FINANCIAL ACCOUNTING MCQ WITH ANSWERS – MULTIPLE CHOICE QUESTION FOR CMA INTERMEDIATE GROUP FIRST (FINANCIAL ACCOUNTING MCQ WITH ANSWERS PDF)
- Which of the following commission is allowed by the consignor to the consignee to encourage the consignee for putting-up hard work in introducing new product in the market?
- Del-credere Commission
- Over-riding Commission
- Hard work Commission
- Ordinary Commission
- If Ram’s acceptance which was endorsed by us in favour of Saleem is dishonoured, then the amount will be debited in our books to
- Saleem
- Ram
- Bills Receivable Account
- None of the above
- In case of a Club, the excess of expenditure over income is called as
- Surplus
- Deficit
- Capital Fund
- Investment in Fixed Assets
- A Charitable Institution has 250 members with a annual subscription of `5,000 each. The subscription received during 2018-19 were $11,25,000, which include $ 65,000 and $25,000 for the years of 2017-18 and 2019-20 respectively. Amount of outstanding subscription for the 2018-19 will be
- (a) $90,000
- (b) $1,25,000
- (c) $2,15,000
- (d) $1,90,000
- When stock is valued at cost in one accounting period and at lower of cost and Net realizable value in another accounting period
- Prudence Principle conflicts with Consistency Principle.
- Matching Principle conflicts with Consistency principle.
- Consistency Principle conflicts with Accounting Period Assumption.
- None of the above
- Materiality Principle is an exception to the
- Consistency principle
- Full disclosure Principle
- Accounting Period Assumption
- Prudence Principle
- In a Cash Book Debit balance of $112 brought forward as credit balance of $ 121, while preparing a Bank Reconciliation Statement taking the balance as per Cash Book as the starting point:
- $112 to be added
- $121 to be added
- $ 233 to be added
- $112 to be subtracted
- represents a potential obligation that could be created depending on the outcome of an event.
- Internal Liability
- Current Liability
- Contingent Liability
- Non-current Liability
- Opening Debtors, Collection from Debtors and Discount Allowed were $3,15,000; $18,30,000 and $35,000 respectively. If the closing debtors were 20% of credit sales of the period then closing debtors and credit sales would be
- (a) $ 3,51,667 and $17,58,333
- (b) $3,63,333 and $18,16,667
- (c) $3,87,500 and $19,37,500
- (d) $3,10,000 and $15,50,000
- Provision for Doubtful Debt on 1st April, 2018 was `21,500. During the year 2018 – 19 the Bad-debt and Recovery of Bad-debt were ` 10,500 and ` 2,100 respectively. The Sundry Debtors on 31st March, 2019 were `2,25,000. Provision is to be made @ 5% on Debtors. If on 31st March, 2019, there was additional Bad-debt of ` 2,500 then Provision for doubtful-debt will be
- debited to Profit & Loss Account by `11,250.
- debited to Profit & Loss Account by `2,625.
- debited to Profit & Loss Account by `3,000.
- debited to Profit & Loss Account by `900.
- A and B enter into a joint venture sharing profit and losses in the ratio of 3:2. A purchased goods costing $2,00,000. B sold 95% goods for $ 2,50,000. A is entitled to get 1% commission on purchase and B is entitled to get 5% commission on sales. A drew a bill on B for an amount equivalent to 80% of original cost of goods. A got it discounted at $1,50,000. What is A’s share of profit?
- (a) $15,300
- (b) $ 21,300
- (c) $18,900
- (d) None of the above
- X and Y are partners with the capital of $50,000 and $ 30,000 respectively. Interest Payable on Capital is 10% p.a. If the profits earned by the firm is $ 4,800, what will be the Interest on Capital for X and Y?
- (a) $5,000 and $3,000
- (b) $3,000 and $1,800
- (c) No interest will be paid to the partners
- (d) None of the
- Canteen expenses are apportioned among departments in the proportion of
- Departmental floor space
- Departmental direct wages
- Departmental sales
- Departmental No. of employees
- Both cash and credit transactions are recorded, on the basis of
- Accounting Period Concept
- Going Concern Concept
- Business Entity Concept
- Accrual Concept
- Which of the following book is both a journal and a ledger?
- Cash Book
- Sales Day Book
- Bills Receivable Book
- Journal Proper
- Interest received in advance account is a
- Nominal Account
- Real Account
- Artificial Personal Account
- Representative Personal Account
- Shiva draws a bill on Sanat on 25th October, 2018 for 90 days, the maturity date of the bill will be
- 27th January, 2019
- 26th January, 2019
- 25th January, 2019
- 28th January, 2019
- Peeru and Simu entered in the business of buy and sale of food grain for a period of one year and sharing the profit in the ratio of 3:2, this agreement is a
- Partnership
- Consignment
- Joint-venture
- Lease
- At the end of the year 2017-18, Prepaid Insurance Premium `7,500 appeared in the Trial Balance, it will be shown
- only in Profit & Loss Account.
- only in Balance Sheet.
- both in Profit & Loss Account and in Balance Sheet.
- not in Both in Profit & Loss Account and in Balance Sheet.
FINANCIAL ACCOUNTING MCQ WITH ANSWERS
- Contingent Liability would appear
- on the liabilities side of the Balance Sheet.
- on the assets side of the Balance Sheet.
- as a note in the Balance Sheet.
- None of the above
- Debtors Ledger Adjustment Account is opened in the
- Debtors Ledger
- Creditors Ledger
- General Ledger
- Both Creditors Ledger and General Ledger
- Generally sacrifice ratio is concerned with the situation of
- Admission of a new partner
- Retirement of a partner
- Dissolution of firm
- Conversion of firm into company
- Which of the following is a resource owned by the business with the purpose of using it for generating future profits?
- Loan from Bank
- Owner’s Capital
- Trade Mark
- All of the above
- Chandu & Co.’s Account is a
- Real Account
- Nominal Account
- Representative Personal Account
- Artificial Personal Accounts
- Purchase of a laptop for office use wrongly debited to Purchase Account. It is an error of
- Omission
- Commission
- Principle
- Misposting
- Which of the following term is most suitable for writing off Patent?
- Depletion
- Amortization
- Depreciation
- All of the above
- Memorandum Joint Venture Account is prepared when
- the separate set of books is maintained for Joint Venture.
- each Co-venturer keeps records of all transactions.
- each Co-venturer keeps records of their own transactions only.
- All of the above cases
- Survey expenses for marine insurance claim must be
- Added to claim;
- Added to legal charges;
- Added to administrative charges;
- None of the above.
- A profit on sale of furniture of a club will be taken to
- Cash Account;
- Receipts and Payment Account;
- Income and Expenditure Account;
- Profit and Loss Account.
- Realization Account is a:
- Representative Personal Account;
- Artificial Personal Account;
- Real Account;
- Nominal Account.
- Bank shows the provision for income tax under the head
- Contingency Accounts;
- Other liabilities and provisions;
- Contingent liabilities;
- Borrowings.
- Bank Reconciliation Statement is:
- Ledger Account
- Part of cash book
- A separate statement
- A subsidiary of Journal
- Income & Expenditure A/c shows subscriptions $10,000; Subscriptions accrued in the beginning of the year and at the end of the year were $1,000 and $1,500 respectively. The figure of subscription received appear in receipts and payments account will be:
- (a) $9,500
- (b) $10,000
- (c) $10,500
- (d) $12,000
- A non-performing asset is:
- Money at call and short notice.
- Cash balance with bank
- An asset that ceases to generate income
- None of the above
- Which of the following is not a Qualitative characteristicof Financial Statement?
- Cost Principle
- Understandability
- Relevance
- Reliability
- Name the book in which, entries are recorded on the basis of credit notes issued.
- Sales Book
- Purchase Book
- Sales Return Book
- Purchase Return Book
- Exception to consistency principle is
- Cost Principle
- Going Concern Principle
- Matching Principle
- Prudence Principle
- The balance in consignment account shows
- Amount receivable from consignee
- Amount payable to consignee
- Profit/ loss on consignment
- Closing stock with consignee
- Provision for bad debts is
- Real Account
- Nominal account
- Personal account
- None of the above
- Due to retrospective effect on revision of salary of employees, the arrears of salary relating to past years, payable in current year is
- Prior – period item
- Extra – ordinary item
- Ordinary item requiring separate disclosure
- Contingent item
- Discount given in the Sales – Invoice itself is
- Cash discount
- Trade discount
- Rebate
- Allowance
- Del credere commission is allowed to consignee
- for making cash sales
- for making credit sales
- for making extra sales
- for undertaking risk of bad debts
- Which of the following is a function of journal:
- Analytical Function
- Recording Function
- Historical Function
- All of the above
- Any change in the accounting policy relating to inventories which has a material effect in the current or later periods should be disclosed. This is in accordance with the accounting principle of:
- Going Concern
- Conservatism
- Consistency
- Disclosure
OPERATIONS MANAGEMENT MCQ JUNE 2021
- Depreciation is a process of
- Apportionment
- Valuation
- Allocation
- None of the above
- AS-9 is related to
- Revenue Recognition
- Cash Flow Statement
- Accounting for Fixed Assets
- Disclosure of Accounting policies
- An amount spent in connection with obtaining a License for starting the factory is
- Revenue Expenditure
- Capital Expenditure
- Pre-paid Expenditure
- None of the above
- According to AS-15 (Revised) superannuation scheme which has relevance only to the final salary and number of years of service is
- Defined Benefit Scheme
- Defined Contribution Scheme
- Non-Contributory Scheme
- Both (a) and (b)
- Expenditures in respect of certain types of assets whose usefulness does not expires in the year of their occurrence but generally expires in the near future are called
- Revenue Expenditure
- Capital Expenditure
- Deferred Revenue Expenditure
- None of the above
- The main objective of average clause contained in a fire insurance policy is to
- Encourage full Insurance
- Discourage full Insurance
- Encourage under Insurance
- Encourage full Insurance and Discourage under Insurance
- Short working can be recouped out of
- Minimum Rent
- Excess of Actual Royalty over Minimum Rent
- Excess of Minimum Rent over Actual Royalty
- Profit and Loss Account
- AS-6 (revised) is applicable to which one of the following assets?
- Goodwill
- Live stock
- Plantation
- Plant and Machinery
- According to AS-3 (Revised) interest and dividends received in the case of a manufacturing enterprise should be classified as cash flow from
- Operating Activities
- Financing Activities
- Investing Activities
- Both (b) and (c)
- Provision for bad and doubtful debts is created in anticipation of actual bad debts on the basis of:
- Business Entity Concept;
- Conservatism Concept;
- Accrual Concept;
- Full Disclosure Concept.
- The out flow of funds to acquire an asset that will benefit the business for more than one accounting period is referred to as:
- Miscellaneous Expenditure;
- Revenue Expenditure;
- Capital Expenditure;
- Deferred Revenue Expenditure.
- Goods are sent to the Branch at cost plus 25%. The loading on invoice price is:
- (a) 20%;
- (b) 25%;
- (c) 30%;
- (d) None of the above.
- Actuarial valuation relates to:
- Banking company;
- Electric Supply Company;
- Insurance Company;
- None of the above.
- The cost of a Fixed Assets of a business has to be written off over its
- Natural Life
- Accounting Life
- Physical Life
- Estimated Economic Life
- Receipts and Payments Account records
- Only revenue nature receipts
- Only capital nature receipts and payment
- Only revenue nature receipts and payments
- Both the revenue and capital nature receipts and payments
- Excess of minimum rent over royalty is known as
- Maximum rent
- Excess workings
- Short workings
- Deficiency of actual royalty
- If any transaction is not recorded in the primary books the same is recorded in
- Journal Proper
- Sales Day Book
- Cash Book
- None of the above
- Which of the following is not a feature of Trial Balance
- It is a list of debit and credit balances which are extracted from various ledger accounts;
- It does not prove arithmetical accuracy which can be determined by audit;
- It is not an account. It is only a statement of account;
- All the transactions are primarily recorded in this book, hence it is the primary book of entry.
- The person in whose favour the bill is endorsed is known as .
- Endorsee
- Drawee
- Drawer
- None of the above
- Which of the following is/ are the basic features of a Joint Venture
- The profit or loss on joint venture is shared between the co-venturers in the agreed ratio;
- The co-venturers may or may not contribute initial capital;
- The JV is dissolved once the purpose of the business is over;
- All of the above.
- The following account has a credit balance
- Plant and Equipment A/c
- Purchase Returns A/c
- Purchase A/c
- None of the above
- When Sales = $3,60,000, Purchase = $ 3,20,000, Opening Stock = $68,000 and rate of the Gross Profit is 20% on cost, the Closing Stock would be
- (a) $1,00,000
- (b) $44,000
- (c) $46,000
- (d) None of the above
- As per AS – 1, which of the following is not a Fundamental Accounting Assumptions?
- Conservatism
- Going Concern
- Consistency
- Accrual
- Name the book in which, entries are recorded on the basis of debit notes issued.
- Sales book
- Purchase Book
- Sales Return Book
- Purchase Return Book
- Name the principle involved in the classification of Assets as Fixed and Current
- Cost Principle
- Going Concern Principle
- Matching Principle
- Prudence Principle
- If a fixed amount is withdrawn on the first day of every month of calendar year by a partner in partnership firm, then for what period the interest on the total amount of drawings will be calculated?
- 4.5 months
- 5.5 months
- 6.5 months
- 7.5 months
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