Accountancy

Q.

When discount is given to the customers, what will be the impact on capital?

1. Increases

2. Decreases

3. No impact

4. None of these

Q. Discount received while payment made to the creditors is for the business entity.

1. gain
2. loss
3. asset
4. liability

Q. concept states that income received in advance should be considered as a liability and not as revenue.

1. Consistency
2. Matching
3. Prudence
4. Going concern

Q.

Mr. Ajay has a business of selling of fans. He took 1 fan to his house for personal use. Which of the following is affected from these drawings in sole-proprietorship business?

1. Assets - Decrease
   Liabilities - Increase
   Capital - No effect

2. Assets - Increase
   Liabilities - No effect
   Capital - Increase

3. Assets - No effect
   Liabilities - Increase
   Capital - Increase

4. Assets - Decrease
   Liabilities - No effect
   Capital - Decrease

Q.

Prepaid expenses are considered as ________

1. Liabilities

2. Income

3. Expenses

4. Assets

Q.

Income received in advance but not earned will appear in the balance sheet as ___.

1. Liabilities

2. Revenue

3. Assets

4. Capital

Q. Outstanding expenses are considered as a/an for the business entity.

1. asset
2. liability
3. income
4. expense

Q.

What will be the impact in accounting equation when dividend is received from a company?

1. Assets - Decrease
   Liabilities - No effect
   Capital - Decrease

2. Assets - No effect
   Liabilities - Decrease
   Capital - Increase

3. Assets - Increase
   Liabilities - No effect
   Capital - Increase

4. None of these

Q. Drawings will the capital of the business entity.

1. increase
2. decrease
3. not change

Q.

When amount is paid to creditors, what will be the impact in accounting equation?

1. Assets - No effect
   Liabilities - Decrease
   Capital - Increase

2. Assets - Decrease
   Liabilities - No effect
   Capital - Decrease

3. No impact

4. Assets - Decrease
   Liabilities -Decrease
   Capital - No effect