Below are some of the most important questions on "Introduction to financial accounting and terms ". All questions are most likely to be asked in.
SSC, SSC CGL, SSC CHSL, UPSC, IBPS, UPPSC, RRB, RRB NTPC, RRB Group D, JKSSB, JKPSC.
And other exams like JKSSB finance accounts assistant, VLW, forester, Jkpsi, junior assistant, patwari, election assistant and all other exams.
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MCQs on Introduction to financial accounting
Q1. According
to accounting concept business and owner are:
Ans : Two Separate entities
Q2. According
to which concept business must incur expenses to earn revenue.
Ans : Matching Principle
Q3. Accounting
principles must not change throughout the accounting period. Which concept says
this:
Ans : Consistency concept
Q3. Which
concept says Accounting records only those transactions which can be expressed
in terms of monetary value
Ans : Money measurement concept
Q4. The
excess of assets over the liabilities can be defined as what:
Ans: Capital
Q5. Long term
assets with no physical existence but, possessing a value are called as:
Ans : Intangible assets
Q6. Using
goods of the business for own use, we must
Ans: Debit drawing account
Q7. Why we
use accounting?
Ans: for preparing financial statements of business
entity.
Q8. Accounting
information is useful for___.
Ans: Comparing information with past
Q9. Why use
book-keeping?
Ans: For recording financial transactions of the business
entity.
Q10. Kiran is
planning to sell goods to Ram on credit, What Kiran must check in financial
statements of Ram.
Ans : for checking Rams payment payable period.
Q11. Financial
statements should be error free and bias free, Which Principle says it.
Ans : Reliability
Q12. Trial
balance is used for___
Ans : checking arithmetical accuracy
Q13. ___ is expenditure for an item which lasts more
than a year.
Ans : Capital expenditure.
Q14. Income
statement is prepared for:
Ans: checking revenues and costs of business
Q15. Assets
are shown in the Balance Sheet at?
- Market Value
- Unexpired Cost
- Replacement Cost
- Revalue Cost
Q16. According
to money measurement concept, ____ will be recorded in the books of accounts?
- All
- Managing ability of the manager
- Quality control in the business
- Cost of Machinery
Q17. The Reason
for showing Contingent liability in the balance sheet is
- convention of uniformity
- Convention of consistency
- Convention of materiality
- Convention of disclosure
Q18. Based on
the going concern concept, a business entity should have ___ life
- none
- a long life
- an indefinite life
- a short life
Q19. When we
considered revenue as earning
- Cash is received
- Production is done
- Sale is affected
Q20. Which
principle says non-financial transactions should not be recorded
- Measurement concept
- Equity concept
- Accrual concept
Q21. Which concept
says ‘for every debit, there is a credit’?
(a) Separate Entity Concept
(b) Dual Aspect Concept
(c) Money Measurement Concept
(d) Accounting Period Concept
Q22. Accounting
principles are based on what
(a) Subjectivity
(b) Practicability
(c) Objectivity
(d) Convenience in Recording
Q23. Contingent
liability displayed as a foot-note in the balance-sheet. It is based on what accounting
principle?
- Disclosure
- Conservatism
- Materiality
- Consistency
Q24. ____ is considered
as the father as modern accounting ?
- J. Betty
- Henry Fayol
- Gestonburg
- Luca Friar Pacioli
Q25. Everything
which is purchased and sold in the business is known as
- Goods
- Capital
- Drawings
- Liabilities
Q26. Which of
the following is Associated with scientific system of maintaining account
- Double entry
- Book entry
- Single entry
- Contra entry
Q27. Cash
withdrawn by owner for personal use is known as
- Capital
- Owner equity
- Drawing
- Liability
Q28. The ____
is a statement of revenues and expenses for a specific period of time
- Trading account
- Balance sheet
- Trial balance
- Profit & Loss statement
Q29. The
liabilities that are payable in more than a year & can’t be liquidated from
current assets
- Fixed liabilities
- Contingent liabilities
- Fixed Assets
- Current liabilities
Q30. The
process of recording, classifying and summarizing, business transactions to
know the financial result is known as:
- Accounting
- Book-keeping
- Journalizing
- summarizing
Q31. The evidence in support of a business
transaction is what
- Journal
- Voucher
- Ledger
- Bill
Q32. The
entry Having more than one debit /credit is known as
- Compound entry
- Single entry
- Multiple entry
- Double entry
Q33. Cash is
a___
- Real Account
- Nominal Account
- Personal Account
- Sales Account
Q34. Patents,
Copyrights and Trademarks are____assets:
- Intangible Assets
- Tangible Assets
- Current Assets
- Fixed Assets
Q35. The
accounts that says "debit what comes in, credit what goes out" are
- Personal accounts
- Real accounts
- Business accounts
- Nominal accounts
Q36. Fixed assets
are held by business for what
- Coverting into cash
- Resale
- Generating revenue
- None of these
Q37. Things which
helps in proper functioning of the business and are owned by the business are known
as …………….
- Drawings
- Assets
- Liabilities
- Capital
Q38. GAAP
stands for what?
- Generally Accounting Accepted Principle
- Generally Accountancy Accepted principles
- General Accountancy Accepting principles
- General Accepted Accounting principles
Q39. The
sales income of a business during a given period is called
- Sales returns
- Transactions
- Purchase returns
- Turnover
Q40. Person,
firm or any entity who fails to pay the price in cash for the goods purchased
or services received is called
- Creditor
- Proprietor
- Owner
- Debtor
Q41. The ____
statement showing the financial status
of the company at any given time
- Profit & Loss statement
- Trading account
- Cash book
- Balance sheet
Q42. Financial
accounting use____
- Historical data
- External data only
- Managerial data only
- Projected data
Q43. Accounting
matches ____of the business
- Revenues & Costs
- Potential & Real Performance
- Benefits & Costs
- Cash Inflow & Cash Outflow
Q44. Financial
position of the business is checked on the basis of
- Records prepared under book keeping process
- Trial Balance
- Accounting reports
- All of the above
Q45. Why Contingent
Liabilities is shown on financial statements
- Convention of consistency
- Convention of materiality
- Convention of disclosure
- All of these
Q46. The
outside Liabilities of business are 20000rs. The proprietor's capital is 50000rs.
Then Total Assets of the firm are:
- 50000
- 30000
- 70000
- 20000
Q47. The
double entry system of accounting came from
- America
- Russia
- Italy
- England
Q48. First
book on double entry book keeping was
- Kautiliya
- Artha shastra
- Summa de arthimatica
Q49. When customer
return the goods it is called
- Purchase return
- Sales return
- Trade receivable
- None
Q50. Difference
between current assets & current liabilities is called
- Actual capital
- Working capital
- Non working capital
- None
Q51. Accounting
involves .....events
- Business
- Economic
- Non economic
- Non business
Q52. Which is
not a current asset
- Prepaid expenses
- Debtors
- Furniture
- Bills receivable
Q53. Branch
of accountancy concerned with decision making
- Financial accounting
- Cost accounting
- Management accounting
- None
Q54..... Is
the language of business
- Book keeping
- Journal
- Ledger
- Accountancy
Q55. Discount
allowed is ....
- Expenses of business
- Income of business
- Loss of business
- None
Q56. Excess
of revenue over expenses is____
- Loss
- Net loss
- Profit
- None
Q57. Principal
tells that business transaction has two aspects
- Conservatism
- Consistency
- Materiality
- Dual aspect
Q58. Refers
to the gross inflow of cash
- Expenses
- Assets
- Revenue
- Profit
Q59. Capital
is treated as ___ for business
- Asset
- Gain
- Liability
- All of these