MGT101 Midterm MCQs 2025

Q1. An event can be classified as non-monetary:

1. Loss by accident
2. Purchases on cash
3. Placing purchase order
4. Selling on credit

Correct answer: Placing purchase order

Q2. “5/10, n/30” is an example of:

1. Regular customer discount
2. Settlement discount
3. Season end discount
4. Bulk purchase discount

Correct answer: Settlement discount

Q3. Increase in liability can cause increase in:

1. Equity
2. Receivables
3. Profit
4. Cash

Correct answer: Cash

Q4. After specific intervals, sum of purchases return journal is posted to the debit side of __________.

1. None of the given options
2. Total creditors account
3. Total debtors account
4. Purchases return account

Correct answer: Total creditors account

Q5. Which group of accounts is DEBITED, when it is decreased?

1. Asset & Liability
2. Assets & Expenses
3. Assets and Income
4. Income and Liability

Correct answer: Income and Liability

Q6. Expenses are recorded when paid either incurred or not according to:

1. Cost accounting
2. Accrual accounting
3. Cash accounting
4. Management accounting

Correct answer: Cash accounting

Q7. Goods sold for Rs. 5,000 on settlement terms (5/10, n/30). The amount of settlement discount is:

1. Rs. 300
2. Rs. 250
3. Rs. 500
4. Rs. 1,000

Correct answer: Rs. 250

Q8. The person who is responsible for maintaining a journal is known as:

1. Bookkeeper
2. Financial manager
3. Chief financial officer
4. Internal auditor

Correct answer: Bookkeeper

Q9. The creditor account will fall under which of the following classification of accounts?

1. Liabilities
2. Assets
3. Expenses
4. Revenues

Correct answer: Liabilities

Q10. Which of the following is TRUE?

1. All of the given options
2. Nature of Owners’ Equity is Credit
3. Nature of Expenses is Debit
4. Nature of Incomes is Credit

Correct answer: All of the given options

Q1. Which voucher is prepared when bank collects money from a Debtor Mr. A?

1. Cash receipt voucher
2. Petty cash voucher
3. Bank payment voucher
4. Bank receipt voucher

Correct answer: Bank receipt voucher

Q2. Identify the two accounting heads that are affected from the transaction of Rent received in cash.

1. Rent expense and cash account
2. Rent income and cash account
3. Rent income and bank account
4. Rent expense and bank account

Correct answer: Rent income and cash account

Q3. Abbreviation Cr. is used in accounting for:

1. Credit
2. Corporation
3. Creditor
4. Competitor

Correct answer: Credit

Q4. All of the following are parts of a journal entry EXCEPT:

1. Date
2. Post reference
3. Narration
4. Closing balance

Correct answer: Closing balance

Q5. The main purpose of ___________ is to ascertain true and fair result of the business operations during a particular period of time, for external reporting only.

1. Tax Accounting
2. Cost Accounting
3. Managerial Accounting
4. Financial Accounting

Correct answer: Financial Accounting

Q6. Which of the following is responsible for maintaining the journal?

1. Bookkeeper
2. Cashier
3. Accounts manager
4. Finance manager

Correct answer: Bookkeeper

Q7. Identify the two accounting heads that are affected from the transaction of Rent received through cheque.

1. Rent expense and cash account
2. Rent income and bank account
3. Rent income and cash account
4. Rent expense and bank account

Correct answer: Rent income and bank account

Q8. Which of the following is also known as ‘Day book’?

1. Balance sheet
2. Journal
3. Trial balance
4. Ledger

Correct answer: Journal