MCQs for Class 12 Accountancy with Answers

Read MCQ Questions for Class 12 Accountancy PDF available for all important topics in PDF based on latest academic session and CBSE and NCERT syllabus, examination and expected question paper pattern. The multiple choice questions provided here for Accounts class 12 have been prepared based on the latest syllabus and examination pattern issued for the current academic year by CBSE, NCERT and KVS, our team of expert teachers have designed the MCQs for benefit of all Class 12 students.

Accountancy Class 12 MCQ Questions Chapter wise based on NCERT

Students can click on the chapter wise links below to access free multiple choice questions for standard 12 Accountancy. These Class 12th Accountancy objective questions and answers will help you to thoroughly revise the entire course as given in NCERT and will help you to get good marks in upcoming examinations

Chapter Wise Class 12 Accountancy Multiple Choice Questions

Part 1

Chapter 1 Accounting For Not For Profit Organisation

Chapter 2 Accounting for Partnership Firms – Basic Concepts

Chapter 3 Reconstitution Of A Partnership Firm – Admission Of A Partner

Chapter 4 Reconstitution Of A Partnership Firm – Retirement/Death Of A Partner

Chapter 5 Dissolution Of Partnership Firm

Part 2

Chapter 1 Accounting for Share Capital

Chapter 2 Issue and Redemption of Debentures

Chapter 3 Financial Statements of a Company

Chapter 4 Analysis of Financial Statements

Chapter 5 Accounting Ratios

Chapter 6 Cash Flow Statement

Our teachers have developed really good Multiple Choice Questions covering all important topics in each chapter which are expected to come in upcoming tests and exams, as MCQs are coming in all exams now therefore practice them carefully to get full understanding of topics and get good marks. Download latest questions with multiple choice answers for Class 12 Accountancy in pdf or read online for free.

The above NCERT based MCQs for Class 12 Accountancy have been designed by our teachers in such a way that it will help you a lot to gain understanding of each topic. These CBSE NCERT Class 12 Accountancy Multiple Choice Questions have been developed and are available free for benefit of Class 12 students.

Advantages of MCQ Questions for Class 12 Accountancy

a) MCQs will help the kids to strengthen concepts and improve marks in tests and exams.

b) Multiple Choice Questions for Accountancy Class 12 have proven to further enhance the understanding and question solving skills.

c) Regular reading topic wise questions with choices will for sure develop very good hold over each chapter which will help in exam preparations.

d) It will be easy to revise all Accountancy chapters and faster revisions prior to class tests and exams.

Free Printable MCQs in PDF of CBSE Class 12 Accountancy are designed by our school teachers and provide best study material as per CBSE NCERT standards.

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Solved Objective Questions Class 12 Accountancy

Question. There are three partners in a firm P & Q. R is admitted in the firm for 1/3rd share of profit with the guaranteed annual profit of Rs. 18,000 p.a. The firm’s total profit for the ear is Rs. 42,000. If A stood as guarantor of guaranteed profit to R, how much profit would be given to Q
(a) Rs. 20,000
(b) Rs. 15,000
(c) Rs. 10,000
(d) Rs. 18,000 

Question. A and B are partners sharing profits in the ratio 2 : 1. They decided to share future profit in the ratio 3 : 2. If the goodwill of the firm is valued at Rs. 1,80,000, how the adjustment in the profit will be affected?
(a) B pays A Rs. 12,000
(b) A pays B Rs. 12,000
(c) A pays B Rs. 18,000
(d) B pays A Rs. 18,000 

Question. The amount set aside for redeeming debentures out of profits available for payment of dividend is termed:
(a) General Reserve
(b) Security Premium Reserve
(c) Debenture Redemption Reserve
(d) Capital Redemption Reserve

Question. Average net profit of Anjara Depot expected in future is Rs. 54,000 per year. Average Capital Employed in the business is Rs. 3,00,000. Normal Profit expected from Capital invested in this class of business is 10%.Management Cost is estimated to be Rs. 9,000 p.a. Determine the value of goodwill on the basis of two years’ purchase of super profit.
a) Rs. 60,000
b) Rs. 90,000
c) Rs. 30,000 
d) Rs. 45,000

Question. Amount is not set aside to Debenture Redemption Reserve (DRR) on
(a) Fully Convertible Debenture
(b) Non-Convertible Debenture
(c) Secured Debentures
(d) Irredeemable Debenture

Question. The excess of Purchase Consideration over net assets is debited to
(a) Goodwill A/c
(b) Capital Reserve A/c
(c) General Reserve A/c
(d) Reserve Capital A/c

Question. Favourable attributes or factors on which goodwill of a firm depends will not include:
(a) Customer’s attitude
(b) Turnover of the business
(c) Desirable location
(d) Absence of competition

Question. In the absence of agreement, partners are entitled to:
(a) Salary
(b) Commission
(c) Interest on Capital
(d) Interest on Loan to the firm @ 6% p.a.

Question. Under Premium Method, share of goodwill brought in cash by the new partner is shared among the old partners:
(a) Equally
(b) In their Sacrificing Ratio
(c) In their new Ratio
(d) In their Capital Ratio

Question. X and Y are partners sharing profits equally. X draws Rs. 2,000 at the end of each month for 6 months. If interest on drawings is to be charged @ 6% p.a. What will be the interest on drawings of X?
(a) Rs. 150
(b) Rs. 160
(c) Rs. 170
(d) Rs. 155

Question. Sleeping Partners are those who:
(a) Take active part in the conduct of the business but provide no capital. However, Salary is paid to them.
(b) Do not take any part in the conduct of the business but provide capital and share profits and losses in the agreed ratio.
(c) Take active part in the conduct of the business but provide no capital. However, Share Profits and Losses in the agreed ratio.
(d) Do not take any part in the conduct of the business and contribute no capital. However, share profits and losses in the agreed ratio.

Question. Maximum Number of partners in a partnership firm can be:
(a) Two
(b) Ten
(c) One Hundred
(d) Fifty

Question. Sangeeta and Ankita are partners in a firm. Sangeeta’s Capital is Rs. 70,000 and Ankita’s Capital is Rs. 50,000. Firm’s Profit is Rs. 60,000. Ankita’s Share in profit will be:
(a) Rs. 25,000
(b) Rs. 30,000
(c) Rs. 35,000
(d) Rs. 20,000.

Question. Normal Profit for Goodwill Valuation is calculated:
(a) By deducting abnormal gains (profit)
(b) By adding abnormal losses
(c) By deducting abnormal gains and adding abnormal losses
(d) By adding Depreciation

Question. The formula for Capitalisation of Super Profit Method is:
(a) Super Profit X Number of Year’s Purchase
(b) Super Profit X 100/Normal Rate of Return
(c) (Super Profit – Normal Profit) X 100 / Number Rate of Return
(d) Super Profit X 100/Number of Years’ Purchase

Question. The amount set aside for redeeming the debentures out of profits available for payment of dividend is termed as:
(a) General Reserve.
(b) Security Premium Reserve.
(c) Debenture Redemption Reserve.

Question. ‘Discount received on making payment to suppliers’ results in:
(a) Inflow of Cash and Cash Equivalents.
(b) Outflow of Cash and Cash Equivalents.
(c) No Flow of Cash and Cash Equivalents.
(d) Both inflow and outflow of Cash and Cash Equivalents.

Question. Example of Investing Activity both for ‘Financial’ and ‘Non-Financial’ Companies:
(a) Purchase of Non-Current Assets.
(b) Purchase of Stock.
(c) Transfer to General Reserve.
(d) Purchase of Current Asset.

Question. Receipts and Payments Account is summary of:
(a) Day to day cash transactions.
(b) Summary of cash transactions.
(c) Credit transactions.
(d) Both Cash and Credit transactions.

Question. X contributes Rs. 2,00,000 for his 1/4th share then the total capital of the firm will be:
(a) Rs. 6,50,000.
(b) Rs. 5,62,500.
(c) Rs. 8,00,000.
(d) Rs. 10,00,000.

Question. Which of the following statement is true?
(a) A minor cannot be admitted as a partner.
(b) A minor can be admitted as a partner, only for the benefits of the partnership.
(c) A minor cannot be a sleeping partner.
(d) A minor can be admitted as a partner but his rights and liabilities are same of adult partner.

Question. The formula for Capitalisation of Super Profit Method is:
(a) Super Profit X Number of Year’s Purchase
(b) Super Profit X 100/Normal Rate of Return
(c) (Super Profit – Normal Profit) X 100 / Number Rate of Return
(d) Super Profit X 100/Number of Years’ Purchase

Question. In the absence of agreement, partners are entitled to:
(a) Salary
(b) Commission
(c) Interest on Capital
(d) Interest on Loan to the firm @ 6% p.a.

Fill in the blanks: 

Question. In case of admission of a partner, the entry for unrecorded investment is ________.

Question. If the capital account of a partner shows a debit balance at the time of final settlement then he will bring _____ equal to the debit balance.

Question. Capital + Reserves – Fictitious Assets – Non-trade investments = ____.

Question. If debentures are redeemed without setting aside amount to Debenture Redemption Reserve (DRR), it is redemption out of _____.

Question. Amount earlier written off as bad debt now received is transferred to Revaluation Account in the ______.

Question. Comparative Statement is ______ analysis.

Question. It is necessary that the firm should do only business that is ______.

Question. For the firm, interest on drawings is an ______.

Question. If a fixed amount is withdrawn by a partner on the first day of every month for one year, interest on the total amount is charged for ____ months.

Question. Common Size Financial Statements are _____ analysis of financial statements.

Question. Share Capital that a Company decides to call at the time of winding up is termed as ______.

Question. Discount or Loss on Issue of debentures is a ______ loss.

Question. Remuneration is paid to partners only if the _______ allows it to be paid.

Question. Total Profit of the year is apportioned between the periods of pre-death and post-death on the basis of turnover by applying _______.

Question. Goodwill is recognised in the books of account only when consideration in ______ or _______ has been paid for it.

Question. If a Company has Reserve Capital, such shares, in the Notes to Account on Share Capital, are shown as______.

Question. Statement prepared for comparing assets, equity and liabilities for two or more accounting periods is called _______.

Question. Interest on Loan taken by a partner is _____ to Profit and Loss Account.

Question. Smaller number of shares are allotted to each applicant according to the number of shares applied by him. This is called ________.

Question. A, B and C are partners sharing profits in the ratio of 1/4 : 3/10: 9/20. New profit sharing ratio on retirement of C will be ______.

Question. In case of _______ allotment is made to all the applicants.

Question. Discount or Loss on Issue of debentures is a ______ loss.

Question. Goodwill is recognised in the books of account only when consideration in ______ or _______ has been paid for it.

True/False :

Question. At the time of admission, General Reserve is transferred to Capital Accounts of the partners in old profit sharing ratio.

Question. Debentures by a Banking Company can be redeemed out of capital. 

Question. General Reserve can be transferred to Debenture Redemption Reserve.

Question. Weighted Average Method of calculating goodwill is useful when Profits are similar in all the years. 

Question. Goodwill is valued only at the time of change in profit sharing ratio.

Question. At the time of admission of a Partner, Gain (Profits) or Losses arising on the revaluation of assets and reassessment of liabilities is transferred to old Partners’ Capital Account in their old profit sharing Ratio.

Question. Ram and Shyam share profits and losses in the ratio of 4 : 3. They admit Mohan in the firm for 3/7th share which he gets 2/7th from Ram and 1/7th from Shyam. The new profit sharing ratio will be 2 : 2 : 3.

Question. Loan by a partner to the firm is an outside liability. 

Question. All liabilities except Partner’s Capital Accounts are transferred to Realisation Account.

Question. Dissolution of Partnership Firm means Relationship among the Partners come to an end.

Question. Raju a partner was to bear realisation expenses, for which he was to be given Rs. 40,000. Raju paid Rs. 50,000 as Realisation Expenses. Realisation Account will be debited by Rs. 50,000.

Question. Debenture holders have a right to vote in the event they are not paid interest.

Question. Debenture issued at Par means Debenture issued at a nominal (face) value. 

Question. According to the Partnership Act, 1932 (Sec. 37), interest payable to the deceased partner on the amount left by him will be @ 6%.

Question. Debentures can be issued at par, premium or discount. 

Question. If firm’s assets are inadequate to meet firm’s debts, private assets of the partners are applied to meet firm’s debts. 

Question. Raju a partner was to bear realisation expenses for which he has paid Rs. 40,000. Raju paid Rs. 50,000 as Realisation Expenses. Realisation Account will be debited by Rs. 50,000.

Question. Surplus or Deficit of a Not-for-Profit Organisation is transferred to Capital A/c. 

Question. M Ltd. purchased a machinery of Rs. 12,00,000 by paying cash of Rs. 3,00,000 and issue of shares at premium for Rs. 9,00,000. In the Cash Flow Statement, the transaction will be shown as outflow under investing activity Rs. 12,00,000.

Question. Shares issued to promotors of a company is not a flow of Cash. 

Question. Voluntary Retirement Compensation paid to employees is an operating activity.

Question. Debenture holders have a right to vote in the event they are not paid interest.

Question. Debentures can be issued at par, premium or discount.