MY SUCCESS 26

Accounting Quiz Q71–Q80 TC Accounting Quiz Q71–Q80 Teal Coral Clean theme — click an option to reveal the correct answer and a concise explanation Questions Q71. Debt Equity Ratio is 1:2. Which of the following transactions will increase it? A. Issue of new share for cash B. Issue of Debenture C. Redemption of Debenture D. Credit Purchase Answer: Issue of Debenture Solution: Debt‑equity ratio = Debt ÷ Equity. Issuing debentures increases debt while equity remains unchanged, so the ratio rises. Issuing new shares increases equity and lowers the ratio; redemption reduces debt and lowers the ratio. Q72. If Inventory Turnover ratio is divided into 365, it becomes a meas...

Accounting Quiz Q61–Q70 TC Accounting Quiz Q61–Q70 Teal Coral Clean theme — click an option to reveal the correct answer and a concise explanation Questions Q61. Current Ratio is: A. Solvency Ratio B. Liquidity Ratio C. Activity Ratio D. Profitability Ratio Answer: Liquidity Ratio Solution: Current ratio measures short‑term liquidity: Current Assets ÷ Current Liabilities, so it is a liquidity ratio. Q62. Liquid asset does not include : A. Bill receivable B. Debtor C. Bank Balance D. Prepaid Expenses Answer: Prepaid Expenses Solution: Liquid a...

Accounting Quiz Q51–Q60 TC Accounting Quiz Q51–Q60 Teal Coral Clean theme — click an option to reveal the correct answer and detailed explanation Questions Q51. Debenture Redemption Reserve can be created out of: A. Current year profits B. In case current year loss then from retained earnings of previous years C. Both a & b above D. None of the above Answer: Both a & b above Solution: Debenture Redemption Reserve (DRR) is normally created out of profits. If the current year shows a loss, DRR may be created from retained earnings/reserves of previous years subject to legal and policy constraints. Q52. Fixed assets lose their value due to: ...

Accounting Quiz Q41–Q50 TC Accounting Quiz Q41–Q50 Teal Coral Clean theme — click an option to reveal the correct answer and detailed solution Questions Q41. Wages paid for machine installation debited in wages account, it is: A. An error of Commission B. An error of omission C. An error of Principal D. Compensating Error Answer: An error of Principal Solution: Wages for installation are a capital expenditure and should be capitalized to the asset (machinery). Debiting Wages account instead is a classification error — an error of principle (wrong accounting treatment). Q42. If amount of any known liability can’t be determined with substantial accuracy then: ...

Bank Reconciliation Quiz Q31–Q40 TC Bank Reconciliation Quiz Q31–Q40 Interactive Teal Coral Clean theme — click an option to reveal the correct answer and explanation Questions Q31. Deposit in Transit will be ______ while preparing BRS. A. Subtracted from bank balance B. Added in bank balance C. No effect D. Added to cash book balance Answer: Added in bank balance Solution: A deposit in transit is recorded in the company's cash book but not yet reflected in the bank statement. To reconcile the bank statement to the cash book, deposits in transit are added to the bank balance. Q32. Unpresented cheques are also referred as: A. Bounced Che...

Single Entry Accounting Quiz Q21–Q30 | Teal Coral Clean TC Single Entry Accounting Quiz Q21–Q30 Interactive Teal Coral Clean theme — click an option to reveal the correct answer and detailed solution Questions Q21. Under single entry system in net worth method drawings is added in : A. Opening Capital Select B. Closing Capital Select C. Additional Capital Select D. Cash Select Answer: Closing Capital Solution: Under the net worth (statement of affairs) method, drawings are added back to the closing capital when reconstructing the closing capital figure to compute profit or loss. This adjustment rest...