Question 1

Accounting furnishes data on&#10;A)Income and cost for the managers&#10;B)Financial conditions of the institutions&#10;C)Company's tax liability for a particular year&#10;D)All the above

Accepted Answer

Accounting provides comprehensive data on various aspects of a business, including income and costs for managerial decision-making, the financial condition of the institution to assess its financial health, and the company's tax liability for a particular year to ensure compliance with tax regulations.

Question 2

Long term assets having no physical existence but, possessing a value are called&#10;A)Intangible assets&#10;B)Fixed assets&#10;C)Current assets&#10;D)Investments

Accepted Answer

Intangible assets are long-term assets that have no physical existence but possess value, such as patents, trademarks, and copyrights.

Question 3

The assets that can be easily converted into cash within a short period, i.e., 1 year or less are known as&#10;A)Current assets&#10;B)Fixed assets&#10;C)Intangible assets&#10;D)Investments

Accepted Answer

Current assets are assets that can be quickly converted into cash or that are expected to be sold or used up within a year or less, such as cash, inventory, and accounts receivable. Fixed assets, intangible assets, and investments do not typically meet this criterion as they are either used over a long period, lack physical substance, or may not be easily liquidated within a year.

Question 4

The debts which are to be repaid within a short period (a year or less) are referred to as,&#10;A)Current Liabilities&#10;B)Fixed liabilities&#10;C)Contingent liabilities&#10;D)All the above

Accepted Answer

Current Liabilities are debts or obligations that are due to be paid within a year or within the operating cycle of a business, making them short-term financial obligations.

Question 5

The following is not a type of liability&#10;A)Short term&#10;B)Current&#10;C)Fixed&#10;D)Contingent

Accepted Answer

The answer of The following is not a type of...

Question 6

Any written evidence in support of a business transaction is called&#10;A)Journal&#10;B)Ledger&#10;C)Ledger posting&#10;D)Voucher

Accepted Answer

A voucher is a document used as evidence in accounting to support and record a business transaction.

Question 7

The accounts that records expenses, gains and losses are&#10;A)Personal accounts&#10;B)Real accounts&#10;C)Nominal accounts&#10;D)None of the above

Accepted Answer

Nominal accounts are used to record expenses, gains, and losses. They are also known as income statement accounts because they are used to track the financial performance of a business over a specific period.

Question 8

Real accounts records&#10;A)Dealings with creditors or debtors&#10;B)Dealings in commodities&#10;C)Gains and losses&#10;D)All of the above

Accepted Answer

Real accounts record transactions related to assets, which include dealings in commodities. They do not typically record transactions with creditors or debtors (which are recorded in personal accounts) or gains and losses (which are recorded in nominal accounts).

Question 9

Which accounting concept satisfy the valuation criteria?&#10;A)Going concern, Realisation, Cost&#10;B)Going concern, Cost, Dual aspect&#10;C)Cost, Dual aspect, Conservatism&#10;D)Realisation, Conservatism, Going concern.

Accepted Answer

The valuation criteria in accounting are satisfied by the Going Concern, Realisation, and Cost concepts, which ensure assets are valued based on their continued use, revenue is recognized when earned, and assets are recorded at their purchase cost.

Question 10

A trader has made a sale of Rs.75,500 out of which cash sales amounted to Rs.25,500. He showed trade receivables on 31-3-2014 at Rs.25,500. Which concept is followed by him?&#10;A)Going concern&#10;B)Cost&#10;C)Accrual&#10;D)Money measurement

Accepted Answer

The trader is following the accrual concept, as he is recognizing revenue at the time of sale and not necessarily when cash is received. This is evident from the fact that he has recorded trade receivables for the portion of sales not received in cash.

Question 11

A trader purchases goods for Rs. 2500000, of these 70% of goods were sold during the year. At the end of 31st December 2009, the market value of such goods were Rs. 500000. But the trader recorded in his books for Rs. 750000. Which of the following concept is violated.

A)Money measurement
B)Conservatism
C)Consistency
D)None of these

Accepted Answer

The answer of A trader purchases goods for Rs. 2500000,...

Question 12

The proprietor of the business is treated as creditor for the capital introduced by him due to_____ concept.&#10;A)Money measurement&#10;B)Cost&#10;C)Entity&#10;D)Dual aspect

Accepted Answer

The answer of The proprietor of the business is treated...

Question 13

Fixed assets are held by business for _____.&#10;A)Converting into cash&#10;B)Generating revenue&#10;C)Resale&#10;D)None of the above

Accepted Answer

The answer of Fixed assets are held by business for...

Question 14

Small items like, pencils, pens, files, etc. are written off within a year according to _____ concept.&#10;A)Materiality&#10;B)consistency&#10;C)Conservatism&#10;D)Realisation

Accepted Answer

The answer of Small items like, pencils, pens, files, etc....

Question 15

Business enterprise is separate from its owner according to _____ concept.&#10;A)Money measurement concept&#10;B)Matching concept&#10;C)Entity concept&#10;D)Dual aspect concept

Accepted Answer

The answer of Business enterprise is separate from its owner...

Question 16

Debit the receiver & credit the giver is _____ account.&#10;A)Personal&#10;B)Real&#10;C)Nominal&#10;D)All the above

Accepted Answer

The answer of Debit the receiver & credit the giver...

Question 17

Cash a/c is a ______.&#10;A)Real a/c&#10;B)Nominal&#10;C)Personal&#10;D)None

Accepted Answer

The answer of Cash a/c is a ______.&#10;A)Real a/c&#10;B)Nominal&#10;C)Personal&#10;D)None...

Question 18

As per the Matching concept, Revenue - ? = Profit&#10;A)Expenses&#10;B)Liabilities&#10;C)Losses&#10;D)Assets

Accepted Answer

The answer of As per the Matching concept, Revenue -...

Question 19

Which of the following is not a nominal Account?&#10;A)Outstanding salaries Account&#10;B)Salaries account&#10;C)Interest paid&#10;D)Commission received

Accepted Answer

The answer of Which of the following is not a...

Question 20

Historical cost concept requires the valuation of an asset at&#10;A)Original cost&#10;B)Replacement value&#10;C)Net realizable value&#10;D)Market value

Accepted Answer

The answer of Historical cost concept requires the valuation of...

Question 21

Profit and loss is calculated at the stage of&#10;A)Recording&#10;B)Posting&#10;C)Classifying&#10;D)Summarising

Accepted Answer

The answer of Profit and loss is calculated at the...

Question 22

The rule debit all expenses and losses and credit all income and gains relates to&#10;A)Personal account&#10;B)Real account&#10;C)Nominal accounts&#10;D)All

Accepted Answer

The answer of The rule debit all expenses and losses...

Question 23

The comparison of financial statement of one year with that of another is possible only when ------------- ---concept is followed&#10;A)Going concern&#10;B)Accrual&#10;C)Consistency&#10;D)Materiality

Accepted Answer

The answer of The comparison of financial statement of one...

Question 24

For every debit there will be an equal credit according to&#10;A)Matching concept&#10;B)Cost concept&#10;C)Money measurement concept&#10;D)Dual aspect concept

Accepted Answer

The answer of For every debit there will be an...

Question 25

A trader calculated his profit as Rs.150000 on 31/03/2014. It is an&#10;A)Transaction&#10;B)Event&#10;C)Transaction as well as event&#10;D)Neither transaction nor event

Accepted Answer

The answer of A trader calculated his profit as Rs.150000...

Deck 1: Accounting Concepts and Principles