Fundamentals Of Accounting And Auditing MCQ - Accounting And Auditing Section 2

16 How would you classify the ‘wages paid for the construction of building’?

A
Revenue Receipt
B
Revenue Expenditure
C
Capital Expenditure
D
Revenue Expenditure

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Correct AnswerOption B

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17 Which of the following best describes a trial balance?

A
It shows the profit or loss of the organization
B
It is a list of balances of ledger accounts
C
Shows the financial position of a business
D
It is a Ledger Account

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Correct AnswerOption B

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18 Contingent liabilities are those and are shown under.

A
Which are never payable and shown outside the balance sheet
B
Which may or may not arise and shown liabilities side of the balance sheet
C
Which crystallize at the time of liquidation of a company and shown in the asset side of the balance sheet
D
Which may or may not arise and shown outside of the balance sheet

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Correct AnswerOption D

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19 Which of the following is a Capital Expenditure?

A
Purchase of raw material
B
Purchase of machinery
C
Interest on loan
D
Depreciation on machinery

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Correct AnswerOption B

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20 How would you journalise the depreciation charged on the asset?

A
Debiting cash account and crediting depreciation account.
B
Debiting depreciation account and crediting cash account.
C
Debiting depreciation account and crediting asset account.
D
Debiting cash account and crediting asset account

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Correct AnswerOption C

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