Quiznetik

Principles of Accounting | Set 1

1. The assets that can be easily converted into cash within a short period, i.e., 1 year or less are known as

Correct : A. Current assets

2. According to which principle the same accounting methods should be used each year:

Correct : D. Consisten cy

3. The elements of the accounting equation are

Correct : A. Assets, Liabilities,Capital

4. Arun is a Book-seller, which item will be goods for his business ?

Correct : D. Purchase of Stationery

5. The expenses due but not paid is known as -

Correct : C. Outstanding Expense

6. Which is correct. I)Dr. the receiver,Cr. the Giver II)Dr. what goes out,Cr. what comes in III)Dr. all Expenses,Cr.All Losses

Correct : A. Only I

7. Goods destroyed by fire should be credited to

Correct : A. Puchases A/c

8. In the books of account if a transaction is completely deleted, will it affect the trial balance?

Correct : A. No

9. The respective normal account balances of Sales, Sales Returns , and Discounts allowed are?

Correct : C. Credit, Debit, Debit

10. Trial balance is not a conclusive proof of accuracy due to which errors. I)Error of omission II)Error of Principle III)Error of Commission IV)Compensatory Errors

Correct : A. All I,II,III and IV

11. Which of the following is not the external user of accounting information?

Correct : B. Shareholders

12. refers to the order in which the various assets and liabilities are shown in the Balance Sheet.

Correct : C. Marshalling

13. If closing stock is mentioned in trial balance,Where is it shown in Final Accounts?

Correct : B. Asset side of Balance Sheet

14. Which one is false. I)Capital Expenditure is non recurring in nature and shown in P&L account. II)Revenue expenditure is incurred to conduct day to day activities

Correct : B. Only I

15. Where do we show Provision of bad debts in final accounts if given in adjustments? I)Debit side of P&L II)Credit side of P&L III)Deduct from Debtors in Balance Sheet IV)Add to Debtors in Balance Sheet

Correct : A. I and III

16. Which is true. I)Fixed installation method is recognised by income tax department. II)The amount of depreciation in WDV method remains same.

Correct : B. None is true

17. Cost of machine=1,90,000 Installation=10,000 Scrap=50,000 Life=6 yrs Calculate depreciation as per SLM method

Correct : A. 25,000

18. Machinery purchased on 1 Oct,2016 for 40,000.This machinery was sold on Dec 2017.Calculate the total depreciation charged on machinery till date if co charges 10% as per WDV method if accounts are closed on 31st March every year.

Correct : D. 4850

19. 1 oct Opening balance=400 units @Rs 20 each, 3 Oct:Purchase=300 units @Rs 10 ,5 Oct Sales=500 units.What will be total Sales value(in Rs) as per FIFO Method?

Correct : A. Rs 9000

20. 2 oct Opening balance=200 units @Rs 15 each, 4 Oct:Purchase=500 units @Rs 10 ,5 Oct Sales=600 units.What will be Closing Inventory value (in Rs) as per LIFO Method?

Correct : D. Rs 1500

21. Business enterprise is separate from its owner according to concept.

Correct : C. business entity concept

22. When proprietor withdrew cash from business for personal use , it is known as -

Correct : A. Drawings

23. In trial balance, which accounts with is/are recorded at the credit side? I)Sales II)Sales return III)Cash IV)Loan

Correct : D. Only I and IV

24. When Salary is paid by cheque, which account is credited.

Correct : B. Bank A/c

25. The process of transferring the debit and credit items from a journal to their respective account in the ledger is termed as?

Correct : B. Posting

26. What are the two statements prepared for summarising the transactions? I)Balance Sheet II)Journal III)P&L IV)Cash Book

Correct : D. Only I and III

27. Where do we show Gas and Fuel in final accounts?

Correct : A. Trading A/c

28. What are the causes of depreciation?

Correct : D. All of the above

29. What is the formula for calculating depreciation in SLM Method?

Correct : C. Cost - Scrap/Useful Life

30. 4 oct Opening balance=500 units @Rs 20 each, 5 Oct:Purchase=1000 units @Rs 15 ,6 Oct Sales=500 units.What will be rate at which the sales unit will be valued as per weighted avg method?

Correct : C. Rs 16.66