laboursonline – MCQs, Mock Tests | Business Studies Financial Accounting MCQ Part

Total creditors account is prepared to find out _______

1. opening balance of debtors
2. closing balance of debtors
3. opening balance of creditors
4. closing balance of creditors

✅ Correct Answer: 4

A bills receivable account is prepared to ascertain bills _______

1. accepte
2. receive
3. drawn
4. endorse

✅ Correct Answer: 2

A bills payable account is prepared to ascertain bills __________

1. accepte
2. receive
3. drawn
4. endorse

✅ Correct Answer: 1

Bills receivable dishonored will be posted to _______ side of debtors account

1. debit
2. credit
3. outside
4. inside

✅ Correct Answer: 1

Bills receivable dishonored will be posted in ___________

1. debit
2. credit
3. outside
4. inside

✅ Correct Answer: 2

Bills payable dishonoured will be posted in which side of bills payable account?

1. Debit
2. Credit
3. Outside
4. Inside

✅ Correct Answer: 3

Opening balance of debtors will be posted in which side of debtors account?

1. Debit
2. Credit
3. Outside
4. Inside

✅ Correct Answer: 3

Closing balance of creditors will be posted in which side of creditors account?

1. Credit
2. Debit
3. Outside
4. Inside

✅ Correct Answer: 2

Opening balance of creditors will be posted in which side of creditors account?

1. Debit
2. Credit
3. Outside
4. Inside

✅ Correct Answer: 4

Cash account opening balance will appear in _______

1. debit
2. credit
3. outside
4. inside

✅ Correct Answer: 1

Cash account closing balance will appear in __________

1. debit
2. credit
3. outside
4. inside

✅ Correct Answer: 2

Bills payable account opening balance will appear in ____________

1. debit
2. credit
3. outside
4. inside

✅ Correct Answer: 4

Bills payable account closing balance will appear in ____________

1. debit
2. credit
3. outside
4. inside

✅ Correct Answer: 3

Bills receivable account opening balance will appear in _________

1. debit
2. credit
3. outside
4. inside

✅ Correct Answer: 1

An agreement of hiring with option to buy is ____________

1. installment system
2. credit system
3. hire purchase system
4. cash system

✅ Correct Answer: 3

Under which system ownership is transferred on payment of final installment?

1. Installment system
2. Credit system
3. Hire purchase system
4. Cash system

✅ Correct Answer: 3

Under which system ownership is transferred on signing of the agreement? Installment system

1. Installment system
2. Credit system
3. Hire purchase system
4. Cash system

✅ Correct Answer: 1

Under hire purchase system the buyer is called _________

1. buyer
2. hirer
3. hire vendor
4. debtor

✅ Correct Answer: 2

Under hire purchase system the seller is called _________

1. buyer
2. hirer
3. hire vendor
4. debtor

✅ Correct Answer: 3

Under hire purchase system the relationship of hirer and hire vendor is ______

1. buyer and seller
2. bailor and bailee
3. pawner and pawnee
4. debtor and creditor

✅ Correct Answer: 2

Under installment system the relationship between the buyer and seller is that of a _________

1. buyer and seller
2. bailor and bailee
3. pawner and pawnee
4. debtor and creditor

✅ Correct Answer: 4

Under hire purchase system the risk of loss is borne by ____________

1. buyer
2. hirer
3. debtor
4. hire vendor

✅ Correct Answer: 4

Under installment system the risk of loss is borne by ________

1. buyer
2. hirer
3. hire vendor
4. debtor

✅ Correct Answer: 1

Under hire purchase system who has the right of sell __________

1. buyer
2. hirer
3. hire vendor
4. debtor

✅ Correct Answer: 3

Under hire purchase system if installment is not paid the hire vendor has right to ___________

1. sell the goods
2. repossession of goods
3. repair the goods
4. purchase the goods

✅ Correct Answer: 2

Under hire purchase system the agreement can be _________

1. renewe
2. registere
3. terminate
4. endorse

✅ Correct Answer: 3

Hire purchase system is governed by ___________

1. Hire Purchase Act 1972
2. Hire Purchase Act 1973
3. Hire Purchase Act 1974
4. Hire Purchase Act 1975

✅ Correct Answer: 1

Installment system is governed by __________ Properties Registration Act

1. Hire Purchase Act
2. Sale of Goods Act
3. Installment Act
4. Properties Registration Act

✅ Correct Answer: 2

Under hire purchase system the retail price of the articles is called ________

1. MRP
2. wholesale price
3. retail price
4. cash price

✅ Correct Answer: 3

Cash price plus interest is _________

1. installment price
2. hire purchase price
3. maximum retail price
4. retail price

✅ Correct Answer: 2

The advance amount under hire purchase system is called __________

1. cash price
2. retail price
3. interest
4. down payment

✅ Correct Answer: 4

Under hire purchase system each installment is treated as __________

1. interest
2. cash price
3. hire charges
4. advance

✅ Correct Answer: 3

Under hire purchase system interest is calculated on _______

1. cash price
2. hire purchase price
3. MRP
4. outstanding balance

✅ Correct Answer: 4

If the hire purchaser fails to make payment of any installment it is called _______

1. default
2. repossession
3. sale
4. purchase

✅ Correct Answer: 1

If the hire vendor may take away all the goods on which there is default of installment it is called ____________

1. repossession
2. partial repossession
3. complete repossession
4. purchase

✅ Correct Answer: 3

The hire vendor takes away only a portion of the goods on which there is default of Installments it is called _________

1. repossession
2. partial repossession
3. complete repossession
4. purchase

✅ Correct Answer: 2

In the books of hirer for payment of down payment hire vendor account will be _______

1. debited
2. credite
3. rectifie
4. reverse

✅ Correct Answer: 1

In the books of hirer for payment of installment hire vendor account will be ___________

1. rectifie
2. credite
3. debite
4. reverse

✅ Correct Answer: 1

In the books of hirer for interest due at the end of the year hire vendor account will be _______

1. debite
2. credite
3. rectifie
4. reverse

✅ Correct Answer: 2

In the books of Hirer the interest and depreciation account will be transferred to ______

1. Trading account
2. P & L account
3. P & L appropriation account
4. Balance sheet

✅ Correct Answer: 2

In the books of hirer when the asset is repossessed hire vendor account will be ______

1. debite
2. credite
3. rectifie
4. reverse

✅ Correct Answer: 1

In the books of hirer when the asset is repossessed asset account will be ______

1. debite
2. credite
3. rectifie
4. reverse

✅ Correct Answer: 2

In the books of hire vendor which account will be debited for hire sales _______

1. buyer
2. hirer
3. hire vendor
4. debtor

✅ Correct Answer: 2

What is depreciation?

1. Cost of a fixed asset
2. Cost of a fixed assets repair
3. The residual value of fixed asset
4. Portion of a fixed assets cost consumed during the current accounting period

✅ Correct Answer: 4

A company purchased a vehicle for $6000 I will be used for 5 years and its residual value is expected to be Rs1000 What is the annual amount of deprecation using straight line method of depreciation?

1. Rs3000
2. Rs2000
3. Rs1000
4. Rs3300

✅ Correct Answer: 3

What is the accumulated deprecation? Sum of all depreciation expenses of a fixed asset

1. Depreciation expenses
2. Cost of depletion of assets
3. Future value of fixed asset
4. None of them

✅ Correct Answer: 1

A fixed asset was bought for Rs5000 Its accumulated depreciation is Rs3000 and rate of depreciation is 20% Calculate its depreciation expenses for the current accounting period using reducing balance method?

1. Rs600
2. Rs500
3. Rs750
4. Rs400

✅ Correct Answer: 4

Revenue Reserve does not include __________

1. Profit & Loss Account
2. Secret Reserve
3. General Reserve
4. Securities Premium

✅ Correct Answer: 4

In single entry system of accounting ___________

1. Dual aspects of a transaction is recorded
2. Single aspect of a transaction is recorded
3. Important transactions are recorded
4. All of them

✅ Correct Answer: 2

Statement of financial position produced from incomplete accounting record is commonly known as ____________

1. Balance sheet
2. Cash flow statement
3. Statement of affairs
4. Statement of financial operations

✅ Correct Answer: 2

Miroeonomi theory is lso known s ��

1. usiness Theory
2. ost Theory
3. Iniviul Theory
4. Prie Theory

✅ Correct Answer: 4

Whih will use hnge in the emn for goo X?

1. hnge in tste
2. hnge in Inome
3. hnge in the prie of X
4. hnge in the prie of omplementry prout

✅ Correct Answer: 3

Which of the following techniques uses variables such as price and promotional expenditures which are related to the product demand to predict demand

1. Associative models
2. exponential smoothing
3. weighted moving average
4. simple moving average

✅ Correct Answer: 2

Time-series data may exhibit which of the following behaviours?

1. Trend
2. Random variation
3. Seasonality
4. Cycles

✅ Correct Answer: 1

Gradual long term movement in time series data is called ��

1. Seasonal variation
2. cycles
3. trends
4. exponential variation

✅ Correct Answer: 1

Which of the following is not present in a time series?

1. Seasonality
2. operational variations
3. trend
4. random variations

✅ Correct Answer: 4

In sample survey method �� technique is adopted

1. deliberate
2. convenience
3. quota
4. random

✅ Correct Answer: 4

car and petrol are �- goods

1. substitutes
2. complementary
3. producers
4. None of the above

✅ Correct Answer: 2

Tea and coffee are �� goods

1. substitutes
2. complementary
3. producers
4. none of the above

✅ Correct Answer: 1

In cross elasticity of demand for unrelated goods the demand curve will be��-

1. Horizontal straight line
2. rectangular hyperbola
3. vertical line
4. none of the above

✅ Correct Answer: 3

The total outlay method explains the relationship between price and ��A

1. demand
2. supply
3. expenditure
4. income

✅ Correct Answer: 3

Supply is a function of ��

1. a straight line
2. a parabolaL
3. a hyperbola
4. convex to the origin

✅ Correct Answer: 3

The supply of a product does not depend on ��-

1. labour costs
2. the number of sellers in the market
3. consumers tastes
4. existing technology

✅ Correct Answer: 3

Passive factor of production is ��-

1. only land
2. only capital
3. both land and capital
4. neither land nor capital

✅ Correct Answer: 3

Reasons for increasing return in stage I of law of variable proportion is ��

1. Indivisibility
2. Specialisation
3. both a and b
4. none of the above

✅ Correct Answer: 3

�� Economics views on reducing the production costs

1. internal
2. inventory
3. pecuniary
4. External

✅ Correct Answer: 4

Which of the following are not related to factors of production(FOP)

1. land
2. capital
3. raw material
4. labour

✅ Correct Answer: 3

Which factor of production is considered as fixed input

1. labour
2. technology
3. capital
4. land

✅ Correct Answer: 4

�- is the remuneration for organisation

1. rent
2. wages
3. interest
4. profit

✅ Correct Answer: 4

�- input factor is divided as skilled semiskilled unskilled

1. land
2. capital
3. Technology
4. labour

✅ Correct Answer: 4

In the Law of variable proportion when TP is maximum then the MP = ��

1. MP = 1
2. MP<0
3. MP=0
4. MP>!

✅ Correct Answer: 3

Cobb Douglas production function mainly studies ��

1. capital and labour
2. labour and expenditure
3. land and labour
4. land and capital

✅ Correct Answer: 1

Marginal cost is defined as

1. change in total cost due to change in output
2. total cost divided by output
3. change in output due to a change in an input
4. total product divided by the quantity of input

✅ Correct Answer: 1

Which of the following is correct?

1. TC = TFC+TVC
2. TFC=TC-TVC
3. TVC=TC-TFC
4. None of the above

✅ Correct Answer: 4

The cost with which the concept of marginal cost is closely related

1. variable cost
2. fixed cost
3. opportunity cost
4. economic cost

✅ Correct Answer: 1

�� costs are business costs which do not involve any cash payments but for them a provision is made in accounts

1. private cost
2. social cost
3. accounting cost
4. book cost

✅ Correct Answer: 4

The vertical difference between TVC and TC is equal to ��

1. MC
2. AVC
3. TFC
4. none

✅ Correct Answer: 3

The costs that depend on output in the short run are ��-

1. total variable costs only
2. both total variable costs and total costs
3. total costs only
4. total fixed cost only

✅ Correct Answer: 1

Inthe short run as economists use the phrase is characterised by ��-

1. all inputs being variable
2. a period where the law of diminishing return does no hold
3. at least one fixed factor of production and firms neither leaving nor entering the industry
4. no variable inputs

✅ Correct Answer: 3

A graph showing all the combination of capital and labour available for a given total cost is the ��-

1. isoquant
2. budget constraint
3. isocost line
4. expenditure set

✅ Correct Answer: 1

The formula for average fixed costs is ��-

1. TFC/Q
2. DQ/DFC
3. Q/TFC
4. TFC � Q

✅ Correct Answer: 1

Implicit costs are ��-

1. equal to total fixed costs
2. comprised entirely of variable costs
3.
4. always greater in the short run than in the long run

✅ Correct Answer: 3

The short run is a time period in which ��-

1. all resources are fixed
2. the level of output is fixed
3. the size of the production plant is variable
4. some resources are fixed and others are variable

✅ Correct Answer: 1

When the total product curve is falling ��-

1. marginal product curve is zero
2. marginal product curve is negative
3. average product is increasing
4. average product is negative

✅ Correct Answer: 2

Variable costs are ��

1. Sunk costs
2. Multiplied by fixed cost
3. Cost that change with the level of productio
4. the change in total cost resulting from the production of an additional unit of output

✅ Correct Answer: 3

Money paid to an unskilled labour is called ��

1. Wages
2. Salary
3. Royalty
4. None

✅ Correct Answer: 1

Marginal cost curve cuts the average cost curve ��

1. at the left of its lowest point
2. at its lowest point
3. at the right of its lowest point
4. at its highest point

✅ Correct Answer: 2

An LAC curve is not known as ��

1. Envelope curve
2. Planning curve
3. operating curve
4. plant curve

✅ Correct Answer: 4

Marginal cost means ��

1. Substitutional cost
2. addition to the total cost
3. multiplication to the total cost
4. variable cost

✅ Correct Answer: 2

What are homogenous products?

1. Undifferentiated products
2. Differentiated products
3. Both (a) and (b)
4. None

✅ Correct Answer: 1

A distinguishing characteristic of monopolistic competition is ��

1. Large number of firms
2. Low entry barriers
3. product standardisation
4. product differentiation

✅ Correct Answer: 4

If firms can neither enter nor leave an industry the relevant time period is the ��

1. Short run
2. Intermediate run
3. Immediate run
4. none

✅ Correct Answer: 1

Imperfect competition was introduced by ��-

1. variable cost
2. Chamberlin
3. Keynes
4. None

✅ Correct Answer: 2

In case of monopoly a firm in the long run can have ��

1. Loss
2. Profit
3. Supernormal profit
4. All of the above

✅ Correct Answer: 4

In perfect competition equilibrium is attained when ��

1. AR = AC
2. TR=TC
3. MR=MC
4. Q=P

✅ Correct Answer: 3

kinked demand curve is associated with ��

1. Cournot
2. Chamberlin
3. Edgeworth
4. Sweezy

✅ Correct Answer: 4

The upper portion of the kinked demand curve is relatively ��

1. More inelastic
2. More elastic
3. Less elastic
4. Less inelastic

✅ Correct Answer: 2

Concentration of monopoly is implemented under ��

1. FERA
2. MRTP
3. FEMA
4. None

✅ Correct Answer: 2

Cartel is a part of ��

1. Monopoly
2. Oligopoly
3. Duopoly
4. Perfect competition

✅ Correct Answer: 2

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