A partnership is formed by

• A. two or more individuals
• B. only one person
• C. two individuals only
• D. two or more companies

Departmental accounts re maintained to ascertain the

• A. profits of the entire organization
• B. contribution of each department
• C. expenses of each department
• D. sales of each department

When goods produced are transferred at cost plus mark-up sale, the difference between the cost and the transferred price is a

• A. discount
• B. sales commission
• C. manufacturing profit
• D. factory reserves

A major cause of discrepancy between the bank statement and the cashbook that overstates the bank statement balance is the

• A. commission paid
• B. interest received
• C. direct withdrawal
• D. direct payment

The LIFO method has an advantage over FIFO in that stocks are valued at

• A. previous prices
• B. current prices
• C. average rates
• D. flat rates

The term posting in accounting refers to

• A) recording entries in the journal
• B) transferring the balances in the ledger to the trial balance
• C) tracing amounts from the journal to the ledger to find errors
• D) transferring entries to the ledger from the journal

In the head office ledger, the value of goods sent to the branch are

• A. debited to the head office current account
• B. debited to the branch current account
• C. credited to the head office current account
• D. credited to the branch current account

The correct expression of accounting equation is

• A. Assets = Liabilities + Equity
• B. Net assets = Liabilities + Equity
• C. Assets + Liabilities = Equity
• D. Assets = Equity - liabilities

Which of the following transaction is BEST recorded in the general journal?

• A. Payment of rent with cheque
• B. Purchase of stock with cash
• C. Purchase of an asset on credit terms
• D. Transfer of cash from head office branch

Debentures can be redeemed out of?

• A. existing share capital reserve
• B. existing general reserve
• C. proceeds from new issue of shares
• D. withholding tax