves two or more accounts it is called ________.
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Simple entry
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Double entry
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Compound entry
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Complex entry
Explanation
When a transaction is involving more than two accounts, entry is called a compound entry.
Goods worth Rs.1000 is purchased on a discount of Rs.100 by paying cash of Rs.900 is an example of combined entry where accounting entry will be:
By Goods A/c Dr. Rs.1000
To Cash A/c Cr. Rs.900
To Cash discount A/c Cr. Rs.100
In Nominal A/c debit means _________.
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What comes in
0%
What goes out
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Income
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Expenses/losses
Explanation
Golden rule for Nominal accounts says that:
Debit all the expenses and losses
Credit all the revenue and gains
Book of Original entry is called _____.
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a journal
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memorandum A/c
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kachha record
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voucher
Explanation
Every business transaction must first be recorded in journal. Hence all original entries are found in journal itself which is a subsidiary books. Subsidiary books of accounts are also called book of original entry as all the transactions are recorded originally or at the first instance in these books.
An entry made in the journal is called _______.
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Journal entry
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Diarizing
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Recording
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Narration
Explanation
Every business transaction must first be recorded in journal. These are called journal entry. Hence all original entries are found in journal itself which is a subsidiary books.
How many columns are in a journal?
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4
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5
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6
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3
Explanation
Date
Particulars
Ledger Folio no
Dr. Amount
Cr. Amount
There are 5 columns in a journal:
An entry for a transaction that affects more than two accounts is known as
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Complex Entry
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Compound Entry
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Single Entry
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Duplicate Entry
Explanation
There are two types of Journal Entry
1. Simple Journal Entry
2. Compound Journal Entry
A compound journal
entry
is
an entry
involving
more than two accounts
. In a compound journal
entry
, there are
two
or
more
debits, credits, or both. Rather
than
making separate journal
entries
for the same
transaction.
Voucher is documentary evidence in support of......
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Transaction
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Event
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Claim
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Adjustment
Explanation
A
voucher
is documentary evidence
in support
of a transaction recorded in the books of account. It is a written document or paper in
support
of an entry in the books of account.
On the basis of source documents, a voucher detailing the accounts that are debited and credited is prepared.
There are two types of Accounting Vouchers
1. Cash Vouchers
2. Non-Cash Vouchers.
Therefore,
Voucher relates to
Cash receipt and payments, credit transactions
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Practice Class 9 Elements Of Book Keeping And Accountancy Quiz Questions and Answers
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