Ledger Entries-100 MCQs

 

100 MCQs on Ledger Entries

Instructions: Choose the most appropriate answer.

Assumption: Unless otherwise stated, entries are made in the books of the business. GST is ignored.

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1. The main purpose of a Ledger is to:

A. Record transactions chronologically
B. Classify transactions under appropriate accounts
C. Prepare invoices
D. Record only cash transactions

2. A Ledger is commonly known as:

A. Book of Original Entry
B. Principal Book of Accounts
C. Subsidiary Book
D. Memorandum Book

3. The left-hand side of a Ledger account is called:

A. Credit side
B. Debit side
C. Balance side
D. Closing side

4. The right-hand side of a Ledger account is called:

A. Debit side
B. Asset side
C. Credit side
D. Expense side

5. If Cash A/c is debited in the Journal, Cash A/c in the Ledger will be posted on:

A. Credit side
B. Debit side
C. Both sides
D. Balance side

6. If Sales A/c is credited in the Journal, the amount will be posted in Sales A/c on:

A. Debit side
B. Credit side
C. Both sides
D. Neither side

7. Goods purchased for cash ₹20,000. In Purchases A/c, the amount will appear on:

A. Debit side
B. Credit side
C. Both sides
D. Balance column only

8. Goods sold for cash ₹15,000. In Sales A/c, ₹15,000 will be posted on:

A. Debit side
B. Credit side
C. Both sides
D. Neither side

9. Goods purchased from Ram on credit ₹30,000. In Ram's A/c, ₹30,000 will be posted on:

A. Debit side
B. Credit side
C. Both sides
D. Balance side

10. Goods sold to Mohan on credit ₹25,000. In Mohan's A/c, ₹25,000 will be posted on:

A. Debit side
B. Credit side
C. Both sides
D. Neither side

11. Cash received from Ravi ₹12,000. Ravi's A/c will be:

A. Debited ₹12,000
B. Credited ₹12,000
C. Debited ₹24,000
D. Credited ₹24,000

12. Cash paid to creditor Sohan ₹8,000. Sohan's A/c will be:

A. Debited ₹8,000
B. Credited ₹8,000
C. Debited ₹16,000
D. Not posted

13. Salary paid ₹10,000. Salary A/c will be:

A. Debited ₹10,000
B. Credited ₹10,000
C. Debited ₹20,000
D. Not opened

14. Rent received ₹5,000. Rent Received A/c will be:

A. Debited ₹5,000
B. Credited ₹5,000
C. Debited ₹10,000
D. Not posted

15. Furniture purchased for cash ₹40,000. Furniture A/c is:

A. Debited ₹40,000
B. Credited ₹40,000
C. Debited ₹80,000
D. Credited ₹80,000

16. Machinery sold for cash ₹50,000. The Cash A/c will be:

A. Credited ₹50,000
B. Debited ₹50,000
C. Debited ₹1,00,000
D. Not affected

17. Capital introduced in cash ₹2,00,000. Capital A/c is:

A. Debited ₹2,00,000
B. Credited ₹2,00,000
C. Debited ₹1,00,000
D. Not posted

18. Drawings in cash ₹15,000. Drawings A/c is:

A. Credited ₹15,000
B. Debited ₹15,000
C. Credited ₹30,000
D. Not posted

19. Purchase Returns A/c normally has:

A. Debit balance
B. Credit balance
C. No balance
D. Asset balance

20. Sales Returns A/c normally has:

A. Credit balance
B. Debit balance
C. Liability balance
D. Capital balance

21. Discount Allowed A/c normally has:

A. Debit balance
B. Credit balance
C. Liability balance
D. Capital balance

22. Discount Received A/c normally has:

A. Debit balance
B. Credit balance
C. Asset balance
D. Drawings balance

23. Carriage Inward A/c normally has:

A. Credit balance
B. Debit balance
C. Liability balance
D. Capital balance

24. Carriage Outward A/c normally has:

A. Credit balance
B. Debit balance
C. Capital balance
D. Liability balance

25. Which account normally has a credit balance?

A. Salary A/c
B. Rent A/c
C. Sales A/c
D. Purchases A/c

26. Which account normally has a debit balance?

A. Capital A/c
B. Sales A/c
C. Commission Received A/c
D. Wages A/c

27. When a customer pays money to the business, the customer's account is:

A. Debited
B. Credited
C. Closed automatically
D. Not affected

28. When goods are purchased from a supplier on credit, the supplier's account is:

A. Debited
B. Credited
C. Closed
D. Not affected

29. The balance of a personal account generally represents:

A. Income or expense
B. Amount receivable or payable
C. Gross profit
D. Depreciation

30. A debit balance in a customer's personal account generally indicates:

A. Amount payable by the customer
B. Amount receivable from the customer
C. Profit earned from customer
D. Discount received

31. A credit balance in a supplier's account generally indicates:

A. Amount receivable from supplier
B. Amount payable to supplier
C. Cash balance
D. Expense due from supplier

32. To balance an account, the smaller side is:

A. Added to the larger side
B. Subtracted from the larger side
C. Transferred to Journal
D. Ignored

33. The difference between the two sides of a Ledger account is called:

A. Journal
B. Balance
C. Posting
D. Folio

34. If the debit side of an account totals ₹80,000 and the credit side totals ₹65,000, the balance is:

A. ₹15,000 debit balance
B. ₹15,000 credit balance
C. ₹65,000 debit balance
D. ₹80,000 credit balance

35. If the credit side of an account totals ₹90,000 and the debit side totals ₹70,000, the balance is:

A. ₹20,000 debit balance
B. ₹20,000 credit balance
C. ₹70,000 credit balance
D. ₹90,000 debit balance

36. A debit balance is brought down in the next accounting period on:

A. Debit side
B. Credit side
C. Both sides
D. Journal only

37. A credit balance is brought down in the next accounting period on:

A. Debit side
B. Credit side
C. Both sides
D. Trial Balance only

38. "To Cash A/c" written on the credit side of a Ledger account indicates:

A. Cash account is debited in the Journal
B. Cash account is credited in the Journal
C. Cash was received
D. Cash balance is zero

39. "By Sales A/c" appearing on the credit side of a Ledger account means:

A. Sales A/c is credited
B. Sales A/c is debited
C. Sales A/c is closed
D. Sales were returned

40. In a traditional Ledger format, "To" is generally used on:

A. Debit side
B. Credit side
C. Both sides
D. Balance column only

41. In a traditional Ledger format, "By" is generally used on:

A. Debit side
B. Credit side
C. Both sides
D. Journal only

42. A debit entry in the Purchases A/c represents:

A. Purchase Returns
B. Purchases made
C. Sales made
D. Cash received

43. A credit entry in the Purchases A/c generally represents:

A. Purchase Returns or transfer/adjustment credited to Purchases
B. Purchases made
C. Cash purchases only
D. Credit sales

44. A credit entry in Sales A/c normally represents:

A. Sales made
B. Sales Returns
C. Purchases made
D. Expenses paid

45. A debit entry in Sales Returns A/c represents:

A. Goods returned by customers
B. Goods returned to suppliers
C. Cash received
D. Goods purchased

46. A credit entry in Purchase Returns A/c represents:

A. Goods returned by customers
B. Goods returned to suppliers
C. Goods purchased
D. Goods sold

47. When salary is outstanding, Salary A/c is:

A. Credited
B. Debited
C. Closed
D. Transferred to Capital A/c directly

48. When prepaid rent is adjusted at year-end, Prepaid Rent A/c is generally:

A. Debited
B. Credited
C. Closed
D. Credited to Sales A/c

49. When depreciation is charged, Depreciation A/c is:

A. Credited
B. Debited
C. Closed without entry
D. Credited to Capital A/c

50. When bad debts are written off, the debtor's account is:

A. Debited
B. Credited
C. Not affected
D. Transferred to Purchases A/c

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51. A business sells goods to A for ₹40,000 on credit. A later returns goods worth ₹6,000. What is the balance due from A before any further transaction?

A. ₹46,000 debit
B. ₹34,000 debit
C. ₹34,000 credit
D. ₹6,000 debit

52. B owes the business ₹50,000. He pays ₹47,000 in full settlement, the balance being discount allowed. What entries will appear in B's Ledger?

A. Debit ₹50,000; Credit ₹47,000 and ₹3,000
B. Credit ₹50,000; Debit ₹47,000 and ₹3,000
C. Debit ₹47,000; Credit ₹50,000
D. Credit ₹47,000; Debit ₹3,000

53. The business owes C ₹60,000. It pays ₹57,000 and receives ₹3,000 discount. In C's account:

A. Debit ₹57,000; Credit ₹60,000
B. Debit ₹60,000; Credit ₹57,000 and ₹3,000
C. Credit ₹60,000; Debit ₹57,000
D. Credit ₹57,000; Debit ₹3,000

54. A customer account has a debit balance of ₹80,000. He returns goods worth ₹10,000 and subsequently pays ₹65,000. The closing balance is:

A. ₹5,000 debit
B. ₹5,000 credit
C. ₹15,000 debit
D. Nil

55. A supplier's account has a credit balance of ₹75,000. Goods worth ₹15,000 are returned to him and ₹55,000 is paid. The remaining balance is:

A. ₹5,000 credit
B. ₹5,000 debit
C. ₹25,000 credit
D. Nil

56. The Cash A/c has a debit balance of ₹35,000. Cash sales are ₹20,000 and salary paid is ₹12,000. Ignoring all other transactions, the closing cash balance is:

A. ₹23,000 debit
B. ₹43,000 debit
C. ₹23,000 credit
D. ₹67,000 debit

57. Bank A/c has a debit balance of ₹1,00,000. A cheque of ₹30,000 is issued to a creditor and a customer directly deposits ₹20,000. The closing balance is:

A. ₹50,000 debit
B. ₹90,000 debit
C. ₹1,50,000 debit
D. ₹90,000 credit

58. Cash A/c has a debit balance of ₹50,000. ₹20,000 is deposited into bank and ₹5,000 is paid as wages. The closing Cash balance is:

A. ₹25,000 debit
B. ₹35,000 debit
C. ₹75,000 debit
D. ₹25,000 credit

59. A customer's account shows the following: Opening debit balance ₹30,000; credit sales ₹20,000; cash received ₹25,000; sales return ₹3,000. The closing balance is:

A. ₹22,000 debit
B. ₹22,000 credit
C. ₹28,000 debit
D. ₹50,000 debit

60. A supplier's account has opening credit balance ₹40,000. Credit purchases ₹25,000, purchase returns ₹5,000 and payment ₹30,000 are recorded. Closing balance is:

A. ₹30,000 credit
B. ₹30,000 debit
C. ₹20,000 credit
D. ₹10,000 credit

61. In a customer's account, the following appear: Debit—opening balance ₹25,000 and credit sales ₹40,000; Credit—cash ₹30,000 and discount allowed ₹2,000. The closing balance is:

A. ₹33,000 debit
B. ₹33,000 credit
C. ₹63,000 debit
D. ₹7,000 debit

62. A creditor's account contains: Credit—opening balance ₹50,000 and purchases ₹30,000; Debit—returns ₹8,000, cash ₹60,000 and discount received ₹2,000. The resulting balance is:

A. ₹10,000 debit
B. ₹10,000 credit
C. ₹18,000 debit
D. Nil

63. A customer's account has a debit balance of ₹20,000. He is allowed ₹1,500 discount and pays ₹18,500. The account will:

A. Have ₹1,500 debit balance
B. Have ₹1,500 credit balance
C. Close with nil balance
D. Have ₹20,000 credit balance

64. A creditor's account has a credit balance of ₹25,000. The business pays ₹23,000 and receives ₹2,000 discount. The account will:

A. Show ₹2,000 debit balance
B. Show ₹2,000 credit balance
C. Close with nil balance
D. Show ₹23,000 credit balance

65. A customer pays ₹10,000 in advance before any sale is made. In the customer's personal account, the amount will initially create:

A. Debit balance
B. Credit balance
C. No balance
D. Debit balance in Sales A/c

66. A customer has a credit balance because he had paid ₹15,000 in advance. Goods worth ₹15,000 are subsequently supplied to him on credit. After recording the sale, his account will:

A. Remain credit ₹30,000
B. Become debit ₹15,000
C. Become nil
D. Become debit ₹30,000

67. A supplier has a debit balance of ₹10,000 because an advance was paid to him. Goods worth ₹35,000 are subsequently purchased on credit. Before any payment, the supplier's account will show:

A. ₹25,000 credit balance
B. ₹45,000 credit balance
C. ₹25,000 debit balance
D. Nil balance

68. A bill receivable of ₹20,000 is received from debtor A. In A's personal account, the effect is:

A. Debit ₹20,000
B. Credit ₹20,000
C. No effect
D. Debit ₹40,000

69. A bill payable of ₹30,000 is accepted in favour of supplier B. In B's account, the acceptance causes:

A. Debit ₹30,000
B. Credit ₹30,000
C. No effect
D. Debit ₹60,000

70. A bill receivable of ₹25,000 is dishonoured. In the debtor's account, the dishonour entry causes:

A. Debit ₹25,000
B. Credit ₹25,000
C. No effect
D. Credit ₹50,000

71. A bill payable of ₹40,000 is dishonoured. In the creditor's account, the creditor is:

A. Debited ₹40,000
B. Credited ₹40,000
C. Debited ₹80,000
D. Not affected

72. A bill receivable of ₹50,000 is discounted with bank. In the debtor's personal Ledger account, at the time of discounting:

A. Debit ₹50,000
B. Credit ₹50,000
C. No entry
D. Debit ₹1,00,000

73. A bill receivable of ₹50,000 is endorsed to a creditor in settlement of debt. In the debtor's account, the endorsement:

A. Debits the debtor ₹50,000
B. Credits the debtor ₹50,000
C. Has no effect
D. Credits the debtor ₹1,00,000

74. A bill receivable of ₹50,000 is retired before maturity and the debtor receives rebate of ₹2,000. In the debtor's account, the total amount credited is:

A. ₹48,000
B. ₹50,000
C. ₹2,000
D. ₹52,000

75. A bill payable of ₹60,000 is retired before maturity and the business receives a rebate of ₹3,000. In the creditor's account, the amount debited is:

A. ₹57,000
B. ₹60,000
C. ₹3,000
D. ₹63,000

76. Goods worth ₹10,000 are withdrawn by the proprietor for personal use. Which account will be credited in the Ledger?

A. Drawings A/c
B. Capital A/c
C. Purchases A/c
D. Cash A/c

77. Goods worth ₹8,000 are donated to a charitable institution. Which account is credited in the Ledger under the periodic inventory approach?

A. Charity A/c
B. Purchases A/c
C. Cash A/c
D. Capital A/c

78. Goods costing ₹12,000 are distributed as free samples. Which account is debited?

A. Purchases A/c
B. Advertisement A/c
C. Sales A/c
D. Capital A/c

79. Goods costing ₹15,000 are destroyed by fire and no insurance claim is receivable. Which account receives the debit?

A. Purchases A/c
B. Fire Loss A/c
C. Insurance A/c
D. Capital A/c

80. Goods costing ₹20,000 are destroyed by fire. Insurance company accepts a claim of ₹15,000. The Fire Loss A/c will ultimately show:

A. Debit balance ₹5,000
B. Credit balance ₹5,000
C. Debit balance ₹15,000
D. Nil balance

81. Salary outstanding ₹12,000 is adjusted at year-end. In Salary A/c, the adjustment appears on:

A. Debit side
B. Credit side
C. Both sides
D. It does not appear

82. Rent prepaid ₹6,000 is adjusted at year-end. In Rent A/c, the prepaid portion is:

A. Debited
B. Credited
C. Added to expense
D. Transferred to Sales A/c

83. Commission accrued ₹4,000 is adjusted at year-end. In Commission Income A/c, the accrued amount is:

A. Debited
B. Credited
C. Not recorded
D. Transferred to Capital A/c

84. Commission received in advance ₹5,000 is adjusted. In Commission Income A/c, the adjustment is:

A. Debited
B. Credited
C. Not recorded
D. Debited to Cash A/c

85. Depreciation on machinery ₹20,000 is charged. In Machinery A/c, depreciation is generally:

A. Debited ₹20,000
B. Credited ₹20,000
C. Not recorded
D. Credited ₹40,000

86. A machine costing ₹2,00,000 is sold for ₹1,70,000. Its accumulated depreciation is ₹50,000. Ignoring other expenses, the profit on sale is:

A. ₹20,000
B. ₹30,000
C. ₹50,000
D. ₹80,000

87. In Question 86, the machine's book value immediately before sale is:

A. ₹1,50,000
B. ₹2,00,000
C. ₹1,70,000
D. ₹50,000

88. A debtor owing ₹30,000 is declared insolvent and only 40% is recovered. In the debtor's account, the amount credited is:

A. ₹12,000
B. ₹18,000
C. ₹30,000
D. ₹42,000

89. A debt of ₹10,000 previously written off is recovered. In the Bad Debts Recovered A/c, the entry will normally be:

A. Debit ₹10,000
B. Credit ₹10,000
C. No entry
D. Debit ₹20,000

90. A provision for doubtful debts is increased by ₹7,000. The Provision for Doubtful Debts A/c is:

A. Debited ₹7,000
B. Credited ₹7,000
C. Debited ₹14,000
D. Not affected

91. A provision for doubtful debts is reduced by ₹4,000. The Provision for Doubtful Debts A/c is:

A. Debited ₹4,000
B. Credited ₹4,000
C. Debited ₹8,000
D. Closed without entry

92. A customer account has a debit balance of ₹1,00,000. Bad debts of ₹8,000 are written off and then a provision of 5% is created on the remaining debtors. The closing balance of the customer's individual account after writing off the bad debt is:

A. ₹92,000 debit
B. ₹95,000 debit
C. ₹1,00,000 debit
D. ₹8,000 credit

93. A business transfers net profit of ₹75,000 to Capital A/c. In Capital A/c, the transfer appears on:

A. Debit side
B. Credit side
C. Both sides
D. It has no effect

94. A business transfers net loss of ₹30,000 to Capital A/c. In Capital A/c, the transfer appears on:

A. Debit side
B. Credit side
C. Both sides
D. It has no effect

95. The Capital A/c has opening credit balance ₹4,00,000. Additional capital introduced ₹50,000, drawings ₹80,000 and net profit ₹70,000 are recorded. The closing capital is:

A. ₹3,40,000
B. ₹4,40,000
C. ₹4,70,000
D. ₹3,70,000

96. The Capital A/c has opening credit balance ₹5,00,000. Drawings ₹60,000 and net loss ₹40,000 are transferred to it. Additional capital is ₹20,000. Closing capital is:

A. ₹4,20,000
B. ₹4,60,000
C. ₹4,80,000
D. ₹5,20,000

97. A Ledger account has total debits of ₹1,25,000 and total credits before balancing of ₹1,00,000. To balance the account, the balance c/d should be:

A. ₹25,000 on debit side
B. ₹25,000 on credit side
C. ₹1,00,000 on debit side
D. ₹1,25,000 on credit side

98. A Ledger account has a debit balance of ₹40,000 at the beginning of the year. During the year, additional debits total ₹25,000 and credits total ₹30,000. The closing balance is:

A. ₹35,000 debit
B. ₹35,000 credit
C. ₹65,000 debit
D. ₹15,000 debit

99. A Ledger account has an opening credit balance of ₹70,000. During the year, credits total ₹40,000 and debits total ₹55,000. The closing balance is:

A. ₹55,000 credit
B. ₹55,000 debit
C. ₹55,000 credit
D. ₹15,000 credit

100. A customer's account has opening debit balance ₹60,000. During the year, credit sales ₹90,000, sales returns ₹10,000, cash received ₹1,00,000 and discount allowed ₹5,000 are recorded. What is the closing balance?

A. ₹35,000 debit
B. ₹35,000 credit
C. ₹45,000 debit
D. Nil

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ANSWER KEY

📖 CLICK HERE TO VIEW SOLUTION

Q	Ans	Q	Ans	Q	Ans	Q	Ans
1	B	26	D	51	B	76	C
2	B	27	B	52	A	77	B
3	B	28	B	53	B	78	B
4	C	29	B	54	A	79	B
5	B	30	B	55	A	80	A
6	C	31	B	56	B	81	B
7	A	32	B	57	B	82	B
8	B	33	B	58	B	83	B
9	B	34	A	59	A	84	A
10	A	35	B	60	A	85	B
11	B	36	A	61	A	86	A
12	A	37	B	62	A	87	A
13	A	38	B	63	C	88	A
14	B	39	A	64	C	89	B
15	A	40	A	65	B	90	B
16	B	41	B	66	C	91	A
17	B	42	B	67	A	92	A
18	B	43	A	68	B	93	B
19	B	44	A	69	A	94	A
20	B	45	A	70	A	95	B
21	A	46	B	71	A	96	A
22	B	47	B	72	B	97	B
23	B	48	B	73	B	98	A
24	B	49	B	74	B	99	D
25	C	50	B	75	B	100	A