1421. Every business concern ascertains profit or loss of the business at the end of year through:
A. Journal
B. Ledger
C. Finan account *
D. Bills of exchange
1422. The system of accounting, in which accounting entries are made only when cash received or paid is known as :
A. Cash system of accounting *
B. Accrual system of accounting
C. Mercantile system of accounting
D. None of these
1423. The accounting system , in which accounting entries are made on the basis of amount having become due for payment or receipt, is known as :
A. Cash system of accounting
B. Accrual or mercantile system of account *
C. Current account period
D. Outstanding system
1424. It is said to be the act of making a correct record of a transaction that has not been entered or was entered incorrectly or incompletely:
A. A transaction
B. On entry
C. A reversed entry
D. An adjustment *
1425. The expense incurred but have not been actually paid til the end of the current accounting year , is known as :
A. Prepaid expenses
B. Un-expired expenses
C. Accrued outstanding expenses *
D. Unearned revenue
1426. Which of the following correct adjusting entry is to be passed for outstanding expenses :
A. Outstanding expenses account XX Dr to expense account XX
B. Prepaid expenses account XX to expenses account XX
C. Expenses account XX Dr *
D. Expenses account XXX to prepaid expenses account XX
1427. Expenses paid in advance before the have fallen due are called :
A. Prepaid expenses *
B. Outstanding expenses
C. Accrued expenses
D. Expenses payable
1428. Which of the following correct adjusting entry is to be passed for prepaid expenses :
A. Prepaid expenses account XX Dr to expenses account XX Cr *
B. Expenses account XX Cr prepaid expenses account XX
C. Expenses account XX to accrued expenses account XX
D. Expenses account XX to outstanding expenses XX
1429. A prepaid expense is :
A. A liability
B. An asset
C. An income *
D. A management expense
1430. A revenue which have earned or which has become due in the current year but not been received in cash within the current year, is known as :
A. Accrued expenses
B. Prepaid expenses
C. Unearned revenue
D. Accrued income *