Chapter MCQ Test 2 — Journal
10 Questions • 12 min • Chapter MCQ
12:00
Question 1 of 10
Paid Rs 9,700 to Sohan in full settlement of his account of Rs 10,000. The correct entry is:
Sohan A/c Dr 10,000; To Cash A/c 9,700; To Discount Received A/c 300
Cash A/c Dr 9,700; To Sohan A/c 9,700
Sohan A/c Dr 9,700; To Cash A/c 9,700
Discount A/c Dr 300; To Sohan A/c 300
Explanation: Sohan (receiver) is cleared for the full 10,000; cash out 9,700 and the Rs 300 saved is a discount received (gain).
Question 2 of 10
Goods costing Rs 2,000 are given away as a charity/donation. The debit goes to:
Charity (Donation) A/c
Sales A/c
Cash A/c
Capital A/c
Explanation: Goods leaving as charity are an expense; debit Charity A/c and credit Purchases A/c.
Question 3 of 10
A student debits 'Purchases A/c' when the firm buys a delivery van for its own use. This is wrong because:
A van for own use is a fixed asset, not goods for resale
Vans are never recorded
It should be credited
Purchases must always be cash
Explanation: Only goods meant for resale go to Purchases; an asset for use goes to its own account (Van A/c).
Question 4 of 10
Why do total debits always equal total credits in every journal entry?
Because of the dual aspect concept
Because of inflation
Because of the bank
It is a coincidence
Explanation: Each transaction has two equal aspects (dual aspect), so debits must equal credits.
Question 5 of 10
Received Rs 5,000 from Gita, allowed her Rs 100 discount. The entry is:
Cash A/c Dr 5,000; Discount Allowed A/c Dr 100; To Gita A/c 5,100
Gita A/c Dr 5,100; To Cash A/c 5,000
Cash A/c Dr 5,100; To Gita A/c 5,100
Discount A/c Dr 100; To Cash A/c 100
Explanation: Cash in 5,000 and discount allowed 100 (an expense, Dr) together clear Gita's 5,100.
Question 6 of 10
Using the modern rule, salary outstanding (unpaid) at year-end increases an expense AND creates a liability. The entry is:
Salary A/c Dr; To Outstanding Salary A/c
Outstanding Salary A/c Dr; To Salary A/c
Cash A/c Dr; To Salary A/c
Salary A/c Dr; To Cash A/c
Explanation: Expense increases (Dr Salary) and a liability is created (Cr Outstanding Salary).
Question 7 of 10
Which is a personal account in disguise?
Outstanding Rent A/c (a representative personal account)
Rent A/c
Cash A/c
Salary A/c
Explanation: Outstanding/prepaid accounts represent persons, so they are representative personal accounts.
Question 8 of 10
Sold goods to Ravi for Rs 8,000 on credit. The correct entry is:
Ravi A/c Dr 8,000; To Sales A/c 8,000
Sales A/c Dr 8,000; To Ravi A/c 8,000
Cash A/c Dr 8,000; To Sales A/c 8,000
Ravi A/c Dr 8,000; To Cash A/c 8,000
Explanation: Ravi (receiver/debtor) is debited; Sales (income) is credited; no cash yet (credit sale).
Question 9 of 10
An opening entry shows assets Rs 80,000 and liabilities Rs 30,000. The capital credited will be:
Rs 50,000
Rs 1,10,000
Rs 30,000
Rs 80,000
Explanation: Capital is the balancing figure = assets − liabilities = 80,000 − 30,000 = 50,000.
Question 10 of 10
The proprietor takes goods (cost Rs 3,000) for personal use. The entry is:
Drawings A/c Dr 3,000; To Purchases A/c 3,000
Drawings A/c Dr 3,000; To Sales A/c 3,000
Purchases A/c Dr 3,000; To Drawings A/c 3,000
Cash A/c Dr 3,000; To Drawings A/c 3,000
Explanation: Goods taken for personal use are drawings; reduce purchases (goods leaving the business at cost).