Financial Accounting - Questions & Answers for Competitive Exams | GkSeries

25. The balance in the asset account will not be reduced to zero under this method _________.

• [A] straight line method .
• [B] written down value method.
• [C] annuity method.
• [D] none of the above.

Answer: Option [B]

26. Under which method of depreciation, the earlier year of the life of the asset, profits are more _________.

• [A] straight line method.
• [B] written down value method.
• [C] annuity method.
• [D] depreciation fund method.

Answer: Option [A]

27. Diminishing balance method is also called _________.

• [A] written down value method.
• [B] annuity method.
• [C] depreciation fund method.
• [D] none of the above.

Answer: Option [A]

28. Deficit balance can be shown in balance sheet as

• [A] Liability.
• [B] Assets.
• [C] Owner's equity
• [D] None of above

Answer: Option [B]

29. Under annuity method the amount of depreciation is found out from _________.

• [A] log tables.
• [B] sinking fund tables.
• [C] annuity tables.
• [D] present value tables.

Answer: Option [C]

30. Under depreciation fund method, the amount of depreciation is calculated with reference to

• [A] log tables.
• [B] sinking fund tables.
• [C] annuity tables.
• [D] none of the above

Answer: Option [B]

31. The difference between the book value at the beginning and at the end (revaluation amount) is

• [A] depreciation.
• [B] appreciation.
• [C] reduction.
• [D] computation.

Answer: Option [A]

32. Expenses which can be directly identified with or incurred for particular department are called

• [A] direct expenses.
• [B] indirect expenses.
• [C] monthly expenses.
• [D] none of the above.

Answer: Option [A]

33. In statement of affairs liabilities are shown on the __________.

• [A] right hand side.
• [B] left hand side.
• [C] right hand side top.
• [D] right hand side bottom.

Answer: Option [B]

34. Under single entry system, opening capital can be found by preparing a statement of affairs

• [A] at the end of the year.
• [B] at the beginning of the year.
• [C] at the end of every month.
• [D] at the end of every quarter.

Answer: Option [B]

35. Under single entry system in net worth method, drawings is added with _______.

• [A] opening capital.
• [B] closing capital.
• [C] additional capital.
• [D] none of the above.

Answer: Option [B]

36. Under single entry system in net worth method, opening capital is subtracted from _________.

• [A] opening capital.
• [B] closing capital.
• [C] additional capital.
• [D] drawings.

Answer: Option [B]