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.

233. When obligation is not probable or the amount expected to be paid to settle the liability cannot be measured with sufficient reliability, it is called

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Contingent liability
Provision
Secured loan
None of the above
✅ The correct answer is A.
When obligation is not probable or the amount expected to be paid to settle the liability cannot be measured with sufficient reliability, it is called Contingent liability. Contingent liability is a potential liability that may occur, depending on the outcome of an uncertain future event.

234. Exercising a degree of caution in the case of judgements needed under the condition of uncertainity is the assumption of which of the following accounting concepts?

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Matching concept
Timeliness concept
Accrual concept
Prudence concept
✅ The correct answer is D.
Exercising a degree of caution in the case of judgements needed under the condition of uncertainity is the assumption of Prudence concept. Prudence Concept or Conservatism principle is a key accounting principle which makes sure that assets and income are not overstated and provision is made for all known expenses and losses whether the amount is known for certain or just an estimation.

237. Bank Reconciliation statement is the comparision of a bank statement (sent by bank) with the

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Cash receipt journal
Cash payment journal
Cash book
Financial statements
✅ The correct answer is C.
Bank Reconciliation statement is the comparision of a bank statement (sent by bank) with the Cash book. In other words, the balance shown in the Pass Book given by the bank should tally with the balance of Bank Account Kept in his ledger or Cash Book (Bank Column).

238. The most common imprest system is the ______ system

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Petty cash
Cash book
Cash receipts journal
Discount
✅ The correct answer is A.
The most common imprest system is the Petty cash system. The base characteristic of an imprest system is that a fixed amount is reserved, which after a certain period of time or when circumstances require, because money was spent, it will be replenished.

239. A recovery of bad debt

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increases net income
decreases net income
increases gross profit
increases gross profit and net income
✅ The correct answer is A.
A recovery of bad debt increases net income. Bad debt recovery is a payment received for a debt that was written off and considered uncollectible. The receivable may come in the form of a loan, credit line, or any other accounts receivable. Because it generally generates a loss when it is written off, bad debt recovery usually produces income.