Accounting MCQs
Accounting MCQs help students and professionals master financial, cost, and managerial accounting, covering topics like journal entries, financial statements, and ratios—ideal for certifications, competitive exams, and business studies to boost skills and exam performance.
Q: Expenses not yet paid are classified under
A) Accrued income
B) Revenue
C) Outstanding expenses
D) Prepaid expenses
✅ Correct Answer: C
Explanation: Such expenses are due but unpaid, thus considered outstanding.
Q: Purchase of goods on credit is recorded in
A) Cash book
B) Purchase book
C) Sales book
D) Journal proper
✅ Correct Answer: B
Explanation: Credit purchases are entered in the purchase book.
Q: If liabilities increase, the accounting equation remains balanced by
A) Increasing assets
B) Decreasing capital
C) Decreasing revenue
D) Increasing equity
✅ Correct Answer: A
Explanation: An increase in liabilities must be matched by a corresponding increase in assets.
Q: Losses and gains from sale of investments are recorded in
A) Profit and loss account
B) Cash book
C) Trading account
D) Capital account
✅ Correct Answer: A
Explanation: These transactions affect overall profit and are recorded accordingly.
Q: Bills receivable is a type of
A) Expense
B) Asset
C) Equity
D) Liability
✅ Correct Answer: B
Explanation: Bills receivable represent amounts legally owed to the business.