Test your Knowledge in Financial Accounting MCQs Set 1

Bank does not issue cheque book on:


Options are :

  • Current account
  • Fixed deposit account (Correct)
  • Saving bank account
  • All of the above

Answer : Fixed deposit account

Bank issue bank statement on:


Options are :

  • Current account
  • Saving bank account
  • Fixed deposit account
  • a & b (Correct)

Answer : a & b

Bank gives overdraft facility on:


Options are :

  • Saving bank account
  • Fixed deposit account
  • Current account (Correct)
  • All of the above

Answer : Current account

A business man like to open account with bank:


Options are :

  • Fixed deposit account
  • Saving bank account
  • Current account (Correct)
  • None of them

Answer : Current account

Commission of bank draft paid by:


Options are :

  • Bank himself
  • Purchaser of draft (Correct)
  • Payee
  • All of the above

Answer : Purchaser of draft

Bank charge collecting fee of out station cheque from:


Options are :

  • Drawer
  • Drawee
  • Payee (Correct)
  • None of them

Answer : Payee

Dishonored cheque is returned by the bank to:


Options are :

  • Drawer
  • Drawee
  • Payee
  • Depositor (Correct)

Answer : Depositor

Bank does not make the payment of cheque on the counter for:


Options are :

  • Bearer Cheque
  • Order Cheque
  • Cross Cheque (Correct)
  • None of these

Answer : Cross Cheque

On opening current account, Bank issue to his client:


Options are :

  • Cheque Book (Correct)
  • Pass Book
  • Both a & b
  • None of these

Answer : Cheque Book

Payment can be made any time during business hours on:


Options are :

  • Saving bank account
  • Fixed deposit account
  • Current Account
  • All of the above (Correct)

Answer : All of the above

Crossing of a cheque which contains the name of a particular bank is called:


Options are :

  • Regular crossing
  • Irregular crossing
  • General Crossing
  • Special Crossing (Correct)

Answer : Special Crossing

Payee has to give his identification to bank for receiving the amount of:


Options are :

  • Bearer cheque
  • Order cheque (Correct)
  • Cross Cheque
  • Blank cheque

Answer : Order cheque

Crossing makes the cheque:


Options are :

  • Unsafe
  • Safe (Correct)
  • Unacceptable
  • Acceptable

Answer : Safe

In case of negotiable instruments, the rights can be:


Options are :

  • Transferred (Correct)
  • Not Transferred
  • Conditionality Transferred
  • All of the above

Answer : Transferred

Endorsement of a cheque is always:


Options are :

  • Written (Correct)
  • Oral
  • Written & Registered
  • All of the above

Answer : Written

Pass book is prepared in the book of:


Options are :

  • Bank (Correct)
  • Customer
  • Guarantor
  • None of these

Answer : Bank

An order drawn by a bank on one of its branches to pay a specified some of money to the person named in is called:


Options are :

  • Cheque
  • Money Order
  • Hundi
  • Bank Draft (Correct)

Answer : Bank Draft

The cheque which is returned by the bank is called:


Options are :

  • Cross Cheque
  • Bearer Cheque
  • Dishonor Cheque (Correct)
  • Order Cheque

Answer : Dishonor Cheque

Now-a-days what is issue in spite of pass book?:


Options are :

  • Cheque Book
  • Pay in slip
  • Bank Statement (Correct)
  • None of these

Answer : Bank Statement

Unfavorable balance of pass book means:


Options are :

  • Debit balance of pass book (Correct)
  • Debit balance of cash book
  • Credit balance of pass book
  • None of these

Answer : Debit balance of pass book

Bank reconciliation statement is :


Options are :

  • Ledger
  • A Journal
  • A Book
  • A memorandum statement (Correct)

Answer : A memorandum statement

In adjusting the Cash Book balance one of the following is not taken into account:


Options are :

  • Mistake
  • Mistake in pass book (Correct)
  • Mistake in cash book

Answer : Mistake in pass book

Under the imprest system the petty cash is:


Options are :

  • Increased every week
  • Always restored to the original amount (Correct)
  • Reduced every week
  • Used up completely before being restored

Answer : Always restored to the original amount

Petty cash system is designed:


Options are :

  • To meet the needs of small business
  • To cover small expenses to be paid in cash (Correct)
  • To cover small and miscellaneous incomes
  • To cover small incomes and small expenses

Answer : To cover small expenses to be paid in cash

Subsidiary books are called book of:


Options are :

  • Original entry (Correct)
  • Secondary entry
  • Basic entry
  • None of these

Answer : Original entry

A contra entry appeals on both sides of :


Options are :

  • Trial balance
  • Journal
  • Cash book (Correct)
  • None of these

Answer : Cash book

A copy of the depositorís account in the banks ledger is called:


Options are :

  • Balance sheet
  • Accounting Equation
  • Trial balance
  • Bank statement (Correct)

Answer : Bank statement

Bank Account is a:


Options are :

  • Personal A/C (Correct)
  • Nominal A/C
  • Real A/C
  • None of these

Answer : Personal A/C

Disagreement balance of cash book and pass book is known through:


Options are :

  • Pass book
  • Subsidiary book
  • Petty cash book
  • Bank reconciliation statement (Correct)

Answer : Bank reconciliation statement

The book in which small payments are recorded is called:


Options are :

  • Trial Balance
  • Petty Cash book (Correct)
  • Pass book
  • Purchase book

Answer : Petty Cash book

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