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Management Sciences 5307 MCQs [All-Courses]

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Management Sciences focuses on the planning, organizing, leading, and controlling of resources to achieve organizational goals.This subject is highly important for competitive exams, academic study, and professional careers in the business and public sectors.

All Topics  5307

Which one of the following should be considered a revenue expenditure?
A 1000 paid for the execution of a new plant
B Loss of 10,000 incurred in increasing the sitting accommodation of a hotel
C Damage paid on account of breach of a contract to supply certain goods
D Repair to machinery purchased, second hand.
Correct Answer: Damage paid on account of breach of a contract to supply certain goods
The balance of which of the following accounts do not disappear, once they are debited/credited to Trading Account?
A Sales
B Purchases
C Inward returns
D Closing stock
Correct Answer: Closing stock
Which of the following is an item of capital expenditure?
A Research and development costs during the year
B Interest on borrowed fund utilized for acquisition of Office Furniture
C Installation charges paid in conjunction with the purchase of Office Equipment
D Monthly rent of a machinery used in the business
Correct Answer: Installation charges paid in conjunction with the purchase of Office Equipment
Any donation received for a specific purpose is a_________?
A Liability
B Assets
C Revenue receipts
D Capital receipts
Correct Answer: Capital receipts
Which of the following is not a deferred revenue expenditure?
A Expenses in connection with issue of equity shares
B Preoperative expenses
C Heavy advertising expenses to introduce a new product
D Legal expenses incurred in defending a suit for breach of contract to supply goods
Correct Answer: Legal expenses incurred in defending a suit for breach of contract to supply goods
Capital expenditure is an expenditure which
A Benefits the current accounting period
B Will benefit the next accounting period
C Results in the acquisition of a permanent asset
D Results in the acquisition of a current asset
Correct Answer: Results in the acquisition of a permanent asset
Which of the following should not be treated as revenue expenditure?
A Interest on loans and debentures
B Annual fire insurance premiums on Plant and Equipment
C Sales tax paid in connection with the purchase of office equipment
D Small expenditures on long- lived assets, such as ` 20 for a paper weight.
Correct Answer: Sales tax paid in connection with the purchase of office equipment
Which of the following errors affects the agreement of a Trial Balance?
A Mistake in balancing an account
B Omitting to record a transaction entirely in the subsidiary books
C Recording of a wrong entry in the subsidiary books
D Posting an entry on the correct side but in the wrong account
Correct Answer: Mistake in balancing an account
The accountant of Leo Ltd. recorded a payment by cheque to a creditor for supply of materials as 1,340.56. The bank recorded the cheque at its correct amount of 3,140.56. The Company has not passed any rectification entries and the error is not detected through the bank reconciliation. The impact of this error is
A The Trial Balance will not agree
B The balance of creditors is understated
C The purchases are understated
D The favorable bank balance as per Pass Book is less than the Bank balance as per Cash book
Correct Answer: The favorable bank balance as per Pass Book is less than the Bank balance as per Cash book
The beginnings inventory of the current year is overstated by 5,000 and closing inventory is overstated by 12,000. These errors will cause the net income for the current year by
A 17,000 (overstated.
B 12,000 (understated.
C 7,000 (overstated.
D 7,000 (understated.
Correct Answer: 7,000 (overstated.
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