101 Accounting For Business decision

MCQ

The accounting Equation of Dual Aspects Concept is

a) Capital + Liabilities = Assets
b) Capital + Assets = Liabilities
c) Liabilities + Assets = Capital
d) None of these
a
2 The Balance Sheet is prepared for a ____________________
a) Particular Period
b) Stipulated Date
c) Financial Period
d) All the above
b
3 Balance Sheet is a statement of ________________________
a) Assets & Liabilities
b) Income & Expenditure
c) Receipts & Payments
d) Revenues & Capital
a
4 Financial Accounting is the branch of Management Accounting
a) True
b) False
a
5 Which of the following statement measures the financial position of the entity on particular
time?
a) Income Statement
b) Balance Sheet
c) Cash Flow Statement
d) Statement of Retained Earning
b
6 Cost accounting concepts include all of the following EXCEPT:
a) Planning
b) Controlling
c) Sharing
d) Costing
c
7
If, COGS = Rs. 70,000 GP Margin = 30% of sales What will be the value of Sales?
a) 2,00,000
b) 66,667
c) 1,00,000
d) 62,500
c
8 A Person from whom such goods in which the firm deals are purchase on credit basis is
called as ________________
a) Tread Debtor
b) Tread Creditor
c) Supplier
d) Account Payable
b
9 Depreciation is the Process of _______________
a) Allocation of Cost
b) Valuation of Assets
c) Both a & b
d) Allocation of revenue
a
10 Any loss of goods arising due to natural causes is called
a) Normal Loss
b) Total Loss
c) Abnormal Loss
d) Contingent Loss
a
11 Good will is the example of ________________ assets
a) Tangible
b) Intangible
c) Fictitious
d) Both b &c
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b
Cost Accounting is based on ______________ figures
a) Actual
b) Estimated
c) Accrual
d) Historical
b
_______________ is useful not only to ascertain the cost but also to control the cost
a) Management Accounting
b) Cost Accounting
c) Auditing
d) Financial Accounting
b
Presentation of accounting data is the objective of_______
a) Financial Accounting
b) Cost Accounting
c) Management Accounting
d) Company Accounting
c
The term Financial Analysis refers to
a) Analysis of financial statements
b) Interpretation of financial statements
c) Preparation of financial statements
d) Both a & b
d
According to Convention of Conservatism profits are not predetermined and all are
provided for ___________________
a) Possible losses
b) Possible revenues
c) Estimate losses
d) Estimated profits
a
Policy of planning safe refers to
a) Convention of Disclosure
b) Convention of Materiality
c) Convention of Consistency
d) Convention of Conservatism
a
The policy consideration of all possible losses and leave all possible profits due to
a) Convention of Consistency
b) Convention of Conservatism
c) Convention of Disclosure
d) None of these
b
All expenses and losses are
a) Credited
b) Debited
c) Ignored
d) Understated
b
Journal is the book of
a) Prime Entry
b) Secondary Entry
c) Closing Entry
d) Correcting Entry
a
The rule of personal account is ____________ the receiver _____________ the giver
a) Credit , Debit
b) Debit , Credit
c) Both a & b
d) None of these
b
The rule of real account is
a) Debit what comes in an credit what goes out
b) Debit the receiver and credit the giver
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101 Accounting For Business decision

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c) Debit all expenses and losses and credit all gain and incomes
d) None of the above

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a
Any assets easily converted into cash refers to
a) Current assets
b) Liquid assets
c) Fixed assets
d) Non- current assets
b
Excess sales over cost of goods sold is
a) Gross Profit
b) Net Profit
c) Operating Profit
d) Net operating profit
a
Income and expenditure account is a nature of ________________
a) Personal account
b) Real account
c) Nominal account
d) None of these
c
Journal is also called as
a) Books of original entry
b) Books of subsidiary record
c) Books of primary entry
d) All the above
d
Determination of profit is the main purpose of preparing
a) Financial Accounting
b) Cost Accounting
c) Management Accounting
d) Auditing
a
Financial Accounting is prepared on the basis of
a) Actual figures
b) Budgeted figures
c) Standard figures
d) Estimated figures
a
According to law Management Accounting is
a) Obligatory
b) Compulsory
c) Optional
d) Essential
c
Accounting designed for use in the operational need of the business is termed as
a) Cost Accounting
b) Management Accounting
c) Financial Accounting
d) Auditing
b
The one which distinguishes between individual and business
a) Business Entity Concept
b) Management Accounting Concept
c) Dual Concern Concept
d) Product Concept
a
Which of the following is cost concept
a) Market values
b) Cost and Market value
c) Estimated value
d) Actual amount paid
d
Financial statement prepared under
a) Income tax act
b) Company act
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101 Accounting For Business decision

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c) Business law

d) Consumer protection act

b
34 Management Accounting provides necessary information to
a) Shareholders
b) Top Management
c) Shareholders and outside agencies
d) All the above
b
35 A summary of account is
a) Cost Accounting
b) Financial Accounting
c) Management Accounting
d) Auditing
b
36 Costing is a technique of _______________
a) Income determination
b) External reporting
c) Ascertaining cost
d) Internal reporting
c
37 Which of the following function related to Cost Accounting?
a) Internal Reporting
b) External Reporting
c) Interim reporting
d) Routine Reporting
a
38 _____________ is useful not only to ascertain the cost but also to control the cost
a) Management Accounting
b) Cost Accounting
c) Auditing
d) Income tax
b
39 One of the function of cost accounting is proper matching of ____________ with revenue
a) Cost
b) Production
c) Sales
d) Stock
a
40 Cost accounting is a tool of ______________
a) Financial Accounting
b) Management Accounting
c) Auditing
d) Company Accounts
b
41 Cost Accounting is based on __________ figures
a) Actual
b) Estimated
c) Accrual
d) Company Accounts
b
42 Which of the following is the main aim of Cost Accounting
a) Cost Control
b) Cost Ascertainment
c) Price Fixation
d) All the above
d
43 The basic function of accounting is to
a) Record of economic data
b) Provide the informational basis for action
c) Classify and record business transactions
d) Attain non-economic goals
c
44 The main function of financial accounting is to
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101 Accounting For Business decision

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a) Record of all business transactions

b) Interpret the financial data
c) Assist the management in performing functions effectively
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a
Management Accounting provides invaluable services to management in performing
a) All management functions
b) Interpret the financial data
c) Controlling functions
a
Book keeping is mainly concerned with
a) Recording of financial data relating to business transactions
b) Designing the system in recording classifying, summarizing, the recorded data
c) Interpreting the data for internal and external end-users.
a
An account
a) Often directs and reviews the work of book keepers
b) Does more of routine work
c) Is required to have a lower level of knowledge than what is required of a book
keeper
a
All the following statements are objective of accounting except
a) Providing the information about the assets, liabilities and capital of business entity
b) Maintaining records of business
c) Providing information about the performance of business entity
d) Providing details about the personal assets and liabilities of the owner
d
Which of the following is not a sub-field of accounting?
a) Management accounting
b) Cost accounting
c) Financial accounting
d) Book keeping
d
All the following are functions of Accounting except
a) Decision making
b) Measurement
c) Forecasting
d) Ledger posting
d
What is the important object of accounting?
a) To maintain record
b) Depiction of financial position
c) Make information available to various groups and users
d) All of three
b
Information provided in the annual financial statements of an enterprise pertain to
a) Business entity
b) Economy
c) Individual business entity
d) None of three
c
A transaction is
a) Language of business
b) Base for accounting
c) Profit and Loss A/c and Balance sheet
d) Business performance of trading activities
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d
Financial statements are part of
a) Accounting
b) Book keeping
c) All the above
d) None of the above
a
Accounting means recording of
a) Transactions
b) Events
c) Both (a) and (b)
d) Neither (a) nor (b)
c
Following is not the example of external users
a) Government
b) Management
c) Investors
d) Suppliers and other creditors
b
The system of recording transactions based on dual aspect concept is called
a) Double account system
b) Double entry system
c) Single entry system
b
The convention of conservatism is applicable
a) In providing for discount on creditors
b) In making provision for bad and doubtful debts
c) Providing for depreciation
b
The convention of conservatism, when applied to balance sheet, result in
a) Understatement of assets
b) Understatement of liabilities
c) Overstatement of capital
a
All the following are fundamental accounting concepts except
a) Duel aspect
b) Going concern
c) Full disclosure
d) Business entity
c
Which of the following is correct?
a) Capital is equal to assets plus liabilities
b) Assets is equal to liabilities minus capital
c) Liabilities is equal to capital plus assets
d) Capital is equal to assets minus liabilities
d
Capital brought by the proprietor is an example of
a) Increase asset and increase in liability
b) Increase liability and decrease in asset
c) Increase asset and decrease in liability
d) Increase in one asset and decrease in another asset
a
Fundamental accounting assumptions are
a) Materiality
b) Business Entity
c) Going concern
d) Dual aspect
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101 Accounting For Business decision

MCQ

b
64 The accounting equation is based on
a) Dual aspect
c) Going concern
a

b) Business entity
d) All of the above

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