Quiznetik

Financial Accounting 2 | Set 1

1. All the transactions measurable in the terms of money are recorded in accounts is according to

Correct : C. money measurement concept

2. Dividing the expenditure into capital and revenue is according to

Correct : D. accounting period concept

3. While putting the value or price of an entity in financial records the lowest price is recorded not the current price or current market value. This is known as

Correct : B. conservatism

4. Co-operative societies is an example of

Correct : A. personal account

5. Outstanding salary account is a

Correct : C. representative personal account

6. Interest earned is a

Correct : C. nominal account

7. Commission paid is a

Correct : C. nominal account

8. Trading account is a

Correct : C. nominal account

9. Profit and loss account is a

Correct : C. nominal account

10. All revenue incomes are credited to

Correct : C. profit and loss account

11. In profit and loss account, if credit is more than the debit, the difference is

Correct : A. net profit

12. The process of recording financial data upto trial balance is

Correct : A. book keeping

13. In income measurement & recognisation of assets & liabilities which of the following concepts goes together?

Correct : A. periodicity, accural, matching

14. Interpretation means

Correct : A. explanation of meaning and significance of the data in financial statements.

15. Which of the following is wrong?

Correct : D. rent is a personal account, outstanding rent is nominal account

16. _______ is root cause for financial accounting

Correct : A. stewardship accounting

17. The proprietor of the business is treated as creditor for the capital introduced by him due to_____ concept.

Correct : C. entity

18. Fixed assets are held by business for _____

Correct : B. generating revenue

19. Which accounting concept specifies the practice of crediting closing stock to the trading account?

Correct : D. matching

20. Amount spent to increasing the earning capacity is a ______ expenditure

Correct : A. capital

21. Human resources will not appear in the balance sheet according to ______ concept.

Correct : C. money measurement concept

22. Provision for discount on debtors is calculated on the amount of debtors.

Correct : B. after deducting provision for doubtful debts.

23. Which of the following is not a Real Account?

Correct : C. outstanding rent a/c

24. Value of goods withdrawn by the proprietor for his personal use should be credited to ____

Correct : D. purchases a/c

25. Which of the following is incorrect?

Correct : D. outstanding expenses – current asset

26. M/s Stationery Mart will debit the purchase of stationery to _______

Correct : A. purchases a/c

27. Small items like, pencils, pens, files, etc. are written off within a year according to ___ concept.

Correct : A. materiality

28. Business enterprise is separate from its owner according to _____ concept.

Correct : C. entity concept

29. The policy of anticipate no profit and provide for all possible losses arise due to the concept of _____

Correct : C. conservatism

30. According to which concept, the proprietor pays interest on drawings

Correct : C. entity concept

31. Cost concept basically recognises ____

Correct : B. historical cost

32. If the Market value of closing Inventory is less than its cost price, inventory will he shown at ____

Correct : A. marketable value

33. The Market price of good declined than the cost price. Then the concept that plays a key role is ____

Correct : C. realization

34. Fixed assets are double the current assets and half the capital. The current assets are Rs.3,00,000 and investments are Rs.4,00,000. Then the current liabilities recorded in balance sheet will be

Correct : B. 1,00,000

35. Which of the following provide frame work and accounting policies so that the financial statements of different enterprises become comparable.

Correct : B. accounting standards

36. Which of the following factor is not considered while selecting accounting policies?

Correct : C. accountancy

37. Debit the receiver & credit the giver is _____ account

Correct : A. personal

38. Cash a/c is a ______

Correct : A. real a/c

39. As per accrual concept, which of the followings is not true

Correct : C. sales + gross profit = revenue

40. Mr. X sold goods to Mr. Y ask Mr. X to keep the goods with him for some time

Correct : A. symbolic delivery

41. If nothing is written about the accounting assumption to be followed it is presumed that

Correct : B. they have not been followed

42. Capital A/c is a _______ A/c.

Correct : A. personal

43. Cash A/c is a ________ A/c.

Correct : B. real

44. The principle “Debit the receiver and credit the giver” is related to_____

Correct : A. personal a/c

45. Which of the following is a Real A/c?

Correct : A. building a/c

46. Valuation of stock in accounting follows the principle of cost price or ____ whichever is lower.

Correct : C. net realizable value

47. Which of the following is not a nominal Account?

Correct : A. outstanding salaries account

48. For every debit there will be an equal credit according to

Correct : D. dual aspect concept

49. Historical cost concept requires the valuation of an asset at

Correct : A. original cost

50. The comparison of financial statement of one year with that of another is possible only when _______ concept is followed

Correct : C. consistency

51. Profit and loss is calculated at the stage of

Correct : D. summarising

52. Which of the following is not the main objective of accounting?

Correct : D. solving tax disputes with tax authorities

53. The rule debit all expenses and losses and credit all income and gains relates to

Correct : C. nominal accounts

54. Matching concept means

Correct : D. expenses should be matched with the revenue of the period. branch accounts

55. When Branch pays expenses for H.O. the following account is debited in the books of the branch _______

Correct : B. h.o. a/c is debited

56. Under the stock and debtor system, Branch A/c is treated as ______

Correct : D. real a/c

57. Goods are sent to branch at cost plus 20%. If closing stock of the branch is Rs 60,000 at invoice price, Rs ______ will be credited to stock reserve a/c.

Correct : A. rs 10000

58. HO sends goods to branch at 20% profit on invoice price, therefore the percentage of profit on cost comes to ______

Correct : B. 25%

59. HO sends goods to branch at invoice price after adding 25% on cost price, so profit would be ___ % of invoice price

Correct : C. 20%

60. For finding the amount of sundry expenses paid by the branch, the following a/c should be prepared.

Correct : C. petty cash a/c

61. If the opening balance of petty cash is Rs 1000, closing balance is Rs 500 and the petty cash received from HO is Rs 700, then what will be the amount of sundry expenses _____

Correct : A. rs 1200

62. H.O. sent Rs 5000 as petty cash to branch during the year. Opening and closing balances of petty cash was Rs 1400 and Rs 400 respectively. Then petty expenses of the branch during the year will be ______

Correct : D. rs 6000

63. Which of the following branches, taking into consideration the scope of authority and responsibility, prepares its own independent final accounts?

Correct : A. independent branch

64. Opening balance of debtors a/c is Rs 1,40,000. Credit sales is Rs 10,74,000 and closing balance of Debtors a/c is Rs 1,90,000. What is the amount of cash collection from the debtors?

Correct : A. rs 10,24,000

65. Goods in transit are shown in the balance sheet at ______

Correct : A. head office

66. H.O. has sent goods on invoice price worth Rs 2,40,000 which are 25% above cost price. What is the loading element?

Correct : C. rs 48000

67. The adjusting entry for difference between the invoice price and cost price of goods are shown in ________

Correct : C. branch adjustment a/c

68. Stock and debtors system is generally used when goods are sent to the branch at _____

Correct : B. invoice price

69. H.O. sent goods to branch at invoice price 50% plus on original price. How many percentage of profit will be on Invoice price?

Correct : C. 33.33%

70. Goods sent by HO but not received by branch before the end of the year, by debiting it to goods in transit, which account should be credited?

Correct : D. branch a/c

71. If the opening balance of debtors is Rs 16,000 and closing balance is Rs 80,000, cash received from debtors is Rs 35,000 and bad debts is Rs 1,000, then what will be the amount of credit sales?

Correct : C. rs 100000

72. The system of keeping accounts generally adopted by small size branches are:

Correct : A. debtors system

73. Goods are supplied by the head office to dependent branches are at:

Correct : D. cost or invoice price

74. Under debtors system which account is prepared by head office to calculate profit or loss of each branch:

Correct : C. branch account

75. Under debtors system depreciation on fixed asset is ________

Correct : C. not shown in branch a/c

76. Branch Trading &Profit & Loss A/c is only a _________ account not forming part of the full accounting system.

Correct : B. memorandum

77. In final account system, Branch Trading and Profit & Loss A/c is prepared at ________

Correct : C. cost & invoice price

78. Under Final A/c system, the profit or loss made by the branch is determined by preparing

Correct : D. branch trading & profit &loss a/c

79. The Branch Account prepared under Final Account System is the nature of:

Correct : A. nominal account

80. Dependent branch makes:

Correct : C. cash & credit sales

81. All branch expenses such as rent, salary are paid by H.O in case of:

Correct : C. dependent branch

82. Branch Trading & Profit & Loss A/c is prepared to incorporate all _____

Correct : A. revenue items

83. The difference between goods sent by H.O. and received by branch is known as _______

Correct : A. goods in transit

84. The stock reserve for unrealised profit will be ________ to the H.O profit & Loss A/C

Correct : D. not shown

85. ____________ account is prepared to adjust the loads included in the value of opening stock and closing stock.

Correct : B. branch adjustment

86. ____________ account shows the shortage or surplus of stock.

Correct : B. branch stock

87. The profit included in surplus or shortage of stock is transferred to ______ account

Correct : C. branch adjustment

88. The balance of branch adjustment account is transferred to _________ account

Correct : B. branch p&l

89. An ordinary partnership business can have:

Correct : B. not more than 20 partners.

90. In the absence of an agreement profit and loss are divided by partners in the ratio of:

Correct : B. equally

91. In the absence of an agreement, Interest on loan advanced by the partner to the firm is allowed at the rate of:

Correct : A. 6%

92. Current accounts of the partners should be opened when the capitals are:

Correct : B. fixed

93. Investment in partnership is made by introducing:

Correct : C. cash or non – cash assets

94. Partnership is formed by the partners by:

Correct : C. written or oral

95. Any partner who investments in the business but does not take active part in the business is:

Correct : B. sleeping partner

96. The written agreement of partnership is called:

Correct : A. partnership deed

97. Under fixed capital methods, profit will be credited to:

Correct : C. current a/c

98. The members of partnership firm are individually called as:

Correct : C. partner

99. Liability of partners in a partnership business is:

Correct : B. un-limited

100. Capital of the partners are maintained by:

Correct : C. by any two above methods