MGT101 Final Term MCQs

Shares for which amount is paid by public are called ________ shares.

✓ ► Paid up ✓ ► Authorized ✓ ► Bonus shares ✓ ► All are correct options

Term “Credit” means_______ by the business.

✓ ► Receiving of benefits ✓ ► It has no effect on business ✓ ► Providing of benefits ✓ ► It depends upon items

Which of the following is used to record financial transactions in chronological (day-to-day) order?

1. Voucher
2. General Journal
3. General Ledger
4. Trial balance

Which of the following is CORRECT about the flow of recording a transaction?

1. Occurrence of event – voucher—Journal—Ledger—Trial Balance—profit and loss account—Balance Sheet
2. Occurrence of event—Journal – voucher —Ledger—Trial Balance—profit and loss account—Balance Sheet
3. Occurrence of event—Ledger – voucher—Journal—Trial Balance—profit and loss account—Balance Sheet
4. Occurrence of event—Trial Balance – voucher—Journal—Ledger—profit and loss account—Balance Sheet

In an account, if credit side < debit side then the balance is known as:

✓ ► Negative Balance ✓ ► Debit Balance ✓ ► Positive Balance ✓ ► Credit Balance

Which one of the following is a type of General Ledger?

1. Book of original entry
2. ‘T’ Account
3. Source document
4. Day book

Which of the following is NOT considered a part of financial statements?

1. General Ledger
2. Balance Sheet
3. Profit and Loss Account
4. Cash Flow Statement

The difference between current Assets and current liabilities is known as:

✓ ► Working capital ✓ ► Opening stock ✓ ► Closing stock ✓ ► Owner’s equity

If the Company ABC has current assets Rs. 100,000, current liabilities Rs. 75,000 and fixed assets Rs. 200,000, what would be the value of working capital?

1. Rs. 25,000
2. Rs. 1, 00,000
3. Rs. 1, 75,000
4. Rs. 3, 00,000

If, Cost of machine = Rs.400, 000 · Useful life = 5 years · Residual value = Rs.25, 000

The depreciation of machine per year using straight line method is?

1. Rs. 160,000
2. Rs. 96,000
3. Rs. 75,000
4. Rs. 57,600

The cost of moving plant and machinery to a new site will be treated as:

✓ ► Revenue expense ✓ ► Capital expense ✓ ► Administrative expense ✓ ► Operating expense

Which of the following account balance is shown on credit side of Trial Balance? (It is assumed that all account balances are shown on normal balance)

✓ ► Cash account ✓ ► Furniture account ✓ ► Vehicle account ✓ ► Capital account

A debit balance in the Bank Statement indicates:

✓ ► Cash at bank ✓ ► Bank overdraft ✓ ► Overpayment to creditors ✓ ► Cash in hand

Which of the following best describes unpresented cheques?

1. Cheques received on behalf of the business by the bank
2. Cheques drawn but yet to be recorded in the bank records
3. Cheques issued by the bank not recorded in business records
4. Cheques received but yet to be recorded in the bank records

Correct answer: Cheques issued by the bank not recorded in business records

Which of the following is an item of a debtors control account?

1. Cash sale
2. Credit sales
3. Credit purchase
4. Cash purchases