Commerce Accountancy

Accounting Principles and Practices

2,324 Questions

Accounting principles and practices involve the preparation of trial balances, ledgers, and bank reconciliation statements. This area tests your knowledge of fundamental accounting concepts and routine business transactions. It is a core section in commerce exams and various competitive tests.

Ledger accountsTrial balance preparationBank reconciliation statementAccounting conceptsPrimary books of accounts

Accounting Principles and Practices Questions

Multiple choice memorandum of understanding and articles of association company business studies

Final accounts of companies are prepaid according to_________of the companies Act,2013.

  1. Schedule VI

  2. Schedule V

  3. Schedule II

  4. Schedule III
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Schedule III of the Companies Act, 2013, provides the format for the preparation of the Balance Sheet and Statement of Profit and Loss for companies.

Multiple choice memorandum of understanding and articles of association company business studies

The audit report, besides other things necessary in any particular case, need not to expressly state -

  1. Whether, in opinion of auditor, proper books of account as required by law have been kept by the company

  2. Whether the company's balance sheet and profit and loss account dealt with by the report are in agreement with the books of account and returns.

  3. Whether books of account gives true and fair view

  4. Whether fit and proper person are appointed in the board of the company.
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The auditor is required to state whether the books of account are kept as required by law, whether the balance sheet and P&L account are in agreement with the books, and whether they give a true and fair view. Option D is not a standard requirement for the audit report under the Act.

Multiple choice book keeping and accountancy subsidiary books - 2 three column cash book three columnar cash book triple column cash book

Which of the following subsidiary books serves the purpose of ledger too, in addition to the recording of accounting transaction?

  1. Purchases book

  2. Sales book

  3. Bills receivable book

  4. Cash Book
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The Cash Book serves as a book of original entry (journal) for cash transactions and also functions as a ledger account for cash and bank balances. Other subsidiary books like the Purchases or Sales book only record specific types of credit transactions and do not function as ledger accounts.

Multiple choice commercial studies subsidiary books - 2 three column cash book three columnar cash book triple column cash book

Cash discount is recorded in ______________.

  1. Journal proper

  2. Purchase Journal

  3. Sales account

  4. Cash book
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Cash discounts are typically recorded in the discount column of a three-column cash book. Since the cash book is the primary record for cash and bank transactions, it is the appropriate place for these entries.

Multiple choice commercial studies subsidiary books - 2 three column cash book three columnar cash book triple column cash book

Receipts and Payments Account is an abbreviated form of ___________________.

  1. Cash Book

  2. Pass Book

  3. Both Cash Book and Pass Book

  4. None of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The Receipts and Payments Account is essentially a summary of the cash book for a specific period. It is commonly used by non-profit organizations to show all actual cash inflows and outflows.

Multiple choice commercial studies subsidiary books - 2 three column cash book three columnar cash book triple column cash book

For opening Joint Bank Account, in case of separate set of books _________________.

  1. Joint Venture A/c will be debited and Venturers Capital A/c will be credited.

  2. Joint Bank A/c is debited and Venturers Capital A/c is credited.

  3. Joint Venture A/c is debited and Joint Bank A/c will be credited.

  4. Joint Bank A/c will be debited and Joint Venture A/c will be credited.
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

When separate books are maintained for a joint venture, the Joint Bank Account acts as the primary repository for funds. Contributions from venturers are deposited into this account, resulting in a debit to the Joint Bank Account and a credit to the respective Venturers Capital Accounts.

Multiple choice commercial studies subsidiary books - 2 three column cash book three columnar cash book triple column cash book

When the record of transactions relating to joint venture are made in the books of one party, then the venturer recording the transactions records his share of investment by _____________.

  1. Debiting cash account

  2. Crediting his personal account

  3. No entry is made

  4. Crediting Cash A/c
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

When only one party keeps the books for a joint venture, they record their own investment by crediting their cash account (or bank) and debiting the Joint Venture account. This reflects the outflow of their own funds into the venture.

Multiple choice commercial studies subsidiary books - 2 three column cash book three columnar cash book triple column cash book

In which order the accounting transactions and events are recorded in the books ?  

  1. Journal, Subsidiary books, Ledger and Trial Balance.

  2. Ledger, Journal, Ledger, and Trial Balance.

  3. Subsidiary books, Ledger, and Trial Balance and Journal.

  4. Profit and loss account, Ledger, Balance sheet, Journal.
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The standard accounting cycle begins with recording transactions in the journal or subsidiary books, followed by posting to the ledger, and finally summarizing in the trial balance.

Multiple choice commercial studies subsidiary books - 2 three column cash book three columnar cash book triple column cash book

When a firm maintains a Three-Column Cash Book, it need not maintain _____________.

  1. cash account in the ledger

  2. bank account in the ledger

  3. discount account in the ledger

  4. both cash account and bank account in the ledger
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

A three-column cash book contains both cash and bank columns, which serve the purpose of the cash and bank accounts in the ledger. Therefore, separate accounts for these are not required in the ledger.