# MCQ Questions for Class 12 Accountancy

Please refer to MCQ Questions for Class 12 Accountancy with answers provided below for all subjects. The following subject-wise multiple-choice questions with solutions have been designed for all chapters in Accountancy in standard 12. All objective questions have been designed based on the latest syllabus and examination guidelines issued by CBSE, NCERT, and KVS.

## MCQ Questions with Answers for Accountancy Class 12

Please click on the subject-wise links below to access free multiple-choice questions for Accountancy in Class 12. These MCQs are expected to come in standard 12th examinations. Students should learn all these MCQ with answers to score better marks in examinations. Our expert faculty has designed these important questions and answers based on NCERT books for Class 12 Accountancy issued for the current academic year.

### Subjectwise MCQ with Answers for Class 12 Accountancy

Question. Cash Flow Statement is based on
a) Accrual basis of Accounting
b) Cash basis of Accounting
c) Mixed basis of Accounting
d) Accounting Equation

B

Question. Quick Assets = ?
a) Current Assets – Prepaid Expenses
b) Current Assets – Inventory – Prepaid Expenses
c) Current Assets + Inventory – Prepaid Expenses
d) Current Assets – Inventory + Prepaid Expenses

B

Question. Partners Loan Account is:-
a) Personal Account
b) Real Account
c) Nominal Account
d) Expense Account

A

Question. A, B and C were partners sharing profits in the ratio of 4 : 5 : 3, C retired and continuing partners decided to share future profits in the ratio of 7:8. Gaining ratio will be:
a) 8 : 7
b) 4 : 5
c) 1 : 1
d) 2 : 1

A

Question. X is admitted into the partnership for 1/4th share. Total capital of the firm is Rs. 4,50,000, the amount that X will bring in
a) Rs. 1,50,000
b) Rs. 1,20,000
c) Rs. 1,12,500
d) Rs. 1,00,000

B

Question. Interest on Partner’s Capital Accounts is credited to:
a) Partners’ Capital Accounts
b) Revaluation Account
c) Interest Account
d) Goodwill Account

A

Question. Profit earned over the last 5 years are as follows: Rs.60,000; Rs.65,000 Rs.70,000 Rs.90,000 and Rs. 10,000 (loss). Based on 2 years purchase of the last 5 years profits, value of Goodwill will be:
a) Rs.23,600
b) Rs.22,000
c) Rs.1,10,000
d) Rs.1,18,000

C

Question. Neha and Nisha shared Profits and Losses in the ratio of 5:4. With effect from 1st April, 2019 they decided to share profits equally. The goodwill of the firm was valued at Rs.36,000. The necessary single adjustment entry will be:
a) Dr. Nisha’s Capital A/c and Cr. Neha’s
Capital A/c with Rs.2,000
b) Dr. Neha’s Capital A/c and Cr. Nisha’s
Capital A/c with Rs.2,000
c) Dr. Neha’s Capital A/c and Cr. Nisha’s
Capital A/c with Rs.200
d) Dr. Nisha’s Capital A/c and Cr. Neha’s
Capital A/c with Rs.200

A

Question. X and Y are partners sharing profits and losses in the ratio 3 : 2, Z was admitted for the 1/5th share he brings Rs. 150,000, as his capital. If capitals are to be proportionate to profit – sharing ratio, the respective capitals of the partners will be:
a) Rs. 3,00,000 : 3,00,000 : 1,50,000
b) Rs. 3,60,000 : 2,40,000 : 1,50,000
c) Rs. 1,50,000 : 1,50,000 : 1,50,000
d) Rs. 1,50,000 : 2,00,000 : 4,00,000

B

Question. A NPO has following information: Prize Fund (Opening) – Rs. 50,000, Donations received during the year Rs. 40,000 and Prizes awarded during the year Rs. 1,00,000. Identify which of the following statement is correct with respect to preparation of Balance Sheet.
a) Prizes awarded of Rs. 1,00,000 will be shown in Income and Expenditure Account while Rs. 90,000 will be shown in the Liabilities side of the Balance Sheet.
b) Rs. 1,00,000 (Prize Awarded) will be shown as expense in the debit of Income and Expenditure Account while Rs. 90,000 will be shown as income in the credit of Income and Expenditure Account.
c) Rs. 10,000 (Rs. 1,00,000 – Rs. 90,000) will be transferred to General Fund in the Balance Sheet.
d) Prizes awarded (Rs. 1,00,000) is more than the Prize Fund (Rs. 90,000), the difference (Rs. 10,000) will be shown in the debit of Income and Expenditure

D

Question. If Revenue from Operations for current year is Rs. 10,00,000 and proportionate increase is 25%, Revenue from Operations of the previous year?
a) Rs. 9,00,000
b) Rs. 6,00,000
c) Rs. 8,00,000
d) Rs. 7,00,000

C

Question. The statement that shows percentage of items of profitability of a firm of the same period to a common base is called:-
a) Comparative Statement of Profit and Loss.
b) Comparative Balance Sheet.
c) Common Size Statement of Profit and Loss.
d) Common Size Balance Sheet.

C

Question. B and C were partners sharing profits in the ratio 2 : 2 : 1, having capital accounts as Rs. 50,000, Rs. 50,000 and Rs. 25,000, respectively. B retired. On that date, balance in General Reserve was Rs. 15,000. If firm’s Goodwill is valued at Rs. 30,000 and Gain (profit) on Revaluation is Rs. 7,050, amount payable to B will be:
a) Rs. 50,820
b) Rs. 70,820
c) Rs. 8,820
d) Rs. 9,000

B

Question. A and B are partners sharing in the ratio 2 : 1. They decided to share in the ratio 3 : 2 in future. If the goodwill of the firm is valued at Rs. 60,000, how the adjustment in the profit will be affected?
a) B pays A Rs. 4,000
b) A pays B Rs. 4,000
c) A pays B Rs. 6,000
d) B pays A Rs. 6,000

A

Question. X is admitted into the partnership for 1/4th share. Total capital of the firm is Rs. 4,50,000, the amount that X will bring in
a) Rs. 1,50,000
b) Rs. 1,20,000
c) Rs. 1,12,500
d) Rs. 1,00,000

A

Question. The term Financial Analysis includes:
a) Analysis.
b) Interpretation.
c) Both analysis and interpretation.
d) Preparation of financial statements.

C

Question. On Dissolution Goodwill Account is transferred to:-
a) Credit side of Bank Account.
b) Debit side of Partners’ Capital Account
c) Debit side of Realisation Account
d) Credit side of Realisation Account

C

Question. A, B and C were partners sharing profits in the ratio 3 : 2 : 1. C retired, if A and B take share of retiring partner equally, New profit – sharing ratio will be:
a) 7 : 5
b) 3 : 2
c) 1 : 1
d) 2 : 1

A

Question. A member from whom Rs. 10,000 was due as subscription, resigned and did not pay the dues. Journal entry for writing off subscription will be:
a) Subscription written-off A/c ….Dr. 10,000
To Subscription A/c 10,000
b) Subscription A/c …Dr. 10,000
To Subscription written off A/c 10,000
c) Outstanding Subscription A/c …Dr. 10,000
To Subscription written off 10,000
d) Subscription Written Off A/c …Dr. 10,000
To Outstanding Subscription A/c 10,000

D

Question. Choose the correct option from the following statements:
Statement I – Suppliers of long-term funds are concerned with firm’s longterm solvency
Statement II – Investors are interested about the credit worthiness of the firm.
a) Only Statement II is true
b) Only Statement I is true
c) Both Statements are true
d) Both Statements are false

B

True / False :

Question. Increase in the value of assets and unrecorded assets being recorded at the time of retirement or death of a partner is debited to Revaluation Account.

False

Question. A is drawing Rs.1,000 p.m. on the last day of every month. If the rate of interest is 5% p.a. then the total interest chargeable from him in the accounting year ending on March 31, 2020 will be Rs. Rs. 275.

True

Question. Revaluation Account is debited to transfer gain(profit) on Revaluation to old Partners’ Capital Accounts in their old profit sharing ratio.

True

Question. Notes to Accounts is not a technique of financial analysis.

True

Question. Dissolution of Partnership is different from Dissolution of partnership Firm.

True

Question. Decrease in the value of assets at the time of retirement of a partner is credited to Revaluation Account.

False

Question. Billiard Match Expenses of Rs. 50,000 incurred by a NPO will be shown in Liabilities side of Balance Sheet.

False

Question. In preparing Comparative Financial Statements, percentage change is based on current year values.

False

Question. The court can order the Dissolution of a Partnership Firm, if any of the partners becomes a person of unsound mind.

True

Question. The amount due to deceased partner is paid to his executor.

True

Question. Subscription received in advance during the current year is shown as a/an Income.

False

Question. If creditors are ₹ 20,000, loan (credit) is ₹ 10,000, capital is of ₹ 1,50,000 and cash balance is ₹ 30,000, remaining assets will be ₹ 1,80,000.

False

Question. A, B and C are three partners B retires from the firm, on the date of retirement Stock Rs. 50,000. The partners decided to reduce of stock to 90%. The entry passed will be stock Stock A/c …Dr. Rs. 5,000 To Revaluation A/c Rs. 5,000.

False

Question. Cash Balance in Receipts and Payments account will show Debit or Nil balance.

True

Question. X & Y are partners sharing profits equally. Y draws Rs. 1,000 at the beginning of each month for six months.

True

Question. Gain on forfeited shares that have been reissued is transferred to Capital Reserve.

True

Question. At the time of retirement of a partner, gain (profit) on revaluation is credited to capital Account of all partners in the old profit – sharing ratio.

True

Question. Deprecation is a non-cash item and this is added back to the net profit.

True

Question. The Current Ratio of a Company is 2 : 1. Bills Payable Rs. 5,000 discharged will result in increase in Current Ratio.

True

Question. Large Customer base results in higher valuation of Goodwill.

True

Fill in the Blank :

Question. A , B and C were partners, B retired from the firm. On the date of his retirement Stock, Sundry Debtors and Provisions for Doubtful Debts were Rs.50,000, Rs.45,000 and Rs.4,500 respectively. The partners decided to reduce the value of stock to 90%. The journal entry passed will be ………….. Dr. Rs. 5,000 To ……………. Rs.5,000 .

Revaluation A/c, Stock A/c

Question. A and B are partners sharing profits in the ratio of 7 : 3. C is admitted for 3/7th share in profits. If the new profit sharing ratio is 14 : 6 : 5, sacrificing ratio will be _____.

7 : 3

Question. In the event of death of a partner, the amount of General Reserve is transferred to Partners’ Capital Account, including deceased partner, in their ___ because it was set aside out of profits when ______ was also a partner.

Old profit – sharing ratio, deceased partner

Question. On the death of partner, the amount due to him will be credited to ______.

His Executor’s Account.

Question. Amount paid by a person at the time of becoming a member of a Not-for-Profit Organisation is ______.

Entrance Fees

Question. On liability being paid by a partner on dissolution of the firm, , his ____ will be credited and _______will be debited.

Capital Account, Realisation Account

Question. Retiring partner is compensated for foregoing his share in future profits in favour of remaining partners or continuing partners. The compensation so paid is _____.

Gaining Ratio

Question. At the time of admission of a partner the balance of Profit and Loss Account is transferred to the capital account of _____ in their _____ ratio.

Old Partners, Old Profit-Sharing Ratio

Question. Partner’s Loan Account is not transferred to Realisation on _____.

dissolution

Question. If profit-sharing ratio changes and market value of investment is more than Book value, Investment Fluctuation Reserve appearing in the Balance Sheet is transferred to _____ of partners in their old profit sharing ratio.

Capital Account

Question. If there is no partnership deed or agreement the provisions of the ____ are applicable.

Partnership Act, 1932

Question. Government Grant, Endowment Fund, Annuity Fund, Sports Fund are examples of ______Fund.

Restricted

Question. Manager’s commission is a _______ against profit.

charge

Question. A, B and C were partners sharing profits in the ratio of 2 : 2 : 1 respectively having Capital Accounts as Rs.50,000, Rs.50,000 and Rs.25,000 respectively. B retired from the firm and balance in General Reserve on that date was Rs.15,000. If the goodwill of the firm was valued at Rs.30,000, Profit on Revaluation was Rs.7,050. The amount payable to B will be______.

Rs.70,820

Question. When the shares are issued at a price more that face value it is shares issued at ___.

Question. Capital invested in a firm is Rs. 5,00,000. Normal Rate of Return is 10%. Average profits of the firm are Rs. 64,000 (after abnormal loss of Rs. 4,000). Value of Goodwill at four years purchase of Super Profits will be _____.

Rs. 72,000

Question. Amount transferred to General Reserve will be affecting ____ Activity of Cash Flow Statement.

Operating

Question. Income and Expenditure Account is based on ______ Basis of Accounting.

Accrual

Question. Amount received as donation by a NPO under will of a decreased person is termed as ______.

Legacy

Our expert faculty have designed these MCQ questions for all chapters in Class 12 Accountancy and has made sure that all the important topics which can come in Accountancy Grade 12 examinations are covered. All MCQ questions for class 12th have been provided with answers so that you check your understanding. You can download all MCQ questions in Pdf for Accountancy grade 12. All students should learn these objective questions so that they are able to score better rank this year.

Students should also read all notes provided by our teachers so that they are able to learn all concepts which will help them to solve all MCQ easily. The above NCERT based MCQs for Class 12 Accountancy have been developed based on the latest books for the current academic year. Our teachers of Class 12 have done a thorough analysis of current examination guidelines and have designed these questions to help students gain more marks.

a) MCQs will be asked in the upcoming Accountancy examination. By practicing these questions for Accountancy Class 12 you will be able to improve marks in the class tests and exams.

b) Multiple Choice Questions for Accountancy Class 12 have been designed as per the latest examination style to help you understand the exam pattern.

c) You should go through these questions and answers for grade 12th for Accountancy on daily basis to properly understand all topics given in your books.

d) You will be able to download the MCQ questions for Accountancy Class 12 in Pdf so that you can read them later.

Free Printable MCQs in PDF of CBSE Class 12 Accountancy is developed by our expert faculty and provide the best study material as per CBSE NCERT standards.

How can I download MCQs for Accountancy in Class 12 in Pdf?

You can get free MCQs for Accountancy Class 12 from https://www.worksheetsbag.com

How can I get the latest Accountancy MCQs based on the current year’s syllabus?

The MCQs for Class 12 Accountancy have been designed based on the latest examination guidelines and current NCERT textbooks.

How can I get printable MCQs for Accountancy class 12th?

Multiple Choice Questions for Class 12 Accountancy with Answers have been provided in Pdf so that you can download and print them easily.

Have you covered all chapters in my Accountancy textbooks for class 12 issued by NCERT?

MCQs cover all chapters given in Accountancy NCERT Books for Class 12 issued for the current academic year.

Are these free or is there any charge for these MCQs?

No – All MCQs for all subjects are free to read for all students.