Accounting for business transaction MCQs with answers

Accounting MCQs: In this blog post, we have written Accounting for business transaction MCQs and Journal MCQs. Answers are provided for all the MCQs.

The MCQs on “Accounting for the business transaction” and “Journal entries” are important for all commerce students.

Accounting for business transaction MCQs

1. ——————— accounting system is the combination of both cash as well as on credit.

 Cash basis

 Credit system

 Hybrid System

 None of the above

2. Increase in Asset is




 None of the above

3. Increase in Liabilities is




 None of the above

4. Which is not the features of Accounting Vouchers?

 It is a written document.

 It is prepared by labour.

 It is prepared on the basis of evidence of the transaction.

 It contains an analysis of a transaction.

5. Which is not the business transaction.

 X commences the business with cash Rs. 50,000.

 He purchased goods for cash Rs. 18,000

 He got a gift worth Rs. 7,000 in a family function.

 He deposited cash into bank Rs. 20,000

6. Which is the business transaction?

 Suresh sold goods for cash Rs.30,000

 X paid house tax for his own house

 A deposited into bank Rs. 6,000 as school fee for his children

 He purchased house hold goods worth Rs. 8,000

7. The terms of an accounting equations can be presented as under;

 Assets = Liabilities – Capital

 Capital= Assets – Liabilities

 Assets =  Capital + Liabilities

 Liabilities=  Assets  – Capital

8. The fundamental rule for recording changes in Assets/Expenses/Losses is

 Increase in liabilities is credited and decrease in liabilities is debited.

 Increase in Assets is debited and decrease in Assets is Credited.

 Increase in capital is credited and decrease in capital is debited.

 Increase in expenses/losses is credited and decrease in expenses/losses is debited.

MCQs on Journal Entries

9. Depreciation reduces the value of —————————-




 None of the above

10. No entry is made for  ————– discount in the Journal.




 None of the above

11. Accrued Income is —————– in the Journal




 None of the above

12. A combination of two or more simple Journal entries is known as

 Single Entry

 Double Entry

Compound Entry

 Ledger Entry

13. Drawings _____________ the amount of Capital




 None of these

14. Another name for Journal is

Book of original records



 Cash records

15. Which is not the column of a Journal?


 Ledger Folio

Journal Folio


16. Brief explanation of a journal entry is known as





17. Which is not the compound entries?

 Discount allowed

 Bad debt

 Discount received


MCQs on Ledger

18. The page number of the journal is entered in the ———————– column in the ledger account.

 L F

 J F


 None of these

19. Ledger is known as ——————-

Primary Book

 Secondary Book

 Cash Book

 Sales Book

20. The Revenue and expense accounts are closed by taking the balances to —————————–


 Trading and Profit loss A/c

 Balance sheet

 Trial Balance

21. Assets ledger does not contain:

 Capital account

 Machinery account

 Building account

 Furniture account

22. Revenue ledger contains

 Building account

 Loan account

 Sales account

 Bank overdraft account

23. _____________ contains rent paid, wages paid, electricity charges etc.

Creditors ledger

 General ledger

Debtors ledger

Expenses ledger

24. Name of the account in the journal is entered in _________ column of the relevant account in the ledger.





25. The balance of an account is written on the side having ______ total, so that its total becomes equal to the total of other side.




 None of the above

26. The balance of _________ accounts are debit balances.




 None of the above

27. Which of the following columns does a ledger have-




All of the above

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