Chapter MCQ Test 2 — Ledger
10 Questions • 12 min • Chapter MCQ
12:00
Question 1 of 10
For the entry 'Ram A/c Dr / To Sales A/c', how is the Sales account posted?
Credit side: 'By Ram A/c'
Debit side: 'To Ram A/c'
Credit side: 'By Sales A/c'
Debit side: 'To Sales A/c'
Explanation: Sales was credited, so post on its credit side as 'By Ram A/c' (the other account's name).
Question 2 of 10
A debtor's account shows Dr 12,000 and Cr 12,000. Its balance is:
Nil — the debtor has fully paid
Rs 12,000 debit
Rs 24,000
Rs 12,000 credit
Explanation: Equal sides mean a nil balance — the debt has been settled in full.
Question 3 of 10
Why is the Rent account NOT balanced at year-end but the Cash account is?
Rent is a nominal account, closed to P&L; Cash is real, carried forward
Rent has no entries
Cash is nominal
Both are closed
Explanation: Nominal accounts are transferred to Trading/P&L; real and personal accounts are balanced and carried forward.
Question 4 of 10
An account's debit side totals 75,000 and credit side 90,000. The Balance c/d and its position are:
15,000 on the debit side (a credit balance)
15,000 on the credit side (a debit balance)
1,65,000 on the debit side
No balance
Explanation: Credit side is larger, so a credit balance of 15,000; Balance c/d is written on the smaller (debit) side to equalise.
Question 5 of 10
A capital account always tends to show a credit balance because capital is:
The firm's liability to the owner
An asset
An expense
Drawings
Explanation: Capital is owed to the owner — a liability — so it carries a credit balance.
Question 6 of 10
If the cash payments in a period exceed the cash receipts plus opening cash, it suggests:
An error — cash cannot have a credit balance
A normal credit balance
High profit
Nothing unusual
Explanation: Physical cash can never be negative, so a credit balance in Cash signals a recording error.
Question 7 of 10
Posting the entry 'Drawings A/c Dr / To Cash A/c' affects the ledger as:
Drawings debit side 'To Cash'; Cash credit side 'By Drawings'
Cash debit side 'To Drawings'
Drawings credit side 'By Cash'
No posting needed
Explanation: The debited account (Drawings) gets a debit-side entry; the credited account (Cash) gets a credit-side entry.
Question 8 of 10
Why is the ledger more useful than the journal for answering 'how much does Ram owe?'
It gathers all of Ram's entries in one account and shows his balance
It is written in ink
It is shorter
It ignores Ram
Explanation: The ledger groups all transactions of each account together, so a single balance answers the question.
Question 9 of 10
After balancing, an account shows 'To Balance b/d 8,000' on the debit side. This means the account has:
An opening debit balance of 8,000
A credit balance of 8,000
No balance
Been closed
Explanation: Balance b/d on the debit side is a debit (opening) balance carried into the new period.
Question 10 of 10
A trial balance is prepared AFTER:
All accounts are posted and balanced
Only the journal is written
The balance sheet
The bank statement arrives
Explanation: Balances can only be listed once every account has been posted and balanced.