MCQs on Account, balance, debit, & credit

1. Ledger is called:
(a) King of all books of account
(b) Subsidiary book
(c) Book of original entry
(d) None of above
King of all books of account
2. King of all books of account is called:
(a) Trial balance
(b) Balance Sheet
(c) Cash book
(d) Ledger
Ledger
3. Process of recording transaction in ledger is called:
(a) Classifying
(b) Posting
(c) Journalizing
(d) Summarizing
Posting
4. Cash sales to Nadeem will be posted on the debit side of:
(a) Nadeem account
(b) Sales account
(c) Cash account
Cash account
5. Excess of debit over debit is called:
(a) Credit balance
(b) Zero balance
(c) Debit balance
(d) Negative balance
Debit balance
6. If debit side is equal to credit side, it should represent:
(a) Debit balance
(b) Zero balance
(c) Nil Balance
d) (b) & (c)
(b) & (c)
7. Excess of glory over debit’ is called:
(a) Credit balance
(b) Zero balance
(c) Debit balance
(d) None of above
Credit balance
8. Transactions are primarily recorded in:
(a) Journal
(b) Ledger
(c) Trial balance
(d) (a) & (b)
Journal
9. Transactions are secondary recorded in:
(a) Journal
(b) Ledger
(c) Trial balance
(d) None of above
10. Cash received from Yasir should dispatched to credit side of
(a) Yasir account
(b) Cash account
(c) Sale account
(d) Creditor account
Cash account
11.Account shows debit balance represents:
(a) Liability
(b). Owner’s equity
(d) Income
(c) Assets
Assets
12. If an account shows a credit balance represents:
(a) Liability
(b) Owner’s equity
(c) Income
(d) All of above
All of above
13. Record of journal folio is:
(a) Trial balance
(b) Journal
(d) (b) & (c)
(c) Ledger
Ledger
14. Transactions of proprietor are recorded in:
(a) Personal accounts
(b) Real accounts
(c) Nominal accounts
(d) None of above
Personal accounts
15. The act of balancing the both sides of an account is called
(a) Journalizing
(b) Balancing
(c) Transferring
(d) Composing
Balancing
16. Major ledger are:
(a) General ledger
(b) Creditors ledger
(c) Proprietor ledger
(d) (a) & (b)
(a) & (b)
17. Successful request of double entrance system is guaranteed by:
(a) Journal
(c) Ledger
(b) Trial balance
(d) Balance sheet
Ledger
18. Ledger is a book of entry is known as:
(a) Primary book
(b) Secondary book
(c) Final book
(d)(b) & (c)
Secondary book
19. Purchase return from customer should be posted to credit side of:
(a) Purchases return Account
(b) Purchases Account
(c) Suppliers Account
(d) (a) and (c)
Purchases return Account
20. Right side of Ledger account is:
(a) Debit side
(b) Credit side
(c) Liability side
(d) Balance sheet
Credit side
21. The left side of ledger account is known as:
(b) Debit side
(a) Credit side
(c) Asset side
(d) (b) & (c)
Debit side
22. Trial balance represents:
(a) Balance sheet
(b) List of ledger balances
(c) (a) and (c)
(d) None of above
List of ledger balances
23. Liabilities typically show:
(a) Debit balance
(b) Credit balance
(c) Zero balance
(d) Negative balance
Credit balance
24. Properties normally show:
(a) Debit balance
(b) Credit balance
(c) Zero balance
(d) Negative
Debit balance
25. Credit balance Costs normally show:
(a) Debit balance
(b) Credit balance
(c) Zero balance
(d) Nil balance
Debit balance
26. Incomes/proceeds normally show:
(a) Nil balance
(b) Zero balance
(c) Debit balance
(d) Credit balance
Credit balance
27. Fatalities normally represent:
(a) Negative balance
(b) Debit balance
(c) Credit balance
Debit balance
28. Profit normally represents:
(a) Favorable balance
(b) Unfavorable balance
(c) Credit balance
(d) None of these
Credit balance
29. Arithmetical correctness of books of account is checked through:
(a) Balance sheet
(b) Profit & loss account
(c) Trial balance
(d) None of these
Trial balance
30. The main purpose of test balance is to:
(a) Check the arithmetical accuracy
(b) Check the balance
(c) Check the systematic accuracy
(d) (a) & (c)
Check the arithmetical exactness
31. The title given to an organization of information in accounting system is called:
(a) Ledger balance
(b) Title of account
(c) Account
(d) (b) and (c)
Title of account
32. A form regularly used for tune increase and decrease in assets, liabilities and capital is called:
(a) Account
(b) Balance sheet
(c) Register
(d) Ledger
Account
33. Final account is very difficult to formulate in the absenteeism of:
(a) Journal
(b) Trial balance
(c) Ledger
(d) Account
Trial balance
34. Transactions are finally noted in:
(a) Trial balance
(b) Profit & loss account
(c) Ledger.
(d) Balance sheet
Ledger
35. For placement transaction on credit side of ledger’s account we use word:
(a) By
(b) To
(c) With
(d) (a) & (b)
By
36. We use word for placement transaction on debit side of ledger’s account
(a) To
(b) By
(c) With
(d) All of above
To
37. Suspense account is opened in trial Balance on the:
(a) Shorter side
(b) Greater side
(c) Excess side
(d) (b) & (c)
Shorter side
38. Which type of error is not exposed by?
(a) An error of omission
(b) Compensating error
(c) Error of principle
(d) Al of above
Al of above
39. When a suspense account is opened
(a) Balance sheet does not agree
(b) Profit & loss account does not agree
(e). Trial balance does not agree
(d) (a) and (b)
Trial balance does not agree
40. Trial balance shows:
(a) Complete accuracy
(b) Whole accuracy
(c) Arithmetical accuracy
(d) Full accuracy
Arithmetical accuracy
41. Closing balance of last year will symbolize in current year:
(a) Opening balance
(b) Ending balance
(c) Initial balance
(d) None of above
Opening balance
42. Ledger is a set of:
(a) Balances
(b) Vouchers
(c) Accounts
(d) None of above
Accounts
43. A person who is beholden to business is called:
(a) Debtor
(b) Receiver
(c) Creditor
(d) None of above
Debtor
44. A person to whom business is indebted is called:
(a) Debtor
(b) Creditor
(c) Giver
(d) None of above
Creditor
45. If two sides of an account are equal it represents:
(a) Zero balance
(b) Positive balance
(c) Nil balance
(d) (a) & (c)
(a) & (c)
46. The difference between two sides of an account is called:
(a) Difference
(b) Balance
(c) Gap
(d) None of the
Balance
47. The book where all business transactions are recorded and classified into relevant accounts is called.
(a) Difference
(b) Balance
(c) Gap
(d) None of these
Gap
48. The balance on debit or credit side of closing of any account is called
(a) Opening balance
(b) Closing balance
(c) Beginning balance
(d) None of above
Closing balance
49. Entering ledger page numbers in the journal and journal page numbers in the ledger is called cross-referencing.
(a) Journalizing
(b) Posting
(c) Folioing
(d) Reference
Folioing
50. Entering ledger page numbers in the journal and journal page numbers in the ledger is called cross-referencing.
(a) Debtors ledger
(b) General ledger
(c) Creditors ledger
(d) None of above
General ledger
51. To determine the balance of a particular account, one should refer to which of the following?
(a) Ledger
(b) Source document
(c) Chart of accounts
(d) Journal
Ledger
52. Transferring entries from journal to ledger account is commonly known as:
(a) Recording
(c) Posting
(b) Transferring
(d) Entry making
Posting
53. An account records the balance of an item: in the
(a) Increase
(b) Increase
(c) Increase or decrease
(d) Appreciation
Increase or decrease
54. If credit side of a bank account is greater than the debit side, it indicates which of the following?
(a) Bank overdraft
(b) Cash at bank
(c) Bank balance
(d) Current Asset
Bank overdraft
55. If debit side of a bank account is greater than credit side it indicates which, of the following?
(a) Cash at bank
(b) Bank understatement
(c) Bank overdraft
(d) Balance overstatement
Cash at bank
56 will be credited if goods are given as charity:
(a) Cash
(b) Charity
(c) Purchases
(d) Sales
Purchases
57. Which of the following is known as the base for preparing trial balance?
(a) Journal
(b) Cash account
(c) Ledger account
(d) Balance sheet
Ledger account
58. If debit balance is greater than credit balance then the account balance will be:
(a) Credit balance
(b) Debit and credit balance
(c) Cash balance
(d) Debit balance
Debit balance
59. The normal balance of capital account is:
(a) Credit balance
(b) Debit balance
(c) Cash balance
(d) Neither debit nor credit balance 160. The normal balance e of asset account
Credit balance
60. The Normal
(a) Credit balance
(b) Deoit balance
(c) Cash balance
(d) Neither debit nor-credit balance
Deoit balance
61. The normal balance of liability account is:
(a) Debit balance
(b) Credit balance
(c) Cash balance
(d) Neither debit nor credit balance
Credit balance
62. The type of account with a normal credit balance is:
(a) An asset
(b) A drawing
(c) Revenue
(d) An expense
Revenue

SET 2

Covering Trial basis

1 Which of the following is TRUE about trial balance?
(a) Both sides are always positive
(b) Both sides are negative
(c) Both sides are equal
(d) Both sides are not linked which each other
Both sides are equal
2. Trial balance is prepared to check accuracy of:
(a) Ledger accounts balances
(b) Balance sheet balances
(c) Income statement balances
(d) Cash flow statement balances
Ledger accounts balances
3. If a transaction is omitted will it affect the agreement of a tried balance?
(a) Yes
(b) No
(c) Transactions can’t be omitted
(d) None of these
No
4. Is the common base for making a trial balance?
(a) Ledger accounts
(b) General Journal
(c) Specialized journals
(d) Balance sheet
Ledger accounts
5. Which of the following is true about a trial balance?
(a) It lists down the balances of accounts
(b) It lists down the balances of a balance sheet
(c) It is a kind of financial statement
(d) It is not a part of accounting cycle
It lists down the balances of accounts
6. Debit balance Credit balance in a trial balance indicates that:
(a) No error in recording transactions
(b) No error in posting entries to ledger accounts
(c) Account balances are correct
(d) Mathematically Capital Liabilities Assets
Mathematically Capital Liabilities Assets
7. Trial balance is commonly set:
(a) Frequently during the year
(b) At the end of an accounting period
(c) At the end of a month
(d) At the end of a year
At the end of an accounting period
8. Which of the following will affect the contract of a trial balance?
(a) Complete omission of transaction a
(b) Partial omission of a transaction
(c) Error of principle
(d) Compensating errors
Partial omission of a transaction
9. A balanced trial balance only shows that debits equal credits; it doesn’t ensure error-free recording and posting.
(a) Arithmetic accuracy
(b) Errors of com mission
(c) Omissions of economic events
(d) Understatements of balances
Arithmetic accuracy
10. Which of the next account with normal balance is shown at the debit side of a trial steadiness?
(a) Rent income account
(b) Creditors account
(c) Unearned income account
(d) Cash account
Cash account
11. The form listing the balances and the title of the balance sheet in the ledger on a given date is the:
(a) Income statement
(b) Balance Sheet
(c) Retained earnings statement
(d) Trial balance
Trial balance

MCQs on Account, balance, debit, & credit
By: Prof. Dr. Fazal Rehman Shamil | Last updated: July 28, 2024

SET 2

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