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.

311. Narrations are given at the end of

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Final accounts
Trial Balance
Each Ledger account
Each journal entry
✅ The correct answer is D.
Narrations are given at the end of each journal entry. Each journal entry includes the date, the amount of the debit and credit, the titles of the accounts being debited and credited (with the title of the credited account being indented), and also a short narration of why the journal entry is being recorded.

314. The three column cash book represents

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Real accounts
Nominal accounts
Nominal and personal accounts
Real, personal and nominal accounts
✅ The correct answer is D.
The three column cash book represents Real, personal and nominal accounts. 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.

315. Which one of the following is INCORRECT about closing stock?

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It is added into current assets
It is deducted from Material available for use
It becomes opening stock of next year
It reduces the resources of business
✅ The correct answer is D.
Closing stock does not reduce the resources of business. Closing stock is the amount of inventory that a business still has on hand at the end of a reporting period.

316. When one or both aspects of a transaction are recorded in the wrong class or category of account, it is called

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Error of principle
Error of omission
Error of commission
Error of original entry
✅ The correct answer is A.
When one or both aspects of a transaction are recorded in the wrong class or category of account, it is called Error of principle. An error of principle is an accounting mistake in which an entry is recorded in the incorrect account, violating the fundamental principles of accounting.