Accounting

Master the fundamentals of Accounting with our extensive collection of Accounting MCQs with answers and detailed explanations. Covering topics like financial accounting, cost accounting, auditing, partnership accounts, corporate accounting, and managerial accounting, these multiple-choice questions are ideal for students, teachers, and candidates preparing for competitive exams (CA, ACCA, ICMA, CSS, PMS, NTS, FPSC, PPSC, UPSC, etc.). Each question is followed by a clear solution and explanation to strengthen your concepts, improve problem-solving skills, and boost exam preparation. Perfect for practice, self-assessment, and revision in Accounting.

101. Accrued expenses are considered as

August 24, 2025 by Administrator

Asset

Liability

Gain

Income

✅ The correct answer is B.
Accrued expenses are considered as Liability. Accrued expenses are typically periodic, and are documented on a company’s balance sheet as current liabilities.

102. The accrual basis of accounting records revenues when they are

August 24, 2025 by Administrator

Collected

Earned

Contracted

Readily available for use

✅ The correct answer is B.
The accrual basis of accounting records revenues when they are earned. In other words, under the accrual basis of accounting, the receipt of cash and the payment of cash are not the focus of reporting revenues and expenses.

103. The closing balance of petty cash book is considered as

August 24, 2025 by Administrator

Liability

Asset

Expenses

Income

✅ The correct answer is B.
The closing balance of petty cash book is considered as Asset. Petty Cash is a current asset account; it is part of a company’s cash.

104. There must be a gap of at least ___ month between two calls

August 24, 2025 by Administrator

✅ The correct answer is B.
There must be a gap of at least 1 month between two calls.

105. The owner of consignment stock is

August 24, 2025 by Administrator

Consignor

Consignee

Debtors

None of the above

✅ The correct answer is A.
The owner of consignment stock is Consignor.

106. In case of opening Credit Balance, the word ______ are written on the credit side.

August 24, 2025 by Administrator

By Balance b/d

To Balance b/d

By Balance c/d

To Balance c/d

✅ The correct answer is A.
In case of opening Credit Balance, the word By Balance b/d are written on the credit side.

107. Income includes

August 24, 2025 by Administrator

Income earned

Income received

Income receivable

All of the above

✅ The correct answer is D.
Income includes Income earned, Income received and Income receivable.

108. The installation expenses for a new machinery will be debited to

August 24, 2025 by Administrator

Cash A/c

Profit & Loss A/c

Machinery A/c

Installation expenses A/c

✅ The correct answer is C.
The installation expenses for a new machinery will be debited to Machinery A/c.

109. What is the next step to Journalizing in accounting cycle?

August 24, 2025 by Administrator

Recording

Posting

Balancing

Analyzing

✅ The correct answer is B.
Posting is the next step to Journalizing in accounting cycle. 10 Steps of Accounting Cycle are; Analyzing and Classify Data about an Economic Event. Journalizing the transaction. Posting from the Journals to General Ledger. Preparing the Unadjusted Trial Balance. Recording Adjusting Entries. Preparing the Adjusted Trial Balance. Preparing Financial Statements.

110. In case goods are manufactured and segregated for specified consumers, the best method for valuation of inventory would be

August 24, 2025 by Administrator

FIFO

Simple average

Base stock

Specific identification method

✅ The correct answer is D.
In case goods are manufactured and segregated for specified consumers, the best method for valuation of inventory would be Specific identification method. Specific identification inventory valuation method is a way of keeping track of all items in an inventory individually.