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.

241. The persons who sign Articles and Memorandum of the company and contribute in the initial share capital of the company are called

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Subscribers
Shareholders
Managers
Directors
✅ The correct answer is A.
The persons who sign Articles and Memorandum of the company and contribute in the initial share capital of the company are called Subscribers. They are called subscribers because, as part of the company formation.

242. Reserve capital means

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Part of subscribed uncalled capital
Accumulated profit
Part of Capital Reserve
Part of Capital Redemption Reserve
✅ The correct answer is A.
Reserve capital means Part of subscribed uncalled capital. Reserve Capital is defined as a part of subscribed uncalled capital, which will not be called up until and unless the company goes into liquidation.

243. Unpresented cheques are also referred to as

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Uncollected cheques
Uncredited cheques
Outstanding cheques
Bounced cheques
✅ The correct answer is C.
Unpresented cheques are also referred to as Outstanding cheques. An unpresented check is a check written by a company and entered in its records, but the check has not yet cleared the company’s checking account. In other words, the check has not yet been paid by the bank on which the check is drawn. An unpresented check is also known as an outstanding check.

244. A cash book with cash, bank and discount column is commonly referrred to as

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Cash book
Two columns cash book
Three columns cash book
Petty cash book
✅ The correct answer is C.
A cash book with cash, bank and discount column is commonly referrred to as Three columns cash book. The three column cash book (also known as triple column cash book) has three money columns on both debit and credit side – one on each side for recording discount, cash and bank amounts.

245. Overriding commission is generally calculated on

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Cash sale only
Total sales exceeding invoice value/cost
Credit sales
None of the above
✅ The correct answer is B.
Overriding commission is generally calculated on Total sales exceeding invoice value/cost. Overriding Commission is the extra commission allowed to the consignee in addition to the normal commission usually for making extra efforts to sell a new product in the market.

246. Which of the following is the most common cause of bad debt?

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Debtor refusal to repayment
Debtor left the country
Debtor committed a crime
Debtor declared to be a bankrupt
✅ The correct answer is D.
Debtor declared to be a bankrupt is the most common cause of bad debt. A bad debt is a monetary amount owed to a creditor that is unlikely to be paid and, or which the creditor is not willing to take action to collect for various reasons, often due to the debtor not having the money to pay, for example due to a company going into liquidation or insolvency.

247. The main objective of providing depreciation is to

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Calculate the true net profit
Compute the actual cash profit
Create funds for replacement of fixed assets
Reduce tax burden
✅ The correct answer is C.
The main objective of providing depreciation is to Create funds for replacement of fixed assets. The main objective of charging depreciation is to accumulate adequate fund to replace old asset with the new one after the useful life. Depreciation is charged to fixed assets which helps to show the current value of the asset.

248. Which one of the following accounting equations is correct?

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Assets = Owner’s equity
Assets = Liabilities + Owner’s equity
Assets = Liabilities – Owner’s equity
Assets + Liabilities = Owner’s equity
✅ The correct answer is B.
Assets = Liabilities + Owner’s eq accounting equations is correct. It shows that a company’s total amount of assets equals the total amount of liabilities plus owner’s (or stockholders’) equity.

249. Depreciation is charged on fixed assets to comply with which of the following accounting principle?

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Matching concept
Prudence concept
Timeliness concept
Reliability concept
✅ The correct answer is A.
Depreciation is charged on fixed assets to comply with Matching concept which requires that revenues must be matched with associated expenses to get a complete and accurate picture of profit and loss.