Practice Pakistan's most useful MCQs for competitive exams

Under which of the following situations, is journal entry not passed in the books of the drawer?

• (A)  When a discounted bill is honoured by the drawee on the due date
• (B)  When a bill is sent to the bank for collection
• (C)  When a bill is renewed at the request of the drawee
• (D)  When a debtor accepts a bill drawn by the drawer

Answer

Submitted By :Ali Uppal

The drawer of a trade bill passes relevant entries with regard to the transaction involved in it. But, in case of an accommodation bill, he passes an entry in addition to the usual entries. The additional entry so passed is with respect to

• (A)  Discounting of the bill with the bank
• (B)  Payment of the bill on due date
• (C)  Remitting or receiving the amount
• (D)  Sending the bill to bank for collection

Answer

Submitted By :Ali Uppal

The noting charges levied on dishonour of an endorsed bill by the Notary Public are to be borne by

• (A)  The drawer of the bill
• (B)  The person responsible for dishonour
• (C)  The holder of the bill
• (D)  The endorser of the bill

Answer

Submitted By :Ali Uppal

A discount of $2000 was given to a supplier on his prompt repayment of debt but the cashier entered the gross amount in cash book. What should be the adjustment in cash to work out the correct balance of cash book?

• (A)  $2000 will be debited in cash book
• (B)  $2000 will be credited in cash book
• (C)  $4000 will be debited in cash book
• (D)  $4000 will be credited in the cash book

Answer

Submitted By :Ali Uppal

Unpresented checks also referred as____________?

• (A)  Uncollected checks
• (B)  Uncredited checks
• (C)  Outstanding checks
• (D)  Bounced checks

Answer

Submitted By :Ali Uppal

In the Bank reconciliation statement “Deposit in transit” is usually:

• (A)  Subtracted from bank balance
• (B)  Added to bank balance
• (C)  Added to Cash book balance
• (D)  Subtracted from cash book balance

Answer

Submitted By :Ali Uppal

Bank reconciliation statement is the comparison of a bank statement (sent by bank) with the _________ (prepared by business).

• (A)  Cash receipt journal
• (B)  Cash payment journal
• (C)  Cash book
• (D)  Financial statements

Answer

Submitted By :Ali Uppal

Favorable balance of cash book implies that

• (A)  Credit balance of cash book
• (B)  Debit balance of cash book
• (C)  Bank overdraft
• (D)  Adjusted balance of cash book

Answer

Submitted By :Ali Uppal

Bank charges amounting to $5000 was not entered in the cash book. Identify the correct adjustment in cash book?

• (A)  Bank charges will be debited in cash book
• (B)  Bank charges will be added to cash book balance
• (C)  Bank charges will be credited in cash book
• (D)  Bank charges need no adjustment in cash book

Answer

Submitted By :Ali Uppal

Bank reconciliation statement is prepared by____________?

• (A)  Accountant of the business
• (B)  Manager of the business
• (C)  Controller of the bank
• (D)  Accountant of the bank

Answer

Submitted By :Ali Uppal