1) The accounting process involves in recording: A) Quantifiable economic event B) Non quantifiable economic event C) All of them D) None of them ) !n accounting an "conomic event is referred to as: A) Cash B) Ban# statement C) Transaction D) "$change of mone% &) !dentif% the correct sequence of accounting process A) Communicating'(ecording'!dentif%ing B) (ecording'Communicating'!dentif%ing C) !dentif%ing'communicating'recording D) !dentif%ing'recording'communicating ) Boo##eeping mainl% concerns *ith *hich part of accounting process+ A) Anal%sing B) ,reparing financial statements C) (ecording financial information D) Auditing the boo#s of accounts -) .inancial accounting provides financial information to all of the follo*ing e$ternal users e$cept: A) /overnment agencies B) investors C) Creditors D) 0anagers ) .or *hich step of accounting process the accountants of business entit% prepare financial statements+ A) !dentification of economic event B) Communication of financial information C) (ecording financial information D) 0a#ing decisions about business 2) 3eeping the log of financial information in boo#s of original entries is called A) (ecording B) summari4ing C) /rouping
D) ,rocessing 5) Auditing is *hat+ A) (eporting the financial information B) "$amination of financial statements C) ,reparation financial statements D) maintaining the ledger records 6) 7hich of the follo*ing is the e$ternal user of financial statements+ A) 0anager of the business B) C"8 of the business C) Creditor of the business D) Controller of the business 19) 7hich of the follo*ing is the internal user of financial statements+ A) Creditor of the business B) /overnment agenc% C) hareholder of the business D) 0anager of the business 11) ;;;;;;;;; is the first phase of accounting c%cle A) !dentif%ing an economic event or transaction B) ,reparing
C) "$penses for the business D) 0erits and Demerits for the business 1-) >iabilities are *hich of the follo*ing+ A) (esources B) 8bligations C) .uture benefits D) "$penses 1) ;;;;;;;; is the gross inflo* of economic benefits A) Assets B) >iabilities C) !ncome D) "$penses 12) The gross decrease in economic benefits for the business are *hat+ A) "$penses B) 8bligations C) Creditors D) !ncome or gain 15) An asset must be ;;;;;;; b% the business to be sho*n as an asset in its ?balance sheet? A) ,ossessed B) 8*ned C) Controlled D) @sed 16) >iabilit% are arisen from *hich of the follo*ing events+ A) ,resent event B) .uture event C) ,ast event D) Non of them 9) 7hich of the follo*ing can be considered as the most important phase of accounting c%cle and it is the primaril% obong life of assets
B) alue of assets C) !ntangible nature of assets D) .uture economic benefits ) 7hat is the basic accounting equation+ A) Capital>iabilitiesAssets B) Assets liabilities Capital C) Capitalassetsliabilities D) >iabilitiesCapital &) 7hich of the follo*ing is a liabilit%+ A) Cash B) "quipment C) Debtors D) Creditors ) 7hat is equit%+ A) Cash from the business B) liabilit% of a business C) 8*ners claim on total assets D) 8*ners claim on total liabilities -) !dentif% the asset from the follo*ing A) Cash and cash equivalent B) Creditors C) Notes pa%able D) Ban# loan ) ;;;;;;; the *ithdra*al of cash and goods b% the o*ner of the busienss for hisEher personal use A) Depreciation B) Dra*ings C) 8utflo* of cash D) Appreciation 2) Net loss occurs *hen A) "$penses are greater than !ncome B) "$penses are less than !ncome C) "$penses!ncome D) >iabilities are greater than income 5) Double entr% implies that
A) (ecording entries in edger account C) (ecording t*o aspects of ever% transaction D) (ecording ever% transaction in boo#s 6) !dentif% the nominal account A) 0achiner% account B) Building account C) Creditors account D) (ent e$penses account &9) 7hich of the follo*ing accounts can be classified as a real account+ A) (ent e$penses account B) (ent income account C) insurance e$penses account D) Cash account Accounting concept and conventions 1) 7hich of the follo*ing is not regarded as the fundamental concept that is identified b% !A=1 A) The going concern concept B) The septate entit% concept C) The prudence concept D) Correction concept )@sing ?lo*er of cost and net realisable value? for the purpose of inventor% valuation is the implementation of *hich of the follo*ing concepts+ A) The going concern concept B) The septate entit% concept C) The prudence concept D) 0atching concept &)The concept of separate entit% is applicable to *hich of follo*ing t%pes of businesses+ A) ole proprietorship B) Corporation C) ,artnership D) All of them )!s ,rudence concept allo*s a business to build substantiall% higher reserves or provisions than that are actuall% required+ A) Fes B) No
C) To some e$tent D) !t depends on the t%pe of business -)The revenue recognition principal dictates that all t%pes of incomes should be recorded or recogni4ed *hen A) Cash is received B) At the end of accounting period C) 7hen the% are earned D) 7hen interest is paid )The matching concept matches *hich of the follo*ing+ A) Asset *ith liabilities B) Capital *ith income C) (evenues *ith e$penses D) "$penses *ith capital
2)The allocation of o*ners private e$penses to hisEher business violates *hich of the follo*ing+ A) Accrual concept B) 0atching concept C) eparate business entit% concept D) Consistenc% concept
5)The going concern concept assumes that A) The entit% continue running for foreseeable future B) The entit% continue running until the end of accounting period C) The entit% *ill close its operating in 19 %ears D) The entit% cant be liquidated 6)American companies prepare their their financial statement in dollars *hereas Gapanese companies produce financial statements in %ensH Ths is an e$ample of: A) table monetar% unit Concept B) @nit of measurement Concept C) 0one% value concept D) Current s*ap concept 19)7hich of the follo*ing is time span into *hich the total life of a business is divided for the purpose of preparing financial statements+ A) .iscal %ear B) Calendar %ear C) Accounting period D) Accrual period
11)ho*ing purchased office equipments in financial statements is the application of *hich accounting concept+ A) Iistorical cost convention B) 0aterialit% C) ,rudence D) 0atching concept 1&)!nformation about an item is ;;;;;;;; if its omission or misstatement might influence the financial decision of the users ta#en on the basis of that information A) Concrete B) Complete C) !mmaterial D) 0aterial 1)"$ercising a degree of caution in the case of
1-)7hich one of the follo*ing concepts states that the publication or presentation financial statements should not be dela%ed+ A) 8b
B) Total e$penses to be overstated C) Total income to be overstated D) Total assets to be understated 9)Depreciation is charged on fi$ed asset to compl% *ith *hich of the follo*ing accounting principles or concepts+ A) 0atching concept B) ,rudence concept C) Timeliness concept D) (eliabilit% concept ,artnership .irm 1)7hat is the minimum number of partners required to commence a partnership business+ A) 9 B) 19 C) D) ),artnership t%pe of business is formed b% the mutual agreement of partnersH 7hat #ind of agreement is it+ A) 8ral agreement B) 7ritten agreement C) 8ral or *ritten agreement D) None of them &)!n the general form of partnershipK liabilities of partners are: A) limited B) unlimited C) limited to the business capital )!s partnership t%pe of business considered as a separate legal entit%+ A) No B) Fes -)Can a partner transfer hisEher share of business to a third part% *ithout other partners consent+ A) No B) Fes )!s it compulsor% for all partners to contribute equal amount of capital in the business+ A) No B) Fes 2)!nterest on dra*ings is:
A) Debited to partnerLs current aEc B) Credited to partnerLs current aEc C) Not sho*n in current account 5)The *ritten agreement of partnership is most commonl% referred to as: A) Agreement B) ,artnership deed C) ,artnership contract D) ,artnership Act 6)7here there is no partnership agreement e$ists bet*een partnersK *hat *ill be the profit sharing ratio bet*een the partners+ A) "qual B) @nequal C) !t *ill depend on a partnerLs capital D) !t *ill depend on the e$perience of a partner 19)alar% of a partner is ;;;;;;;;; to current account A) Debited B) Credited
11)Ne* investment b% an% partner in the partnership t%pe of business is ;;;;;;; to the partnerLs capital account A) Debited B) Credited 1)@nder fluctuation method of capitalK *hat is the treatment of Minterest on capital+ A) Credited to capital account B) Debited to capital account C) No treatment or adimited life B) "ase of formation C) 0utual agenc% D) >imited liabilit%
1)!n *hich of the follo*ing t%pes of partnership the liabilit% of at least one partner is unlimited *hereas the liabilit% of other partners is limited+ A) /eneral partnership B) ,articular partnership
C) ,artnership=at=*ill D) >imited partnership 1-)!n *hich of the follo*ing t%pes of partnership there is no agreement regarding the duration of partnership+ A) /eneral partnership B) ,artnership=at=*ill C) >imited partnership D) (egistered partnership 15)7hich of the follo*ing is #no*n as the value addition to a business because of business reputationK customersL lo%alt%K brand name etc A) Assets B) 0ar#et capitali4ation C) /ood*ill D) 0ar#et penetration 16)7hich of follo*ing is the correct double entr% for revaluation surplus A) (evaluation Debit and ,artners capital accounts Credit B) ,artners capital accounts Debit and (evaluation surplus Credit 1)7hich one of the follo*ing double entries is correct regarding the cost of firm or partnership dissolution+ A) Credit reali4ation aEc and Debit partners capital aEc B) Credit reali4ation aEc and Debit ban# aEc C) Debit reali4ation aEc and Credit ban#Ecash )!dentif% the correct double entr% for reali4ation profit at time dissolution of partnership A) Debit reali4ation aEc and Credit ban# aEc B) Debit ban# aEc and Credit reali4ation account C) Debit reali4ation account and Credit partnersL capital accounts )7hich one of the follo*ing is the method of good*ill valuation+ A) Average capital method B) uper capital method C) Capital intensit% method D) uper profit method 2)@nder capitali4ation method of good*ill valuationK *hich of the follo*ing formulas is used to calculate the Mvalue of *hole business+ A) alue of *hole business,rofit E (easonable rate of return O 199 B) alue of *hole business Total assets E (easonable rate of return O 199 C) alue of *hole business "quit%=Net assets
5)7hich of the follo*ing is not recorded in the partners current accounts+ A) Dra*ings B) !nterest on Dra*ings C) ,artners salaries 6)A partner that doesnLt ta#e part in the management of businessK but heEshe has made investment in business and liable to creditors of the business is #no*n as: A) Active partner B) Nominal partner C) Gunior partner D) Dormant partner Financial A/c-1
1) 7e can sa% that the business is in profitK *hen: A) Assets e$ceed "$penditure B) !ncome e$ceeds >iabilities C) !ncome e$ceeds "$penditure D) !ncome e$ceeds >iabilities ) According to the double entr% s%stem of accountingK an account that obtains benefit is: A) Credit B) Debit C) !ncome D) No need to sho* as accounting record &) Term ?Credit? means;;;;;;; b% the businessH A) (eceiving of benefits B) !t has no effect on business C) ,roviding of benefits D) !t depends upon items ) 7hen a >iabilit% is reduced or decreasedK it is recorded on the: A) >eft or credit side of the account B) (ight or debit side of the account C) (ight or credit side of the account D) >eft or debit side of the account -) 7hen Capital is increased b% an amountK it is recorded on the: A) (ight or debit side of the account B) >eft or credit side of the account C) >eft or debit side of the account D) (ight or credit side of the account
) 7hat t%pe of e$penses are paid out of /ross ,rofit+ A) /eneral "$penses B) .inancial "$penses C) elling "$penses D) All of the given options 2) 7hich of the follo*ing sho*s summar% of a compan%s financial position at a specific date+ A) ,rofit P >oss Account B) Cash .lo* tatement C) Balance heet D) !ncome P "$penditure Account 5) 7hich of the follo*ing is N8T an e$ample of intangible assets+ A) .ranchise rights B) /ood*ill C) ,atents D) >and 6) 7hich of the follo*ing is an e$ample of business liabilit%+ A) >and B) Building C) Cash D) Creditors 19) The unfavorable balance of ,rofit and >oss account should be: A) Added in liabilities B) ubtracted from current assets C) ubtracted from capital D) ubtracted from liabilities .in = 1) 7hich of the follo*ing account *ill be creditedK if business bought goods on credit from 0rH A) ,urchases account B) 0rH account C) Cash account D) ales account ) !nterest on loan paid b% business is an e$ample of : A) (evenue e$pense B) !ncome C) Asset
D) (eturn out*ard &) 7hich of the follo*ing is N8T a function of ban# reconciliation statement+ A) To chec# for errors in balance sheet B) To update omitted entries into the cash boo# C) To update omitted entries into the ban# statement D) To reconcile the difference in ban# statement and cash boo# ) 7hich of the follo*ing account *ill be credited *hen a t%pe*riter is sold that has been used in the office+ A) 8ffice "quipment Account B) Cash Account C) ales Account D) ,urchase Account -) 7hich of the follo*ing subsidiar% boo#Rs) is Rare) maintained for debtors control account+ A) ales Da% Boo# B) ales (eturn C) Debtors >edger D) All of the given options ) The allocation of the cost of a tangible plant asset to e$pense in the periodsK in *hich services are received from the assetK is termed as: A) Appreciation B) Depreciation C) .luctuation D) None of the given options 2) 7hich of the follo*ing is N8T a function of ban# reconciliation statement+ A) To chec# for errors in balance sheet B) To update omitted entries into the cash boo# C) To update omitted entries into the ban# statement D) To reconcile the difference in ban# statement and cash boo# 5) 7hich of the follo*ing entr% *ill be recorded *hen the Bad Debts are recovered+ A) CashRDrH) P Bad Debts recoveredRCr) B) AEC (eceivableRDrH) P Bad Debts recoveredRCrH) C) Bad debts recoveredRDrH) and ,rofit P >ossRCrH) D) ,rovision for doubtful debtsRDrH) P CashRCrH) 6) 7hich of the follo*ing subsidiar% boo#Rs) is Rare) maintained for debtors control account+ A) ales Da% Boo#
B) ales (eturn C) Debtors >edger D) All of the given options 19) 7hich of the follo*ing item *ill be sho*n on debit side of debtors account+ A) Discount received B) (eturn in*ards C) Discount allo*ed D) Credit sales Fin A/c-3
1) /oods of J1K999 purchased from 0rH MA *ere recorded in sales boo#K the rectification of this error *ill: A) !ncrease the gross profit B) (educe the gross profit C) Iave no effect on gross ,rofit D) None of the given options ) 7hich of the follo*ing account *ill be credited *hen a t%pe*riter is sold that has been used in the office+ A) ,urchase Account B) ales Account C) Cash Account D) 8ffice "quipment Account &) 7hen one or both aspects of a transaction are recorded in the *rong class or categor% of accountK this is called: A) "rror of principle B) "rror of omission C) "rror of commission D) "rror of original entr% ) 7hich of the follo*ing item must be recorded in the ad
C) ,urchasing cleaning services D) bu%ing a computer 2) 7hich of the follo*ing *ould N8T be considered as a component of cost of stoc#+ A) Transportation in*ard costs B) !mport duties C) alaries of selling staff D) ,urchase price 5) 7hich of the follo*ing *ill be debitedK if cash is dra*n b% ,roprietor+ A) ,roprietorLs dra*ings B) ,roprietorLs cash C) ,roprietorLs capital D) 8ut flo*s 6) 7hich of the follo*ing is T(@" about the treatment of insurance paid in advance J 199+ A) Current asset B) Current liabilit% C) hort term liabilit% D) .i$ed asset 19) 7hen closing stoc# is given in trial balanceK then it *ill effect: A) Trading account onl% B) Balance sheet onl% C) 8*ners equit% onl% D) Trading AEC and Balance sheet Consignment AEc 1H !n accounting consignment meansH Ra) /oods for*arded from one place to anotherH Rb) /oods for*arded b% a person to anotherH Rc) /oods sent b% its o*ner to his agentH Rd) /oods sent b% its o*ner to his agent for the purpose b% saleH RT)
H /oods sent on consignment should be debited b% consignor to: Ra) Consignment AEc RT) Rb) /oods sent on consignment AEc Rc) Consignees AEc Rd) Consignors AEc R&)!n the boo#s of consignor the balance of the consignment stoc# account *ould be sho*n: Ra) As an asset in the balance sheetH RT) Rb) As liabilit% in the balance sheetH Rc) 8n the credit side of trading accountH Rd) 8n the debit side of consignment accountH R) 8n the dispatch of goodsK the entr% in the boo#s of consignee *ould be: Ra) Consignment AEc *ill be debited and goods sent on consignment AEc *ill be creditedH Rb) Consignment AEc debit and consignee AEc credit Rc) No entr% RT)
Rd)
None of above
R-)The consignor is: Ra) ,rincipal RT) Rb) Rc) Debtor Rd)
Agent None of them
R) The consignee is: Ra) ,rincipal Rc) Bu%er R2) Account sales is submitted b%: Ra) Consignor Rc) ,rincipal to his agent
Rb) Rd)
Rb) Rd)
Agent RT) eller
Consignee RT) Debtor to creditor
R5)!n the boo#s of consignorK the e$penses incurred b% consignor should be debited to: Ra) Consignees AEc RT) Rb) Consignment AEc Rc) "$penses AEc Rd) ConsignorLs AEc R6)!n the boo#s of consignorK the e$penses incurred b% consignee should be debited to: Ra) Consignee AEc Rb) Consignment AEc RT) Rc) "$penses AEc Rd) ConsignorLs AEc R19)!n the boo#s of consignor the acceptance of bills of e$change b% the consignee *ill be credited to: Ra) Consignment AEc Rb) Consignment AEc RT) Rc) !ncome AEc Rd) ConsignorLs AEc R11)!n the boo#s of consignor the acceptance of bills of e$change b% the consignee *ill be credited to: Ra) Consignment AEc Rb) ConsigneeLs AEc RT) Rc) Bill receivable AEc Rd) Bills pa%able AEc R1)!n the boo#s of consignor the abnormal loss should be credited to: Ra) ,rofit P loss AEc Rb) Consignment AEc RT) Rc) Trading AEc Rd) Consignees AEc R1&)!n case of delcreder commissionK the liabilit% for bad debits is on: Ra) Consignor Rb) Consignee RT) Rc) Customer Rd) None of the above R1)!n the boo#s of consignorK the balance in the goods sent on consignment account is sho*n: Ra) 8n the asset side to balance sheetH Rb) 8n the liabilit% side of balance sheetH Rc) 8n the credit side of trading AEc RT) Rd) 8n the credit side of consignment AEc R1-)!n the boo#s of consignee the e$penses incurred b% him on consignment are debited to: Ra) Consignment AEc Rb) Cash AEc Rc) ConsignorLs AEc RT) Rd) "$pense AEc R1)!n the boo#s of consigneeK the sale of goods is credited to: Ra) ConsignorLs AEc RT) Rb) ales AEc Rc) ConsigneeLs AEc Rd) Cash AEc R12)The term AEc and sale AEc are ;;;;;;;;;;;;;;;; in natureH Ra) ,arallel Rb) ome Rc) "qual Rd) Different RT) R15)The consignment in*ard boo# or
R1)Consignee AEc is the nature of: Ra) Nominal AEc Rb) Rc) (eal AEc Rd)
,ersonal AEc RT) None
R)Normal losses are due to: Ra) Avoidable factor Rc) Contingent
@navoidable RT) None
Rb) Rd)
R&)!n consignee boo#K the acceptance of bill of e$change b% consignee *ill be debited to: Ra) Trading AEc Rb) Consignor AEc RT) Rc) Balance pa%able AEc Rd) Consignee AEc
