Fixed costs are those

• A. Outside the control of managers
• B. Which are constant per unit of output
• C. Expenses that do not change as a function of the activity of a business, with in relevant period
• D. None of the above

Subscriptions received in advance is

• A. An income
• B. A loss
• C. A liability
• D. An asset

In straight line method, the depreciation charge is:

• A. A fixed percentage of the cost of the asset each year
• B. Always 5% of the cost of the asset each year
• C. A fixed percentage of the book value of the asset each year
• D. None of the above.

Depreciation is to be charged because

• A. The machinery gets old with time
• B. Of physical wear and tear
• C. Of fall in the market value of the asset
• D. The plant is not as good as new one

The purpose of double entry bookkeeping is:

• A. To apply the dual aspect concept.
• B. To prepare books of prime entry accurately
• C. To avoid errors
• D. To record capital and revenue transactions correctly

Which account will have a credit balance?

• A. Carriage inwards
• B. Carriage outwards
• C. Discount received
• D. Discount allowed

Sales= 150,000 Gross profit = 15,000 Net loss= 4,000 Then the operating expenses will be

• A. 19,000
• B. 165,000
• C. 131,000
• D. 11,000

Cost of sale is equal to

• A. Sales -purchases 895
• B. Opening stock – closing stock + purchase – returns out
• C. Purchases – returns out + closing stock if.
• D. Gross profit – expenses

The Current Ratio formula is

• A. All assets: all liabilities
• B. All assets: current liabilities
• C. Current assets: all liabilities
• D. Current assets: current liabilities

A petty cash book records

• A. All petty cash receipts
• B. Petty transactions
• C. Cash receipts from customers
• D. All petty cash expenses