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.

261. In which of the following interim dividend is treated?

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In profit and loss account
In profit and loss appropriation account
On the asset side of the Balance sheet
In trading account
✅ The correct answer is B.
In profit and loss appropriation account interim dividend is treated. An interim dividend is a dividend payment made before a company’s annual general meeting (AGM) and the release of final financial statements.

264. The left side of an account is known as ___ and the right side as ____

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Debit, Credit
Credit, Debit
Liability, Asset
None of the above
✅ The correct answer is A.
The left side of an account is known as Debit and the right side as Credit. Asset accounts such as Cash, Accounts Receivable, Inventory, and Equipment should have debit balances. Liabilities are on the right side of the accounting equation.

265. Stock of a Trading concern consists of

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Raw material
Work in progress
Merchandise inventory
All of the above
✅ The correct answer is C.
Stock of a Trading concern consists of Merchandise inventory. Merchandise inventory is the cost of goods on hand and available for sale at any given time. Merchandise inventory (also called Inventory) is a current asset with a normal debit balance meaning a debit will increase and a credit will decrease.

267. Cash book with cash and discount column is mostly referred to as

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Simple cash book
Two columns cash book
Three columns cash book
Petty cash book
✅ The correct answer is B.
Two Column Cash Books – In this discounts is also recorded with cash transactions. So both discounts received and the discount that is given is recorded here. If any organization is in a general practice of giving or receiving discounts this is the preferable option.

268. Which of the following is a leverage ratio?

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Debt equity ratio
Current ratio
Quick ratio
Earning power
✅ The correct answer is A.
Debt equity ratio is a leverage ratio. The debt-to-equity ratio (D/E) is a financial ratio indicating the relative proportion of shareholders’ equity and debt used to finance a company’s assets. Closely related to leveraging, the ratio is also known as risk, gearing or leverage.