Basic Accounting 1

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Objective Questions and Answers of MBA: Basic Accounting 1

Subject: Objective Questions and Answers of MBA: Basic Accounting 1

Part 1: Objective questions and answers of Basic Accounting

 

Q1. Return of goods by a customer should be debited to

a) Customers account

b) Sales return account

c) Goods account

d) Purchase account

 

Q2. The concept of separate entity is applicable to which of the following types of businesses?

a) Sole proprietorship

b) Corporation

c) Partnership

d) All of them

 

Q3. Debit the receiver credit the giver rule for

a) Real a/c

b) Personal a/c

c) Nominal a/c

d) None of these

 

Q4. True & fair profit and loss a/c of a company know by

a) Preparing trial balance

b) Preparing respective ledger of account

c) Preparing to trade a/c

d) Preparing trading & profit & loss a/c

 

Q5. Amount brought in by proprietor should be credited to

a) Cash account

b) Capital account

c) Drawings account

d) Creditors account

 

Q6. Management accounting provides invaluable services to management in performing

a) All management function

b) Interpret financial data

c) Controlling function

d) None of these

 

Q7. Financial information should be neutral and bias-free is the dictation of which one of the following?

a) Completeness concept

b) Faithful representation concept

c) Objectivity concept

d) Duality concept

 

Q8. A company’s telephone bill consisting of an rs.200 monthly base amount, plus long-distance charges, would be classified as a:

a) Variable cost

b) Committed fixed cost

c) Direct cost

d) Semi variable cost

 

Q9. Which of these items would be accounted for as an expense?

a) Repayment of bank loan

b) Dividend to stockholders

c) The purchase of land

d) Payment of current period rent

 

Q10. The cash discount allowed to a debtor should be credited to

a) Discount a/c

b) Customer a/c

c) Sales a/c

d) None of these

 

Q11. The concept of separate entity is applicable to which of following types of businesses?

a) Sole proprietorship

b) Corporation

c) Partnership

d) All of them

 

Q12. The primary objective of cost accounting is

a) Ascertain the cost of goods and services

b) Ascertain the profit

c) Presentation of all data

d) None of these

 

Q13. Which of the following statements about differences between financial and managerial accounting is incorrect?

a) Managerial accounting information is prepared primarily for external parties such as stockholders and creditors; financial accounting is directed at internal users.

b) Financial accounting is aggregated; managerial accounting is focused on products and departments.

c) Managerial accounting pertains to both past and future items; financial accounting focuses primarily on past transactions and events.

d) Financial accounting is based on generally accepted accounting practices; managerial accounting faces no similar constraining factors.

 

Q14. Balance sheet is a statement of

a) Assets

b) Liabilities

c) Capital

d) All of these

 

Q15. Outstanding salary is shown as:

a) An asset in the balance sheet

b) A liability

c) By adjusting it in the p & l a/c

d) Both a and c above

e) Both b and c above

 

Q16. Which of the following is correct?

a) Profit does not alter capital

b) Capital can only come from profit

c) Profit reduces capital

d) Profit increases capital

 

Q17. Cost of asset should always be equal to the cost of the liabilities. This concept is

a) Double entry bookkeeping

b) Matching concept

c) Consistency

d) Money measurement concept

 

Q18. Prepaid expense is treated as

a) Current asset

b) Current liability

c) Short term liability

d) None of these

 

Q19. Advantages of cost accounting accrue:

a) Only to workers

b) Only to government

c) Only to consumers

d) To management, workers, consumers and government

 

Q20. The books to be compulsorily maintained by a company are:

a) Cash book and ledger

b) Sales and purchase book

c) Journal

d) Both a and b

e) All of a, b, c above

 

Part 1: Objective questions and answers of Basic Accounting

 

Q1. Answer b

 

Q2. Answer d

 

Q3. Answer b

 

Q4. Answer d

 

Q5. Answer b

 

Q6. Answer a

 

Q7. Answer c

 

Q8. Answer d

 

Q9. Answer d

 

Q10. Answer b

 

Q11. Answer d

 

Q12. Answer a

 

Q13. Answer a

 

Q14. Answer d

 

Q15. Answer e

 

Q16. Answer d

 

Q17. Answer b

 

Q18. Answer a

 

Q19. Answer d

 

Q20. Answer e

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