Accounting for Managers Online MCQ Set 15

QN01. Under which concept it is assumed that the enterprises has neither the intention nor the necessity of liquidation or of curtailing materiality the scale of operation

  1. Revenue realization concept
  2. Matching cost concept
  3. Going concern concept
  4. None of these
Answer

(C) Going concern concept

QN02. Bookkeeping is an ______________ of correctly recording of business transition.

  1. Art and Science
  2. Art
  3. Science
  4. Art or Science
Answer

(B) Art

QN03. Journal Entries are known as book of ______________ Entry.

  1. Original
  2. Duplicate
  3. Personal
  4. Nominal
Answer

(A) Original

QN04. Fixed assets and current assets are categorized as per concept of:

  1. Separate entity
  2. Going concern
  3. Consistency
  4. Time period
Answer

(B) Going concern

QN05. The allocation of owner’s private expenses to his/her business violates which of the following?

  1. Accrual concept
  2. Matching concept
  3. Separate business entity concept
  4. Consistency concept
Answer

(C) Separate business entity concept

QN06. Profit from sale of assets is example for&#8211

  1. Revenue Profit
  2. Capital Profit
  3. Loss
  4. None of these
Answer

(B) Capital Profit

QN07. Book keeping is mainly concerned with

  1. Recording of financial data relating to business operation
  2. Designing the systems in recording classifying,summarizing the recorded data
  3. Interpreting the data for internal and external users
Answer

(A) Recording of financial data relating to business operation

QN08. The convention of conservatism when applied to the balance sheet result in.

  1. Understand the asset
  2. Understand the liabilities
  3. Overstatement of capital
  4. None of these
Answer

(A) Understand the asset

QN09. The amount brought in by the proprietor in the business should be credited to

  1. Cash a/c
  2. Capital a/c
  3. Drawing a/c
  4. Bank a/c
Answer

(B) Capital a/c

QN10. The return of goods by the customer should be debited to

  1. Customer a/c
  2. Sales return a/c
  3. Goods a/c
  4. Purchase return a/c
Answer

(B) Sales return a/c

QN11. sales made by Mahesh for cash should be debited to

  1. Cash a/c
  2. Mahesh a/c
  3. Sales a/c
  4. Sales return a/c
Answer

(A) Cash a/c

QN12. The rent paid to land lord to be credited to

  1. Land lord a/c
  2. Rent a/c
  3. Cash a/c
  4. Tenant a/c
Answer

(C) Cash a/c

QN13. Which of the following statements are false?

  1. All liability is a debt for your business
  2. Debtor are a asset for business
  3. The accounting equation shows how much of your assets belong to the owner, and how much belong to people outside business
  4. None of the above
Answer

(D) None of the above

QN14. A business has the following items in it:
Land Rs.1,000,000
Machinery Rs.20,000
Cash Rs.10,000
Debt Rs.0
Owner’s equity?

What is the valve of owner’s equity?

  1. Rs.1020000
  2. Rs.1010000
  3. Rs.1030000
  4. None of the above
Answer

(C) Rs.1030000

QN15. A business has the following items in it:
Owners’ equity Rs.6,00, 000.
Liabilities Rs.14,00,000.
What is the value of Assets ______________

What is the valve of owner’sequity?

  1. 600,000
  2. 1,400,000
  3. 2,000,000
  4. None of these
Answer

(C) 2,000,000

QN16. A business has the following items in it:
Land Rs.1, 500,000
Machinery Rs.80, 000
Cash Rs.20, 000
Owners equity Rs.900, 000
Loan Rs.500, 000
Creditors?

  1. Rs.200, 000
  2. Rs.700, 000
  3. Rs.800, 000
  4. Rs1, 100,000
Answer

(A) Rs.200, 000

QN17. A business has following items in it Land?
Vehicles Rs.600,000
Debtors Rs. 1,20,000
Cash Rs.30,000
Owners’Equity Rs.1,000,000
Loan 5,00,000
Creditors Rs.50,000

What is the value of the land ______________

  1. 1,000,000
  2. 1,550,000
  3. 800,000
  4. None of these
Answer

(C) 800,000

QN18. XYZ ltd.has provided the following information about its balance sheet:
Cash Rs.100
Accounts Receivable Rs.500
Stock holder equity Rs.700
Accounts Payable Rs.200
Bank Loan Rs.1,000

Based on the information provided, how much are XYZ ltd.Total liabilities?

  1. Rs.200
  2. Rs.1900
  3. Rs.1200
  4. Rs.1700
Answer

(B) s.1900

QN19. Contingent liabilities should be recorded in the accounts when:

  1. It is probable that the future event will occur.
  2. The amount of the liability can be reasonably estimated.
  3. Both (a) and (b).
  4. Either (a) or (b).
Answer

(C) Both (a) and (b).

QN20. Accounting concepts are based on

  1. Certain assumptions
  2. Certain facts and figures
  3. Certain accounting records
  4. Practice experience
Answer

(B) Certain facts and figures

QN21. Retained earnings statement depicts:

  1. Appropriation of profits
  2. Estimates of profits
  3. Estimates of costs
Answer

(A) Appropriation of profits

QN22. Financial accounting deals with:

  1. Determination of cost
  2. Determination of profit
  3. Determination of price
  4. Determination of selling price
Answer

(B) Determination of profit

QN23. Financial account record only

  1. Actual figures
  2. Budgeted figures
  3. Standard figures
  4. Management Figure
Answer

(A) Actual figures

QN24. Content of income statement

  1. Trading account
  2. Profit and loss account
  3. Balance sheet
  4. All of the above
Answer

(D) All of the above

QN25. Depreciation is a ______________

  1. Cash operating expenditure
  2. Non cash operating expenditure
  3. Cash non-operating expenditure
  4. Non cash non-operating expenditure
Answer

(B) Non cash operating expenditure

QN26. Outstanding salary account is a ______________ account

  1. Nominal account
  2. Real Account
  3. Artificial person’s account
  4. Representative personal account
Answer

(D) Representative personal account

QN27. The work of factory employees that can be physically associated with converting raw material into finished goods is classified as ––

  1. Manufacturing overhead
  2. Indirect materials
  3. Indirect labour
  4. Direct labour
Answer

(D) Direct labour

QN28. Aggregate of prime cost and Factory overhead is known as:

  1. Work on cost
  2. Work Cost
  3. Cost of Production
  4. Direct Cost
Answer

(B) Work Cost

QN29. Conversion cost includes cost of onverting ______________ into ______________

  1. Raw material, WIP
  2. Raw material, Finished goods
  3. WIP, Finished goods
  4. Finished goods, Saleable goods
Answer

(B) Raw material, Finished goods

QN30. All costs other than direct materials cost, direct labour cost and direct expenses are known as:

  1. Indirect material cost
  2. Overhead
  3. Indirect labour cost
  4. Indirect expenses
Answer

(B) Overhead

QN31. ______________ is a summary of all transactions relating to particular account.

  1. Balance sheet
  2. Trial Balance
  3. Ledger
  4. Journal
Answer

(C) Ledger

QN32. Amount of salary paid to Suresh should be debited to ______________

  1. Account of Suresh
  2. Salaries account
  3. Cash account
  4. Outstanding expenses
Answer

(B) Salaries account

QN33. Modern Method of Accounting was introduced by

  1. M. S. Gosav
  2. Wheldon
  3. LucoPacioli
  4. R. N. Carter
Answer

(C) LucoPacioli

QN34. If a company has contingent liabilities, they appear in the ______________

  1. Balance Sheet
  2. Director’s Report
  3. Foot note down the balance sheet
  4. Chairman’s report
Answer

(A) Balance Sheet

QN35. The use of management accounting is

  1. Compulsory
  2. Optional
  3. Obligation
  4. Statutory requirement
Answer

B) Optional

QN36. Financial account state the ______________ position of a concern.

  1. Financial
  2. Economic
  3. Non financial
  4. None of these
Answer

(A) Financial

QN37. Which group of ratios relates profits to sales and investment?

  1. Liquidity ratios
  2. Debt ratios
  3. Coverage ratios
  4. Profitability ratios
Answer

(D)Profitability ratios

QN38. Process that involves decision making with respect to investment in fixed asset

  1. Valuation
  2. Breakeven analysis
  3. Capital budgeting
  4. Material management decision
Answer

(C)Capital budgeting

QN39. When a Bond’s Yield to Maturity is greater than the Bond’s Coupon Rate, the Bond

  1. Is selling at a Premium
  2. Has reached its Maturity Date
  3. Is priced at Par
  4. Is selling at a Discount
Answer

(D)Is selling at a Discount

QN40. The ______________ is a common term for the market consensus value of the required return on a stock.

  1. Dividend payout ratio
  2. Intrinsic value
  3. Market capitalization rate
  4. Plowback rate
Answer

(C)Market capitalization rate

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