Question Option 1 Option 2 Option 3 Option 4 Opt

Ans
ion
wers
5
Accounting standards are Profession
Bodies of
statements prescribed by al Governmen
Law shareholder 3
accounting t
s
bodies
Accounting Principles are Convenien
Practicabili
generally based on Subjectivity ce in Recording 1
ty
recording
The Policy of ‘anticipate no
profit and provide for all Consistenc Conservati
Disclosure Materiality 3
possible losses’ arises due y sm
to convention of
Which is the accounting
concept that requires the
Going Conservatis
practice of crediting closing Cost Matching 3
concern m
stock to the trading
account
The convention of
understat Overstatem understate Overstatem
conservatism, when
ement of ent of ment of ent of 1
applied to the balance
assets assets capital. capital
sheet, results in
A business firm is separate
and distinct from its
Going Money Accounting
owners is the assumption Business
Concern Measuring Period 1
under which of the Entity
Entity Entity concept
following accounting
concepts:
Under which of the
following kinds of business Going Money
Accounting Accounting
concepts it is assumed that Concern Measuring 1
Entity Period
the organization will last Entity Entity
for a long time.
Distinction between an
expenditure whose benefit
will be for a long period Going Money
Accounting Accounting
and whose benefit for a concern Measuring 1
Entity Period
short period of say up to Entity Entity
one year, is made under
which of the following.
A firm is expected not to
curtail its present scale and
Going Money
continue to operate at Accounting
Concern Measuring Materiality 1
least at the existing level Period
Entity Entity
under, which of the
following:
It is assumed that only
Money Going
those transactions that Dual Aspect Cost
Measurem Concern 1
could be expressed in Principle Principle
ent Entity Entity
monetary terms, under
which of the following
concepts:

Entire life of a business

entity is divided into Money
Accountin Dual Aspect Cost
shorter time intervals, say Measuring 1
g Principle Principle Principle
of one year, under which of Principle
the following
General rules that are
Generally Double
used as a guide in Cash Revenue
Accepted Entry Book-
accounting and as a basis Accrual Accrual 1
Accountin keeping
of accounting practices are Principle Principle
g Practices System
called
Every transactions has two
Double
aspects i.e., debit and Dual Cash Revenue
Entry Book-
credit, under which of the Aspect Accrual Accrual 1
keeping
following accounting Principle Principle Principle
System
principles:
Anticipate no profits and
provide for all possible Conservati
Dual Aspect Timeliness
losses. This is essence of sm Materiality 1
Principle Principle
which of the following Principle Principle
accouinting principles:
Accounting procedures and
accounting practices
should remain same from Consistenc Dual Aspect Materiality Timeliness
1
year to year under which of y Principle Principle Principle Principle
the following accounting
principles:
An ink-stand has been
purchased by a firm for a
nominal amount that is to
last for 4 year. It should Materialit Dual Aspect Timeliness
Consistency 1
not be classified as a fixed y Principle Principle Principle
Principle
asset under which of the
following accounting
principles:
When a machinery is
purchased for cash, the
cash balance is reduced
and to that extent, the Dual
Materiality Timeliness
amount of machinery as an Aspect Consistency 1
Principle Principle
asset is recorded. This is Principle Principle
done to follow which of the
following accounting
principles:
Expense on conveyance is
Administrat
a: Manufactu Selling
Distributio ive 4
ring expense
n expense expenses
expense
Prepaid rent is :
Both (a)
Administra Current Current
and (b) 2
tion asset liability
above
expenses
Unpaid preliminary Non
Current Current Fictitious
expenses are : Ficticious 2
asset liability asset
Asset
Power and Fuel is
expenses under head Administra Selling Manufactu HR 3
tion ring
Controlling Telephone
expenses is responsibility Administra Selling Purchasing HR 1
of tion
Financial statement of Income
company include : Income statement,
Income statement Balance Balance
4
statement and Balance sheet sheet and
Sheet cash flow
statement
Balance sheet indicates : Assets, Asset,
Assets and Both a and
Liabilities Liabilities 2
Liabilities c above
and profit and capital
Which of the following is it lists it lists down
it is not a
true about a trial balance? down the the it is a kind
part of
balances balances of of financial 1
accounting
of a balance statement
cycle
accounts sheet
Debit balance= Credit mathemat No error in
balance in a trial balance ically No error in posting Accounts
indicates that capital+Lia recording entries to balances 1
bilities= transaction ledger are correct
Assets accounts
Trial Balance is commonly At the end
At the end Frequently
Prepared of an at the end
of the during the 1
accountin of a year
month year
g period
Which of the following will Partial
Complete
affect the agreement of a omission
omission of error of compensati
trial balance of a 1
a principle ng errors
transactio
transaction
n
Which of the following
account with normal Accrued
Equipment bank cash
balance is shown at the expenses 1
account account account
credit side of a trial account
balance?
Purchase of office
Accounts Equipment
computer on credit Computer Cash 3
payable expenses
requires : Credit to :
A/ An Accountan Finance Data entry Finance
______________________ t Manager operator head
__ is a person who does
the basic job of 1
maintaining accounts as he
is the man who is engaged
in book keeping.
_________________ is Financial Manageme Cost None of the
primarily concerned with accountin nt Accounting above
the preparation of financial g Accounting
statements whereas
management accounting 1
covers areas such as
interpretation of financial
statements, cost
accounting, etc.
______________________ Financial Manageme Cost None of the
____ is based on certain accountin nt Accounting above 1
concepts and conventions. g Accounting
The significance of Financial Manageme Cost None of the
_________________ lies in accountin nt Accounting above
the fact that it aids the g Accounting
2
management in directing
and controlling the
activities of the firm
Current liabilities must be 6 months 3 months 9 months 12 months
4
paid within :
A business has the 6,00,000 14,00,000 20,00,000 12,00,000
following items in it:
Owners’ equity Rs.6,00,
000 3
Liabilities Rs.14,00,000.
What is the value of
Assets__________
Left side of account is Balance Debit Credit Footing
2
referred to as :
Payment of 18 months Prepaid Insurance Cash Accounts
insurance policy requires insurance Expense payable 1
debit to :
An agreement to spend Rs Debit to Credit to No entry Debit to
1,00,000 a month on advertisin cash prepaid
1
advertising beginning next g expense advertising .
month requires.
Cash book is : Subsidiary Ledger A/C Journalized Account
1
book ledger book
Financial statement of Income Income Balance Income
company include : statement statement sheet statement,
and Balance Balance
4
Sheet sheet and
cash flow
statement
Withdrawals by proprietor Reduce Reduce Reduce No. change.
would : assets and assets and owner's
owners increase equity and 1
equity liability increase
liabilities
Books of Accounts of Any of the Head office Registered Registered
company should be kept at offices of office office or
Co any other
4
place
decided by
board
Financial statements of All Any 2 M.D. + Chairman of
company must be directors directors Other Co.
authenticated by director +
3
Mngr or
company
secretary
Annual accounts must be Sharehold Owner Manageme Finance
approved by ------------------- ers of nt Manager 1
-------------------- company
Shareholders can impact Articles of Memorand Manageme Company
books of accounts only if Associatio um of nt 1
authorized by: n Association
Composition of Board is Board Corporate Auditor's Annual
given in : Report Governance Report report 2
Report
Audit report gives Investors Manageme Governme Accountant
1
confidence to : nt nt
A component of cost which Prime cost Cost of Works cost Total sales
1
includes all direct costs is: goods sold
Summarises the Cost Sheet Cost Cost Cost
components of cost in the statements measurem analysis 1
form of a statement: ent
Cost will still be incurred Cost of Advertising Depreciati Carriage
although a plant is shut raw on 3
down temporarily: material
Anything for which a Cost Cost control Cost centre Cost
separate measurement of Object allocation
1
cost is desired may be
defined as :
Following overheads are Factory, Indirect Indirect Selling,
included under functional Office and expenses,In material,Di distribution,
classification: Administra direct rect R&D
tion, material, material, 1
Selling & Indirect Direct
Distributio labour labour
n
Basic objective of cost Tax Financial Cost Profit
accounting is: complianc audit ascertainm analysis 3
e ent
The information provided Financial Manageme Cost None of the
by____________________ accountin nt Accounting above
_____________ is g Accounting
1
historical in nature and as
such the predictability of
such information is limited.
_____________________ Financial Manageme Cost None of the
the basic foundation on accountin nt Accounting above
which other branches and g Accounting 1
tools of accounting analysis
are based.
______________________ Managem Financial Cost None of the
________ caters to the ent Accounting Accounting above
specific decision needs, it accountin
1
does not rest upon any g
well-defined and set
principles.
___________________ Managem Financial Cost None of the
reports can be of any ent Accounting Accounting above
duration– short or long, accountin
depending on purpose and g
1
the reports can be
prepared for the
organisation as a whole as
well as its segments.
_____________________ Cost Manageme Financial None of the
makes elaborate cost accountin nt Accounting above
records regarding various g Accounting 1
products, operations and
functions.
_________________ is Cost Manageme Financial None of the
the process of determining Accountin nt Accounting above
and accumulating the cost g Accounting 1
of a particular product or
activity.
The basic purpose Cost Manageme Financial None of the
of__________________ is accountin nt Accounting above
to provide a detailed g Accounting
breakup of cost of different
departments, processes, 1
jobs, products, sales
territories, etc., so that
effective cost control can
be exercised.
____________________ Cost Manageme Financial None of the
also helps in making accountin nt Accounting above
revenue decisions such as g Accounting
1
those related to pricing,
product-mix, profit-volume
decisions, expansion of
business, replacement
decisions, etc.

______________________ Cost Manageme Financial None of the

_ helps in making realistic accountin nt Accounting above
pricing decisions in times g Accounting
1
of low demand,
competitive conditions,
technology changes, etc.
______________________ Accountin Manageme Financial None of the
_ is an ongoing process of g nt Accounting above
performance measurement Accounting 1
and reporting the results to
decision-makers.
___________________ is Financial Manageme Cost None of the
primarily concerned with accountin nt Accounting above
the preparation of financial g Accounting 1
statements mainly for
outsiders.
______________________ Managem Financial Cost None of the
_______ is meant to help ent Accounting Accounting above
in decision-making by accountin
1
analyzing and interpreting g
the information generated
by financial accounting.
______________________ Managem Financial Cost None of the
___________ is futuristic ent Accounting Accounting above
1
and decision-oriented. accountin
g
The methods Managem Financial Cost None of the
of____________________ ent Accounting Accounting above
_______ are not very accountin
exact as they have to be g 1
varied according to the
requirements of the
decision.
______________________ Cost Manageme Financial None of the
____ is an important accountin nt Accounting above
1
aspect of management g Accounting
accounting.
Cost Accounting does not with tax Manageme Financial Corporate
include financial accountin nt Accounting accounting
1
accounting and has nothing g Accounting
to do -----------------------
Cost Accounting is more short Long term Strategic None of the
concerned term planning Planning above
1
with__________________ planning.
_______
_____________________is Cost Manageme Financial None of the
mostly historical in its Accountin nt Accounting above 3
g Accounting
approach and projects the
past.
Exchange of goods and or Business Services Barter Company
services for earning profit System
1
is called as
______________________
Amount which can not be BAD INSOLVENT DEFAULTE All of the
collected by Co.from DEBTS R above
customer, is 1
called_________________
___.
_________________ as Accountin Accounting Both A & B None of the
those rules of action or g Convention above
conduct which are adopted Principles s
3
by the accountants
universally while recording
accounting transactions.
The Concept Accounting Accounting None of the
term__________________ Convention Principles above
_ is used to connote the s
accounting postulates, i.e.,
1
necessary assumptions and
ideas which are
fundamental to accounting
practice.
______________________ Accountin Accounting Accounting None of the
are broad general g concepts Convention Principles above
assumptions which s
1
underline the periodic
financial statements of
business enterprises.
The term conventio Accounting Accounting None of the
______________________ n Principles Concepts above
is used to signify customs
1
or tradition as a guide to
the preparation of
accounting statements.
Assumption of accounting Societies Joint Stock Corporatio Partnership all
entity or business entity Companies ns Firms of
concept is applicable for the 5
which of the following abo
business organizations. ve
Financial Accounting is statutory Governmen RBI SEBI
governed framewor t of
1
by____________________ k Maharashtr
_______ a
Basic function of Financial record do analysis provide match the
Accounting is to the informatio debit side
______________________ transactio n and credit 1
_______ ns of the side
business
 Format of financial provisions GAAP Statutiry SEBI
accounting reports is of framework
1
standardized as per Companie
______________________ s Act.
Rules of revenue
recognition determine that Historical Accounting
Realizatio Materiality
earning process should be Record Period 1
n Concept Concept
either complete or near Concept Concept
completion under:
The business transactions
are recorded date wise to Historical Accounting
Realization
create proper record for all Record Materiality Period 1
Concept
transactions. This is part of Concept Concept Concept
which of the following
Profit is a liability for a
Business Historical Accounting
firm and the loss is an asset Materiality
Entity Record Period 1
under which of the Concept
Concept Concept Concept
following concepts
The accounting equation
Dual Historical
‘asset = capital + liability is Realization Materiality
Aspect Record 1
part of which of the Concept Concept
Concept Concept
following concepts
Under which conventions
of accounting, the Convention
Conventio Convention Convention
contingent liabilities are Of
n Of Full Of Of 1
shown as a footnote or Conservati
Disclosure Materiality Consistency
explanatory notes in the sm
balance sheet of a firm:
The use of management Optional Legally Compulsory
accounting is Compulsory obligatory to some
and 1
optional to
others
Who coined the concept of James H. J. Batty American R.N
management accounting? Bliss Accounting Anthony 1
Association
The branch of accounting Financial Cost Manageme Inflation
which primarily deals with Accountin Accounting nt Accounting
processing and presenting g Accounting 3
accounting data for
internal use in a concern is:
The prime function of Record Assist the Interpret Assist tax
management accounting is business manageme the authorities
to: transactio nt in financial
n performing data 2
its
functions
effectively
Cost Accounting does not with tax Manageme Financial Corporate
include financial accountin nt Accounting accounting 1
g Accounting
accounting and has nothing
to do :
Exchange of goods and or Business Services Barter Company
services for earning profit System 1
is called as :
Fixed budget is useless for Increases Fluctuates Decreases Constant
comparison when the level both ways 2
of activity:
The budget committee Managers Budget Creditors Supervisors
2
consists of… officers
R&D budget and Capital Short- Current Long-term Cost budget
expenditure budget are term budget budget 3
examples of budget
Plant utilization budget and Productio Sales Cost Purchase
Manufacturing overhead n budget budget budget budget 3
budgets are types of
A budgeting process which Functional Master Zero base Non-
demands each manager to budget budget budgeting functional
3
justify his entire budget in budget
detail from beginning is
Management accounting Qualitative Both A & B None of the
deals with Quantitati information above
ve 3
informatio
n
………………………………… is a Accountin manageme Cost Financial
system meant for g nt Accounting Accounting
measuring business accounting
activities, processing of
1
information into reports
and making the findings
available to decision-
makers.
The documents, which financial Profit and Balance Audit
communicate these statement Loss a/c sheet report
findings about the s
performance of an
1
organisation in monetary
terms, are called
…………………………………………
....
Accounting is understood The Important Important all of the
as Language aspect of part of above
1
………………………………………… of Business business
……………………………. Business
A man who is involved in Accountan Finance Data entry Finance
the process of book t Manager operator head
keeping and accounting is 1
called a/an
……………………………………
What are fixed to control Maximum Minimum Re-Order Inventory
4
inventory Level Level Level Levels
The allotment of whole cost cost
item of cost to cost centre cost apportionm cost disburseme 1
or cost units is called allocation ent absorption nt
Packing cost is will come productio administrat distribution
4
under which cost n cost selling cost ion cost cost
productio administrati
distribution
Directors remuneration n ve selling 4
overhead
and expenses form part of overhead overhead overhead
allotment
charging of of
charging charging of overheads overheads
2
overheads overheads to cost to different
Absorption means which of to cost to cost centres or department
the following centres units cost units s
direct
direct
List An example of fixed property rent for material 2
wages
cost tax building cost
A cost that is easily
Indirect Variable
traceable to a cost object is Direct cost Fixed cost 1
cost cost
known as:
The process of distribution
of overheads allotted to a
Apportionm Department
particular department or Allocation Absorption 3
ent alization
cost center over the units
produced is called:
The labour engaged in the
Permanent
making of a product is Direct Indirect Temporary 1
labour
known as labour labour labour
Standards that can be Attaina Budget Practical
attained only under the ble standards standards
3
best circumstances are standards Ideal
referred to as: standards
As per J. Batty, Standard
Empirical
Cost represents which Anticipate Current Historical 1
costs
costs d costs costs costs
Company tries to achieve --
Break
------------------------------------ Standard Benchmark Margin 1
even Point
-------as early as possible.
…………………………………………
Margin of Break Even Marginal Contributio
….is more when sales are 1
Safety Point costing n
more than B.E.P.
Every company must
Merchantil
maintain accounts on ------- Accrual Cash Credit 1
e
---------------------- basis.
Books of accounts are kept
at ---------------------------------
Registered Head Office Company C.A office 1
-------------
office of Company
________ is the language
of Business which used to
Accountin Pricing 1
communicate financial
g
information. Marketing Profit
________ is the study of Cost Manageme
managerial aspects of accountin Financial nt Business 3
financial accounting g accounting accounting accounting
Auditor gives his report to - Sharehold Manageme
------------------------------------ ers of nt of the Manager Owner 1
---------------------------- company company
Every company at end of
Annual Financial
financial year must publish Article Agenda 1
Report reports
-------------------------------.
Indian Accounting
standards are prepared
ICAI RBI SEBI IRDA 1
by____________________
_____.
G.A.AP Generally Governme
Governmen Generally
means_________________ Accepted nt
t Accepted assumed
____________ Accountin accepted 1
Accounting accounting
g Accrual
Principals Principals
Principals principals
Marginal cost is the
increase or decrease in
total cost when there is TRUE FALSE 1
increase or decrease in
production by one unit.
Difference between actual
sales and B.E. sales is called TRUE FALSE 1
Margin of Safety
Profit volume ratio shows
relationship between
TRUE FALSE 1
contribution and turnover
of company.
Marginal cost is the total
cost incurred for producing
one additional unit, which TRUE FALSE 1
is nothing but variable
cost per unit.
Margin of safety (M.O.S. or
M/S ) is the sales achieved
TRUE FALSE 1
by company over break
even sales
Marginal costing is useful
TRUE FALSE 1
for decision making
Contribution depends on
TRUE FALSE 2
fixed cost
Increase variable cost to
TRUE FALSE 2
increase P/V ratio
The type of account with
Asset Dividend Revenue Expense 1
normal credit balance is :
 Debit : Debit : Debit : Debit :
Receipt of cash from Cash :: Accounts Cash :: Accounts
customer on his account is Credit : Receivable Credit : Payable :: 1
recorded as : Accounts :: Credit : Accounts Credit :
Receivable Cash Payable Cash
Left side of account is
Balance Debit Credit Footing 2
referred to as :
Which of the following is a Accounts Withdrawal Rent Accounts
4
liability A/C : receivable s expense payable
Purchase of office
Accounts Equipment
computer on credit Computer Cash 3
payable expenses
requires : Credit to :
Payment of 18 months
Prepaid Insurance Accounts
insurance policy requires Cash 1
insurance Expense payable
debit to :
An agreement to spend Rs
Debit to Debit to
1,00,000 a month on Credit to
advertisin No entry prepaid 1
advertising beginning next cash
g expense advertising .
month requires.
Debit and
Normal account balance Credit and
credit
for asset and accumulated debit Debits Credits 1
respectivel
depreciation on asset are : respectively
y
All cash
All sales of
sale of
Sales day book records : All sales merchandis Credit sale 4
merchandi
e
se
Suraj industries has
Return Return
returned goods sold to Sales return
Cash book inward outward 4
him. This will be recorded book
book book
in :
Assets sold on credit are Sales day Journal Purchase
Cash book 1
recorded in : book proper day book
Bills raised by supplier and Bills Bills
None of the
accepted by our Co. is Bills book receivable payable 3
above
recorded in : book. book
Subsidiary Journalized None of the
Cash book is : Ledger A/C 1
book ledger above
An action undertaken to
sales after sales business pre sales 3
earn profit is called
Original Secondary Subsidiary None of the
Ledger is book of : 2
entry entry entry above.
The statement in which
closing balance of ledger Income Trial General None of the
1
account are listed is known statement balance ledger above
as
Equity of debits and credit
Trial
can be tested by preparing T Accounts Journal Ledger 1
Balance
:
Transaction recorded on
Can not be None of the
debit side of cash book is Debit side Credit side 1
posted above.
transferred to ledger on :
The journal entry of
Purchases
purchase of stock under Inventory Cash to Purchase to
to 4
periodic inventory system to Cash Purchases Stock
Inventory
would be?
Price
Calculation
determina Solution of
Absorption costing is used of gross Net profit,
tion on separation 1
for and net expenses
basis of of costs
profit
full cost
If total cost of 100 units is
Rs 5000 and those of 101
Marginal All variable
units is Rs 5030 then Prime cost Fixed cost 1
cost overheads
increase of Rs 30 in total
cost is
eliminate
the need to
eliminate account for
the need year-end
replace
simplify for actual under-
A purpose of standard budgets
costing costing for applied or 3
costing is to and
procedures. external over-
budgeting.
reporting applied
purposes. manufacturi
ng
overhead.
Getting
Budgetary control helps Obtaining grants
Issue of Granting
the management in one of bank from 4
shares credits
the following? credit governmen
t
American
Who coined the concept of James H. R.N
J. Batty Accounting 1
management accounting? Bliss Anthony
Association
Compulsory
to some
The use of management Legally
Optional Compulsory and 1
accounting is obligatory
optional to
others
The convention of
understat Overstatem understate Overstatem
conservatism, when
ement of ent of ment of ent of 1
applied to the balance
assets assets capital. capital
sheet, results in
Which is the accounting
concept that requires the
Going Conservatis
practice of crediting closing Cost Matching 3
concern m
stock to the trading
account
It is assumed that only
those transactions that
Money Going
could be expressed in Dual Aspect Cost
Measurem Concern 1
monetary terms, under Principle Principle
ent Entity Entity
which of the following
concepts: