Accounting for consignment

Multiple choice questions (MCQs) Quiz

1. The relationship between consignor and consignee is that of:

2. A consignee becomes the consignor’s debtor when the goods are:

3. If no agreement regarding the responsibility of loss exists between consignor and consignee, the loss of goods resulting from accident, fire or theft etc. would be born by the:

4. According to traditional classification of accounts, the type of consignment account is:

5. Del credere commission is calculated on:

6. Del credere commission is allowed to cover:

7. According to traditional classification, the nature of consignee account is:

8. Which of the following items may be shown by an account sales:

9. Proforma invoice is a document which is prepared by:

10. Which of the following is a correct journal entry to record the loss incurred by a consignment:

11. No entry is made for the loss, the amount of loss is absorbed by good units. This statement belongs to:

12. Overriding commission is granted to consignee for

13. A consignee is entitled to a 10% ordinary and a 5% del credere commission. If cash sales are $50,000 and credit sales are $25,000, the total commission would be:

14. The profit generated or loss incurred by a consignment is shown by the:

15. If the consignor is a manufacturer, which of the following journal entries should he make to close the goods sent on consignment account?

16. Goods costing $50,000 are consigned at a proforma invoice of cost plus 20%. The consignment account will be debited by:

17. Which one of the following is not credited to consignment account?

18. Which one of the following is not a non-recurring expense in consignment?

19. The consignor does not keep a record of consignment related debtors when:

20. A loss which occurs due to natural causes and which is not avoidable is known as:

21. Which of the following expenses should not be taken into account while calculating the value of stock on consignment?

22. In consignment, the ownership to goods:

23. Mr. Arfan of Mumbai consigned goods to Mr. Nabeel of Nagpur. The following selected data is provided to you:

• Goods consigned: 2,000 units @ Rs 100 per unit
• Goods sold: 1,900 units @ Rs 1,200 per unit
• Unsold stock with consignee: 100 units
• Non-recurring expenses paid by consignor: Rs 2,400
• Non-recurring expenses paid by consignee: Rs 1,600
• Recurring expenses paid by consignee: Rs 1,000

Based on the data given above, the value of stock on consignment is:

24. A loss that is highly controllable or avoidable is referred to as:

25. If del credere commission is given, the consignee will debit the amount of bad debts to:

26. Which of the following accounts will be credited by the consignee when he sells the goods?

27. Which of the following is a correct journal entry in the books of consignee when he pays expenses in respect of consignment:

28. Which of the following is a correct statement about stock on consignment?

29. The nature of goods sent on consignment account is:

30. Which one of the following is a correct statement about stock reserve?