Course:
CMA Foundation
1) Goods purchased from A for Rs.10,000 passed through the sales book. The error will result in:
(a) Increase in gross profit
(b) Decrease in gross profit
(c)No effect on gross profit
2) If a purchase return of Rs.1,000 has been wrongly posted to the debit of the sales returns account,
but has been correctly entered in the suppliers’ account, the total of the:
(a) Trial balance would show the debit side to be Rs.1,000 more than the credit
(b) Trial balance would show the credit side to be ₹ 1,000 more than the debit.
(c) The debit side of the trial balance will be ₹ 2,000 more than the credit side.
3) If the amount is posted in the wrong account or it is written on the wrong side , it is called:
(a) Error of omission (b) Error of Commission (c) Error of Principle
4) ₹ 200 Paid as wages for erecting a machine should be debited to:
(a) Repair A/c (b) Machine A/c (c) Capital A/c
5) On purchase of old furniture, the amount of Rs.1,000 spent on its repair should be debited to:
(a) Repair A/c (b) Furniture A/c (c) Cash A/c
6) Goods worth Rs.50 given as charity should be credited to:
(a) Charity A/c (b) Sales A/c (c) Purchase A/c
7) Goods worth Rs.100 taken by proprietor for domestic use should be credited to:
(a) Sales A/c (b) Proprietor’s personal expenses (c) Purchases account
8) Sales of office furniture should be credited to:
(a) Sales A/c (b) Furniture A/c (c) Purchase A/c
9) The preparation of a trial balance is for:
(a) Locating errors of commission
(b) Locating errors of principle
(c) Locating clerical errors
10) 200 received from Smith whose account, was written off as a bad debt should be credited to:
(a) Bad Debts Recovered account (b) Smith’s account (c) Cash account
11) Purchase of office furniture Rs.1,200 has been debited to General Expense Account. It is:
(a) A clerical error (b) An error of principle (c) An error of omission
12) Discount allowed Rs.93 to Mohan has been credited to his account by Rs.39. The error will be
rectified by:
(a) Crediting Mohan by Rs.54
(b) Debiting Mohan by Rs.54
(c) Debiting discount by Rs.54
13) A Bill Receivable of Rs.500 was dishonoured and credited as Rs.50. The error will be rectified by:
(a) Crediting debtor by Rs.450 (b) Crediting bill receivable by Rs.450
(c) Debiting bills receivable by Rs.450 (d) Debiting debtors A/c by Rs.550
14) Which of the following errors will affect Trial Balance?
(a) Repairs to buildings have been debited to buildings
(b) The total of purchases journal is Rs.2,000 short
(c) Freight paid on new machinery has been debited to the Freight Account
(d) None of these
15) Salary paid for the Month of June, Rs.21,000 by issue of a cheque was recorded in the Journal but
not posted at all. The rectification will be done by:
(a) Passing a rectification entry (b) Creating a Suspense A/c
(c) Making the posting in the Ledger (d) None of the above
16) Which of the following is not an error of principle?
(a) Rs.10,000 paid for erection and commissioning of Plant debited to Repairs A/c
(b) Rs.1,000 Paid to Shyam, credited to his A/c
(c) Rs.1,000 paid as cartage for office furniture debited to Cartage A/c
(d) Rs.5,000 paid to Gopal as salary, debited to his A/c
17) Suspense A/c is:
(a) Nominal A/c (b) Personal A/c (c) Real A/c (D) Can be of any type
18) Rent paid to landlord amounting to Rs.500 was credited to Rent A/c with Rs.5,000. In the rectifying
entry, the amount to be debited to Rent Account is:
(a) ₹ 5,000 (b) ₹ 500 (c) ₹ 5,500 (c) ₹ 4,500
19) Sohan returned goods to us amounting Rs.4,200 but was recorded as Rs.2,400 in his account. In
the rectifying entry. Sohan’s A/c will be credited with:
(a) ₹ 1,800 (b) ₹ 4,200 (c) ₹ 2,400 (c) ₹ 6,600
20) Commission paid to Mr. Dixit Rs.225 was posted twice to Commission account. The rectification is
done by:
(a) Writing ‘Error in Posting’ ₹ 225 on credit side of Mr. Dixit A/c in Ledger
(b) Passing a rectification entry in Journal Proper crediting Commission A/c by ₹ 225
(c) Writing ‘Error in Posting’ ₹ 225 on credit side of Commission A/c in Ledger
(d) Passing a rectification entry in Journal Proper debiting Commission A/c by ₹ 225
21) Goods purchased from A for ₹ 2,000 passed through sales book. The rectification of this error
results in:
(a) Decrease in Gross Profit (b) No effect on Gross Profit
(c) Increase in Gross Profit (d) Increase in Sundry Debtors
22) A credit sale of goods to Amir, worth ₹ 600 was recorded in Purchase Book. In the rectification
entry:
(a) Amir will be debited by Rs.600 (b) Purchase will be debited by Rs.600
(c) Amir will be debited by Rs.1,200 (d) Sales will be credited by Rs.1,200
23)
24) Cheque for ₹ 1,000 from D was recorded in cash received column. The rectification entry is:
(a) Enter Rs.1,000 in bank column (Dr.) in cash book & enter Rs.1,000 in cash column (Cr.)
(b) In Cash Book, Dr. Bank column with Rs.2,000 & Cr. Cash column with Rs.2,000
(c) In Cash Book, Cr. Bank column with Rs.1,000 & Dr. cash column with Rs.1,000
(d) In Cash Book, Credit Cash Column with Rs.1,000
The following errors were discovered after concerned final accounts were prepared – i.e. discovered
in the next year. (Two Sided Errors). Indicate the correct rectification entry
25) Purchases from A for Rs.10,000 not recorded. The rectification entry is:
26)
27)
28)
29)
30)
31) A suspense account facilitates the preparation of _even when the ____ has not tallied.
(a) Ledgers; Trial balance (b) Financial statements; Trial Balance.
(c) Trial balance; Financial statements (d) Journal; Trial balance
32) A Trial Balance will not tally if:
(a) Correct journal entry is posted twice
(b) Credit Purchase debited to purchases & credited to cash
(c) Rs.5,000 cash paid to creditors is debited to creditors for Rs.500 and credited to cash as
Rs.5,000
(d) None of the above
33) Closing stock in Trial Balance will be taken to:
(a) Trading Account only (b) Balance Sheet only
(c) Profit & Loss Account only (d) Trading Account and Balance Sheet
34) Errors of carry forward from one year to another affects:
(a) Personal A/c (b) Real A/c (c) Nominal A/c (d) Both (a) & (b)
35) Which of the following is not a true of a trial balance?
(a) It proves that total debits = total credits, if it balances
(b) It facilities preparation of financial statements
(c) It proves that no errors have been made in recording transactions, if it balances
(d) It will not detect an error where the accounts debited and credited are reversed to recording a particular transaction
36) Unintentional omission or commission of amounts and accounts in the process of recording
transactions are known as:
(a) Frauds (b) Misinterpretation (c) Errors (d) None of the above
37) Whenever errors are noticed in the accounting records, they should be rectified:
(a) At the time of preparation of the trial balance
(b) Without waiting the accounting year to end
(c) After the preparation of final accounts
(d) In the next accounting year
38) Rs.3,000 received from sub-tenant for rent and entered correctly in the cash book is posted to
the debit of the rent account. In the Trial Balance:
(a) Debit total > by Rs.6,000 than the credit total
(b) Debit total > by Rs.3,000 than the credit total
(c) Subject to other entries being correct, total will agree
(d) None of the above
39) Which of the following errors are not revealed by the Trial Balance:
(a) Compensating errors (b) Errors of commission
(c) Wrong balancing of an account (d) Wrong totaling of an account
40) Cartage paid for newly purchased machinery, posted to Cartage Account:
(a) Errors of Omission (b) Errors of Commission (c) Errors of Principle (d) None
41) Goods taken away by the Proprietor for personal use not recorded anywhere:
(a) Errors of Omission (b) Errors of Commission (c) Errors of Principle (d) None
42) The total of Sales Book was not posted to the ledger:
(a) Will affect the trial balance (b) Will not affect the trial balance
43) Goods of the value of Rs.376 were returned by Ram and were taken into stock on the same date
but no entry was made in the books:
(a) Will affect the trial balance (b) Will not affect the trial balance
44) A credit sale wrongly passed through purchases book:
(a) Will affect the trial balance (b) Will not affect the trial balance
45) Repairs of newly purchased second-hand machinery debited to Repairs Expenses Account:
(a) Will affect the trial balance (b) Will not affect the trial balance
46) Repairs to Machinery charged to Machinery A/c:
(a) Will affect the trial balance (b) Will not affect the trial balance
47) Cartage paid for newly purchased machinery, posted to Cartage Account:
(a) Will affect the trial balance (b) Will not affect the trial balance
48) Recording a transaction in a wrong book of original entry with wrong amount:
(a) Will affect the trial balance (b) Will not affect the trial balance
49) Recording a transaction in a correct book of original entry but not posted in the ledger:
(a) Will affect the trial balance (b) Will not affect the trial balance
50) Sales book was overcast by Rs.100. The rectification is:
(a) Writing “By Error of Casting in Sales Book.” Rs.100 on the credit side of the Sales A/c in Ledger
(b) Passing a rectification entry in Journal Proper debiting Sales A/c by Rs.100
(c) Writing “To Error Casting in Sales Book.” – Rs.100 on the debit side of the Sales A/c in Ledger
(d) Passing a rectification entry in Journal Proper Debiting Suspense A/c by Rs.100
ANSWERS:
1) (a)
2) (c)
3) (b)
4) (b)
5) (b)
6) (c)
7) (c)
8) (b)
9) (c)
10) (a)
11) (b)
12) (a)
13) (b)
14) (b)
15) (c)
16) (b)
17) (d)
18) (c)
19) (a)
20) (c)
21) (a)
22) (c)
23) (b)
24) (a)
25) (c)
26) (d)
27) (b)
28) (a)
29) (b)
30) (c)
31) (b)
32) (c)
33) (b)
34) (d)
35) (c)
36) (c)
37) (b)
38) (a)
39) (a)
40) (c)
41) (a)
42) (a)
43) (b)
44) (b)
45) (b)
46) (b)
47) (b)
48) (b)
49) (a)
50) (c)