Accounting Objective Questions and Answers

2171. Premium on issue of equity shares is:

2172. Agreement of the trial balance may not indicate that:

A. no error remains undetected

B. double entry has been completed

C. arithmetic accuracy is reasonably proved

D. all ledger accounts have been correctly posted

Discussion

2173. Both assets and owners equity would be increased by . . . . . . . .

A. capital brought in

B. purchase of an asset on credit

C. payment of creditors

D. proprietors drawings

Discussion

2174. A and B are partners in a firm sharing profit and loss in the ratio of 3 : 2. They admit C into a partnership for $${\frac{1}{8}^{{\text{th}}}}$$ share, and the new ratio between A and B is 4 : 3. The sacrificing ratio is

2175. Assertion (A): Personal transactions of the business owners are not recorded in the books.
Reason (R): According to the business entity concept, each business enterprise is considered an accounting unit separate from owners.

A. Both (A) and (R) are correct, and (R) is the correct explanation of (A)

B. Both (A) and (R) are correct, but (R) is not the cor rect explanation of (A)

C. (A) is correct, but (R) is incorrect

D. (A) is incorrect, but (R) is correct

Discussion

2176. Advertising expenses done on launching of a new product are treated as

A. Capital Expenditure

B. Revenue Expenditure

C. Deferred Revenue Expenditure

D. None of these

Discussion

2177. Which of the following transactions affects the flow of funds?

A. A transaction both aspects of which affect current accounts

B. A transaction both aspectys of which affect non-current accounts

C. A transaction one aspect of which affects current accounts and the other affects non current accounts

D. None of the above

Discussion

Accounting MCQs