1.
Which of the following is of capital nature?
A. 
B. 
C. 
Wages paid for installation of machinery
D. 
2.
A second-hand car is purchased for Rs. 10,000, the amount of Rs. 1,000 is spent on its repairs, Rs. 500 is incurred to get the car registered in the owner's name and Rs. 1,200 is paid as dealer's commission. The amount debited to the card account will be:
A. 
B. 
C. 
D. 
3.
If the repair cost is Rs. 25,000, whitewash expenses are Rs. 5,000, cost of extension of the building is Rs. 2,50,000 and of improvement in electrical wiring system is Rs. 19,000; the amount to be expensed is:
A. 
B. 
C. 
D. 
4.
Rs. 200 paid as wages for erecting a machine should be debited to
A. 
B. 
C. 
D. 
5.
Rs. 2,500 spent on the overhaul of a machine purchased second-hand is:
A. 
B. 
C. 
Deferred revenue expenditure
D. 
6.
The basic consideration(s) in the distinction between capital and revenue expenditures is/are:
A. 
B. 
Effect on revenue generating capacity of business.
C. 
D. 
7.
A bad debt recovered during the year is a:
A. 
B. 
C. 
D. 
8.
Carriage charges paid for a new plant purchased if debited to carriage account would affect:
A. 
B. 
C. 
Plant and carriage accounts
D. 
9.
On January 1, 2006, Victory Ltd., purchased second-hand machinery for Rs.50,000 and spend Rs.2,000 as shipping and forwarding charges, Rs.1,000 as import duty, Rs.1,000 as carriage inwards, Rs.500 is repair charges, Rs.200 as installation charges, Rs.400 as the brokerage of the middle man and Rs.100 for an iron pad. The total cost of machinery is:
A. 
B. 
C. 
D. 
10.
Material costing Rs.700 in the erection of the machinery and the wages 4 paid for it amounting to Rs. 400 should be debited to:
A. 
B. 
C. 
D. 
11.
Expenses incurred to retain the title of a building is a:
A. 
B. 
C. 
Deferred revenue expenditure
D. 
12.
Rs.5,000 spent to remove a worn-out part and replace it with a new one is:
A. 
B. 
C. 
Deferred revenue expenditure
D. 
13.
Rs.5,000 was spent by Mrs. Saroj in addition to machinery to increase the production capacity. The amount is:
A. 
B. 
Deferred revenue in nature
C. 
D. 
14.
An old piece of furniture was purchased for Rs.10,000.It was repaired for Rs.100.The repairs account should be debited by:
A. 
B. 
C. 
D. 
15.
Rs. 5,000 incurred for up-gradation of the computer by the installation of 128 MB RAM is:
A. 
B. 
Deferred revenue expenditure
C. 
D. 
16.
Rs. 5,000 spent on maintenance of plant and machinery is_______
A. 
B. 
C. 
Deferred capital expenditure
D. 
17.
Mohan runs a restaurant. He renovates some of the old cabins to increase some space—the amount of Rs. 15,000 was incurred on the renovation. The amount to be charged to the profit and loss account is:
A. 
B. 
C. 
D. 
18.
Money paid to MTNL Rs.10,000 for installing a telephone in the office is:
A. 
B. 
C. 
D. 
19.
Cost of a tour abroad by the sales manager to develop markets (tour was successful) is:
A. 
B. 
C. 
Deferred revenue expenditure
D. 
20.
Heavy amount spent on advertisement is______
A. 
B. 
C. 
Deferred revenue expenditure
D. 
21.
Rs. 5,000 spent on repairs of a newly purchased old motor car is debited to:
A. 
B. 
C. 
D. 
22.
An old machine was purchased for Rs. 60,000. It was repaired for Rs. 5,000 and Rs. 5,000 paid on its installation. Machinery repairs a/c will be debited by:
A. 
B. 
C. 
D. 
23.
Cost of removal of business to a more convenient locality is:
A. 
B. 
C. 
Deferred revenue expenditure
D. 
24.
Rs. 35,000 was spent on painting the new factory. It is a
A. 
B. 
C. 
Deferred revenue expenditure
D. 
25.
Amount spent on "Structural alterations" under the pressure of law is a
A. 
B. 
C. 
Deferred revenue expenditure
D.